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TABLE OF CONTENTS
Item 10. Directors, Executive Officers and Corporate Governance

Table of Contents

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549



FORM 10-K

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2008



SIMON PROPERTY GROUP, L.P.
(Exact name of registrant as specified in its charter)

Delaware
(State or other jurisdiction of
incorporation or organization)
  333-11491
(Commission File No.)
  34-1755769
(I.R.S. Employer
Identification No.)

225 West Washington Street
Indianapolis, Indiana 46204
(Address of principal executive offices) (ZIP Code)

(317) 636-1600
(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12 (b) of the Act: None

Securities registered pursuant to Section 12 (g) of the Act: None



            Indicate by check mark if the Registrant is a well-known seasoned issuer (as defined in Rule 405 of the Securities Act). Yes ý    No o

            Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o    No ý

            Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý    No o

            Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of Registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ý

            Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller company. See the definitions of "large accelerated filer," "accelerated filer," and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer o   Accelerated filer o   Non-accelerated filer ý
(Do not check if a smaller reporting company)
  Smaller reporting company o

            Indicate by checkmark whether the Registrant is a shell company (as defined in rule 12-b of the Act). Yes o    No ý

Registrant had no publicly-traded voting equity as of June 30, 2008.

            Registrant has no common stock outstanding.



Documents Incorporated By Reference

            None.


Table of Contents

Simon Property Group, L.P. and Subsidiaries
Annual Report on Form 10-K
December 31, 2008

TABLE OF CONTENTS

Item No.    
  Page No.
Part I

1.

 

Business

 

3
1A.   Risk Factors   7
1B.   Unresolved Staff Comments   12
2.   Properties   12
3.   Legal Proceedings   47
4.   Submission of Matters to a Vote of Security Holders   47

Part II

5.

 

Market for the Registrant's Common Equity, Related Stockholder Matters,
and Issuer Purchases of Equity Securities

 

48
6.   Selected Financial Data   49
7.   Management's Discussion and Analysis of Financial Condition and Results of Operations   50
7A.   Quantitative and Qualitative Disclosure About Market Risk   67
8.   Financial Statements and Supplementary Data   67
9.   Changes in and Disagreements with Accountants on Accounting
and Financial Disclosure
  67
9A.   Controls and Procedures   67
9B.   Other Information   68

Part III

10.

 

Directors, Executive Officers and Corporate Governance

 

69
11.   Executive Compensation   69
12.   Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters   69
13.   Certain Relationships and Related Transactions, and Director Independence   69
14.   Principal Accountant Fees and Services   69

Part IV

15.

 

Exhibits, and Financial Statement Schedules

 

71

Signatures

 

109

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Part I

Item 1.    Business

            Simon Property Group, L.P. is a Delaware limited partnership and the majority-owned subsidiary of Simon Property Group, Inc. In this report, the terms "Operating Partnership", "we", "us" and "our" refer to Simon Property Group, L.P. and its subsidiaries and the term "Simon Property" refers specifically to Simon Property Group, Inc.

            We own, develop, and manage retail real estate properties in five retail real estate platforms: regional malls, Premium Outlet Centers®, The Mills®, community/lifestyle centers, and international properties. As of December 31, 2008, we owned or held an interest in 324 income-producing properties in the United States, which consisted of 164 regional malls, 16 additional regional malls and four additional community centers acquired as a result of the 2007 acquisition of The Mills Corporation, or the Mills acquisition, 40 Premium Outlet Centers, 16 The Mills, 70 community/lifestyle centers, and 14 other shopping centers or outlet centers in 41 states and Puerto Rico. We also own interests in four parcels of land held for future development. In the United States, we have one new property currently under development aggregating approximately 0.4 million square feet which will open during 2009. Internationally, we have ownership interests in 52 European shopping centers (in France, Italy and Poland), seven Premium Outlet Centers in Japan, one Premium Outlet Center in Mexico, one Premium Outlet Center in Korea, and one shopping center in China. Also, through joint venture arrangements we have ownership interests in the following properties under development internationally: a 24% interest in two shopping centers in Italy, a 40% interest in a Premium Outlet Center in Japan, and a 32.5% interest in three additional shopping centers under construction in China.

            For a description of our operational strategies and developments in our business during 2008, see the "Management's Discussion and Analysis of Financial Condition and Results of Operations" which appears in Item 7 to this Form 10-K.

Other Policies

            The following is a discussion of our investment policies, financing policies, conflict of interest policies and policies with respect to certain other activities. One or more of these policies may be amended or rescinded from time to time by Simon Property without a vote by our limited partners.

            While we emphasize equity real estate investments, we may, at our discretion, invest in mortgages and other real estate interests consistent with Simon Property's qualification as a real estate investment trust, or REIT. We do not currently intend to invest to a significant extent in mortgages or deeds of trust; however, we hold a mortgage note which results in us receiving 100% of the economics of a property. We may invest in participating or convertible mortgages if we conclude that we may benefit from the cash flow or any appreciation in the value of the property.

            We may invest in securities of other entities engaged in real estate activities or securities of other issuers. However, any of these investments would be subject to the percentage ownership limitations and gross income tests necessary to maintain Simon Property's qualification as a REIT. These REIT limitations mean that Simon Property cannot make an investment that would cause its real estate assets to be less than 75% of its total assets. In addition, at least 75% of Simon Property's gross income must be derived directly or indirectly from investments relating to real property or mortgages on real property, including "rents from real property," dividends from other REIT's and, in certain circumstances, interest from certain types of temporary investments. At least 95% of Simon Property's income must be derived from such real property investments, and from dividends, interest and gains from the sale or dispositions of stock or securities or from other combinations of the foregoing.

            Subject to REIT limitations, we may invest in the securities of other issuers in connection with acquisitions of indirect interests in real estate. Such an investment would normally be in the form of general or limited partnership or membership interests in special purpose partnerships and limited liability companies that own one or more properties. We may, in the future, acquire all or substantially all of the securities or assets of other REITs, management companies or similar entities where such investments would be consistent with our investment policies.

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            We must comply with the covenants contained in our financing agreements that limit our ratio of debt to total assets or market value, as defined. For example, our lines of credit and the indentures for our debt securities contain covenants that restrict the total amount of debt to 65%, or 60% in relation to certain debt, of total assets, as defined under the related arrangement, and secured debt to 50% of total assets. In addition, these agreements contain other covenants requiring compliance with financial ratios. Furthermore, the amount of debt that we may incur is limited as a practical matter by our desire to maintain acceptable ratings for Simon Property's equity securities and our debt securities.

            We may raise additional capital by issuing units of limited partnership interests, or units, or debt securities, creating joint ventures with existing ownership interests in properties, retention of cash flows or a combination of these methods. If Simon Property's Board of Directors determines to raise additional equity capital, at the Operating Partnership level, we may, without limited partner approval, issue additional units or other equity interests in us. We may issue Units in any manner and on such terms and for such consideration as we deem appropriate. This may include issuing Units in exchange for property. We may issue preferred units that could be senior to our Units and may be convertible into Units. Existing holders of Units have no preemptive right to purchase Units in any subsequent offerings. Any such offering could dilute a limited partner's investment in us.

            We expect most additional borrowings would be made in the form of bank borrowings, publicly and privately placed debt instruments, or purchase money obligations to the sellers of properties. Any such indebtedness may be secured or unsecured. Any such indebtedness may also have full or limited recourse to the borrower or cross-collateralized with other debt, or may be fully or partially guaranteed by us. Although we may borrow to fund the payment of distributions, we currently have no expectation that we will regularly be required to do so.

            We have a $3.5 billion revolving unsecured credit facility, or the Credit Facility. We also issue debt securities, but we may issue our debt securities which may be convertible into Units, preferred units or be accompanied by warrants to purchase equity interests or be exchangeable for stock of Simon Property. We also may sell or securitize our lease receivables. The proceeds from any borrowings or financings may be used for one or more of the following:

            We may also finance acquisitions through the following:

            Our ability to issue Units to transferors of properties or other partnership interests may defer gain recognition for tax purposes by the transferor. It may also be advantageous for us since there are ownership limits that restrict the number of Units that investors may own.

            We do not have a policy limiting the number or amount of mortgages that may be placed on any particular property. Mortgage financing instruments, however, usually limit additional indebtedness on such properties. We also have covenants on our unsecured debt that limit our total secured debt.

            Typically, we invest in or form special purpose entities to assist us in obtaining permanent financing on attractive terms. Permanent financing may be structured as a mortgage loan on a single property, or on a group of properties, and generally requires us to provide a mortgage interest on the property in favor of an institutional third party, as a joint venture with a third party, or as a securitized financing. For securitized financings, we create special purpose entities to own the properties. These special purpose entities are structured so that they would not be consolidated with us in the event we would ever become subject to a bankruptcy proceeding. We decide upon the structure of the financing based upon the best terms then available to us and whether the proposed financing is consistent with our other business objectives. For accounting purposes, we include the outstanding securitized debt of special purpose entities owning consolidated properties as part of our consolidated indebtedness.

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            We maintain policies and have entered into agreements designed to reduce or eliminate potential conflicts of interest. Simon Property has adopted governance principles governing its affairs and the affairs of its subsidiaries and the Simon Property Board of Directors, as well as written charters for each of the standing Committees of the Board of Directors. In addition, the Board of Directors of Simon Property has a Code of Business Conduct and Ethics, which applies to all of its officers, directors, and employees. At least a majority of the members of the Simon Property Board of Directors must qualify as independent under the listing standards for New York Stock Exchange companies and cannot be affiliated with the Simon family who are significant stockholders. Any transaction between us and the Simons, including property acquisitions, service and property management agreements and retail space leases, must be approved by a majority of Simon Property's non-affiliated directors.

            The sale of certain of our properties may have an adverse tax impact on the Simons and the other limited partners. In order to avoid any conflict of interest between Simon Property and our limited partners, the Simon Property charter requires that at least six of the non-affiliated directors of the Board of Directors must authorize and require us to sell any property we own. Any such sale is subject to applicable agreements with third parties. Noncompetition agreements executed by each of the Simons contain covenants limiting the ability of the Simons to participate in certain shopping center activities in North America.

            We intend to make investments which are consistent with Simon Property's qualification as a REIT, unless the Board of Directors determines that it is no longer in Simon Property's best interests to so qualify as a REIT. The Board of Directors may make such a determination because of changing circumstances or changes in the REIT requirements. We have authority to offer Units of equity interest or other securities in exchange for property. We also have authority to repurchase or otherwise reacquire our Units or any other securities. Our policy prohibits us from making any loans to the directors or executive officers of Simon Property for any purpose. We may make loans to the joint ventures in which we participate.

Competition

            Our principal competitors are nine major United States or internationally publicly-held companies that own or operate regional malls, outlet centers, and other shopping centers in the United States and abroad. We also compete with many commercial developers, real estate companies and other owners of retail real estate that operate in our trade areas. Some of our properties and investments are of the same type and are within the same market area as competitor properties. The existence of competitive properties could have a material adverse effect on our ability to lease space and on the level of rents we can obtain. This results in competition for both the acquisition of prime sites (including land for development and operating properties) and for tenants to occupy the space that we and our competitors develop and manage. In addition, our properties compete against other forms of retailing, such as catalog companies and e-commerce websites that offer retail products and services.

            We believe that we have a competitive advantage in the retail real estate business as a result of:

            Our size reduces our dependence upon individual retail tenants. Approximately 4,300 different retailers occupy more than 28,600 stores in our properties and no retail tenant represents more than 2.0% of our properties' total minimum rents.

Certain Activities

            During the past three years, we have:

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Employees

            At January 16, 2009, we and our affiliates employed approximately 5,300 persons at various properties and offices throughout the United States, of which approximately 1,800 were part-time. Approximately 1,100 of these employees were located at our corporate headquarters in Indianapolis, IN and 150 were located at our Chelsea offices in Roseland, NJ.

Corporate Headquarters

            Our corporate headquarters are located at 225 West Washington Street, Indianapolis, Indiana 46204, and our telephone number is (317) 636-1600.

Available Information

            Our Internet website address is www.simon.com. Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act are available or may be accessed free of charge through the "About Simon/Investor Relations/Financial Information" section of our Internet website as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC. Our Internet website and the information contained therein or connected thereto are not intended to be incorporated into this Annual Report on Form 10-K.

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Item 1A.    Risk Factors

            The following factors, among others, could cause our actual results to differ materially from those contained in forward-looking statements made in this Annual Report on Form 10-K and presented elsewhere by our management from time to time. These factors, among others, may have a material adverse effect on our business, financial condition, operating results and cash flows, and you should carefully consider them. It is not possible to predict or identify all such factors. You should not consider this list to be a complete statement of all potential risks or uncertainties and we may update them in our future periodic reports.

Risks Relating to Debt and the Financial Markets

            As of December 31, 2008, our consolidated mortgages and other indebtedness, excluding the related premium and discount, totaled $18.0 billion, of which approximately $1.5 billion matures during 2009, including recurring principal amortization on mortgages maturing during 2009. We are subject to the risks normally associated with debt financing, including the risk that our cash flow from operations will be insufficient to meet required debt service. Our debt service costs generally will not be reduced if developments at the property, such as the entry of new competitors or the loss of major tenants, cause a reduction in the income from the property. Should such events occur, our operations may be adversely affected. If a property is mortgaged to secure payment of indebtedness and income from the property is insufficient to pay that indebtedness, the property could be foreclosed upon by the mortgagee resulting in a loss of income and a decline in our total asset value.

            We depend primarily on external financings, principally debt financings, to fund the growth of our business and to ensure that we can meet ongoing maturities of our outstanding debt. Our access to financing depends on our credit rating, the willingness of banks to lend to us and conditions in the capital markets. The disruption in the capital markets that began in 2008 has continued into 2009, restricting access to capital markets for many companies. We cannot assure you that we will be able to obtain the financing we need for future growth or to meet our debt service as obligations mature, or that the financing available to us will be on acceptable terms.

            Our outstanding senior unsecured notes and the preferred stock of Simon Property are periodically rated by nationally recognized credit rating agencies. These credit ratings are based on our operating performance, liquidity and leverage ratios, overall financial position, and other factors viewed by the credit rating agencies as relevant to our industry and the economic outlook in general. These credit ratings can also affect the amount of capital we can access, as well as the terms of any financing we obtain. Since we depend primarily on debt financing to fund our growth, adverse changes in our credit rating could have a negative effect on our future growth.

            We manage our exposure to interest rate risk by a combination of interest rate protection agreements to effectively fix or cap a portion of our variable rate debt, or in the case of a fair value hedge, effectively convert fixed rate debt to variable rate debt. In addition, we refinance fixed rate debt at times when we believe rates and terms are appropriate. Our efforts to manage these exposures may not be successful.

            Our use of interest rate hedging arrangements to manage risk associated with interest rate volatility may expose us to additional risks, including a risk that a counterparty to a hedging arrangement may fail to honor its obligations. Developing an effective interest rate risk strategy is complex and no strategy can completely insulate us from risks associated with interest rate fluctuations. There can be no assurance that our hedging activities will have the desired beneficial impact on our results of operations or financial condition. Termination of these hedging agreements typically involves costs, such as transaction fees or breakage costs.

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Factors Affecting Real Estate Investments and Operations

            We regularly acquire and develop new properties and expand and redevelop existing properties, and these activities are subject to various risks. We may not be successful in pursuing acquisition, development or redevelopment/expansion opportunities. In addition, newly acquired, developed or redeveloped/expanded properties may not perform as well as expected. We are subject to other risks in connection with any acquisition, development and redevelopment/expansion activities, including the following:

            If a development or redevelopment/expansion project is unsuccessful, either because it is not meeting our expectations when operational or was not completed according to the project planning, we could lose our investment in the project. Further, if we guarantee the property's financing, our loss could exceed our investment in the project.

            Our properties represent a substantial portion of our total consolidated assets. These investments are relatively illiquid. As a result, our ability to sell one or more of our properties or investments in real estate in response to any changes in economic or other conditions is limited. If we want to sell a property, we cannot assure you that we will be able to dispose of it in the desired time period or that the sales price of a property will exceed the cost of our investment.

Environmental Risks

            Federal, state and local laws and regulations relating to the protection of the environment may require us, as a current or previous owner or operator of real property, to investigate and clean up hazardous or toxic substances or petroleum product releases at a property or at impacted neighboring properties. These laws often impose liability regardless of whether the property owner or operator knew of, or was responsible for, the presence of hazardous or toxic substances. These laws and regulations may require the abatement or removal of asbestos containing materials in the event of damage, demolition or renovation, reconstruction or expansion of a property and also govern emissions of and exposure to asbestos fibers in the air. Those laws and regulations also govern the installation, maintenance and removal of underground storage tanks used to store waste oils or other petroleum products. Many of our properties contain, or at one time contained, asbestos containing materials or underground storage tanks (primarily related to auto service center establishments or emergency electrical generation equipment). The costs of investigation, removal or remediation of hazardous or toxic substances may be substantial and could adversely affect our results of operations or financial condition but is not estimable. The presence of contamination, or the failure to remediate contamination, may also adversely affect our ability to sell, lease or redevelop a property or to borrow using a property as collateral.

            Although we believe that our portfolio is in substantial compliance with Federal, state and local environmental laws, ordinances and regulations regarding hazardous or toxic substances, this belief is based on limited testing. Nearly all of our properties have been subjected to Phase I or similar environmental audits. These environmental audits have not revealed, nor are we aware of, any environmental liability that we believe will have a material adverse effect on our results of operations or financial condition. However, we cannot assure you that:

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Retail Operations Risks

            Our concentration in the retail real estate market means that we are subject to the risks that affect the retail environment generally, including the levels of consumer spending, seasonality, the willingness of retailers to lease space in our shopping centers, tenant bankruptcies, changes in economic conditions, consumer confidence and terrorist activities. A recession is currently affecting the economy and consumer spending in the United States has recently declined. The unemployment rate is rising and consumer confidence has decreased significantly. In addition, we derive our cash flow from operations primarily from retail tenants, many of whom are currently under considerable economic stress. A prolonged recession is likely to adversely affect our tenants and as a result this could affect our results of operations and financial condition. A significant deterioration in our cash flow from operations could require us to curtail planned capital expenditures or seek alternative sources of financing.

            We may not be able to lease new properties to an appropriate mix of tenants or for rents that are consistent with our projections. Also, when leases for our existing properties expire, the premises may not be relet or the terms of reletting, including the cost of allowances and concessions to tenants, may be less favorable than the current lease terms. To the extent that our leasing plans are not achieved, our cash generated before debt repayments and capital expenditures could be adversely affected.

            Regional malls are typically anchored by department stores and other large nationally recognized tenants. The value of some of our properties could be adversely affected if these tenants fail to comply with their contractual obligations, seek concessions in order to continue operations, or cease their operations. Larger store, also referred to as "big box", consolidations typically result in the closure of existing stores or duplicate or geographically overlapping store locations. We do not control the disposition of those department stores or larger stores that we do not own. We also may not control the vacant space that is not re-leased in those stores we do own. Other tenants may be entitled to modify the terms of their existing leases in the event of such closures. The modification could be unfavorable to us as the lessor and could decrease rents or expense recovery charges. Additionally, major tenant closures may result in decreased customer traffic which could lead to decreased sales at other stores. If the sales of stores operating in our properties were to decline significantly due to closing of anchors, economic conditions, or other reasons, tenants may be unable to pay their minimum rents or expense recovery charges. In the event of default by a tenant or anchor store, we may experience delays and costs in enforcing our rights as landlord to recover amounts due to us under the terms of our agreements with those parties.

            Although bankruptcy filings by retailers occur regularly in the course of our operations, the number of tenant bankruptcies has increased substantially in the past twelve months. We continually seek to re-lease vacant spaces resulting from tenant terminations. The bankruptcy of a tenant, particularly an anchor tenant, may make it more difficult to lease the remainder of the affected properties. Future tenant bankruptcies could adversely affect our properties or impact our ability to successfully execute our re-leasing strategy.

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Risks Relating to Joint Venture Properties

            As of December 31, 2008, we owned interests in 183 income-producing properties with other parties. Of those, 18 properties are included in our consolidated financial statements. We account for the other 165 properties under the equity method of accounting, which we refer to as joint venture properties. We serve as general partner or property manager for 93 of these 165 properties; however, certain major decisions, such as selling or refinancing these properties, require the consent of the other owners. Of the properties for which we do not serve as general partner or property manager, 62 are in our international joint ventures. The other owners also have other participating rights that we consider substantive for purposes of determining control over the properties' assets. The remaining joint venture properties are managed by third parties. These limitations may adversely affect our ability to sell, refinance, or otherwise operate these properties.

            Joint venture debt is the liability of the joint venture and is typically secured by a mortgage on the joint venture property. As of December 31, 2008, we had loan guarantees and other guarantee obligations to support $71.9 million and $6.6 million, respectively, of our total $6.6 billion share of joint venture mortgage and other indebtedness. A default by a joint venture under its debt obligations may expose us to liability under a guaranty or letter of credit.

Other Factors Affecting Our Business

            CAM costs typically include allocable energy costs, repairs, maintenance and capital improvements to common areas, janitorial services, administrative, property and liability insurance costs, and security costs. We historically have used leases with variable CAM provisions that adjust to reflect inflationary increases. Recently, we have made a concerted effort to convert our leases to a fixed payment methodology which fixes our tenants' CAM contributions and should in turn reduce the volatility of and limitations on the recoveries we collect from our tenants for the reimbursement of our property operating expenses. However, with respect to both variable and fixed payment methodologies, the amount of CAM charges we bill to our tenants may not allow us to recover all of these operating costs.

            Our properties compete with other retail properties for tenants on the basis of the rent charged and location. The principal competition may come from existing or future developments in the same market areas and from discount shopping centers, outlet malls, catalogues, discount shopping clubs and electronic commerce. The presence of competitive properties also affects our ability to lease space and the level of rents we can obtain. Renovations and expansions at competing malls could also negatively affect our properties.

            We also compete with other retail property developers to acquire prime development sites. In addition, we compete with other retail property companies for tenants and qualified management.

            We hold interests in joint venture properties that are under operation in Italy, France, Poland, Japan, Korea, Mexico, and China and we have recently made an investment in a U.K. retail real estate company. We may pursue additional expansion opportunities outside the United States. International development and ownership activities carry risks that are different from those we face with our domestic properties and operations. These risks include:

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            Although our international activities currently are a relatively small portion of our business (international properties represented approximately 6.3% of the GLA of all of our properties at December 31, 2008), to the extent that we expand our international activities, these risks could increase in significance which in turn could adversely affect our results of operations and financial condition.

            We maintain commercial general liability, fire, flood, extended coverage and rental loss insurance on all of our properties in the United States through wholly-owned captive insurance entities and other self-insurance mechanisms. Rosewood Indemnity, Ltd. and Bridgewood Insurance Company, Ltd. are our wholly-owned captive insurance subsidiaries, and have agreed to indemnify our general liability carrier for a specific layer of losses for the properties that are covered under these arrangements. The carrier has, in turn, agreed to provide evidence of coverage for this layer of losses under the terms and conditions of the carrier's policy. A similar policy written through these captive insurance entities also provides initial coverage for property insurance and certain windstorm risks at the properties located in coastal windstorm locations.

            There are some types of losses, including lease and other contract claims that generally are not insured. If an uninsured loss or a loss in excess of insured limits occurs, we could lose all or a portion of the capital we have invested in a property, as well as the anticipated future revenue from the property. If this happens, we may still remain obligated for any mortgage debt or other financial obligations related to the property.

            We currently maintain insurance coverage against acts of terrorism on all of our properties in the United States on an "all risk" basis in the amount of up to $1 billion per occurrence for certified foreign acts of terrorism and $500 million per occurrence for non-certified domestic acts of terrorism. The current federal laws which provide this coverage are expected to operate through 2014. Despite the existence of this insurance coverage, any threatened or actual terrorist attacks in high profile markets could adversely affect our property values, revenues, consumer traffic and tenant sales.

Risks Relating to Federal Income Taxes

            Two of our subsidiaries have elected to qualify as a REIT. Qualification as a REIT for federal income tax purposes is governed by highly technical and complex provisions for which there are only limited judicial or administrative interpretations. If either of the REIT subsidiaries fails to comply with those provisions, and if available relief provisions do not apply:

            As a result, net income and funds available for distribution to our unitholders would be reduced for those years in which a REIT subsidiary fails to qualify as a REIT. Although we currently intend to operate the REIT subsidiaries so as to qualify each as a REIT, we cannot assure you we will succeed or that future economic, market, legal, tax or other considerations might cause us to revoke the REIT election of either of the REIT subsidiaries.

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Item 1B.    Unresolved Staff Comments

            None.

Item 2.    Properties

            Our U.S. properties primarily consist of regional malls, Premium Outlet Centers, The Mills, community/lifestyle centers, and other properties. These properties contain an aggregate of approximately 246 million square feet of gross leasable area, or GLA, of which we own approximately 152.8 million square feet. Total estimated retail sales at the properties in 2008 were approximately $62 billion.

            Regional malls typically contain at least one traditional department store anchor or a combination of anchors and big box retailers with a wide variety of smaller stores connecting the anchors. Additional stores are usually located along the perimeter of the parking area. Our 164 regional malls are generally enclosed centers and range in size from approximately 400,000 to 2.3 million square feet of GLA. Our regional malls contain in the aggregate more than 19,300 occupied stores, including approximately 740 anchors, which are mostly national retailers. The 16 regional malls acquired in the Mills acquisition are identified in this section as the Mills Regional Malls. These malls typically range in size from 700,000 to 1.3 million square feet of GLA and contain a wide variety of national retailers.

            Premium Outlet Centers generally contain a wide variety of designer and manufacturer stores located in an open-air center. Our 40 Premium Outlet Centers range in size from approximately 200,000 to 850,000 square feet of GLA. The Premium Outlet Centers are generally located near major metropolitan areas and tourist destinations including New York City, Los Angeles, Boston, Palm Springs, Orlando, Las Vegas, and Honolulu.

            The Mills generally range in size from 1.0 million to 2.3 million square feet of GLA and are located in major metropolitan areas. They have a combination of traditional mall, outlet center, and big box retailers and entertainment uses.

            Community/lifestyle centers are generally unenclosed and smaller than our regional malls. Our 70 community/lifestyle centers generally range in size from approximately 100,000 to 900,000 square feet of GLA. Community/lifestyle centers are designed to serve a larger trade area and typically contain anchor stores and other national retail tenants, which occupy a significant portion of the GLA of the center. We also own traditional community shopping centers that focus primarily on value-oriented and convenience goods and services. These centers are usually anchored by a supermarket, discount retailer, or drugstore and are designed to service a neighborhood area. Finally, we own open-air centers adjacent to our regional malls designed to take advantage of the drawing power of the mall.

            We also have interests in 14 other shopping centers or outlet centers. These properties range in size from approximately 85,000 to 1.0 million square feet of GLA and in total represent less than 1% of our total operating income before depreciation.

            The following table provides representative data for our U.S. properties on a gross basis as of December 31, 2008:

 
  Regional
Malls
  Premium
Outlet
Centers
  Mills Portfolio
(including The
Mills and Mills
Regional Malls)
  Community/
Lifestyle
Centers
  Other Properties  

% of total property annualized base rent

    64.5 %   13.0 %   16.8 %   5.2 %   0.5 %

% of total property GLA

    66.0 %   6.7 %   16.8 %   8.4 %   2.1 %

% of owned property GLA

    58.3 %   10.7 %   19.6 %   9.2 %   2.2 %

            As of December 31, 2008, approximately 92.4% of the owned GLA in regional malls and the retail space of the other properties was leased, approximately 98.9% of owned GLA in the Premium Outlet Centers was leased, approximately 94.5% of the owned GLA for The Mills and 87.4% of owned GLA for the Mills regional malls was leased, and approximately 90.7% of owned GLA in the community/lifestyle centers was leased.

            We own 100% of 203 of our properties, effectively control 18 properties in which we have a joint venture interest, and hold the remaining 103 properties through unconsolidated joint venture interests. We are the managing or co-managing general partner or member of 314 properties. Substantially all of our joint venture properties are

12


Table of Contents


subject to rights of first refusal, buy-sell provisions, or other sale rights for all partners which are customary in real estate partnership agreements and the industry. Our partners in our joint ventures may initiate these provisions at any time, which will result in either the use of available cash or borrowings to acquire their partnership interest or the disposal of our partnership interest.

            The following property table summarizes certain data for our regional malls, Premium Outlet Centers, the Mills portfolio, and community/lifestyle centers located in the United States, including Puerto Rico, as of December 31, 2008.

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Table of Contents

Simon Property Group, L.P. and Subsidiaries

Property Table

U.S. Properties

 
   
   
   
   
   
   
   
  Gross Leasable Area    
 
   
   
   
  Ownership
Interest
(Expiration if
Lease)(3)
   
   
   
   
 
 
Property Name
  State   City (CBSA)   Legal
Ownership
  Year Built
or
Acquired
  Occupancy(5)   Anchor   Mall &
Freestanding
  Total   Retail Anchors and Selected Major Tenants
    Regional Malls

1.

 

Anderson Mall

 

SC

 

Anderson (Greenville)

 

Fee

 

 

100.0%

 

Built 1972

 

 

78.9

%

 

480,209

 

 

190,817

 

 

671,026

 

Belk Ladies Fashion Store, Belk Men's & Home Store, JCPenney, Sears, Dillard's
2.   Apple Blossom Mall   VA   Winchester   Fee     49.1% (4) Acquired 1999     87.0 %   229,011     211,193     440,204   Belk, JCPenney, Sears, Eastwynn Theatres
3.   Arsenal Mall   MA   Watertown (Boston)   Fee     100.0%   Acquired 1999     99.1 %   191,395     312,205 (18)   503,600   Marshalls, Filene's Basement, Old Navy
4.   Atrium Mall   MA   Chestnut Hill (Boston)   Fee     49.1% (4) Acquired 1999     95.8 %       205,058     205,058   Borders Books & Music
5.   Auburn Mall   MA   Auburn (Worcester)   Fee     49.1% (4) Acquired 1999     95.0 %   417,620     173,282     590,902   Macy's, Macy's Home Store, Sears
6.   Aventura Mall(1)   FL   Miami Beach   Fee     33.3% (4) Built 1983     96.1 %   1,283,938     815,416     2,099,354   Bloomingdale's, Macy's, Macy's Mens & Home Furniture, JCPenney, Sears, Nordstrom, Equinox Fitness Clubs, AMC Theatre
7.   Avenues, The   FL   Jacksonville   Fee     25.0% (4)(2) Built 1990     96.0 %   754,956     362,861     1,117,817   Belk, Dillard's, JCPenney, Belk Men and Kids, Sears
8.   Bangor Mall   ME   Bangor   Fee     67.4% (15) Acquired 2003     91.7 %   416,582     236,322     652,904   Macy's, JCPenney, Sears, Dick's Sporting Goods
9.   Barton Creek Square   TX   Austin   Fee     100.0%   Built 1981     97.7 %   922,266     506,721     1,428,987   Nordstrom, Macy's, Dillard's Women's & Home, Dillard's Men's & Children's, JCPenney, Sears, AMC Theatre
10.   Battlefield Mall   MO   Springfield   Fee and Ground Lease (2056)     100.0%   Built 1970     95.0 %   770,111     432,352     1,202,463   Macy's, Dillard's Women's, Dillard's Men's, Children's & Home, JCPenney, Sears
11.   Bay Park Square   WI   Green Bay   Fee     100.0%   Built 1980     95.5 %   425,773     274,241     700,014   Younkers, Younkers Home Furniture Gallery, Kohl's, ShopKo, Bay Park Cinema
12.   Bowie Town Center   MD   Bowie (Washington, D.C.)   Fee     100.0%   Built 2001     98.1 %   355,557     328,829     684,386   Macy's, Sears, Barnes & Noble, Bed Bath & Beyond, Best Buy
13.   Boynton Beach Mall   FL   Boynton Beach (Miami-Fort Lauderdale)   Fee     100.0%   Built 1985     84.8 %   714,210     387,123     1,101,333   Macy's, Dillard's Men's & Home, Dillard's Women, JCPenney, Sears, Muvico Theatres
14.   Brea Mall   CA   Brea (Los Angeles)   Fee     100.0%   Acquired 1998     98.0 %   874,802     444,766     1,319,568   Nordstrom, Macy's, JCPenney, Sears, David's Bridal, Macy's Men's Children & Home.
15.   Broadway Square   TX   Tyler   Fee     100.0%   Acquired 1994     100.0 %   427,730     200,338     628,068   Dillard's, JCPenney, Sears
16.   Brunswick Square   NJ   East Brunswick (New York)   Fee     100.0%   Built 1973     98.2 %   467,626     297,365     764,991   Macy's, JCPenney, Barnes & Noble, Mega Movies
17.   Burlington Mall   MA   Burlington (Boston)   Ground Lease (2048)     100.0%   Acquired 1998     95.3 %   780,411     537,396     1,317,807   Macy's, Lord & Taylor, Sears, Nordstrom, Crate & Barrel
18.   Cape Cod Mall   MA   Hyannis   Ground Leases (2009-2073)(7)     49.1% (4) Acquired 1999     91.6 %   420,199     303,391     723,590   Macy's, Macy's Men's and Home, Sears, Best Buy, Marshalls, Barnes & Noble, Regal Cinema
19.   Castleton Square   IN   Indianapolis   Fee     100.0%   Built 1972     95.7 %   908,481     472,986     1,381,467   Macy's, Von Maur, JCPenney, Sears, Dick's Sporting Goods, Borders Books & Music, AMC Theatres
20.   Century III Mall   PA   West Mifflin (Pittsburgh)   Fee     100.0%   Built 1979     70.3 %   831,439     458,780 (18)   1,290,219   Macy's, JCPenney, Sears, Dick's Sporting Goods, Macy's Jr.
21.   Charlottesville Fashion Square   VA   Charlottesville   Ground Lease (2076)     100.0%   Acquired 1997     95.2 %   381,153     189,694     570,847   Belk Women's & Children's, Belk Men's & Home, JCPenney, Sears
22.   Chautauqua Mall   NY   Lakewood (Jamestown)   Fee     100.0%   Built 1971     79.8 %   213,320     218,794     432,114   Sears, JCPenney, Bon Ton, Office Max, Dipson Cinema

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Table of Contents

Simon Property Group, L.P. and Subsidiaries

Property Table

U.S. Properties

 
   
   
   
   
   
   
   
  Gross Leasable Area    
 
   
   
   
  Ownership
Interest
(Expiration if
Lease)(3)
   
   
   
   
 
 
Property Name
  State   City (CBSA)   Legal
Ownership
  Year Built
or
Acquired
  Occupancy(5)   Anchor   Mall &
Freestanding
  Total   Retail Anchors and Selected Major Tenants
23.   Chesapeake Square   VA   Chesapeake (Virginia Beach-Norfolk)   Fee and Ground Lease (2062)     75.0% (12) Built 1989     86.5 %   534,760     268,873     803,633   Macy's, Dillard's Women's, Dillard's Men's, Children's & Home, JCPenney, Sears, Target
24.   Cielo Vista Mall   TX   El Paso   Fee and Ground Lease (2010)(7)     100.0%   Built 1974     100.0 %   793,716     449,571     1,243,287   Macy's, Dillard's Women's & Furniture, Dillard's Men's, Children's & Home, JCPenney, Sears, Cinemark Theatres
25.   Circle Centre   IN   Indianapolis   Property Lease (2097)     14.7% (4)(2) Built 1995     83.4 %   350,000     432,196 (18)   782,196   Nordstrom, Carson Pirie Scott, United Artists Theatre
26.   Coconut Point   FL   Estero (Cape Coral-Fort Myers)   Fee     50.0% (4) Built 2006     98.3 %   691,785     504,554     1,196,339   Dillard's, Barnes & Noble, Bed Bath & Beyond, Best Buy, DSW, Office Max, Old Navy, PetsMart, Pier 1 Imports, Ross Dress for Less, Cost Plus World Market, T.J. Maxx, Muvico Theatres, Super Target
27.   Coddingtown Mall   CA   Santa Rosa   Fee     50.0% (4) Acquired 2005     83.7 %   547,090     262,821     809,911   Macy's, JCPenney, Gottschalk's, Whole Foods(6)
28.   College Mall   IN   Bloomington   Fee and Ground Lease (2048)(7)     100.0%   Built 1965     88.1 %   356,887     278,499     635,386   Macy's, Sears, Target, Dick's Sporting Goods, Bed Bath & Beyond, Old Navy
29.   Columbia Center   WA   Kennewick   Fee     100.0%   Acquired 1987     90.4 %   408,052     365,186     773,238   Macy's, Macy's Mens & Children, JCPenney, Sears, Barnes & Noble, Regal Cinema
30.   Copley Place   MA   Boston   Fee     98.1%   Acquired 2002     96.2 %   150,847     1,091,967 (18)   1,242,814   Nieman Marcus, Barneys New York
31.   Coral Square   FL   Coral Springs (Miami-Fort Lauderdale)   Fee     97.2%   Built 1984     98.0 %   648,144     296,014     944,158   Macy's Mens, Children & Home, Macy's Women, Dillard's, JCPenney, Sears
32.   Cordova Mall   FL   Pensacola   Fee     100.0%   Acquired 1998     95.4 %   395,875     459,212     855,087   Dillard's Men's, Dillard's Women's, Belk, Best Buy, Bed Bath & Beyond, Cost Plus World Market, Ross Dress for Less
33.   Cottonwood Mall   NM   Albuquerque   Fee     100.0%   Built 1996     97.7 %   631,556     409,270     1,040,826   Macy's, Dillard's, JCPenney, Sears, United Artists Theatre(8)
34.   Crossroads Mall   NE   Omaha   Fee     100.0%   Acquired 1994     68.4 %   522,119     188,403     710,522   Sears, Target, Barnes & Noble, Old Navy
35.   Crystal Mall   CT   Waterford   Fee     74.6% (4) Acquired 1998     88.7 %   419,405     350,390     769,795   Macy's, JCPenney, Sears, Bed Bath & Beyond, Christmas Tree Store(6)(17)
36.   Crystal River Mall   FL   Crystal River   Fee     100.0%   Built 1990     71.7 %   302,495     121,804     424,299   JCPenney, Sears, Belk, Kmart, Regal Cinema
37.   Dadeland Mall   FL   Miami   Fee     50.0% (4) Acquired 1997     98.2 %   1,132,072     342,700     1,474,772   Saks Fifth Avenue, Nordstrom, Macy's, Macy's Children & Home, JCPenney
38.   DeSoto Square   FL   Bradenton (Sarasota-Bradenton)   Fee     100.0%   Built 1973     93.5 %   435,467     253,949     689,416   Macy's, Dillard's, JCPenney, Sears
39.   Domain, The   TX   Austin   Fee     100.0%   Built 2006     90.9 %   220,000     411,101 (18)   631,101   Neiman Marcus, Macy's, Borders Books & Music, Village Roadshow(6), Dick's Sporting Goods(6), Dillard's(6)
40.   Eastland Mall   IN   Evansville   Fee     50.0% (4) Acquired 1998     95.7 %   489,144     375,323     864,467   Macy's, JCPenney, Dillard's
41.   Edison Mall   FL   Fort Myers   Fee     100.0%   Acquired 1997     95.0 %   742,667     308,844     1,051,511   Dillard's, Macy's Mens, Children & Home, Macy's Women, JCPenney, Sears
42.   Emerald Square   MA   North Attleboro (Providence—RI-New Bedford)   Fee     49.1% (4) Acquired 1999     91.1 %   647,372     375,129     1,022,501   Macy's, Macy's Mens & Home Store, JCPenney, Sears

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Table of Contents

Simon Property Group, L.P. and Subsidiaries

Property Table

U.S. Properties

 
   
   
   
   
   
   
   
  Gross Leasable Area    
 
   
   
   
  Ownership
Interest
(Expiration if
Lease)(3)
   
   
   
   
 
 
Property Name
  State   City (CBSA)   Legal
Ownership
  Year Built
or
Acquired
  Occupancy(5)   Anchor   Mall &
Freestanding
  Total   Retail Anchors and Selected Major Tenants
43.   Empire Mall(1)(2)   SD   Sioux Falls   Fee and Ground Lease (2013)(7)     50.0% (4) Acquired 1998     89.6 %   497,341     576,797     1,074,138   Macy's, Younkers, JCPenney, Sears, Gordmans, Old Navy, Hy-Vee
44.   Fashion Centre at Pentagon City   VA   Arlington (Washington, DC)   Fee     42.5% (4) Built 1989     96.1 %   472,729     517,516 (18)   990,245   Nordstrom, Macy's
45.   Fashion Mall at Keystone at the Crossing   IN   Indianapolis   Ground Lease (2067)     100.0%   Acquired 1997     95.3 %   249,721     433,766 (18)   683,487   Saks Fifth Avenue, Crate & Barrel, Nordstrom, Keystone Art Cinema
46.   Fashion Valley   CA   San Diego   Fee     50.0% (4) Acquired 2001     99.4 %   1,053,305     668,485     1,721,790   Saks Fifth Avenue, Neiman-Marcus, Bloomingdale's, Nordstrom, Macy's, JCPenney, Pottery Barn, AMC Theatres, Old Navy
47.   Firewheel Town Center   TX   Garland (Dallas-Fort Worth)   Fee     100.0%   Built 2005     89.0 %   295,532     705,571 (18)   1,001,103   Dillard's, Macy's, Barnes & Noble, Old Navy, Pier One, DSW, Cost Plus World Market, AMC Theatres, Dick's Sporting Goods
48.   Florida Mall, The   FL   Orlando   Fee     50.0% (4) Built 1986     97.9 %   1,092,465     616,803     1,709,268   Saks Fifth Avenue, Nordstrom, Macy's, Dillard's, JCPenney, Sears(8)
49.   Forest Mall   WI   Fond Du Lac   Fee     100.0%   Built 1973     89.2 %   327,260     172,914     500,174   JCPenney, Kohl's, Younkers, Sears, Cinema I & II
50.   Forum Shops at Caesars, The   NV   Las Vegas   Ground Lease (2050)     100.0%   Built 1992     99.6 %       635,410     635,410    
51.   Granite Run Mall   PA   Media (Philadelphia)   Fee     50.0% (4) Acquired 1998     85.5 %   500,809     535,889     1,036,698   JCPenney, Sears, Boscov's, Granite Run 8 Theatres, Acme, Kohl's
52.   Great Lakes Mall   OH   Mentor (Cleveland)   Fee     100.0%   Built 1961     88.0 %   869,454     378,492     1,247,946   Dillard's Men's, Dillard's Women's, Macy's, JCPenney, Sears, AMC Theatres
53.   Greendale Mall   MA   Worcester (Boston)   Fee and Ground Lease (2009)(7)     49.1% (4) Acquired 1999     94.2 %   132,634     298,247 (18)   430,881   T.J. Maxx 'N More, Best Buy, DSW(8)
54.   Greenwood Park Mall   IN   Greenwood (Indianapolis)   Fee     100.0%   Acquired 1979     96.8 %   754,928     525,162     1,280,090   Macy's, Von Maur, JCPenney, Sears, Dick's Sporting Goods, Barnes & Noble, AMC Theatres
55.   Gulf View Square   FL   Port Richey (Tampa-St. Pete)   Fee     100.0%   Built 1980     86.9 %   461,852     291,089     752,941   Macy's, Dillard's, JCPenney, Sears, Best Buy
56.   Gwinnett Place   GA   Duluth (Atlanta)   Fee     75.0%   Acquired 1998     88.3 %   843,609     436,181     1,279,790   Belk, JCPenney, Macy's, Sears
57.   Haywood Mall   SC   Greenville   Fee and Ground Lease (2017)(7)     100.0%   Acquired 1998     96.4 %   902,400     328,561     1,230,961   Macy's, Dillard's, JCPenney, Sears, Belk
58.   Highland Mall(1)   TX   Austin   Fee and Ground Lease (2070)     50.0% (4) Acquired 1998     60.5 %   718,741     355,213     1,073,954   Dillard's Women's & Home, Dillard's Men's & Children's, Macy's
59.   Houston Galleria   TX   Houston   Fee and Ground Lease (2029)     31.5% (4) Acquired 2002     95.0 %   1,233,802     1,116,505     2,350,307   Saks Fifth Avenue, Neiman Marcus, Nordstrom, Macy's (2 locations), Borders Books & Music, Galleria Tennis/Athletic Club
60.   Independence Center   MO   Independence (Kansas City)   Fee     100.0%   Acquired 1994     98.3 %   499,284     532,170     1,031,454   Dillard's, Macy's, Sears
61.   Indian River Mall   FL   Vero Beach   Fee     50.0% (4) Built 1996     88.9 %   445,552     302,604     748,156   Dillard's, Macy's, JCPenney, Sears, AMC Theatres

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Table of Contents

Simon Property Group, L.P. and Subsidiaries

Property Table

U.S. Properties

 
   
   
   
   
   
   
   
  Gross Leasable Area    
 
   
   
   
  Ownership
Interest
(Expiration if
Lease)(3)
   
   
   
   
 
 
Property Name
  State   City (CBSA)   Legal
Ownership
  Year Built
or
Acquired
  Occupancy(5)   Anchor   Mall &
Freestanding
  Total   Retail Anchors and Selected Major Tenants
62.   Ingram Park Mall   TX   San Antonio   Fee     100.0%   Built 1979     94.9 %   750,888     374,818     1,125,706   Dillard's, Dillard's Home Store, Macy's, JCPenney, Sears, Bealls
63.   Irving Mall   TX   Irving (Dallas-Fort Worth)   Fee     100.0%   Built 1971     98.0 %   637,415     405,299     1,042,714   Macy's, Dillard's (1 level Clearance store), Sears, Burlington Coat Factory, General Cinema(20)
64.   Jefferson Valley Mall   NY   Yorktown Heights (New York)   Fee     100.0%   Built 1983     90.1 %   310,095     277,309     587,404   Macy's, Sears, H&M, Movies at Jefferson Valley
65.   King of Prussia   PA   King of Prussia (Philadelphia)   Fee     12.4% (4)(15) Acquired 2003     95.6 %   1,545,812     1,067,674 (18)   2,613,486   Neiman Marcus, Bloomingdale's, Nordstrom, Lord & Taylor, Macy's (Court), JCPenney, Sears, Crate & Barrel(8)
66.   Knoxville Center   TN   Knoxville   Fee     100.0%   Built 1984     79.7 %   597,028     383,212     980,240   JCPenney, Belk, Sears, The Rush Fitness Center, Regal Cinema(8)
67.   La Plaza Mall   TX   McAllen   Fee and Ground Lease (2040)(7)     100.0%   Built 1976     98.4 %   776,397     422,987     1,199,384   Macy's, Macy's Home Store, Dillard's, JCPenney, Sears, Joe Brand
68.   Laguna Hills Mall   CA   Laguna Hills (Los Angeles)   Fee     100.0%   Acquired 1997     92.9 %   536,500     330,061     866,561   Macy's, JCPenney, Sears, Laguna Hills Cinema, Nordstrom Rack, Total Woman Gym & Spa
69.   Lake Square Mall   FL   Leesburg (Orlando)   Fee     50.0% (4) Acquired 1998     74.2 %   296,037     262,287     558,324   JCPenney, Sears, Belk, Target, AMC Theatres, Books-A-Million
70.   Lakeline Mall   TX   Cedar Park (Austin)   Fee     100.0%   Built 1995     94.6 %   745,179     352,627     1,097,806   Dillard's, Macy's, JCPenney, Sears, Regal Cinema
71.   Lehigh Valley Mall   PA   Whitehall (Allentown—Bethlehem)   Fee     37.6% (4)(15) Acquired 2003     96.1 %   564,353     604,338 (18)   1,168,691   Macy's, JCPenney, Boscov's, Barnes & Noble(8)
72.   Lenox Square   GA   Atlanta   Fee     100.0%   Acquired 1998     95.5 %   873,580     671,433 (18)   1,545,013   Neiman Marcus, Bloomingdale's, Macy's, Crate & Barrel, Pottery Barn, Pottery Barn Kids
73.   Liberty Tree Mall   MA   Danvers (Boston)   Fee     49.1% (4) Acquired 1999     94.4 %   498,000     359,835     857,835   Marshalls, The Sports Authority, Target, Bed, Bath & Beyond, Kohl's, Best Buy, Staples, AC Moore, Old Navy, Pier 1 Imports, K&G Fashion Superstore, AMC Theatres, Nordstrom Rack, Off Broadway Shoes
74.   Lima Mall   OH   Lima   Fee     100.0%   Built 1965     93.6 %   541,861     203,650     745,511   Macy's, JCPenney, Elder-Beerman, Sears
75.   Lincolnwood Town Center   IL   Lincolnwood (Chicago)   Fee     100.0%   Built 1990     95.4 %   220,830     201,911     422,741   Kohl's, Carson Pirie Scott
76.   Lindale Mall(1)   IA   Cedar Rapids   Fee     50.0% (4) Acquired 1998     82.5 %   305,563     382,869     688,432   Von Maur, Sears, Younkers
77.   Livingston Mall   NJ   Livingston (New York)   Fee     100.0%   Acquired 1998     88.1 %   616,128     368,275     984,403   Macy's, Lord & Taylor, Sears, Modell's Sporting Goods, Barnes & Noble
78.   Longview Mall   TX   Longview   Fee     100.0%   Built 1978     83.4 %   440,917     209,282     650,199   Dillard's, JCPenney, Sears, Bealls(17)
79.   Mall at Chestnut Hill, The   MA   Chestnut Hill (Boston)   Lease (2039) (9)     47.2% (4) Acquired 2002     94.7 %   297,253     178,093     475,346   Bloomingdale's, Bloomingdale's Home Furnishing and Men's Store
80.   Mall at Rockingham, The   NH   Salem (Boston)   Fee     24.6% (4) Acquired 1999     95.4 %   638,111     382,133     1,020,244   JCPenney, Sears, Macy's(8)
81.   Mall at The Source, The   NY   Westbury (New York)   Fee     25.5% (4)(2) Built 1997     94.3 %   210,798     515,580     726,378   Fortunoff, Off 5th-Saks Fifth Avenue, Nordstrom Rack, David's Bridal, Golf Galaxy

17


Table of Contents

Simon Property Group, L.P. and Subsidiaries

Property Table

U.S. Properties

 
   
   
   
   
   
   
   
  Gross Leasable Area    
 
   
   
   
  Ownership
Interest
(Expiration if
Lease)(3)
   
   
   
   
 
 
Property Name
  State   City (CBSA)   Legal
Ownership
  Year Built
or
Acquired
  Occupancy(5)   Anchor   Mall &
Freestanding
  Total   Retail Anchors and Selected Major Tenants
82.   Mall of Georgia   GA   Buford (Atlanta)   Fee     100.0%   Built 1999     95.6 %   1,069,590     727,248     1,796,838   Nordstrom, Dillard's, Macy's, JCPenney, Belk, Dick's Sporting Goods, Barnes & Noble, Haverty's Furniture, Bed Bath & Beyond, Regal Cinema
83.   Mall of New Hampshire, The   NH   Manchester   Fee     49.1% (4) Acquired 1999     94.0 %   447,887     363,127     811,014   Macy's, JCPenney, Sears, Best Buy, Old Navy, A.C. Moore
84.   Maplewood Mall   MN   Minneapolis   Fee     100.0%   Acquired 2002     93.1 %   588,822     342,278     931,100   Macy's, JCPenney, Sears, Kohl's, Barnes & Noble
85.   Markland Mall   IN   Kokomo   Ground Lease (2041)     100.0%   Built 1968     98.5 %   273,094     141,811     414,905   Sears, Target, MC Sporting Goods(8)
86.   McCain Mall   AR   N. Little Rock   Fee     100.0%   Built 1973     92.9 %   554,156     221,043     775,199   Dillard's, JCPenney, Sears(8)
87.   Melbourne Square   FL   Melbourne   Fee     100.0%   Built 1982     84.5 %   416,167     293,886     710,053   Macy's, Dillard's Men's, Children's & Home, Dillard's Women's, JCPenney, Dick's Sporting Goods
88.   Menlo Park Mall   NJ   Edison (New York)   Fee     100.0%   Acquired 1997     97.0 %   527,591     796,382 (18)   1,323,973   Nordstrom, Macy's, Barnes & Noble, Cineplex Odeon, WOW! Work Out World
89.   Mesa Mall(1)   CO   Grand Junction   Fee     50.0% (4) Acquired 1998     90.4 %   441,208     441,129     882,337   Sears, Herberger's, JCPenney, Target(8)
90.   Miami International Mall   FL   Miami   Fee     47.8% (4) Built 1982     98.2 %   778,784     294,792     1,073,576   Macy's Mens & Home, Macy's Women & Children, Dillard's, JCPenney, Sears
91.   Midland Park Mall   TX   Midland   Fee     100.0%   Built 1980     91.5 %   339,113     280,088     619,201   Dillard's, Dillard's Mens & Juniors, JCPenney, Sears, Bealls, Ross Dress for Less
92.   Miller Hill Mall   MN   Duluth   Ground Lease (2013)     100.0%   Built 1973     93.1 %   429,508     376,119     805,627   JCPenney, Sears, Younkers, Barnes & Noble, Old Navy, DSW
93.   Montgomery Mall   PA   North Wales (Philadelphia)   Fee     60.0% (15) Acquired 2003     85.2 %   734,855     413,531     1,148,386   Macy's, JCPenney, Sears, Dick's Sporting Goods(8)
94.   Muncie Mall   IN   Muncie   Fee     100.0%   Built 1970     92.0 %   435,756     204,085     639,841   Macy's, JCPenney, Sears, Elder Beerman
95.   North East Mall   TX   Hurst (Dallas-Fort Worth)   Fee     100.0%   Built 1971     97.1 %   1,191,930     452,253     1,644,183   Nordstrom, Dillard's, Macy's, JCPenney, Sears, Dick's Sporting Goods, Rave Theatre
96.   Northfield Square   IL   Bourbonnais   Fee     31.6% (12) Built 1990     77.4 %   310,994     246,180     557,174   Carson Pirie Scott Women's, Carson Pirie Scott Men's, Children's & Home, JCPenney, Sears, Cinemark Movies 10
97.   Northgate Mall   WA   Seattle   Fee     100.0%   Acquired 1987     96.0 %   612,073     446,815     1,058,888   Nordstrom, Macy's, JCPenney, Toys 'R Us, Barnes & Noble, Bed Bath & Beyond, DSW
98.   Northlake Mall   GA   Atlanta   Fee     100.0%   Acquired 1998     88.8 %   665,745     296,235     961,980   Macy's, JCPenney, Sears, Kohl's
99.   NorthPark Mall   IA   Davenport   Fee     50.0% (4) Acquired 1998     93.0 %   650,456     422,332     1,072,788   Dillard's, Von Maur, Younkers, JCPenney, Sears, Barnes & Noble
100.   Northshore Mall   MA   Peabody (Boston)   Fee     49.1% (4) Acquired 1999     90.0 %   677,433     743,622     1,421,055   JCPenney, Sears, Filene's Basement, Nordstrom(19), Macy's Mens/Furniture, Macys, H&M, XXI Forever(6), Barnes & Noble, Toys 'R Us, Shaw's Grocery
101.   Northwoods Mall   IL   Peoria   Fee     100.0%   Acquired 1983     92.9 %   472,969     221,021     693,990   Macy's, JCPenney, Sears
102.   Oak Court Mall   TN   Memphis   Fee     100.0%   Acquired 1997     89.9 %   532,817     317,713 (18)   850,530   Dillard's, Dillard's Mens, Macy's
103.   Ocean County Mall   NJ   Toms River (New York)   Fee     100.0%   Acquired 1998     99.7 %   616,443     273,778     890,221   Macy's, Boscov's, JCPenney, Sears
104.   Orange Park Mall   FL   Orange Park (Jacksonville)   Fee     100.0%   Acquired 1994     99.3 %   576,051     379,174     955,225   Dillard's, JCPenney, Sears, Belk, Dick's Sporting Goods, AMC Theatres
105.   Orland Square   IL   Orland Park (Chicago)   Fee     100.0%   Acquired 1997     98.6 %   773,295     436,561     1,209,856   Macy's, Carson Pirie Scott, JCPenney, Sears

18


Table of Contents

Simon Property Group, L.P. and Subsidiaries

Property Table

U.S. Properties

 
   
   
   
   
   
   
   
  Gross Leasable Area    
 
   
   
   
  Ownership
Interest
(Expiration if
Lease)(3)
   
   
   
   
 
 
Property Name
  State   City (CBSA)   Legal
Ownership
  Year Built
or
Acquired
  Occupancy(5)   Anchor   Mall &
Freestanding
  Total   Retail Anchors and Selected Major Tenants
106.   Oxford Valley Mall   PA   Langhorne (Philadelphia)   Fee     65.0% (15) Acquired 2003     93.4 %   762,558     556,708 (18)   1,319,266   Macy's, JCPenney, Sears, United Artists Theatre(8)
107.   Paddock Mall   FL   Ocala   Fee     100.0%   Built 1980     96.1 %   387,378     169,501     556,879   Macy's, JCPenney, Sears, Belk
108.   Penn Square Mall   OK   Oklahoma City   Ground Lease (2060)     94.5%   Acquired 2002     98.1 %   588,137     462,654     1,050,791   Macy's, Dillard's Women's, Dillard's Men's, Children's & Home, JCPenney, Dickinson Theatre
109.   Pheasant Lane Mall   NH   Nashua (Manchester)       (14) Acquired 2002     96.9 %   555,474     314,194     869,668   JCPenney, Sears, Target, Macy's
110.   Phipps Plaza   GA   Atlanta   Fee     100.0%   Acquired 1998     96.3 %   472,385     345,490     817,875   Saks Fifth Avenue, Nordstrom, Belk, AMC Theatres
111.   Plaza Carolina   PR   Carolina (San Juan)   Fee     100.0%   Acquired 2004     87.7 %   504,796     588,878 (18)   1,093,674   JCPenney, Sears, Tiendas Capri, Pueblo Xtra, Best Buy(6)
112.   Port Charlotte Town Center   FL   Port Charlotte (Punta Gorda)   Fee     80.0% (12) Built 1989     82.0 %   458,251     322,059     780,310   Dillard's, Macy's, JCPenney, Bealls, Sears, DSW, Regal Cinema
113.   Prien Lake Mall   LA   Lake Charles   Fee and Ground Lease (2025)(7)     100.0%   Built 1972     98.4 %   644,124     177,244     821,368   Dillard's, JCPenney, Sears, Cinemark Theatres(8)
114.   Quaker Bridge   NJ   Lawrenceville (Trenton)   Fee     38.0% (4)(15) Acquired 2003     95.0 %   686,760     412,070     1,098,830   Macy's, Lord & Taylor, JCPenney, Sears
115.   Richmond Town Square   OH   Richmond Heights (Cleveland)   Fee     100.0%   Built 1966     97.5 %   685,251     331,498     1,016,749   Macy's, JCPenney, Sears, Barnes & Noble, Regal Cinemas
116.   River Oaks Center   IL   Calumet City (Chicago)   Fee     100.0%   Acquired 1997     88.0 %   807,871     557,412 (18)   1,365,283   Macy's, Carson Pirie Scott, JCPenney, Sears
117.   Rockaway Townsquare   NJ   Rockaway (New York)   Fee     100.0%   Acquired 1998     97.0 %   786,626     456,927     1,243,553   Macy's, Lord & Taylor, JCPenney, Sears
118.   Rolling Oaks Mall   TX   San Antonio   Fee     100.0%   Built 1988     88.8 %   596,308     292,169     888,477   Dillard's, Macy's, JCPenney, Sears
119.   Roosevelt Field   NY   Garden City (New York)   Fee and Ground Lease (2090)(7)     100.0%   Acquired 1998     96.4 %   1,430,425     778,892 (18)   2,209,317   Bloomingdale's, Bloomingdale's Furniture Gallery, Nordstrom, Macy's, JCPenney, Dick's Sporting Goods, Loews Theatre, Sport Fitness, Paul Mitchell The School
120.   Ross Park Mall   PA   Pittsburgh   Fee     100.0%   Built 1986     92.8 %   701,477     510,243     1,211,720   JCPenney, Sears, Nordstrom, Old Navy, H&M, L.L. Bean, XXI Forever, Macy's
121.   Rushmore Mall(1)   SD   Rapid City   Fee     50.0% (4) Acquired 1998     89.5 %   470,660     364,935     835,595   JCPenney, Herberger's, Sears, Carmike Cinemas(8)
122.   Santa Rosa Plaza   CA   Santa Rosa   Fee     100.0%   Acquired 1998     95.1 %   428,258     270,535     698,793   Macy's, Sears(8)
123.   Seminole Towne Center   FL   Sanford (Orlando)   Fee     45.0% (4)(2) Built 1995     87.2 %   768,798     369,499     1,138,297   Macy's, Dillard's, Belk, JCPenney, Sears, United Artists Theatre
124.   Shops at Mission Viejo, The   CA   Mission Viejo (Los Angeles)   Fee     100.0%   Built 1979     97.5 %   677,215     473,376     1,150,591   Saks Fifth Avenue, Nordstrom, Macy's (2 locations)
125.   Shops at Sunset Place, The   FL   S. Miami   Fee     37.5% (4)(2) Built 1999     90.9 %       514,559     514,559   NikeTown, Barnes & Noble, GameWorks, Z Gallerie, L.A. Fitness, AMC Theatres, Splitsville
126.   Smith Haven Mall   NY   Lake Grove (New York)   Fee     25.0% (4) Acquired 1995     92.6 %   794,310     513,192     1,307,502   Macy's, Macy's Furniture Gallery, JCPenney, Sears, Dick's Sporting Goods, Barnes & Noble, H&M
127.   Solomon Pond Mall   MA   Marlborough (Boston)   Fee     49.1% (4) Acquired 1999     91.9 %   538,812     370,420     909,232   Macy's, JCPenney, Sears, Regal Cinema
128.   South Hills Village   PA   Pittsburgh   Fee     100.0%   Acquired 1997     96.3 %   655,987     481,287     1,137,274   Macy's, Sears, Barnes & Noble, Carmike Cinemas(8)
129.   South Shore Plaza   MA   Braintree (Boston)   Fee     100.0%   Acquired 1998     96.5 %   547,287     618,678     1,165,965   Macy's, Lord & Taylor, Sears, Filene's Basement, Nordstrom(19)

19


Table of Contents

Simon Property Group, L.P. and Subsidiaries

Property Table

U.S. Properties

 
   
   
   
   
   
   
   
  Gross Leasable Area    
 
   
   
   
  Ownership
Interest
(Expiration if
Lease)(3)
   
   
   
   
 
 
Property Name
  State   City (CBSA)   Legal
Ownership
  Year Built
or
Acquired
  Occupancy(5)   Anchor   Mall &
Freestanding
  Total   Retail Anchors and Selected Major Tenants
130.   Southern Hills Mall(1)   IA   Sioux City   Fee     50.0% (4) Acquired 1998     83.9 %   387,553     409,172     796,725   Younkers, JCPenney, Sears, Scheel's Sporting Goods, Barnes & Noble, Carmike Cinemas
131.   Southern Park Mall   OH   Boardman (Youngstown)   Fee     100.0%   Built 1970     90.4 %   811,858     382,235     1,194,093   Macy's, Dillard's, JCPenney, Sears, Cinemark Theatres
132.   SouthPark   NC   Charlotte   Fee & Ground Lease (2040)(11)     100.0%   Acquired 2002     99.2 %   1,044,742     580,866     1,625,608   Neiman Marcus, Nordstrom, Macy's, Dillard's, Belk, Dick's Sporting Goods, Crate & Barrel, Joseph Beth Booksellers
133.   SouthPark Mall   IL   Moline (Davenport—IA-Moline)   Fee     50.0% (4) Acquired 1998     81.6 %   578,056     440,798     1,018,854   Dillard's, Von Maur, Younkers, JCPenney, Sears, Old Navy
134.   SouthRidge Mall(1)   IA   Des Moines   Fee     50.0% (4) Acquired 1998     70.6 %   388,752     500,676     889,428   JCPenney, Younkers, Sears, Target(8)
135.   Springfield Mall(1)   PA   Springfield (Philadelphia)   Fee     38.0% (4)(15) Acquired 2005     88.5 %   367,176     220,803     587,979   Macy's, Target(6)
136.   Square One Mall   MA   Saugus (Boston)   Fee     49.1% (4) Acquired 1999     93.5 %   608,601     321,524     930,125   Macy's, Sears, Best Buy, T.J. Maxx N More, Best Buy, Old Navy, Dick's Sporting Goods, Filene's Basement
137.   St. Charles Towne Center   MD   Waldorf (Washington, D.C.)   Fee     100.0%   Built 1990     95.8 %   631,602     348,307     979,909   Macy's, Macy's Home Store, JCPenney, Sears, Kohl's, Dick Sporting Goods, AMC Theatres
138.   St. John's Town Center   FL   Jacksonville   Fee     50.0% (4) Built 2005     97.0 %   653,291     568,751     1,222,042   Dillard's, Target, Ashley Furniture Home Store, Barnes & Noble, Dick's Clothing & Sporting Goods, Ross Dress for Less, Staples, DSW, JoAnn Fabrics, PetsMart, Old Navy
139.   Stanford Shopping Center   CA   Palo Alto (San Francisco)   Ground Lease (2054)     100.0%   Acquired 2003     94.5 %   849,153     528,198 (18)   1,377,351   Neiman Marcus, Bloomingdale's, Nordstrom, Macy's, Macy's Mens Store
140.   Summit Mall   OH   Akron   Fee     100.0%   Built 1965     93.7 %   432,936     337,198     770,134   Dillard's Women's & Children's, Dillard's Men's & Home, Macy's
141.   Sunland Park Mall   TX   El Paso   Fee     100.0%   Built 1988     93.6 %   575,837     341,829     917,666   Macy's, Dillard's Women's & Children's, Dillard's Men's & Home, Sears(8)
142.   Tacoma Mall   WA   Tacoma (Seattle)   Fee     100.0%   Acquired 1987     89.3 %   804,262     443,450     1,247,712   Nordstrom, Macy's, JCPenney, Sears, David's Bridal
143.   Tippecanoe Mall   IN   Lafayette   Fee     100.0%   Built 1973     91.8 %   537,790     323,632     861,422   Macy's, JCPenney, Sears, Kohl's, Dick's Sporting Goods, H.H. Gregg
144.   Town Center at Aurora   CO   Aurora (Denver)   Fee     100.0%   Acquired 1998     83.2 %   682,169     402,375     1,084,544   Macy's, Dillard's, JCPenney, Sears, Century Theatres
145.   Town Center at Boca Raton   FL   Boca Raton (Miami-Fort Lauderdale)   Fee     100.0%   Acquired 1998     98.1 %   1,164,658     589,410     1,754,068   Saks Fifth Avenue, Neiman Marcus, Bloomingdale's, Nordstrom, Macy's, Sears, Crate & Barrel
146.   Town Center at Cobb   GA   Kennesaw (Atlanta)   Fee     75.0%   Acquired 1998     93.2 %   851,346     422,808     1,274,154   Belk, Macy's, JCPenney, Sears, Macy's Furniture
147.   Towne East Square   KS   Wichita   Fee     100.0%   Built 1975     89.6 %   779,490     357,310     1,136,800   Dillard's, Von Maur, JCPenney, Sears
148.   Towne West Square   KS   Wichita   Fee     100.0%   Built 1980     80.4 %   619,269     333,237     952,506   Dillard's Women's & Home, Dillard's Men's & Children, JCPenney, Sears, Dick's Sporting Goods, The Movie Machine
149.   Treasure Coast Square   FL   Jensen Beach   Fee     100.0%   Built 1987     89.9 %   508,176     372,968     881,144   Macy's, Dillard's, JCPenney, Sears, Borders Books & Music, Regal Cinema
150.   Tyrone Square   FL   St. Petersburg (Tampa-St. Pete)   Fee     100.0%   Built 1972     97.4 %   725,298     370,270     1,095,568   Macy's, Dillard's, JCPenney, Sears, Borders Books & Music, Old Navy
151.   University Park Mall   IN   Mishawaka (South Bend)   Fee     100.0%   Built 1979     91.4 %   499,876     361,446     861,322   Macy's, JCPenney, Sears, Barnes & Noble(6)

20


Table of Contents

Simon Property Group, L.P. and Subsidiaries

Property Table

U.S. Properties

 
   
   
   
   
   
   
   
  Gross Leasable Area    
 
   
   
   
  Ownership
Interest
(Expiration if
Lease)(3)
   
   
   
   
 
 
Property Name
  State   City (CBSA)   Legal
Ownership
  Year Built
or
Acquired
  Occupancy(5)   Anchor   Mall &
Freestanding
  Total   Retail Anchors and Selected Major Tenants
152.   Upper Valley Mall   OH   Springfield (Dayton—Springfield)   Fee     100.0%   Built 1971     90.9 %   479,418     264,686     744,104   Macy's, JCPenney, Sears, Elder-Beerman, MC Sporting Goods, Chakeres Theatres
153.   Valle Vista Mall   TX   Harlingen   Fee     100.0%   Built 1983     79.2 %   389,781     262,863     652,644   Dillard's, JCPenney, Sears(8)
154.   Valley Mall   VA   Harrisonburg   Fee     50.0% (4) Acquired 1998     91.7 %   315,078     191,738     506,816   JCPenney, Belk, Target, Old Navy(8)
155.   Virginia Center Commons   VA   Glen Allen (Richmond)   Fee     100.0%   Built 1991     84.8 %   506,639     280,964     787,603   Macy's, Dillard's Men's, Dillard's Women's, Children's & Home, JCPenney, Sears
156.   Walt Whitman Mall   NY   Huntington Station (New York)   Ground Lease (2012)     100.0%   Acquired 1998     95.1 %   742,214     284,871     1,027,085   Saks Fifth Avenue, Bloomingdale's, Lord & Taylor, Macy's
157.   Washington Square   IN   Indianapolis   Fee     100.0%   Built 1974     86.0 %   616,109     347,167     963,276   Sears, Target, Dick's Sporting Goods, Burlington Coat Factory, Kerasotes Theatres(8)
158.   West Ridge Mall   KS   Topeka   Fee     100.0%   Built 1988     90.3 %   716,811     280,991     997,802   Macy's, Dillard's, JCPenney, Sears, Burlington Coat Factory
159.   West Town Mall   TN   Knoxville   Ground Lease (2042)     50.0% (4) Acquired 1991     95.0 %   868,295     468,455     1,336,750   Belk Women, Dillard's, JCPenney, Belk Men, Home and Kids, Sears, Regal Cinema
160.   Westchester, The   NY   White Plains (New York)   Fee     40.0% (4) Acquired 1997     96.2 %   349,393     477,979 (18)   827,372   Neiman Marcus, Nordstrom
161.   Westminster Mall   CA   Westminster (Los Angeles)   Fee     100.0%   Acquired 1998     88.2 %   716,939     495,092     1,212,031   Macy's, JCPenney, Sears, Target
162.   White Oaks Mall   IL   Springfield   Fee     80.7%   Built 1977     77.3 %   556,831     375,516     932,347   Macy's, Bergner's, Sears, Dick's Sporting Goods(8)
163.   Wolfchase Galleria   TN   Memphis   Fee     94.5%   Acquired 2002     98.5 %   761,648     505,572     1,267,220   Macy's, Dillard's, JCPenney, Sears, Malco Theatres
164.   Woodland Hills Mall   OK   Tulsa   Fee     94.5%   Acquired 2002     97.0 %   700,235     391,539     1,091,774   Macy's, Dillard's, JCPenney, Sears
                                                 
    Total Regional Mall GLA     96,727,572     65,455,103     162,182,675    
                                                 

 

 

Premium Outlet Centers

1.

 

Albertville Premium Outlets

 

MN

 

Albertville (Minneapolis)

 

Fee

 

 

100.0%

 

Acquired 2004

 

 

99.3

%

 

 

 

 

 

 

 

429,534

 

Banana Republic, Calvin Klein, Coach, Gap Outlet, Kenneth Cole, Lucky Brand Jeans, Nike, Polo Ralph Lauren, Tommy Hilfiger
2.   Allen Premium Outlets   TX   Allen (Dallas-Ft. Worth)   Fee     100.0%   Acquired 2004     100.0 %               441,492   Ann Taylor, Brooks Brothers, Calvin Klein, Coach, Cole Haan, J.Crew, Kenneth Cole, Michael Kors, Neiman Marcus Last Call, Nike, Polo Ralph Lauren, Tommy Hilfiger
3.   Aurora Farms Premium Outlets   OH   Aurora (Cleveland)   Fee     100.0%   Acquired 2004     97.1 %               300,218   Ann Taylor, Brooks Brothers, Calvin Klein, Coach, Gap Outlet, Liz Claiborne, Michael Kors, Nautica, Polo Ralph Lauren, Saks Fifth Avenue Off 5th,Tommy Hilfiger
4.   Camarillo Premium Outlets   CA   Camarillo   Fee     100.0%   Acquired 2004     99.3 %               454,119   Ann Taylor, Banana Republic, Barneys New York, Coach, Diesel, Giorgio Armani, Hugo Boss, Kenneth Cole, Nike, Polo Ralph Lauren, Saks Fifth Avenue Off 5th, Sony
5.   Carlsbad Premium Outlets   CA   Carlsbad (San Diego)   Fee     100.0%   Acquired 2004     100.0 %               287,931   Adidas, Banana Republic, Barneys New York, BCBG Max Azria, Calvin Klein, Coach, Gap Outlet, Guess, Kenneth Cole, Lacoste, Polo Ralph Lauren, Theory

21


Table of Contents

Simon Property Group, L.P. and Subsidiaries

Property Table

U.S. Properties

 
   
   
   
   
   
   
   
  Gross Leasable Area    
 
   
   
   
  Ownership
Interest
(Expiration if
Lease)(3)
   
   
   
   
 
 
Property Name
  State   City (CBSA)   Legal
Ownership
  Year Built
or
Acquired
  Occupancy(5)   Anchor   Mall &
Freestanding
  Total   Retail Anchors and Selected Major Tenants
6.   Carolina Premium Outlets   NC   Smithfield (Raleigh)   Ground Lease (2029)     100.0%   Acquired 2004     100.0 %               439,445   Banana Republic, Brooks Brothers, Coach, Gap Outlet, Liz Claiborne, Nike, Polo Ralph Lauren, Timberland, Tommy Hilfiger
7.   Chicago Premium Outlets   IL   Aurora (Chicago)   Fee     100.0%   Built 2004     98.2 %               437,800   Ann Taylor, Banana Republic, Calvin Klein, Coach, Diesel, Dooney & Bourke, Elie Tahari, Gap Outlet, Giorgio Armani, Kate Spade, Michael Kors, Polo Ralph Lauren, Salvatore Ferragamo, Sony
8.   Clinton Crossing Premium Outlets   CT   Clinton (New Haven)   Fee     100.0%   Acquired 2004     100.0 %               276,163   Banana Republic, Barneys New York, Calvin Klein, Coach, Dooney & Bourke, Gap Outlet, Kenneth Cole, Liz Claiborne, Nike, Polo Ralph Lauren, Saks Fifth Avenue Off 5th
9.   Columbia Gorge Premium Outlets   OR   Troutdale (Portland)   Fee     100.0%   Acquired 2004     98.0 %               163,815   Adidas, Bass, Carter's, Gap Outlet, Liz Claiborne, Samsonite, Van Heusen
10.   Desert Hills Premium Outlets   CA   Cabazon (Palm Springs)   Fee     100.0%   Acquired 2004     99.9 %               498,848   Burberry, Coach, Dior, Giorgio Armani, Gucci, Nike, Polo Ralph Lauren, Prada, Saks Fifth Avenue Off 5th, Salvatore Ferragamo, Yves Saint Laurent Rive Gauche, Zegna
11.   Edinburgh Premium Outlets   IN   Edinburgh (Indianapolis)   Fee     100.0%   Acquired 2004     100.0 %               377,772   Adidas, Ann Taylor, Anne Klein, Banana Republic, Calvin Klein, Coach, Gap Outlet, J.Crew, Nautica, Nike, Polo Ralph Lauren, Tommy Hilfiger
12.   Folsom Premium Outlets   CA   Folsom (Sacramento)   Fee     100.0%   Acquired 2004     99.8 %               298,848   BCBG Max Azria, Bebe, Brooks Brothers, Calvin Klein, Coach, Gap Outlet, Guess, Kenneth Cole, Nautica, Nike, Saks Fifth Avenue Off 5th
13.   Gilroy Premium Outlets   CA   Gilroy (San Jose)   Fee     100.0%   Acquired 2004     98.6 %               577,287   Ann Taylor, Banana Republic, Brooks Brothers, Calvin Klein, Coach, J.Crew, Hugo Boss, Michael Kors, Nike, Polo Ralph Lauren, Sony, Timberland, Tommy Hilfiger
14.   Houston Premium Outlets   TX   Houston   Fee     100.0%   Built 2008     100.0 %               425,484   Adidas, Banana Republic, Burberry, Coach, Cole Haan, Elie Tahari, Juicy Couture, Michael Kors, Nike, True Religion, Tommy Hilfiger
15.   Jackson Premium Outlets   NJ   Jackson   Fee     100.0%   Acquired 2004     100.0 %               285,779   Banana Republic, Brooks Brothers, Calvin Klein, Gap Outlet, J.Crew, Liz Claiborne, Nike, Polo Ralph Lauren, Tommy Hilfiger
16.   Jersey Shore Premium Outlets   NJ   Tinton Falls   Fee     100.0%   Built 2008     87.3 %               434,204   Burberry, Brooks Brothers, Elie Tahari, Guess, J. Crew, Kate Spade, Kenneth Cole, Michael Kors, Theory, Nike, Timberland, Tommy Hilfiger
17.   Johnson Creek Premium Outlets   WI   Johnson Creek (Milwaukee)   Fee     100.0%   Acquired 2004     92.0 %               277,585   Adidas, Banana Republic, Calvin Klein, Gap Outlet, Nike, Polo Ralph Lauren, Tommy Hilfiger

22


Table of Contents

Simon Property Group, L.P. and Subsidiaries

Property Table

U.S. Properties

 
   
   
   
   
   
   
   
  Gross Leasable Area    
 
   
   
   
  Ownership
Interest
(Expiration if
Lease)(3)
   
   
   
   
 
 
Property Name
  State   City (CBSA)   Legal
Ownership
  Year Built
or
Acquired
  Occupancy(5)   Anchor   Mall &
Freestanding
  Total   Retail Anchors and Selected Major Tenants
18.   Kittery Premium Outlets   ME   Kittery   Ground Lease (2009)     100.0%   Acquired 2004     95.4 %               264,425   Anne Klein, Banana Republic, Calvin Klein, Coach, Gap Outlet, J.Crew, Nike, Polo Ralph Lauren, Puma, Reebok, Timberland, Tommy Hilfiger
19.   Las Americas Premium Outlets   CA   San Diego   Fee     100.0%   Acquired 2007     98.2 %               525,262   Ann Taylor, Banana Republic, Calvin Klein, Coach, Gap Outlet, J.Crew, Kenneth Cole, Neiman Marcus Last Call, Nike, Polo Ralph Lauren, Sony
20.   Las Vegas Outlet Center   NV   Las Vegas   Fee     100.0%   Acquired 2004     100.0 %               474,828   Adidas, Calvin Klein, Coach, Gymboree, Liz Claiborne, Nautica, Nike, Reebok, Timberland, Tommy Hilfiger, VF Outlet, Zales
21.   Las Vegas Premium Outlets   NV   Las Vegas   Fee     100.0%   Built 2003     100.0 %               538,660   A/X Armani Exchange, Ann Taylor, Banana Republic, Coach, Diesel, Dolce & Gabbana, Elie Tahari, Kenneth Cole, Lacoste, Polo Ralph Lauren, Salvatore Ferragamo
22.   Leesburg Corner Premium Outlets   VA   Leesburg (Washington D.C.)   Fee     100.0%   Acquired 2004     100.0 %               463,288   Ann Taylor, Barneys New York, Burberry, Coach, Crate & Barrel, Diesel, DKNY, Kenneth Cole, Nike, Polo Ralph Lauren, Restoration Hardware, Saks Fifth Avenue Off 5th, Williams-Sonoma
23.   Liberty Village Premium Outlets   NJ   Flemington   Fee     100.0%   Acquired 2004     99.3 %               168,466   Ann Taylor, Brooks Brothers, Calvin Klein, Cole Haan, J.Crew, Liz Claiborne, Michael Kors, Polo Ralph Lauren, Tommy Hilfiger
24.   Lighthouse Place Premium Outlets   IN   Michigan City   Fee     100.0%   Acquired 2004     99.4 %               454,314   Ann Taylor, Banana Republic, Burberry, Coach, Coldwater Creek, Gap Outlet, J.Crew, Nike, Polo Ralph Lauren, Tommy Hilfiger
25.   Napa Premium Outlets   CA   Napa   Fee     100.0%   Acquired 2004     99.4 %               179,348   Ann Taylor, Banana Republic, Barneys New York, Calvin Klein, Coach, Cole Haan, J.Crew, Kenneth Cole, Nautica, Tommy Hilfiger
26.   North Georgia Premium Outlets   GA   Dawsonville (Atlanta)   Fee     100.0%   Acquired 2004     98.6 %               539,757   Ann Taylor, Banana Republic, Calvin Klein, Coach, Hugo Boss, J.Crew, Nike, Polo Ralph Lauren, Restoration Hardware, Saks Fifth Avenue Off 5th, Williams-Sonoma
27.   Orlando Premium Outlets   FL   Orlando   Fee     100.0%   Acquired 2004     100.0 %               549,379   Barneys New York, Burberry, Coach, Diesel, Dior, Fendi, Giorgio Armani, Hugo Boss, J. Crew, Lacoste, Nike, Polo Ralph Lauren, Salvatore Ferragamo, Theory
28.   Osage Beach Premium Outlets   MO   Osage Beach   Fee     100.0%   Acquired 2004     99.0 %               391,309   Adidas, Banana Republic, Brooks Brothers, Calvin Klein, Coach, Gap Outlet, Polo Ralph Lauren, Tommy Hilfiger
29.   Petaluma Village Premium Outlets   CA   Petaluma (Santa Rosa)   Fee     100.0%   Acquired 2004     100.0 %               195,982   BCBG Max Azria, Banana Republic, Brooks Brothers, Coach, Gap Outlet, Nike, Puma, Saks Fifth Avenue Off 5th, Tommy Hilfiger

23


Table of Contents

Simon Property Group, L.P. and Subsidiaries

Property Table

U.S. Properties

 
   
   
   
   
   
   
   
  Gross Leasable Area    
 
   
   
   
  Ownership
Interest
(Expiration if
Lease)(3)
   
   
   
   
 
 
Property Name
  State   City (CBSA)   Legal
Ownership
  Year Built
or
Acquired
  Occupancy(5)   Anchor   Mall &
Freestanding
  Total   Retail Anchors and Selected Major Tenants
30.   Philadelphia Premium Outlets   PA   Limerick (Philadelphia)   Fee     100.0%   Built 2007     98.8 %               549,070   Adidas, Ann Taylor, Banana Republic, Brooks Brothers, Calvin Klein, Coach, Cole Haan, DKNY, Elie Tahari, Gap Outlet, Guess, J.Crew, Michael Kors, Neiman Marcus Last Call, Nike, Polo Ralph Lauren, Restoration Hardware, Sony
31.   Rio Grande Valley Premium Outlets   TX   Mercedes (McAllen)   Fee     100.0%   Built 2006     97.9 %               578,890   Adidas, Ann Taylor, Banana Republic, BCBG Max Azria, Burberry, Calvin Klein, Coach, Gap Outlet, Guess, Nike, Polo Ralph Lauren, Saks Fifth Avenue Off 5th, Sony, Tommy Hilfiger
32.   Round Rock Premium Outlets   TX   Round Rock (Austin)   Fee     100.0%   Built 2006     100.0 %               431,621   Adidas, Ann Taylor, Banana Republic, Burberry, Calvin Klein, Coach, Gap Outlet, J.Crew, Michael Kors, Nike, Polo Ralph Lauren, Theory, Tommy Hilfiger
33.   Seattle Premium Outlets   WA   Tulalip (Seattle)   Ground Lease (2035)     100.0%   Built 2005     100.0 %               402,668   Adidas, Ann Taylor, Banana Republic, Burberry, Calvin Klein, Coach, Juicy Couture, Kenneth Cole, Nike, Polo Ralph Lauren, Restoration Hardware, Sony
34.   St. Augustine Premium Outlets   FL   St. Augustine (Jacksonville)   Fee     100.0%   Acquired 2004     99.6 %               328,632   Ann Taylor, Banana Republic, Brooks Brothers, Calvin Klein, Coach, Gap Outlet, J.Crew, Nike, Polo Ralph Lauren, Reebok, Tommy Bahama
35.   The Crossings Premium Outlets   PA   Tannersville   Fee and Ground Lease (2009)(7)     100.0%   Acquired 2004     100.0 %               411,731   Ann Taylor, Banana Republic, Burberry, Calvin Klein, Coach, Coldwater Creek, J.Crew, Liz Claiborne, Nike, Polo Ralph Lauren, Reebok, Tommy Hilfiger
36.   Vacaville Premium Outlets   CA   Vacaville   Fee     100.0%   Acquired 2004     100.0 %               442,042   Adidas, Ann Taylor, Banana Republic, Burberry, Calvin Klein, Coach, J.Crew, Nike, Polo Ralph Lauren, Restoration Hardware
37.   Waikele Premium Outlets   HI   Waipahu (Honolulu)   Fee     100.0%   Acquired 2004     99.7 %               209,846   A/X Armani Exchange, Banana Republic, Barneys New York, Calvin Klein, Coach, Guess, Kenneth Cole, Polo Ralph Lauren, Saks Fifth Avenue Off 5th
38.   Waterloo Premium Outlets   NY   Waterloo   Fee     100.0%   Acquired 2004     98.2 %               417,577   Adidas, Ann Taylor, Banana Republic, Brooks Brothers, Calvin Klein, Coach, Gap Outlet, J.Crew, Nike, Polo Ralph Lauren, Tommy Hilfiger, VF Outlet
39.   Woodbury Common Premium Outlets   NY   Central Valley (New York)   Fee     100.0%   Acquired 2004     100.0 %               844,246   Banana Republic, Burberry, Chanel, Chloe, Coach, Dior, Dolce & Gabbana, Giorgio Armani, Gucci, Lacoste, Neiman Marcus Last Call, Nike, Polo Ralph Lauren, Saks Fifth Avenue Off 5th
40.   Wrentham Village Premium Outlets   MA   Wrentham (Boston)   Fee     100.0%   Acquired 2004     100.0 %               615,713   Banana Republic, Barneys New York, Burberry, Coach, Hugo Boss, Kenneth Cole, Lacoste, Nike, Polo Ralph Lauren, Saks Fifth Avenue Off 5th, Salvatore Ferragmo, Sony, Williams-Sonoma
                                                     
    Total U.S. Premium Outlet Centers GLA                 16,383,378    
                                                     

24


Table of Contents

Simon Property Group, L.P. and Subsidiaries

Property Table

U.S. Properties

 
   
   
   
   
   
   
   
  Gross Leasable Area    
 
   
   
   
  Ownership
Interest
(Expiration if
Lease)(3)
   
   
   
   
 
 
Property Name
  State   City (CBSA)   Legal
Ownership
  Year Built
or
Acquired
  Occupancy(5)   Anchor   Mall &
Freestanding
  Total   Retail Anchors and Selected Major Tenants
    Community/Lifestyle Centers

1.

 

Arboretum

 

TX

 

Austin

 

Fee

 

 

100.0%

 

Acquired 1998

 

 

86.0

%

 

 

 

 

 

 

 

206,827

 

Barnes & Noble, Pottery Barn
2.   Bloomingdale Court   IL   Bloomingdale (Chicago)   Fee     100.0%   Built 1987     81.5 %               630,359   Best Buy, T.J. Maxx N More, Office Max, Old Navy, Wal-Mart, Dick's Sporting Goods, Jo-Ann Fabrics
3.   Brightwood Plaza   IN   Indianapolis   Fee     100.0%   Built 1965     100.0 %               38,493    
4.   Charles Towne Square   SC   Charleston   Fee     100.0%   Built 1976     100.0 %               71,794   Regal Cinema
5.   Chesapeake Center   VA   Chesapeake (Virginia Beach-Norfolk)   Fee     100.0%   Built 1989     93.4 %               305,935   K-Mart, Movies 10, Petsmart, Michaels, Value City Furniture
6.   Clay Terrace   IN   Carmel (Indianapolis)   Fee     50.0% (4)(18) Built 2004     93.8 %               503,693   Dick's Sporting Goods, Whole Foods, DSW(8)
7.   Cobblestone Court   NY   Victor (Rochester)   Fee and Ground Lease (2038)(7)     35.0% (4)(13) Built 1993     99.4 %               265,445   Dick's Sporting Goods, Kmart, Office Max
8.   Countryside Plaza   IL   Countryside (Chicago)   Fee     100.0%   Built 1977     85.0 %               403,756   Best Buy, Home Depot, PetsMart, Jo-Ann Fabrics, Office Depot, Value City Furniture
9.   Crystal Court   IL   Crystal Lake (Chicago)   Fee     35.0% (4)(13) Built 1989     52.8 %               278,970   (8)
10.   Dare Centre   NC   Kill Devil Hills   Ground Lease (2058)     100.0%   Acquired 2004     98.7 %               168,838   Belk, Food Lion
11.   DeKalb Plaza   PA   King of Prussia (Philadelphia)   Fee     50.3% (15) Acquired 2003     100.0 %               101,742   ACME Grocery
12.   Eastland Convenience Center   IN   Evansville   Ground Lease (2075)     50.0% (4) Acquired 1998     96.1 %               175,639   Toys 'R Us, Kids 'R Us, Bed Bath & Beyond(8)
13.   Eastland Plaza   OK   Tulsa   Fee     100.0%   Built 1986     41.7 %               190,261   Marshalls, Toys 'R Us(8)(17)
14.   Empire East(1)   SD   Sioux Falls   Fee     50.0% (4) Acquired 1998     98.1 %               297,278   Kohl's, Target, Bed Bath & Beyond
15.   Fairfax Court   VA   Fairfax (Washington, D.C.)   Fee     41.3% (4)(13) Built 1992     100.0 %               249,658   Burlington Coat Factory, Offenbacher's(8)
16.   Forest Plaza   IL   Rockford   Fee     100.0%   Built 1985     93.2 %               428,039   Kohl's, Marshalls, Michaels, Factory Card Outlet, Office Max, Bed Bath & Beyond, Petco, Babies 'R Us, Toys 'R Us(8)
17.   Gaitway Plaza   FL   Ocala   Fee     23.3% (4)(13) Built 1989     95.1 %               208,873   Books-A-Million, Office Depot, T.J. Maxx, Ross Dress for Less, Bed Bath & Beyond
18.   Gateway Center   TX   Austin   Fee     100.0%   2004     81.2 %               512,625   Star Furniture, Best Buy, Recreational Equipment, Inc., Whole Foods, Crate & Barrel, The Container Store, Old Navy, Regal Cinema(17)
19.   Great Lakes Plaza   OH   Mentor (Cleveland)   Fee     100.0%   Built 1976     100.0 %               164,104   Michael's, Best Buy, Cost Plus World Market(8)
20.   Greenwood Plus   IN   Greenwood (Indianapolis)   Fee     100.0%   Built 1979     100.0 %               155,319   Best Buy, Kohl's
21.   Hamilton Town Center   IN   Noblesville (Indianapolis)   Fee     50.0% (4) Built 2008     80.4 %               649,576   JCPenney, Borders, Dick's Sporting Goods, Old Navy, Stein Mart, Bed Bath & Beyond, DSW, Ulta, Hamilton 16 IMAX
22.   Henderson Square   PA   King of Prussia (Philadelphia)   Fee     76.0% (15) Acquired 2003     96.0 %               107,383   Genuardi's Family Market(8)
23.   Highland Lakes Center   FL   Orlando   Fee     100.0%   Built 1991     75.6 %               493,378   Marshalls, Bed Bath & Beyond, American Signature Furniture, Ross Dress for Less, Burlington Coat Factory(8)
24.   Indian River Commons   FL   Vero Beach   Fee     50.0%   Built 1997     100.0 %               255,882   Lowe's, Best Buy, Ross Dress for Less, Bed Bath & Beyond, Michael's

25


Table of Contents

Simon Property Group, L.P. and Subsidiaries

Property Table

U.S. Properties

 
   
   
   
   
   
   
   
  Gross Leasable Area    
 
   
   
   
  Ownership
Interest
(Expiration if
Lease)(3)
   
   
   
   
 
 
Property Name
  State   City (CBSA)   Legal
Ownership
  Year Built
or
Acquired
  Occupancy(5)   Anchor   Mall &
Freestanding
  Total   Retail Anchors and Selected Major Tenants
25.   Ingram Plaza   TX   San Antonio   Fee     100.0%   Built 1980     100.0 %               111,518   Sheplers, Macy's Home Store
26.   Keystone Shoppes   IN   Indianapolis   Ground Lease (2067)     100.0%   Acquired 1997     89.8 %               29,140    
27.   Knoxville Commons   TN   Knoxville   Fee     100.0%   Built 1987     100.0 %               180,463   Office Max, Home Emporium(17)
28.   Lake Plaza   IL   Waukegan (Chicago)   Fee     100.0%   Built 1986     90.3 %               215,462   Home Owners Bargain Outlet(8)
29.   Lake View Plaza   IL   Orland Park (Chicago)   Fee     100.0%   Built 1986     95.0 %               368,007   Factory Card Outlet, Best Buy, Petco, Jo-Ann Fabrics, Golf Galaxy, Value City Furniture, Loehmann's
30.   Lakeline Plaza   TX   Cedar Park (Austin)   Fee     100.0%   Built 1998     98.2 %               387,445   T.J. Maxx, Old Navy, Best Buy, Ross Dress for Less, Office Max, PetsMart, Party City, Cost Plus World Market, Toys 'R Us(8)
31.   Lima Center   OH   Lima   Fee     100.0%   Built 1978     85.6 %               236,878   Kohl's, Hobby Lobby, T.J. Maxx
32.   Lincoln Crossing   IL   O'Fallon (St. Louis)   Fee     100.0%   Built 1990     95.5 %               243,266   Wal-Mart, PetsMart, The Home Depot
33.   Lincoln Plaza   PA   King of Prussia (Philadelphia)   Fee     65.0% (15) Acquired 2003     100.0 %               267,231   Burlington Coat Factory, AC Moore, Michaels, T.J. Maxx, Home Goods(8)
34.   MacGregor Village   NC   Cary (Raleigh)   Fee     100.0%   Acquired 2004     82.2 %               144,859    
35.   Mall of Georgia Crossing   GA   Buford (Atlanta)   Fee     100.0%   Built 1999     98.7 %               440,612   Best Buy, American Signature Furniture, T.J. Maxx 'n More, Nordstrom Rack, Staples, Target
36.   Markland Plaza   IN   Kokomo   Fee     100.0%   Built 1974     100.0 %               90,527   Best Buy, Bed Bath & Beyond
37.   Martinsville Plaza   VA   Martinsville   Space Lease (2046)     100.0%   Built 1967     97.1 %               102,105   Rose's
38.   Matteson Plaza   IL   Matteson (Chicago)   Fee     100.0%   Built 1988     47.4 %               270,955   Dominick's(8)
39.   Muncie Towne Plaza   IN   Muncie   Fee     100.0%   Built 1998     98.6 %               298,821   Kohl's, Target, Shoe Carnival, T.J. Maxx, MC Sporting Goods, Kerasotes Theatres
40.   New Castle Plaza   IN   New Castle   Fee     100.0%   Built 1966     71.6 %               91,648    
41.   North Ridge Plaza   IL   Joliet (Chicago)   Fee     100.0%   Built 1985     85.5 %               305,070   Hobby Lobby, Office Max, Minnesota Fabrics, Burlington Coat Factory, Ultra Foods Grocery
42.   North Ridge Shopping Center   NC   Raleigh   Fee     100.0%   Acquired 2004     98.2 %               166,619   Ace Hardware, Kerr Drugs, Harris-Teeter Grocery
43.   Northwood Plaza   IN   Fort Wayne   Fee     100.0%   Built 1974     78.8 %               208,245   Target, Cinema Grill
44.   Palms Crossing   TX   McAllen   Fee     100.0%   Built 2007     99.5 %               337,249   Bealls, DSW, Barnes & Noble, Babies 'R Us, Sports Authority, Guitar Center, Cavendar's Boot City, Best Buy
45.   Park Plaza   KY   Hopkinsville   Fee     100.0%   Built 1968     91.8 %               114,924   Big Lots!
46.   Pier Park   FL   Panama City Beach   Fee     100.0%   Built 2008     89.8 %               815,706   Dillard's, JCPenney, Target, Old Navy, Borders, Grand Theatres
47.   Plaza at Buckland Hills, The   CT   Manchester (Hartford)   Fee     35.0% (4)(13) Built 1993     77.4 %               334,546   Jo-Ann Fabrics, Party City, Toys 'R Us, Michaels, PetsMart(17)
48.   Regency Plaza   MO   St. Charles (St. Louis)   Fee     100.0%   Built 1988     95.5 %               287,473   Wal-Mart, Sam's Wholesale Club
49.   Richardson Square   TX   Richardson   Fee     100.0%   Built 2008     100.0 %               512,845   Lowe's, Ross Dress for Less, Sears, Super Target
50.   Ridgewood Court   MS   Jackson   Fee     35.0% (4)(13) Built 1993     97.8 %               369,501   T.J. Maxx, Lifeway Christian Bookstore, Bed Bath & Beyond, Best Buy, Michaels, Marshalls
51.   Rockaway Commons   NJ   Rockaway (New York)   Fee     100.0%   Acquired 1998     90.9 %               149,570   Best Buy, Acme, Office Depot
52.   Rockaway Town Plaza   NJ   Rockaway (New York)   Fee     100.0%   Acquired 1998     100.0 %               458,828   Target, Pier 1 Imports, PetsMart, Dick's Sporting Goods, AMC Theatres

26


Table of Contents

Simon Property Group, L.P. and Subsidiaries

Property Table

U.S. Properties

 
   
   
   
   
   
   
   
  Gross Leasable Area    
 
   
   
   
  Ownership
Interest
(Expiration if
Lease)(3)
   
   
   
   
 
 
Property Name
  State   City (CBSA)   Legal
Ownership
  Year Built
or
Acquired
  Occupancy(5)   Anchor   Mall &
Freestanding
  Total   Retail Anchors and Selected Major Tenants
53.   Royal Eagle Plaza   FL   Coral Springs (Miami-Ft. Lauderdale)   Fee     35.0% (4)(13) Built 1989     100.0 %               199,059   K Mart, Stein Mart
54.   Shops at Arbor Walk, The   TX   Austin   Ground Lease (2055)     100.0%   Built 2006     97.7 %               442,585   Home Depot, Marshall's, DSW, Golf Galaxy, Jo-Ann Fabrics
55.   Shops at North East Mall, The   TX   Hurst (Dallas-Ft. Worth)   Fee     100.0%   Built 1999     98.2 %               364,833   Michael's, PetsMart, Old Navy, Pier 1 Imports, T.J. Maxx, Bed Bath & Beyond, Best Buy, Barnes & Noble
56.   St. Charles Towne Plaza   MD   Waldorf (Washington, D.C.)   Fee     100.0%   Built 1987     72.3 %               394,873   K & G Menswear, CVS, Shoppers Food Warehouse, Dollar Tree, Value City Furniture, Gallo(8)
57.   Teal Plaza   IN   Lafayette   Fee     100.0%   Built 1962     43.4 %               101,087   Pep Boys(8)
58.   Terrace at the Florida Mall   FL   Orlando   Fee     100.0%   Built 1989     87.6 %               346,693   Marshalls, American Signature Furniture, Global Import, Target, Bed Bath & Beyond(8)
59.   Tippecanoe Plaza   IN   Lafayette   Fee     100.0%   Built 1974     100.0 %               90,522   Best Buy, Barnes & Noble
60.   University Center   IN   Mishawaka (South Bend)   Fee     100.0%   Built 1980     57.5 %               150,524   Michael's, Best Buy
61   Village Park Plaza   IN   Camel (Indianapolis)   Fee     35.0% (4)(13) Built 1990     97.4 %               549,576   Bed Bath & Beyond, Ashley Furniture HomeStore, Kohl's, Wal-Mart, Marsh, Menards, Regal Cinema
62.   Washington Plaza   IN   Indianapolis   Fee     100.0%   Built 1976     100.0 %               50,107    
63.   Waterford Lakes Town Center   FL   Orlando   Fee     100.0%   Built 1999     100.0 %               949,779   Ross Dress for Less, T.J. Maxx, Bed Bath & Beyond, Old Navy, Barnes & Noble, Best Buy, Jo-Ann Fabrics, Office Max, PetsMart, Target, Ashley Furniture HomeStore, L.A. Fitness, Regal Cinema
64.   West Ridge Plaza   KS   Topeka   Fee     100.0%   Built 1988     89.5 %               254,519   T.J. Maxx, Toys 'R Us, Target
65.   West Town Corners   FL   Altamonte Springs (Orlando)   Fee     23.3% (4)(13) Built 1989     95.9 %               385,643   Sports Authority, PetsMart, Winn-Dixie Marketplace, American Signature Furniture, Wal-Mart
66.   Westland Park Plaza   FL   Orange Park (Jacksonville)   Fee     23.3% (4)(13) Built 1989     96.1 %               163,154   Sports Authority, PetsMart, Burlington Coat Factory
67.   White Oaks Plaza   IL   Springfield   Fee     100.0%   Built 1986     93.9 %               391,474   T.J. Maxx, Office Max, Kohl's Babies 'R Us, Kids 'R Us, Country Market
68.   Whitehall Mall   PA   Whitehall   Fee     38.0% (15)(4) Acquired 2003     89.3 %               588,143   Sears, Kohl's, Bed Bath & Beyond, Borders Books & Music, Gold's Gym
69.   Willow Knolls Court   IL   Peoria   Fee     35.0% (4)(13) Built 1990     96.9 %               382,377   Burlington Coat Factory, Kohl's, Sam's Wholesale Club, Willow Knolls 14
70.   Wolf Ranch   TX   Georgetown (Austin)   Fee     100.0%   Built 2005     77.1 %               614,012   Kohl's, Target, Michaels, Best Buy, Office Depot, Old Navy, Pier 1 Imports, PetsMart, T.J. Maxx, DSW
                                                     
    Total Community/Lifestyle Center GLA                 20,822,340    
                                                     

 

 

Other Properties

1.

 

Crossville Outlet Center

 

TN

 

Crossville

 

Fee

 

 

100.0%

 

Acquired 2004

 

 

100.0

%

 

 

 

 

 

 

 

151,256

 

Bass, Dressbarn, Kasper, L'eggs Hanes Bali Playtex, Liz Claiborne, Rack Room Shoes, Van Heusen, VF Outlet
2.   Factory Merchants Branson   MO   Branson   Ground Lease (2021)     100.0%   Acquired 2004     78.2 %               269,307   Carter's, Crocs, Izod, Jones New York, Pendleton, Reebok, Tuesday Morning
3.   Factory Stores of America-Boaz   AL   Boaz   Ground Lease (2012)     100.0%   Acquired 2004     81.6 %               111,909   Bon Worth, Easy Spirit, Rue21, VF Outlet
4.   Factory Stores of America—Georgetown   KY   Georgetown   Fee     100.0%   Acquired 2004     97.7 %               176,615   Bass, Dressbarn, Rack Room Shoes, Van Heusen

27


Table of Contents

Simon Property Group, L.P. and Subsidiaries

Property Table

U.S. Properties

 
   
   
   
   
   
   
   
  Gross Leasable Area    
 
   
   
   
  Ownership
Interest
(Expiration if
Lease)(3)
   
   
   
   
 
 
Property Name
  State   City (CBSA)   Legal
Ownership
  Year Built
or
Acquired
  Occupancy(5)   Anchor   Mall &
Freestanding
  Total   Retail Anchors and Selected Major Tenants
5.   Factory Stores of America—Graceville   FL   Graceville   Fee     100.0%   Acquired 2004     100.0 %               83,962   Factory Brand Shoes, Van Heusen, VF Outlet
6.   Factory Stores of America—Lebanon   MO   Lebanon   Fee     100.0%   Acquired 2004     100.0 %               86,249   Dressbarn, Factory Brand Shoes, Van Heusen, VF Outlet
7.   Factory Stores of America-Nebraska City   NE   Nebraska City   Fee     100.0%   Acquired 2004     97.8 %               89,646   Bass, Easy Spirit, Van Heusen, VF Outlet
8.   Factory Stores of America—Story City   IA   Story City   Fee     100.0%   Acquired 2004     85.3 %               112,405   Dressbarn, Factory Brand Shoes, Van Heusen, VF Outlet
9.   Factory Stores of North Bend   WA   North Bend   Fee     100.0%   Acquired 2004     100.0 %               223,402   Adidas, Bass, Carter's, Coach, Gap Outlet, Izod, Nike, Nine West, Samsonite, Van Heusen, VF Outlet
10.   The Factory Shoppes at Branson Meadows   MO   Branson   Ground Lease (2021)     100.0%   Acquired 2004     88.0 %               915,279   Branson Meadows Cinemas, Dressbarn, VF Outlet
11.   Nanuet Mall   NY   Nanuet (New York)   Fee     100.0%   Acquired 1998     66.7 %               1,083,373   Macy's, Sears(8)
12.   Palm Beach Mall   FL   West Palm Beach (Miami-Fort Lauderdale)   Fee     100.0%   Built 1967     82.3 %               917,195   Dillard's, Macy's, JCPenney, Sears, Borders Books & Music
13.   Raleigh Springs Mall   TN   Memphis   Fee and Ground Lease (2018)(7)     100.0%   Built 1971     59.1 %               286,924   Sears, Malco Theatres(8)(17)
14.   University Mall   FL   Pensacola   Fee     100.0%   Acquired 1994     73.5 %               709,220   JCPenney, Sears, Belk
                                                     
    Total Other GLA                 5,216,742    
                                                     

 

 

Mills Properties
    The Mills®

1.

 

Arizona Mills

 

AZ

 

Tempe (Phoenix)

 

Fee

 

 

25.0%

 

Acquired 2007

 

 

93.8

%

 

 

 

 

 

 

 

1,250,934

 

Marshalls, Last Call Nieman Marcus, Off 5th Saks Fifth Avenue, Burlington Coat Factory, Sears Appliance Outlet, Gameworks, Sports Authority, Ross Dress for Less, JCPenney Outlet, Group USA, Hi-Health, Harkins Cinemas, IMAX Theatre
2.   Arundel Mills   MD   Hanover (Baltimore)   Fee     29.6%   Acquired 2007     99.9 %               1,291,849   Bass Pro Shops, Bed Bath & Beyond, Best Buy, Books-A-Million, Burlington Coat Factory, The Children's Place, Dave & Buster's, F.Y.E., H&M, Medieval Times, Modell's, Neiman Marcus Last Call, OFF 5TH Saks Fifth Avenue Outlet, Off Broadway Shoe Warehouse, Old Navy, T.J. Maxx, Muvico Theatres
3.   Colorado Mills   CO   Lakewood (Denver)   Fee     18.8% (2) Acquired 2007     83.1 %               1,106,368   Borders Books Music Café, Eddie Bauer Outlet, Last Call Clearance Center from Neiman Marcus, Off Broadway Shoe Warehouse, Off 5th Saks Fifth Avenue Outlet, Sports Authority, Super Target, United Artists Theatre

28


Table of Contents

Simon Property Group, L.P. and Subsidiaries

Property Table

U.S. Properties

 
   
   
   
   
   
   
   
  Gross Leasable Area    
 
   
   
   
  Ownership
Interest
(Expiration if
Lease)(3)
   
   
   
   
 
 
Property Name
  State   City (CBSA)   Legal
Ownership
  Year Built
or
Acquired
  Occupancy(5)   Anchor   Mall &
Freestanding
  Total   Retail Anchors and Selected Major Tenants
4.   Concord Mills   NC   Concord (Charlotte)   Fee     29.6% (2) Acquired 2007     97.0 %               1,347,377   Bass Pro Shops Outdoor World, Books-A-Million, Burlington Coat Factory, Off 5th Saks Fifth Avenue, FYE, The Children's Place Outlet, Dave & Buster's, NIKE, T.J. Maxx, Group USA, Sun & Ski, AC Moore, Off Broadway Shoes, Old Navy, Bed Bath & Beyond, NASCAR Speedpark, AMC Theatres
5.   Discover Mills   GA   Lawrenceville (Atlanta)   Fee     25.0% (2) Acquired 2007     95.2 %               1,183,562   Bass Pro Shops, Books-A-Million, Burlington Coat Factory, Neiman Marcus Last Call, Medieval Times, Off 5th Saks Fifth Avenue Outlet, Off Broadway Shoe Warehouse, ROSS Dress for Less, Sears Appliance Outlet, Sun & Ski Sports, Urban Behavior, Woodward Skatepark, Dave & Buster's, AMC Theatres
6.   Franklin Mills   PA   Philadelphia   Fee     50.0%   Acquired 2007     94.9 %               1,753,021   Army Experience Center, Dave & Buster's, JCPenney Outlet Store, Burlington Coat Factory, Marshalls HomeGoods, Modell's Sporting Goods, Group USA, Bed Bath & Beyond, Sam Ash Music, Off 5th Saks Fifth Avenue, Last Call Neiman Marcus, Off Broadway Shores, Sears Appliance Outlet, H&M, Woodward Skatepark, AMC Theatres
7.   Grapevine Mills   TX   Grapevine (Dallas-Ft. Worth)   Fee     29.6%   Acquired 2007     97.3 %               1,775,656   Bed, Bath & Beyond, Books-A-Million, Burlington Coat Factory, The Children's Place, Forever 21, Group USA—The Clothing Co. JCPenney Outlet, Marshalls, NIKE, OFF 5th Saks Fifth Avenue, Old Navy, Virgin Megastore, Western Warehouse, Gameworks, AMC Theatres, Dr. Pepper Star Center, Sun & Ski Sports, Last Call Neiman Marcus, Sears Appliance Outlet, Bass Pro Outdoor World, Woodward Skate Park
8.   Great Mall   CA   Milpitas (San Jose)   Fee     24.5% (2) Acquired 2007     93.0 %               1,380,741   Last Call Nieman Marcus, Sports Authority, Group USA, Old Navy, Kohl's, Dave & Busters, H&M, Sears Appliance Outlet, Burlington Coat Factory, Marshalls, Off 5th Saks Fifth Avenue, NIKE, Century Theatres(8)
9.   Gurnee Mills   IL   Gurnee (Chicago)   Fee     50.0%   Acquired 2007     95.6 %               1,821,704   Bass Pro Shops Outdoor World, Bed Bath & Beyond, Burlington Coat Factory, H&M, JCPenney Outlet Store, Kohl's, Marshall's Home Goods, Off 5th—Saks Fifth Avenue Outlet, Nickles & Dimes, Sears Grand, The Sports Authority, T.J. Maxx, VF Outlet, Marcus Cinema, Last Call Neiman Marcus
10.   Katy Mills   TX   Katy (Houston)   Fee     31.3% (2) Acquired 2007     93.2 %               1,574,216   Bass Pro Shops Outdoor World, Bed Bath and Beyond, Books-A-Million, Burlington Coat Factory, F.Y.E.-For Your Entertainment, Marshalls, Neiman Marcus Last Call Clearance Center, Nike Factory Store, Off 5th Saks Fifth Avenue Outlet, Sun & Ski Sports, American Theatres, Old West Warehouse, Old Navy

29


Table of Contents

Simon Property Group, L.P. and Subsidiaries

Property Table

U.S. Properties

 
   
   
   
   
   
   
   
  Gross Leasable Area    
 
   
   
   
  Ownership
Interest
(Expiration if
Lease)(3)
   
   
   
   
 
 
Property Name
  State   City (CBSA)   Legal
Ownership
  Year Built
or
Acquired
  Occupancy(5)   Anchor   Mall &
Freestanding
  Total   Retail Anchors and Selected Major Tenants
11.   Ontario Mills   CA   Ontario   Fee     25.0%   Acquired 2007     94.5 %               1,481,954   Burlington Coat Factory, Totally for Kids, NIKE, Gameworks, The Children's Place Outlet, Cost Plus World Market, Marshalls, JCPenney Outlet, Off 5th Saks Fifth Avenue Outlet, Bed Bath & Beyond, Nordstrom Rack, Dave & Busters, Group USA, Sam Ash Music, Off Broadway Shoes, AMC Theatres(8)
12.   Opry Mills   TN   Nashville   Fee     24.5% (2) Acquired 2007     96.5 %               1,158,952   Bass Pro Shops Outdoor World, Dave & Buster's, The Gibson Showcase, Bed Bath & Beyond, Off 5th Saks Fifth Avenue Outlet, Barnes & Noble, Old Navy, Off Broadway Shoe Warehouse, Nike Factory Store, Sun & Ski Sports, BLACKLION, Regal Cinema, XXI Forever
13.   Potomac Mills   VA   Prince William (Washington, D.C.)   Fee     50.0%   Acquired 2007     96.7 %               1,515,731   Group USA, Marshall's, T.J. Maxx, Sears Appliance Outlet, Old Navy, JCPenney Outlet, Urban Behavior, Burlington Coat Factory, Off Broadway Shoe Warehouse, Nordstrom Rack and Off 5th Saks Fifth Avenue Outlet, Costco Warehouse, The Children's Place, AMC Theatres, Modell's Sporting Goods, Books-A-Million, The Sports Authority, H&M, Last Call Neiman Marcus(6)
14.   Sawgrass Mills   FL   Sunrise (Miami-Ft. Lauderdale)   Fee     50.0%   Acquired 2007     98.5 %               2,252,117   American Signature Home, Beall's Outlet, Bed Bath & Beyond, Brandsmart USA, Burlington Coat Factory, Gameworks, JCPenney Outlet Store, Marshalls, Neiman Marcus Last Call Clearance Center, Nike Factory Store, Nordstrom Rack, Off 5th Saks Fifth Avenue Outlet, Ron Jon Surf Shop, The Sports Authority, Super Target, T.J. Maxx, VF Factory Outlet, Wannado City, FYE, Off Broadway Shoes, Regal Cinema, GAP Outlet, Books-A-Million
15.   St. Louis Mills   MO   Hazelwood (St. Louis)   Fee     25.0% (2) Acquired 2007     81.1 %               1,191,207   Bed Bath & Beyond, Books-A-Million, Burlington Coat Factory, Cabela's, iceZONE, Marshalls MegaStore, NASCAR SpeedPark, Off Broadway Shoe Warehouse, Sears Appliance Outlet, The Children's Place Outlet, Regal Cinema
16.   The Block at Orange   CA   Orange (Los Angeles)   Fee     25.0%   Acquired 2007     96.8 %               717,692   Dave & Buster's, Vans Skatepark, Lucky Strike Lanes, Borders Books & Music, Hilo Hattie, Off 5th Saks Fifth Avenue, AMC Theatres, Nike Factory Store, Last Call Neiman Marcus
                                                     
    Subtotal The Mills®                 22,803,081    
                                                     

30


Table of Contents

Simon Property Group, L.P. and Subsidiaries

Property Table

U.S. Properties

 
   
   
   
   
   
   
   
  Gross Leasable Area    
 
   
   
   
  Ownership
Interest
(Expiration if
Lease)(3)
   
   
   
   
 
 
Property Name
  State   City (CBSA)   Legal
Ownership
  Year Built
or
Acquired
  Occupancy(5)   Anchor   Mall &
Freestanding
  Total   Retail Anchors and Selected Major Tenants
    Mills Regional Malls

17.

 

Briarwood Mall

 

MI

 

Ann Arbor

 

Fee

 

 

25.0%

 

Acquired 2007

 

 

95.9

%

 

608,118

 

 

367,790

 

 

975,908

 

Macy's, JCPenney, Sears, Von Maur
18.   Del Amo Fashion Center   CA   Torrance (Los Angeles)   Fee     25.0% (2) Acquired 2007     78.0 %   1,341,701     1,061,962 (18)   2,403,663   Macy's, Macy's, Macy's Home & Furnishings, JCPenney, Sears, Marshalls, T.J. Maxx, Barnes & Noble, JoAnn Fabrics, Crate & Barrel, L.A. Fitness, Burlington Coat Factory, AMC Theatres
19.   Dover Mall   DE   Dover   Fee     34.1%   Acquired 2007     95.1 %   583,696     303,500     887,196   Macy's, JCPenney, Boscov's, Sears, Carmike Cinemas
20.   Esplanade, The   LA   Kenner (New Orleans)   Fee     50.0%   Acquired 2007     88.8 %   544,140     355,394     899,534   Dillard's, Dillard's Men's, Macy's(6)(20)
21.   Falls, The   FL   Miami   Fee     25.0%   Acquired 2007     95.0 %   455,000     353,753     808,753   Bloomingdale's, Macy's, Regal Cinema
22.   Galleria at White Plains, The   NY   White Plains (New York)   Fee     50.0%   Acquired 2007     83.4 %   556,067     322,321     878,388   Macy's, Sears, H&M
23.   Hilltop Mall   CA   Richmond (San Francisco)   Fee     25.0%   Acquired 2007     75.6 %   748,551     321,142     1,069,693   JCPenney, Sears, Macy's, Wal-Mart, 24 Hour Fitness
24.   Lakeforest Mall   MD   Gaithersburg (Washington, D.C.)   Fee     25.0%   Acquired 2007     81.3 %   639,289     406,236     1,045,525   Macy's, Lord & Taylor, JCPenney, Sears
25.   Mall at Tuttle Crossing, The   OH   Dublin (Columbus)   Fee     25.0%   Acquired 2007     91.1 %   744,128     380,624     1,124,752   Macy's, Macy's, Sears, JCPenney
26.   Marley Station   MD   Glen Burnie (Baltimore)   Fee     25.0%   Acquired 2007     80.8 %   735,682     334,183     1,069,865   Macy's, JCPenney, Sears, The Movies at Marley Station, Gold's Gym
27.   Meadowood Mall   NV   Reno   Fee     25.0%   Acquired 2007     89.4 %   609,840     274,442     884,282   Macy's Men's, Macy's, Sears, JCPenney, Sports Authority
28.   Northpark Mall   MS   Ridgeland (Jackson)   Fee     50.0%   Acquired 2007     90.2 %   646,725     311,273     957,998   Dillard's, JCPenney, Belk, Regal Cinema
29.   Shops at Riverside, The   NJ   Hackensack (New York)   Fee     50.0%   Acquired 2007     91.0 %   404,666     340,663     745,329   Bloomingdale's, Saks Fifth Avenue, Barnes & Noble
30.   Southdale Center   MN   Edina (Minneapolis)   Fee     50.0%   Acquired 2007     85.5 %   817,320     524,307     1,341,627   Macy's, JCPenney, Marshall's, AMC Theatres(8)
31.   Southridge Mall   WI   Greendale (Milwaukee)   Fee     50.0%   Acquired 2007     92.1 %   874,925     348,181     1,223,106   JCPenney, Sears, Kohl's, Boston Store, Cost Plus World Market(8)
32.   Stoneridge Shopping Center   CA   Pleasanton (San Francisco)   Fee     25.0%   Acquired 2007     96.7 %   841,454     460,038     1,301,492   Macy's Women's, Macy's Men's, Nordstrom, Sears, JCPenney, H&M
                                                 
    Subtotal Mills Regional Malls     11,151,302     6,465,809     17,617,111    
                                                 

31


Table of Contents

Simon Property Group, L.P. and Subsidiaries

Property Table

U.S. Properties

 
   
   
   
   
   
   
   
  Gross Leasable Area    
 
   
   
   
  Ownership
Interest
(Expiration if
Lease)(3)
   
   
   
   
 
 
Property Name
  State   City (CBSA)   Legal
Ownership
  Year Built
or
Acquired
  Occupancy(5)   Anchor   Mall &
Freestanding
  Total   Retail Anchors and Selected Major Tenants
    Mills Community Centers

33.

 

Arundel Mills Marketplace

 

MD

 

Hanover (Baltimore)

 

Fee

 

 

29.6%

 

Acquired 2007

 

 

100.0

%

 

 

 

 

 

 

 

101,613

 

Michael's, Staples
34.   Concord Mills Marketplace   NC   Concord (Charlotte)   Fee     50.0%   Acquired 2007     100.0 %               230,683   BJ's Wholesale Club, Garden Ridge
35.   Denver West Village   CO   Lakewood   Fee     18.8%   Acquired 2007     99.6 %               310,090   Barnes & Noble, Bed Bath & Beyond, Office Max, Whole Foods, DSW, Ultimate Electronics, Christy Sports, United Artists
36.   Liberty Plaza   PA   Philadelphia   Fee     50.0%   Acquired 2007     94.2 %               371,446   Wal-Mart, Dick's Sporting Goods, Raymour & Flanigan, Super Fresh Food Market
                                                     
    Subtotal Mills Community Centers                 1,013,832    
                                                     
    Total Mills Properties                 41,434,024    
                                                     
    Total U.S. Properties GLA                 246,039,154    
                                                     

32


Table of Contents

FOOTNOTES:


(1)
This property is managed by a third party.

(2)
Our direct and indirect interests in some of the properties held as joint venture interests are subject to preferences on distributions in favor of other partners or us.

(3)
The date listed is the expiration date of the last renewal option available to the operating entity under the ground lease. In a majority of the ground leases, we have a right of first refusal or the right to purchase the lessor's interest. Unless otherwise indicated, each ground lease listed in this column covers at least 50% of its respective property.

(4)
Joint venture properties accounted for under the equity method.

(5)
Regional Malls—Executed leases for all company-owned GLA in mall stores, excluding majors. Premium Outlet Centers—Executed leases for all company-owned GLA (or total center GLA). Community/Lifestyle Centers—Executed leases for all company-owned GLA including majors and mall stores.

(6)
Indicates anchor or major that is currently under development.

(7)
Indicates ground lease covers less than 50% of the acreage of this property.

(8)
Indicates vacant anchor space(s).

(9)
The lease at the Mall at Chestnut Hill includes the entire premises including land and building.

(10)
Indicates ground lease covers all of the property except for parcels owned in fee by anchors.

(11)
Indicates ground lease covers outparcel only.

(12)
We receive substantially all the economic benefit of the property due to a preference or advance.

(13)
Outside partner receives substantially all of the economic benefit due to a partner preference.

(14)
We own a mortgage note that encumbers Pheasant Lane Mall that entitles us to 100% of the economics of this property.

(15)
Our indirect ownership interest is through an approximately 76% ownership interest in Kravco Simon Investments.

(16)
Indicates anchor has announced its intent to close this location.

(17)
Indicates anchor has closed, but we still collect rents and/or fees under an agreement.

(18)
Mall & Freestanding GLA includes office space as follows:
    Arsenal Mall—105,807 sq. ft.   Lenox Square—2,674 sq. ft.
    Century III Mall—35,929 sq. ft.   Menlo Park Mall—50,615 sq. ft.
    Circle Centre Mall—9,123 sq. ft.   Oak Court Mall—126,319 sq. ft.
    Copley Place—856,586 sq. ft.   Oxford Valley Mall—109,832 sq. ft.
    Fashion Centre at Pentagon City, The—169,089 sq. ft.   Plaza Carolina—28,192 sq. ft.
    Fashion Mall at Keystone, The—10,927 sq. ft.   River Oaks Center—118,311 sq. ft.
    Firewheel Town Center—75,000 sq. ft.   Roosevelt Field—1,610 sq. ft.
    Greendale Mall—119,860 sq. ft.   Stanford Shopping Center—5,748 sq. ft.
    The Plaza & Court at King of Prussia—13,627 sq. ft.   The Westchester—820 sq. ft.
    Lehigh Valley Mall—11,754 sq. ft.   Del Amo—113,000 sq. ft.
(19)
Nordstrom to open stores in locations previously operated by others at South Shore Plaza (2009) and Northshore Mall (2009).

(20)
Vacant anchor store owned by another company.

33


Table of Contents

International Properties

            Our ownership interests in entities that operate properties outside the United States are primarily owned through joint venture arrangements. However, during 2008, we acquired shares of stock of Liberty International, PLC, or Liberty, as further described below.

            The following summarizes our joint venture investments in Europe and the underlying countries in which these joint ventures own and operate real estate properties as of December 31, 2008:

Joint Venture Investment   Ownership
Interest
  Properties
open and
operating
  Countries of
Operation

Gallerie Commerciali Italia, S.p.A., or GCI

    49.0 %   45   Italy

Simon Ivanhoe S.à.r.l., or Simon Ivanhoe

    50.0 %   7   France, Poland

            In addition, we jointly hold with a third party an interest in one parcel of land for development near Paris, France outside of these two joint ventures. Simon Ivanhoe and GCI are fully integrated European retail real estate developers, owners and managers.

            Our properties in Europe consist primarily of hypermarket-anchored shopping centers. Substantially all of our European properties are anchored by either the hypermarket retailer Auchan, primarily in Italy, who is also our partner in GCI, or are anchored by the hypermarket Carrefour in France and Poland. Certain of the properties in Italy are subject to leaseholds whereby GCI leases all or a portion of the premises from a third party who is entitled to receive substantially all the economic benefits of that portion of the properties. Auchan and Carrefour are the two largest hypermarket operators in Europe.

            We also hold real estate interests in seven joint venture properties in Japan, one property in Mexico, one property in Korea, and one property in China. The seven Japanese Premium Outlet Centers operate in various cities throughout Japan and are held in a joint venture with Mitsubishi Estate Co., Ltd. and Sojitz Corporation (formerly known as Nissho Iwai Corporation). These centers comprise over 2.0 million square feet of GLA and were 99.9% leased as of December 31, 2008. They contain 854 stores with approximately 380 different tenants. The Premium Outlet Center in Mexico was 92% leased as of December 31, 2008, and the Premium Outlet Center in Korea was 100% leased as of December 31, 2008. The center in Changshu, China was 98% occupied as of December 31, 2008.

            The following summarizes these nine Premium Outlet Centers in international joint ventures:

Joint Venture Investment Holdings   Ownership
Interest
 

Gotemba Premium Outlets — Gotemba City (Tokyo), Japan

    40.0 %

Kobe-Sanda Premium Outlets — Hyougo-Ken (Osaka), Japan

    40.0 %

Rinku Premium Outlets — Izumisano (Osaka), Japan

    40.0 %

Sano Premium Outlets — Sano (Tokyo), Japan

    40.0 %

Sendai-Izumi Premium Outlets — Izumi Park Town (Sendai), Japan

    40.0 %

Toki Premium Outlets — Toki (Nagoya), Japan

    40.0 %

Tosu Premium Outlets — Fukuoka (Kyushu), Japan

    40.0 %

Premium Outlets Punta Norte — Mexico City, Mexico

    50.0 %

Yeoju Premium Outlets — Seoul, South Korea

    50.0 %

            In 2008, we completed construction on Sendai Izumi Premium Outlets, a 164,000 square foot center located in Sendai, Japan. We have a 40% interest in this property consistent with the ownership structure of our other Japanese investments. Also, through joint venture arrangements, we have a 32.5% interest in four shopping centers in China, one of which is open and three that are under construction, aggregating 2.0 million square feet of GLA.

            Liberty operates regional shopping centers and is the owner of other prime retail assets throughout the U.K. Liberty is a U.K. FTSE 100 listed company, with shareholders' funds of £4.7 billion and property investments of

34


Table of Contents

£8.6 billion, of which its U.K. regional shopping centers comprise 75%. Assets of the group under control or joint control amount to £11.0 billion. Liberty converted into a U.K. Real Estate Investment Trust (REIT) on January 1, 2007. Our interest in Liberty is less than 5% of their shares and is adjusted to their quoted market price, including a related foreign exchange component.

            The following property table summarizes certain data for our properties located in Europe, Japan, Mexico, Korea, and China at December 31, 2008.

35


Table of Contents

Simon Property Group, L.P. and Subsidiaries
International Property Table

 
   
   
   
   
   
  Gross Leasable Area (1)    
 
 
COUNTRY/Property Name
  City (Metropolitan area)   Ownership
Interest
  SPG
Effective
Ownership
  Year
Built
  Hypermarket/
Anchor (4)
  Mall &
Freestanding
  Total   Retail Anchors and
Major Tenants
    FRANCE                                        
1.   Bay 2   Torcy (Paris)   Fee     50.0 % 2003     159,900     416,900     576,800   Carrefour, Leroy Merlin
2.   Bay 1   Torcy (Paris)   Fee     50.0 % 2004         348,900     348,900   Conforama, Go Sport
3.   Bel'Est   Bagnolet (Paris)   Fee     17.5 % 1992     109,800     63,300     173,100   Auchan
4.   Villabé A6   Villabé (Paris)   Fee     7.5 % 1992     124,900     159,400     284,300   Carrefour
5.   Wasquehal   Wasquehal (Lille)   Fee     50.0 % 2006     131,300     123,400     254,700   Carrefour
                                       
    Subtotal France                       525,900     1,111,900     1,637,800    
    ITALY                                        
6.   Ancona — Senigallia   Senigallia (Ancona)   Fee     49.0 % 1995     41,200     41,600     82,800   Cityper
7.   Ascoli Piceno — Grottammare   Grottammare (Ascoli Piceno)   Fee     49.0 % 1995     38,900     55,900     94,800   Cityper
8.   Ascoli Piceno — Porto Sant'Elpidio   Porto Sant'Elpidio (Ascoli Piceno)   Fee     49.0 % 1999     48,000     114,300     162,300   Cityper
9.   Bari — Casamassima   Casamassima (Bari)   Fee     49.0 % 1995     159,000     388,800     547,800   Auchan, Coin, Eldo, Bata, Leroy Merlin, Decathlon
10.   Bari — Modugno   Modugno (Bari)   Fee     49.0 % 2004     96,900     46,600     143,500   Auchan, euronics, Decathlon
11.   Brescia — Mazzano   Mazzano (Brescia)   Fee / Leasehold (2)     49.0 %(2) 1994     103,300     127,400     230,700   Auchan, Bricocenter, Upim
12.   Brindisi-Mesagne   Mesagne (Brindisi)   Fee     49.0 % 2003     88,000     140,600     228,600   Auchan
13.   Cagliari — Santa Gilla   Cagliari   Fee / Leasehold (2)     49.0 %(2) 1992     75,900     114,800     190,700   Auchan, Bricocenter
14.   Catania — La Rena   Catania   Fee     49.0 % 1998     124,100     22,100     146,200   Auchan
15.   Cinisello   Cinisello (Milano)   Fee     49.0 % 2007     125,000     250,600     375,600   Auchan
16.   Cuneo   Cuneo (Torino)   Fee     49.0 % 2004     80,700     201,500     282,200   Auchan, Bricocenter
17.   Giugliano   Giugliano (Napoli)   Fee     49.0 %(5) 2006     130,000     624,500     754,500   Auchan
18.   Milano — Rescaldina   Rescaldina (Milano)   Fee     49.0 % 2000     165,100     212,000     377,100   Auchan, Bricocenter, Decathlon, Media World
19.   Milano — Vimodrone   Vimodrone (Milano)   Fee     49.0 % 1989     110,400     80,200     190,600   Auchan, Bricocenter
20.   Napoli — Pompei   Pompei (Napoli)   Fee     49.0 % 1990     74,300     17,100     91,400   Auchan
21.   Nola — Volcano Buono   Nola (Napoli)   Fee     22.1 % 2007     142,900     733,100     876,000   Auchan, Coin, Holiday Inn, Media World
22.   Padova   Padova   Fee     49.0 % 1989     73,300     32,500     105,800   Auchan
23.   Palermo   Palermo   Fee     49.0 % 1990     73,100     9,800     82,900   Auchan
24.   Pesaro — Fano   Fano (Pesaro)   Fee     49.0 % 1994     56,300     56,000     112,300   Auchan
25.   Pescara   Pescara   Fee     49.0 % 1998     96,300     65,200     161,500   Auchan
26.   Pescara — Cepagatti   Cepagatti (Pescara)   Fee     49.0 % 2001     80,200     189,600     269,800   Auchan, Bata
27.   Piacenza — San Rocco al Porto   San Rocco al Porto (Piacenza)   Fee     49.0 % 1992     104,500     74,700     179,200   Auchan, Darty
28.   Porta Di Roma   Roma   Fee     19.6 % 2007     624,800     630,600     1,255,400   Auchan, Leroy Merlin, UGC Theatres, Ikea, Media World, Decathlon
29.   Roma — Collatina   Collatina (Roma)   Fee     49.0 % 1999     59,500     4,100     63,600   Auchan
30.   Sassari — Predda Niedda   Predda Niedda (Sassari)   Fee / Leasehold (2)     49.0 %(2) 1990     79,500     154,200     233,700   Auchan, Bricocenter
31.   Taranto   Taranto   Fee     49.0 % 1997     75,200     126,500     201,700   Auchan, Bricocenter
32.   Torino   Torino   Fee     49.0 % 1989     105,100     66,700     171,800   Auchan
33.   Torino — Venaria   Venaria (Torino)   Fee     49.0 % 1982     101,600     64,000     165,600   Auchan, Bricocenter
34.   Venezia — Mestre   Mestre (Venezia)   Fee     49.0 % 1995     114,100     132,600     246,700   Auchan
35.   Vicenza   Vicenza   Fee     49.0 % 1995     78,400     20,100     98,500   Auchan
36.   Ancona   Ancona   Leasehold (3)     49.0 %(3) 1993     82,900     82,300     165,200   Auchan

36


Table of Contents

Simon Property Group, L.P. and Subsidiaries
International Property Table

 
   
   
   
   
   
  Gross Leasable Area (1)    
 
 
COUNTRY/Property Name
  City (Metropolitan area)   Ownership
Interest
  SPG
Effective
Ownership
  Year
Built
  Hypermarket/
Anchor (4)
  Mall &
Freestanding
  Total   Retail Anchors and
Major Tenants
    ITALY (continued)                                        
37.   Bergamo   Bergamo   Leasehold (3)     49.0 %(3) 1976     103,000     16,900     119,900   Auchan
38.   Brescia — Concesio   Concesio (Brescia)   Leasehold (3)     49.0 %(3) 1972     89,900     27,600     117,500   Auchan
39.   Cagliari — Marconi   Cagliari   Leasehold (3)     49.0 %(3) 1994     83,500     109,900     193,400   Auchan, Bricocenter, Bata
40.   Catania — Misterbianco   Misterbianco (Catania)   Leasehold (3)     49.0 %(3) 1989     83,300     16,000     99,300   Auchan
41.   Merate — Lecco   Merate (Lecco)   Leasehold (3)     49.0 %(3) 1976     73,500     88,500     162,000   Auchan, Bricocenter
42.   Milano — Cesano Boscone   Cesano Boscone (Milano)   Leasehold (3)     49.0 %(3) 2005     163,800     120,100     283,900   Auchan
43.   Milano — Nerviano   Nerviano (Milano)   Leasehold (3)     49.0 %(3) 1991     83,800     27,800     111,600   Auchan
44.   Monza   Monza   Leasehold (3)     49.0 %(3)       59,200     152,500     211,700    
45.   Napoli — Mugnano di Napoli   Mugnano di Napoli   Leasehold (3)     49.0 %(3) 1992     98,000     94,900     192,900   Auchan, Bricocenter
46.   Olbia   Olbia   Leasehold (3)     49.0 %(3) 1993     74,600     133,000     207,600   Auchan
47.   Roma — Casalbertone   Roma   Leasehold (3)     49.0 %(3) 1998     62,700     84,900     147,600   Auchan
48.   Sassari — Centro Azuni   Sassari   Leasehold (3)     49.0 %(3) 1995         35,600     35,600    
49.   Torino — Rivoli   Rivoli (Torino)   Leasehold (3)     49.0 %(3) 1986     61,800     32,300     94,100   Auchan
50.   Verona — Bussolengo   Bussolengo (Verona)   Leasehold (3)     49.0 %(3) 1975     89,300     75,300     164,600   Auchan, Bricocenter
                                       
    Subtotal Italy                       4,534,900     5,895,300     10,430,200    
    POLAND                                        
51.   Arkadia Shopping Center   Warsaw   Fee     50.0 % 2004     202,200     900,800     1,103,000   Carrefour, Leroy Merlin, Media, Saturn, Cinema City, H & M, Zara, Royal Collection, Peek & Clopperburg
52.   Wilenska Station Shopping Center   Warsaw   Fee     50.0 % 2002     92,700     215,900     308,600   Carrefour
                                       
    Subtotal Poland       Fee               294,900     1,116,700     1,411,600    
    JAPAN                                        
53.   Gotemba Premium Outlets   Gotemba City (Tokyo)   Fee     40.0 % 2000         479,000     479,000   Bally, Coach, Diesel, Gap, Gucci, Jill Stuart, L.L. Bean, Nike, Tod's
54.   Kobe-Sanda Premium Outlets   Hyougo-ken (Osaka)   Ground Lease (2026)     40.0 % 2007         193,500     193,500   BCBG, Bose, Coach, Cole Haan, Lego, Nike, Petit Bateau, Max Azria, Theory
55.   Rinku Premium Outlets   Izumisano (Osaka)   Ground Lease (2020)     40.0 % 2000         320,600     320,600   Bally, Brooks Brothers, Coach, Eddie Bauer, Gap, Nautica, Nike, Timberland, Versace
56.   Sano Premium Outlets   Sano (Tokyo)   Ground Lease (2022)     40.0 % 2003         389,900     389,900   Bally, Brooks Brothers, Coach, Nautica, New Yorker, Nine West, Timberland
57.   Sendai-Izumi Premium Outlets   Izumi Park Town (Sendai)   Ground Lease (2027)     40.0 % 2008         164,200     164,200   Levi's, Miss Sixty, OshKosh B'Gosh, Pleats Please Issey Miyake, St. John, T-Fal, Tasaki, United Arrows, PLS+T, Ray Ban
58.   Toki Premium Outlets   Toki (Nagoya)   Ground Lease (2024)     40.0 % 2005         230,300     230,300   Adidas, Brooks Brothers, Bruno Magli, Coach, Eddie Bauer, Furla, Nautica, Nike, Timberland, Versace
59.   Tosu Premium Outlets   Fukuoka (Kyushu)   Ground Lease (2023)     40.0 % 2004         239,900     239,900   BCBG, Bose, Coach, Cole Haan, Lego, Nike, Petit Bateau, Max Azria, Theory
                                       
    Subtotal Japan                           2,017,400     2,017,400    

37


Table of Contents

Simon Property Group, L.P. and Subsidiaries
International Property Table

 
   
   
   
   
   
  Gross Leasable Area (1)    
 
 
COUNTRY/Property Name
  City (Metropolitan area)   Ownership
Interest
  SPG
Effective
Ownership
  Year
Built
  Hypermarket/
Anchor (4)
  Mall &
Freestanding
  Total   Retail Anchors and
Major Tenants
    MEXICO                                        
60.   Punta Norte Premium Outlets   Mexico City   Fee     50.0 % 2004         231,900     231,900   Christian Dior, Sony, Nautica, Levi's, Nike Rockport, Reebok, Adidas, Samsonite
                                       
    Subtotal Mexico                           231,900     231,900    
    SOUTH KOREA                                        
61.   Yeoju Premium Outlets   Yeoju   Fee     50.0 % 2007         249,900     249,900   Armani, Burberry, Dunhill, Ermenegildo Zegna, Salvatore Ferragamo
                                       
    Subtotal South Korea                           249,900     249,900    
    CHINA                                        
62.   Changshu   Changshu   Fee     32.5 % 2008     180,800     302,800     483,600   Wal-Mart, Forever 21, C&A, Sport 100, Xiang Ge Li, Dino's World, Huiyin
                                       
    Subtotal China                       180,800     302,800     483,600    
    TOTAL INTERNATIONAL ASSETS                       5,536,500     10,925,900     16,462,400    
                                       

FOOTNOTES:

38


Table of Contents

            We have direct or indirect ownership interests in four parcels of land held in the United States for future development, containing an aggregate of approximately 365 acres located in two states.

            The following table sets forth certain information regarding the mortgages and other indebtedness encumbering our properties, and the properties held by our domestic and international joint venture arrangements, and also our unsecured corporate debt. Substantially all of the mortgage and property related debt is nonrecourse to us.

39


Table of Contents


Mortgage and Other Indebtedness
As of December 31, 2008
(Dollars in thousands)

Property Name   Interest
Rate
  Carrying
Amount
  Annual Debt
Service
  Maturity
Date
 

Consolidated Indebtedness:

                         

Secured Indebtedness:

                         

Simon Property Group, LP:

                         

Anderson Mall

    6.20%   $ 27,755   $ 2,216     10/10/12  

Arsenal Mall HCHP Office

    8.20%     1,090     286     05/05/16  

Bangor Mall

    6.15%     80,000     4,918   (2)   10/01/17  

Battlefield Mall

    4.60%     94,530     6,154     07/01/13  

Bloomingdale Court

    7.78%     26,592   (4)   2,578     11/01/09  

Brunswick Square

    5.65%     83,452     5,957     08/11/14  

Carolina Premium Outlets — Smithfield

    9.10%     19,696   (6)   2,114     03/10/13   (25)

Century III Mall

    6.20%     81,930   (9)   6,541     10/10/12  

Chesapeake Square

    5.84%     70,841     5,162     08/01/14  

Copley Place

    1.09%   (1)   200,000     2,173   (2)   08/01/10   (3)

Coral Square

    8.00%     83,134     8,065     10/01/10  

The Crossings Premium Outlets

    5.85%     53,992     4,649     03/13/13  

Crossroads Mall

    6.20%     41,150     3,285     10/10/12  

Crystal River

    7.63%     14,916     1,385     11/11/10   (25)

Dare Centre

    9.10%     1,640   (6)   176     03/10/13   (25)

DeKalb Plaza

    5.28%     3,071     233     01/01/15  

Desoto Square

    5.89%     64,153     3,779   (2)   07/01/14  

The Factory Shoppes at Branson Meadows

    9.10%     9,160   (6)   983     03/10/13   (25)

Factory Stores of America — Boaz

    9.10%     2,678   (6)   287     03/10/13   (25)

Factory Stores of America — Georgetown

    9.10%     6,349   (6)   681     03/10/13   (25)

Factory Stores of America — Graceville

    9.10%     1,886   (6)   202     03/10/13   (25)

Factory Stores of America — Lebanon

    9.10%     1,586   (6)   170     03/10/13   (25)

Factory Stores of America — Nebraska City

    9.10%     1,488   (6)   160     03/10/13   (25)

Factory Stores of America — Story City

    9.10%     1,841   (6)   198     03/10/13   (25)

Forest Mall

    6.20%     16,478   (10)   1,316     10/10/12  

Forest Plaza

    7.78%     14,585   (4)   1,414     11/01/09  

Forum Shops at Caesars, The

    4.78%     524,657     34,564     12/01/10  

Gateway Shopping Center

    5.89%     87,000     5,124   (2)   10/01/11  

Gwinnett Place

    5.68%     115,000     6,532   (2)   06/08/12  

Henderson Square

    6.94%     14,616     1,270     07/01/11  

Highland Lakes Center

    6.20%     15,189   (9)   1,213     10/10/12  

Independence Center

    5.94%     200,000     11,886   (2)   07/10/17  

Ingram Park Mall

    6.99%     77,180   (20)   6,724     08/11/11  

Kittery Premium Outlets

    5.39%   (38)   43,556   (7)   881     07/10/13   (3)

Knoxville Center

    6.99%     58,446   (20)   5,092     08/11/11  

Lake View Plaza

    7.78%     19,388   (4)   1,880     11/01/09  

Lakeline Plaza

    7.78%     21,256   (4)   2,061     11/01/09  

Las Americas Premium Outlets

    5.84%     180,000     10,511   (2)   06/11/16  

Lighthouse Place Premium Outlets

    5.39%   (38)   88,623   (7)   3,670     07/10/13   (3)

Lincoln Crossing

    7.78%     2,935   (4)   285     11/01/09  

Longview Mall

    6.20%     30,839   (9)   2,462     10/10/12  

MacGregor Village

    9.10%     6,596   (6)   708     03/10/13   (25)

Mall of Georgia

    7.09%     185,238     16,649     07/01/10  

Markland Mall

    6.20%     21,818   (10)   1,742     10/10/12  

Matteson Plaza

    7.78%     8,537   (4)   828     11/01/09  

Midland Park Mall

    6.20%     31,852   (10)   2,543     10/10/12  

Montgomery Mall

    5.17%     89,460     6,307     05/11/14   (25)

Muncie Plaza

    7.78%     7,381   (4)   716     11/01/09  

Northfield Square

    6.05%     29,067     2,485     02/11/14  

Northlake Mall

    6.99%     67,423   (20)   5,874     08/11/11  

North Ridge Shopping Center

    9.10%     8,056   (6)   865     03/10/13   (25)

Oxford Valley Mall

    6.76%     74,805     7,801     01/10/11  

40


Table of Contents


Mortgage and Other Indebtedness
As of December 31, 2008
(Dollars in thousands)

Property Name   Interest
Rate
  Carrying
Amount
  Annual Debt
Service
  Maturity
Date
 

Palm Beach Mall

    6.20%     50,953     4,068     10/10/12  

Penn Square Mall

    7.03%     65,828     6,003     03/01/09   (25)

Philadelphia Premium Outlets

    2.29%   (8)   190,000     4,344   (2)   07/30/14   (3)

Plaza Carolina — Fixed

    5.10%     89,975     7,085     05/09/09  

Plaza Carolina — Variable Capped

    1.34%   (29)   91,829     4,707     05/09/09   (3)

Plaza Carolina — Variable Floating

    1.34%   (1)   55,097     2,824     05/09/09   (3)

Port Charlotte Town Center

    7.98%     50,998     4,680     12/11/10   (25)

Regency Plaza

    7.78%     4,003   (4)   388     11/01/09  

Richmond Towne Square

    6.20%     44,739   (10)   3,572     10/10/12  

SB Boardman Plaza Holdings

    5.94%     23,213     1,682     07/01/14  

SB Trolley Square Holding

    9.03%     27,803     2,880     08/01/10  

Secured Term Loan (six properties)

    1.14%   (1)   735,000     8,351   (2)   03/05/12   (3)

St. Charles Towne Plaza

    7.78%     25,613   (4)   2,483     11/01/09  

Stanford Shopping Center

    2.59%   (1)   240,000     6,207   (2)   07/01/13   (3)

Summit Mall

    5.42%     65,000     3,526   (2)   06/10/17  

Sunland Park Mall

    8.63%   (13)   33,734     3,768     01/01/26  

Tacoma Mall

    7.00%     122,687     10,778     10/01/11  

Secured Term Loan (three properties)

    2.39%   (43)   260,000   (40)   6,204   (2)   09/23/13   (3)

Town Center at Cobb

    5.74%     280,000     16,072   (2)   06/08/12  

Towne West Square

    6.99%     50,520   (20)   4,402     08/11/11  

University Park Mall

    1.29%   (1)   100,000     1,286   (2)   07/09/10   (3)

Upper Valley Mall

    5.89%     47,904     2,822   (2)   07/01/14  

Valle Vista Mall

    5.35%     40,000     3,598   (2)   05/10/17  

Washington Square

    5.94%     30,194     2,194     07/01/14  

Waterloo Premium Outlets

    5.39%   (38)   72,822   (7)   2,956     07/10/13   (3)

West Ridge Mall

    5.89%     68,711     4,047   (2)   07/01/14  

West Ridge Plaza

    7.78%     5,158   (4)   500     11/01/09  

White Oaks Mall

    5.54%     50,000     2,768   (2)   11/01/16  

White Oaks Plaza

    7.78%     15,741   (4)   1,526     11/01/09  

Wolfchase Galleria

    5.64%     225,000     12,700   (2)   04/01/17  

Woodland Hills Mall

    7.00%     78,612     7,185     01/01/09   (25)
                         

Total Consolidated Secured Indebtedness

        $ 6,254,045              

41


Table of Contents


Mortgage and Other Indebtedness
As of December 31, 2008
(Dollars in thousands)

Property Name   Interest
Rate
  Carrying
Amount
  Annual Debt
Service
  Maturity
Date
 

Unsecured Indebtedness:

                         

Simon Property Group, LP:

                         

Unsecured Revolving Credit Facility — USD

    0.81%   (15) $ 600,000   $ 4,868   (2)   01/11/11   (3)

Revolving Credit Facility — Yen Currency

    1.07%   (15)   243,990   (41)   2,602   (2)   01/11/11   (3)

Revolving Credit Facility — Euro Currency

    2.96%   (15)   202,298   (42)   5,996   (2)   01/11/11   (3)

Unsecured Notes — 2B

    7.00%     150,000     10,500   (14)   07/15/09  

Unsecured Notes — 4C

    7.38%     200,000     14,750   (14)   06/15/18  

Unsecured Notes — 5B

    7.13%     300,000     21,375   (14)   02/09/09  

Unsecured Notes — 6B

    7.75%     200,000     15,500   (14)   01/20/11  

Unsecured Notes — 8A

    6.35%     350,000     22,225   (14)   08/28/12  

Unsecured Notes — 9A

    4.88%     300,000     14,625   (14)   03/18/10  

Unsecured Notes — 9B

    5.45%     200,000     10,900   (14)   03/15/13  

Unsecured Notes — 10A

    3.75%     300,000     11,250   (14)   01/30/09  

Unsecured Notes — 10B

    4.90%     200,000     9,800   (14)   01/30/14  

Unsecured Notes — 11A

    4.88%     400,000     19,500   (14)   08/15/10  

Unsecured Notes — 11B

    5.63%     500,000     28,125   (14)   08/15/14  

Unsecured Notes — 12 A

    5.10%     600,000     30,600   (14)   06/15/15  

Unsecured Notes — 12 B

    4.60%     400,000     18,400   (14)   06/15/10  

Unsecured Notes — 13 A

    5.38%     500,000     26,875   (14)   06/01/11  

Unsecured Notes — 13 B

    5.75%     600,000     34,500   (14)   12/01/15  

Unsecured Notes — 14 A

    5.75%     400,000     23,000   (14)   05/01/12  

Unsecured Notes — 14 B

    6.10%     400,000     24,400   (14)   05/01/16  

Unsecured Notes — 15 A

    5.60%     600,000     33,600   (14)   09/01/11  

Unsecured Notes — 15 B

    5.88%     500,000     29,375   (14)   03/01/17  

Unsecured Notes — 16 A

    5.00%     600,000     30,000   (14)   03/01/12  

Unsecured Notes — 16 B

    5.25%     650,000     34,125   (14)   12/01/16  

Unsecured Notes — 19A

    5.30%     700,000     37,100   (14)   05/30/13  

Unsecured Notes — 19B

    6.13%     800,000     49,000   (14)   05/30/18  
                         

          10,896,288              

The Retail Property Trust, subsidiary:

                         

Unsecured Notes — CPI 4

    7.18%     75,000     5,385   (14)   09/01/13  

Unsecured Notes — CPI 5

    7.88%     250,000     19,688   (14)   03/15/16  
                         

          325,000              

CPG Partners, LP, subsidiary:

                         

Unsecured Notes — CPG 3

    3.50%     100,000     3,500   (14)   03/15/09  

Unsecured Notes — CPG 4

    8.63%     50,000     4,313   (14)   08/17/09  

Unsecured Notes — CPG 5

    8.25%     150,000     12,375   (14)   02/01/11  

Unsecured Notes — CPG 6

    6.88%     100,000     6,875   (14)   06/15/12  

Unsecured Notes — CPG 7

    6.00%     150,000     9,000   (14)   01/15/13  
                         

          550,000              
                         
 

Total Consolidated Unsecured Indebtedness

        $ 11,771,288              
                         
 

Total Consolidated Indebtedness at Face Amounts

        $ 18,025,333              
 

Net Premium on Indebtedness

          38,737              
 

Net Discount on Indebtedness

          (21,538 )            
                         
 

Total Consolidated Indebtedness

        $ 18,042,532   (19)            
                         

42


Table of Contents


Mortgage and Other Indebtedness
As of December 31, 2008
(Dollars in thousands)

Property Name   Interest
Rate
  Carrying
Amount
  Annual Debt
Service
  Maturity
Date
 

Joint Venture Indebtedness:

                         

Secured Indebtedness:

                         

AMI Premium Outlets — Fixed

    2.22%   $ 33,083   (26) $ 734   (2)   09/25/23  

AMI Premium Outlets — Variable

    1.04%   (12)   33,083   (26)   344   (2)   09/25/23  

Apple Blossom Mall

    7.99%     37,123     3,607     09/10/09  

Arizona Mills

    7.90%     134,138     10,752     10/05/10  

Arkadia Shopping Center

    3.84%   (31)   144,208     5,543   (2)   05/31/12  

Arkadia Shopping Center — 2

    4.69%   (31)   168,741     7,920   (2)   05/31/12  

Arundel Marketplace

    5.92%     11,588     884     01/01/14  

Arundel Mills

    6.14%     385,000     23,639   (2)   08/01/14  

Atrium at Chestnut Hill

    6.89%     44,610     3,880     03/11/11   (25)

Auburn Mall

    7.99%     43,462     4,222     09/10/09  

Aventura Mall

    5.91%     430,000     25,392   (2)   12/11/17  

Avenues, The

    5.29%     72,796     5,325     04/01/13  

Bay 1 (Torcy)

    3.59%   (31)   19,832     713   (2)   05/31/11  

Bay 2 (Torcy)

    3.59%   (31)   73,987     2,659   (2)   06/30/11  

Block at Orange

    6.25%     220,000     13,753   (2)   10/01/14  

Briarwood Mall — 1

    4.45%     192,402     8,568   (2)   11/01/09  

Briarwood Mall — 2

    5.47%     530     29   (2)   09/01/09  

Cape Cod Mall

    6.80%     90,597     7,821     03/11/11  

Changshu SZITIC

    6.73%   (39)   45,477     3,062   (2)   12/01/17  

Circle Centre Mall

    5.02%     72,869     5,165     04/11/13  

Clay Terrace

    5.08%     115,000     5,842   (2)   10/01/15  

Cobblestone Court

    1.44%   (1)   2,669     38   (2)   04/16/10  

Coconut Point

    5.83%     230,000     13,409   (2)   12/10/16  

Coddingtown Mall

    1.59%   (1)   15,500     246   (2)   07/14/10  

Colorado Mills

    6.12%   (38)   170,000     10,404   (2)   11/12/09   (3)

Concord Mills Mall

    6.13%     166,903     13,208     12/07/12  

Concord Marketplace

    5.76%     13,499     1,013     02/01/14  

Crystal Mall

    5.62%     96,461     7,319     09/11/12   (25)

Dadeland Mall

    6.75%     183,700     15,566     02/11/12   (25)

Del Amo

    1.94%   (1)   335,000     6,486   (2)   01/23/13   (3)

Denver West Village

    8.15%     22,184     2,153     10/01/11  

Discover Mills — 1

    7.32%     23,700     1,735   (2)   12/11/11  

Discover Mills — 2

    6.08%     135,000     8,212   (2)   12/11/11  

Domain Residential Phase II

    2.44%   (1)   4,001     97   (2)   07/22/13   (3)

Domain Residential Building P

    2.44%   (1)   1,193     29   (2)   11/07/11   (3)

Dover Mall & Commons

    2.39%   (37)   83,756   (35)   1,999   (2)   02/01/12   (3)

Eastland Mall

    5.79%     168,000     9,734   (2)   06/01/16  

Emerald Square Mall

    5.13%     132,124     9,479     03/01/13  

Empire Mall

    5.79%     176,300     10,215   (2)   06/01/16  

Esplanade, The

    2.39%   (37)   75,136   (35)   1,793   (2)   02/01/12   (3)

Falls, The

    4.34%     148,200     6,432   (2)   11/01/09  

Fashion Centre Pentagon Retail

    6.63%     152,042     12,838     09/11/11   (25)

Fashion Centre Pentagon Office

    1.19%   (30)   40,000     475   (2)   07/09/09   (3)

Fashion Valley Mall

    2.44%   (1)   200,000     4,873   (2)   10/09/13  

Firewheel Residential

    2.29%   (1)   22,985     525   (2)   06/20/11   (3)

Florida Mall, The

    7.55%     247,073     22,766     12/10/10  

Franklin Mills

    5.65%     290,000     16,385   (2)   06/01/17  

Galleria at White Plains

    2.39%   (37)   125,566   (35)   2,996   (2)   02/01/12   (3)

Galleria Commerciali Italia — Facility A

    3.94%   (18)   335,967     18,938     12/22/11   (3)

Galleria Commerciali Italia — Facility B

    4.04%   (27)   332,513     18,838     12/22/11  

Galleria Commerciali Italia — Cinisello

    3.64%   (32)   181,710     6,621   (2)   03/31/15  

Galleria Commerciali Italia — Giugliano A

    3.69%   (34)   36,968     1,795     10/20/13  

Galleria Commerciali Italia — Giugliano B

    3.69%   (33)   38,062     1,848     10/20/13  

Galleria Commerciali Italia — Giugliano C

    4.09%   (11)   16,071     845     10/20/13  

Galleria Commerciali Italia — Catania

    3.63%   (5)   37,961     1,379   (2)   12/17/10  

Gaitway Plaza

    4.60%     13,900   (17)   640   (2)   07/01/15  

Granite Run Mall

    5.83%     118,250     8,622     06/01/16  

43


Table of Contents


Mortgage and Other Indebtedness
As of December 31, 2008
(Dollars in thousands)

Property Name   Interest
Rate
  Carrying
Amount
  Annual Debt
Service
  Maturity
Date
 

Grapevine Mills

    6.26%   (38)   300,000     18,786   (2)   09/22/14   (3)

Great Mall of the Bay Area

    6.01%     270,000     16,227   (2)   08/28/15   (3)

Greendale Mall

    6.00%     45,000     2,699   (2)   10/01/16  

Gotemba Premium Outlets — Fixed

    1.54%     81,874   (26)   11,532     10/25/14  

Gotemba Premium Outlets — Variable

    1.19%   (12)   9,352   (26)   1,280     05/31/12  

Gurnee Mills

    5.77%     321,000     18,512   (2)   07/01/17  

Hamilton Town Center

    2.04%   (1)   93,314     1,900   (2)   05/29/12   (3)

Hangzhou

    8.61%   (24)   36,675     3,159   (2)   10/01/18  

Highland Mall

    6.83%     64,821     5,634     07/10/11  

Hilltop Mall

    4.99%     64,350     3,211   (2)   07/08/12  

Houston Galleria — 1

    5.44%     643,583     34,985   (2)   12/01/15  

Houston Galleria — 2

    5.44%     177,417     9,644   (2)   12/01/15  

Hyatt Coconut

    2.06%   (1)   8,530     176   (2)   09/09/11   (3)

Indian River Commons

    5.21%     9,645     503   (2)   11/01/14  

Indian River Mall

    5.21%     65,355     3,408   (2)   11/01/14  

Katy Mills

    6.69%     145,971     11,448     01/09/13  

King of Prussia Mall — 1

    7.49%     140,179     20,118     01/01/17  

King of Prussia Mall — 2

    8.53%     9,818     1,388     01/01/17  

Kobe Premium Outlets

    1.42%     20,721   (26)   2,280     01/31/12  

Lakeforest Mall

    4.90%     141,050     6,904   (2)   07/08/10  

Lehigh Valley Mall

    1.00%   (36)   150,000     1,494   (2)   08/09/10   (3)

Liberty Plaza

    5.68%     43,000     2,442   (2)   06/01/17  

Liberty Tree Mall

    5.22%     35,000     1,827   (2)   10/11/13  

Mall at Chestnut Hill

    8.45%     13,742     1,396     02/01/10  

Mall at Rockingham

    5.61%     260,000     17,931     03/10/17  

Mall at Tuttle Crossing

    5.05%     116,434     7,774     11/05/13  

Mall of New Hampshire

    6.23%     136,439     10,079     10/05/15  

Marley Station

    4.89%     114,400     5,595   (2)   07/01/12  

Meadowood Mall

    5.13%   (38)   182,000     9,333   (2)   11/09/09   (3)

Mesa Mall

    5.79%     87,250     5,055   (2)   06/01/16  

Miami International Mall

    5.35%     94,554     6,533     10/01/13  

Mills Senior Loan Facility

    1.69%   (1)   711,000     11,989   (2)   06/07/12   (3)

Net Leases I

    7.96%     26,501     2,109   (2)   10/10/10  

Net Leases II

    9.35%     20,873     1,952   (2)   01/10/23  

Northpark Mall — Mills

    2.39%   (37)   105,543   (35)   2,519   (2)   02/01/12   (3)

Northshore Mall

    5.03%     204,832     13,566     03/11/14   (25)

Ontario Mills

    5.13%   (38)   75,000     3,844   (2)   12/05/13   (3)

Opry Mills

    6.16%     280,000     17,248   (2)   10/10/14  

Potomac Mills

    5.83%     410,000     23,901   (2)   07/11/17  

Plaza at Buckland Hills, The

    4.60%     24,800   (17)   1,142   (2)   07/01/15  

Quaker Bridge Mall

    7.03%     19,814     2,407     04/01/16  

Ridgewood Court

    4.60%     14,650   (17)   674   (2)   07/01/15  

Rinku Premium Outlets

    1.84%     38,752   (26)   7,539     11/25/14  

Rushmore Mall

    5.79%     94,000     5,446   (2)   06/01/16  

Sano Premium Outlets

    1.08%   (12)   61,144   (26)   18,842     05/31/18  

Sawgrass Mills

    5.82%     820,000     47,724   (2)   07/01/14  

Shops at Riverside, The

    1.24%   (1)   150,000     1,854   (2)   11/14/11   (3)

St. Johns Town Center

    5.06%     170,000     8,602   (2)   03/11/15  

St. John's Town Center Phase II

    5.50%   (38)   77,500     4,266   (2)   05/10/15   (3)

St. Louis Mills

    6.39%     90,000     5,751   (2)   01/08/12  

Seminole Towne Center

    1.09%   (22)   70,000     760   (2)   07/09/09   (3)

Sendai Premium Outlets

    1.04%   (12)   41,906   (26)   436   (2)   10/31/18  

Shops at Sunset Place, The

    1.19%   (21)   83,897     3,963     05/09/09   (3)

Smith Haven Mall

    5.16%     180,000     9,283   (2)   03/01/16  

Solomon Pond

    3.97%     109,329     6,505     08/01/13  

Source, The

    6.65%     124,000     8,246   (2)   03/11/09  

Southern Hills Mall

    5.79%     101,500     5,881   (2)   06/01/16  

Southdale Center

    5.18%     186,550     9,671   (2)   04/01/10  

SouthPark Residential

    1.84%   (1)   41,568     763   (2)   12/31/10   (3)

Southridge Mall

    5.23%     124,000     6,489   (2)   04/01/12  

44


Table of Contents


Mortgage and Other Indebtedness
As of December 31, 2008
(Dollars in thousands)

Property Name   Interest
Rate
  Carrying
Amount
  Annual Debt
Service
  Maturity
Date
 

Springfield Mall

    1.54%   (1)   72,300     1,111   (2)   12/01/10   (3)

Square One

    6.73%     87,416     7,380     03/11/12  

Stoneridge Shopping Center

    4.63%   (38)   293,800     13,609   (2)   11/01/09  

Suzhou

    8.38%   (28)   73,350     6,149   (2)   01/01/21  

Toki Premium Outlets — Fixed

    1.80%     10,587   (26)   2,628     10/31/11  

Toki Premium Outlets — Variable

    1.44%   (12)   10,697   (26)   2,139     10/30/09  

Tosu Premium Outlets — Fixed

    1.50%     9,802   (26)   2,216     08/24/13  

Tosu Premium Outlets — Variable

    1.85%   (12)   11,910   (26)   1,543     01/31/12  

Valley Mall

    5.83%     45,994     3,357     06/01/16  

Villabe A6 — Bel'Est

    3.89%   (31)   12,363     481   (2)   08/31/11  

Village Park Plaza

    4.60%     29,850   (17)   1,374   (2)   07/01/15  

West Town Corners

    4.60%     18,800   (17)   865   (2)   07/01/15  

West Town Mall

    6.34%     210,000     13,309   (2)   12/01/17  

Westchester, The

    4.86%     500,000     24,300   (2)   06/01/10  

Whitehall Mall

    7.00%     12,325     1,147     11/01/18  

Wilenska Station Shopping Center

    4.29%   (31)   42,199     1,812   (2)   08/31/11  

Zhengzhou

    8.61%   (16)   42,543     3,664   (2)   09/01/18  
                         
 

Total Joint Venture Secured Indebtedness at Face Amounts

        $ 16,563,489              

Unsecured Indebtedness:

                         

TMLP Trust Preferred Unsecured Securities

    7.38%     100,000     7,375   (2)   03/30/36   (3)
                         

Total Joint Venture Unsecured Indebtedness

          100,000              
 

Net Premium on Indebtedness

         
26,804
             
 

Net Discount on Indebtedness

          (3,592 )            
                         
 

Total Joint Venture Indebtedness

        $ 16,686,701   (23)            
                         

(Footnotes on following page)

45


Table of Contents

(Footnotes for preceding pages)


(1)
Variable rate loans based on LIBOR plus interest rate spreads ranging from 56 bps to 296 bps. LIBOR as of December 31, 2008 was 0.44%.

(2)
Requires monthly payment of interest only.

(3)
Includes applicable extension available at the Operating Partnership's option.

(4)
Loans secured by these eleven properties are cross-collateralized and cross-defaulted.

(5)
Debt is denominated in Euros and bears interest at 3 month Euribor + 0.75%. Debt consists of a Euros 71.1 million tranche with Euros 26.9 million is drawn.

(6)
Loans secured by these eleven properties are cross-collateralized and cross-defaulted.

(7)
Loans secured by these three properties are cross-collateralized and cross-defaulted.

(8)
As of December 31, 2008, the loan is set at LIBOR + 1.850%, with LIBOR capped at 8.250%. Effective 1/2/09, we have executed a swap agreement that fixes the interest rate on this loan at 4.19%.

(9)
Loans secured by these three properties are cross-collateralized.

(10)
Loans secured by these four properties are cross-collateralized.

(11)
Debt is denominated in Euros and bears interest at 3 month Euribor + 1.20%. Debt consists of a Euros 12 million tranche which Euros 11.4 million is drawn.

(12)
Variable rate loans based on Yen LIBOR plus interest rate spreads ranging from 35 bps to 187.5 bps. Yen LIBOR as of December 31, 2008 was 0.6913%.

(13)
Lender also participates in a percentage of certain gross receipts above a specified base. This threshold was met and additional interest was paid in 2008.

(14)
Requires semi-annual payments of interest only.

(15)
$3,500,000 Credit Facility. As of December 31, 2008, the Credit Facility bears interest at LIBOR + 0.375% and provides for different pricing based upon our investment grade rating. As of December 31, 2008, $2.4 billion was available after outstanding borrowings and letter of credits.

(16)
Debt is denominated in Chinese Yuan Renuinbi and bears interest at 110% of the People's Republic of China (PBOC) rate. Debt consists of a CNY 290 million tranche which CNY 290 million is drawn.

(17)
Loans secured by these five properties are cross-collateralized and cross-defaulted.

(18)
Debt is denominated in Euros and bears interest at 3 month Euribor + 1.05%. Debt consists of a Euros 258.5 million tranche of which Euros 238.3 million is drawn.

(19)
Our share of consolidated indebtedness was $17,766,316.

(20)
Loans secured by these four properties are cross-collateralized and cross-defaulted.

(21)
LIBOR + 0.750%, with LIBOR capped at 7.500%.

(22)
LIBOR + 0.650%, with LIBOR capped at 8.500%.

(23)
Our share of joint venture indebtedness was $6,632,419.

(24)
Debt is denominated in Chinese Yuan Renuinbi and bears interest at 110% of the People's Republic of China (PBOC) rate. Debt consists of a CNY 250 million tranche which CNY 250 million is drawn.

(25)
The maturity date shown represents the Anticipated Maturity Date of the loan which is typically 10-20 years earlier than the stated Maturity Date of the loan. Should the loan not be repaid at the Anticipated Repayment Date the applicable interest rate shall increase as specified in the loan agreement.

(26)
Amounts shown in US Dollar Equivalent. Yen equivalent 32,908.8 million

(27)
Debt is denominated in Euros and bears interest at 3 month Euribor + 1.15%. Debt consists of a Euros 255 million tranche which Euros 235.9 million is drawn.

(28)
Debt is denominated in Chinese Yuan Renuinbi and bears interest at 115% of the People's Republic of China (PBOC) rate. Debt consists of a CNY 500 million tranche which CNY 500 million is drawn.

(29)
LIBOR + 0.900%, with LIBOR capped at 8.250%.

(30)
LIBOR + 0.750%, with LIBOR capped at 8.250%.

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(31)
Associated with these loans are interest rate swap agreements with a total combined Euro 319.0 million notional amount that effectively fixed these loans at a combined 4.77%.

(32)
Debt is denominated in Euros and bears interest at 3 month Euribor + 0.75%. Debt consists of a Euros 130 million tranche which Euros 128.9 million is drawn.

(33)
Debt is denominated in Euros and bears interest at 3 month Euribor + 0.80%. Debt consists of a Euros 28 million tranche which Euros 27.0 million is drawn.

(34)
Debt is denominated in Euros and bears interest at 3 month Euribor + 0.80%. Debt consists of a Euros 27 million tranche which Euros 26.2 million is drawn.

(35)
Loans secured by these four properties are cross-collateralized and cross-defaulted.

(36)
LIBOR + 0.560%, with LIBOR capped at 7.00%.

(37)
LIBOR + 1.950%, with LIBOR capped at 6.00%.

(38)
Variable rate loans based on LIBOR + 1.975%. An interest rate swap agreement effectively fixes the interest rate of the loans at 5.39%.

(39)
Debt is denominated in Chinese Yuan Renuinbi and bears interest at 110% of the People's Republic of China (PBOC) rate. Debt consists of a CNY 310 million tranche which CNY 310 million is drawn.

(40)
Loan is secured by The Domain Shopping Center, Palms Crossing, and Shops at Arbor Walk and is cross-collateralized and cross-defaulted.

(41)
Amounts shown in US Dollar Equivalent. Balances include borrowings on multi-currency tranche of Yen 22,125.0 million.

(42)
Amounts shown in US Dollar Equivalent. Balances include borrowings on multi-currency tranche of Euro 143.5 million.

(43)
As of December 31, 2008, this loan is set at LIBOR plus 1.95%. Effective 1/2/09 we have executed a swap agreement that fixes the interest rate on $200 million of this loan at 4.35%.

The changes in mortgages and other indebtedness for the years ended December 31, 2008, 2007, 2006 are as follows:

 
  2008   2007   2006  

Balance, Beginning of Year

  $ 17,218,674   $ 15,394,489   $ 14,106,117  
 

Additions during period:

                   
   

New Loan Originations

    1,833,677     3,362,732     2,810,239  
   

Loans assumed in acquisitions and consolidations

        399,545     192,272  
   

Net Premium

    (7,192 )   (1,669 )   (5,031 )
 

Deductions during period:

                   
   

Loan Retirements

    (930,818 )   (1,862,145 )   (1,619,148 )
   

Amortization of Net Premiums

    (14,611 )   (13,661 )   (25,784 )
   

Scheduled Principal Amortization

    (57,198 )   (60,617 )   (64,176 )
               

Balance, Close of Year

  $ 18,042,532   $ 17,218,674   $ 15,394,489  
               

Item 3.    Legal Proceedings

             As previously disclosed, for several years we have been defending actions brought by the Attorneys General of Massachusetts, New Hampshire and Connecticut in their respective state courts and similar litigation brought by other parties alleging that the sale of co-branded, bank-issued gift cards by our affiliate, SPGGC, Inc., at certain of our properties, violated state gift certificate and consumer protection laws. We previously reported the dismissal of the New Hampshire litigation. During the fourth quarter of 2008, the complaint in the Massachusetts litigation was dismissed and we settled the Connecticut litigation. The only remaining legal proceedings involving gift card sales are two purported class actions brought by private parties in New York. With the resolution of the remaining Attorneys General's actions in 2008, we no longer believe that the ultimate outcome of these related actions would have a material adverse effect on our financial position, results of operations or cash flows and, accordingly, we do not expect to report further developments in these actions.

             We are also involved in various other legal proceedings that arise in the ordinary course of our business. We believe that such litigation, claims and administrative proceedings will not have a material adverse impact on our financial position or our results of operations. We record a liability when a loss is considered probable and the amount can be reasonably estimated.

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

             None.

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Part II

Item 5.    Market for the Registrant's Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities

            There is no established trading market for our units or preferred units. The following table sets forth for the periods indicated, the distributions declared on our common units:

 
  Declared
Distributions
 

2007

       

1st Quarter

  $ 0.84  

2nd Quarter

    0.84  

3rd Quarter

    0.84  

4th Quarter

    0.84  

2008

       

1st Quarter

  $ 0.90  

2nd Quarter

    0.90  

3rd Quarter

    0.90  

4th Quarter

    0.90  

            The number of holders of record of units was 255 as of February 24, 2009.

            We make distributions to our limited and general partners in order to maintain Simon Property's qualification as a REIT. Simon Property is required each year to distribute to its stockholders at least 90% of its taxable income after certain adjustments. Future distributions will be determined at the discretion of Simon Property's Board of Directors based on actual results of operations, cash available for distribution, and what may be required to maintain Simon Property's status as a REIT.

            On January 30, 2009, Simon Property's Board of Directors approved a quarterly common stock dividend of $0.90 per share, to be paid in a combination of cash and shares of its common stock. The distribution rate on our units is equal to the dividend rate on Simon Property's common stock. While our unitholders will have the right to elect to receive their distribution in either cash or units, we have announced that the aggregate cash component of the distribution will not exceed 10% of the total distribution, or $0.09 per unit. If the number of unitholders electing to receive cash would result in the payment of cash in excess of this 10% limitation, we will allocate the cash payment on a pro rata basis among those unitholders making the cash election. Simon Property has reserved the right to elect to pay the first quarter dividend, and as a result our distribution, all in cash. Simon Property's Board of Directors reviews and approves Simon Property's dividends and, as a result, our distributions, on a quarterly basis, and no determination has been made about whether the remaining 2009 dividends will be paid in a similar combination of cash and common stock. Paying all or a portion of its remaining 2009 dividends in a combination of cash and common stock allows Simon Property to satisfy its REIT taxable income distribution requirement under existing IRS revenue procedures, while enhancing financial flexibility and balance sheet strength.

            During the fourth quarter of 2008, Simon Property issued 339,621 shares of its common stock to limited partners in exchange for an equal number of units. The issuance of the shares of common stock was made pursuant to the terms of our Partnership Agreement and was exempt from registration under the Securities Act of 1933 as amended, in reliance upon Section 4(2).

            The Simon Property Board of Directors has authorized the repurchase of up to $1.0 billion of its common stock through July 2009. Simon Property may repurchase shares in the open market or in privately negotiated transactions. As of December 31, 2008, the program had remaining availability of approximately $950.7 million. There were no purchases under this program during the fourth quarter of 2008. If Simon Property acquires shares of its common stock, then we would repurchase an equal number of our units from Simon Property.

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Item 6.    Selected Financial Data

            The following tables set forth selected financial data. The selected financial data should be read in conjunction with the financial statements and notes thereto and with Management's Discussion and Analysis of Financial Condition and Results of Operations. Other data we believe is important in understanding trends in our business is also included in the tables.

 
  As of or for the Year Ended December 31,  
 
  2008   2007   2006   2005   2004 (1)  
 
  (in thousands, except per share data)
 

OPERATING DATA:

                               
 

Total consolidated revenue

  $ 3,783,155   $ 3,650,799   $ 3,332,154   $ 3,166,853   $ 2,567,774  
 

Income from continuing operations

    588,469     661,702     719,083     457,328     454,358  
 

Net income available to common unitholders

  $ 529,726   $ 549,678   $ 614,911   $ 510,581   $ 380,711  

BASIC EARNINGS PER UNIT:

                               
 

Income from continuing operations

  $ 1.88   $ 2.09   $ 2.20   $ 1.27   $ 1.47  
 

Discontinued operations

        (0.13 )       0.55     (0.04 )
                       
 

Net income

  $ 1.88   $ 1.96   $ 2.20   $ 1.82   $ 1.43  
                       
 

Weighted average units outstanding

    282,508     281,035     279,567     279,825     265,405  

DILUTED EARNINGS PER UNIT:

                               
 

Income from continuing operations

  $ 1.87   $ 2.08   $ 2.19   $ 1.27   $ 1.47  
 

Discontinued operations

        (0.13 )       0.55     (0.04 )
                       
 

Net income

  $ 1.87   $ 1.95   $ 2.19   $ 1.82   $ 1.43  
                       
 

Diluted weighted average units outstanding

    283,059     281,813     280,471     280,696     266,272  
 

Distributions per unit (2)

  $ 3.60   $ 3.36   $ 3.04   $ 2.80   $ 2.60  

BALANCE SHEET DATA:

                               
 

Cash and cash equivalents

  $ 773,544   $ 501,982   $ 929,360   $ 337,048   $ 519,556  
 

Total assets

    23,596,672     23,605,662     22,084,455     21,131,039     21,921,902  
 

Mortgages and other indebtedness

    18,042,532     17,218,674     15,394,489     14,106,117     14,586,393  
 

Partners' equity

  $ 3,822,122   $ 4,517,432   $ 5,089,868   $ 5,489,518   $ 5,779,870  

OTHER DATA:

                               
 

Cash flow provided by (used in):

                               
   

Operating activities

  $ 1,606,233   $ 1,468,400   $ 1,278,948   $ 1,170,371   $ 1,079,092  
   

Investing activities

    (1,020,872 )   (2,049,576 )   (607,432 )   (51,906 )   (2,742,542 )
   

Financing activities

  $ (313,799 ) $ 153,798   $ (79,204 ) $ (1,300,973 ) $ 1,653,970  
 

Ratio of Earnings to Fixed Charges (3)

    1.46x     1.53x     1.73x     1.56x     1.63x  
                       

Notes

(1)
On October 14, 2004 we acquired the former Chelsea Property Group, Inc. In the accompanying financial statements, Note 2 describes the basis of presentation and Note 4 describes acquisitions and disposals.

(2)
Represents distributions declared per period.

(3)
The ratios for 2004 have been restated for the reclassification of discontinued operations described in Note 3.

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Item 7.    Management's Discussion and Analysis of Financial Condition and Results of Operations

            You should read the following discussion in conjunction with the consolidated financial statements and notes thereto that are included in this report.

            Simon Property Group, L.P. is a Delaware limited partnership and the majority-owned subsidiary of Simon Property Group, Inc. In this discussion, the terms "Operating Partnership", "we", "us" and "our" refer to Simon Property Group, L.P. and its subsidiaries and the term "Simon Property" refers specifically to Simon Property Group, Inc.

            We own, develop, and manage retail real estate properties in five retail real estate platforms: regional malls, Premium Outlet Centers®, The Mills®, community/lifestyle centers, and international properties. As of December 31, 2008, we owned or held an interest in 324 income producing properties in the United States, which consisted of 164 regional malls, 70 community/lifestyle centers, 16 additional regional malls and four additional community centers acquired as a result of the 2007 acquisition of The Mills Corporation, or the Mills acquisition, 40 Premium Outlet Centers, 16 The Mills, and 14 other shopping centers or outlet centers in 41 states plus Puerto Rico. The Mills acquisition is described below in the "Results of Operations" section. We also own interests in four parcels of land held in the United States for future development. In the United States, we have one new property currently under development aggregating approximately 400,000 square feet which will open during 2009. Internationally, we have ownership interests in 52 European shopping centers (located in France, Italy, and Poland); seven Premium Outlet Centers located in Japan, one Premium Outlet Center located in Mexico, one Premium Outlet Center located in Korea, and one shopping center located in China. Also, through joint venture arrangements we have ownership interests in the following properties under development internationally: a 24% interest in two shopping centers in Italy, a 40% interest in a Premium Outlet Center in Japan, and a 32.5% interests in three additional shopping centers under construction in China.

            We generate the majority of our revenues from leases with retail tenants including:

            Revenues of our management company, after intercompany eliminations, consist primarily of management fees that are typically based upon the revenues of the property being managed.

            We seek growth in earnings, and cash flows by enhancing the profitability and operation of our properties and investments. We seek to accomplish this growth through the following:

            We also grow by generating supplemental revenues from the following activities:

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            We focus on high quality real estate across the retail real estate spectrum. We expand or renovate to enhance existing assets' profitability and market share when we believe the investment of our capital meets our risk-reward criteria. We selectively develop new properties in major metropolitan areas that exhibit strong population and economic growth.

            We routinely review and evaluate acquisition opportunities based on their ability to complement our portfolio. Lastly, we are selectively expanding our international presence. Our international strategy includes partnering with established real estate companies and financing international investments with local currency to minimize foreign exchange risk.

            To support our growth, we employ a three-fold capital strategy:

            Diluted earnings per unit of limited partnership interest, or units, decreased $0.08 during 2008, or 4.1%, to $1.87 from $1.95 for 2007. The decrease is primarily due to the $20.3 million loss relating to the redemption of remarketable debt securities, and $21.2 million in impairment charges in 2008, as compared to net gains aggregating $9.0 million related to sales and disposition activity and impairment charges for the comparable period in 2007. Consolidated total revenues increased $132.4 million, or 3.6%, driven by the full year effect of our 2007 openings and expansion activities and the releasing of space at higher rental rates per square foot, or psf. Releasing spreads in the regional mall and Premium Outlet portfolios were strong at $8.02 psf (or 21.3%) and $12.48 psf (or 48.8%), respectively, due to continued demand for higher quality space in our portfolio. Total operating expenses increased $106.5 million, or 5.0%, due to additional depreciation provisions related to the full year of operations for 2007 openings and 2008 new openings, an increase in the provision for bad debts due to the estimated uncollectability of certain tenant receivables, and higher personnel and utility costs attributable to normal inflationary increases. Interest costs remained relatively flat despite an increase in total debt due to lowered variable borrowing costs as a result of a reduced one-month LIBOR rate, the benchmark rate for most of our floating rate debt.

            In the United States, business fundamentals were relatively stable, except for tenant sales psf which were mixed across the portfolio, and were dependent upon asset type, geographic location, and mix of specialty and luxury tenants. Average base rents for the regional mall and domestic Premium Outlet portfolios were relatively stable for 2008. The regional malls average base rent ended the year at $39.49 psf, or an increase of 6.5% over 2007. The domestic Premium Outlets average base rent ended the year at $27.65 psf, or an increase of 7.7%. The stability of the occupancy, rent psf, and releasing rental spread fundamentals contributed to our ability to generate growth in our operating results despite the adverse effects the general economic pressures are creating for our tenants and the consumer.

            Internationally, in 2008, we and our joint venture partners opened three additional centers (one each in Italy, China, and Japan) and expanded two existing Premium Outlet Centers which added an aggregate 1 million square feet of retail space to the international portfolio. Also during 2008, we acquired shares of stock of Liberty International, PLC, or Liberty. Liberty operates regional shopping centers and is the owner of other prime retail assets throughout the U.K. Liberty is a U.K. FTSE 100 listed company, with shareholders' funds of £4.7 billion and property investments of £8.6 billion, of which its U.K. regional shopping centers comprise 75%. Assets of the group under control or joint control amount to £11.0 billion. Liberty converted into a U.K. Real Estate Investment Trust (REIT) on January 1, 2007. Our interest in Liberty is less than 5% of their shares and is adjusted to their quoted market price, including a related foreign exchange component.

            Our effective overall borrowing rate for the year ended December 31, 2008, decreased 55 basis points to 5.12% as compared to the year ended December 31, 2007. This was a result of a significant decrease in the base LIBOR rate applicable to a majority of our floating rate debt (0.44% at December 31, 2008, versus 4.60% at December 31, 2007)

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and also the issuance of new unsecured and secured debt at favorable rates. Our financing activities for the year ended December 31, 2008, included:

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United States Portfolio Data

            The portfolio data discussed in this overview includes the following key operating statistics: occupancy; average base rent per square foot; and comparable sales per square foot for our four domestic platforms. We include acquired properties in this data beginning in the year of acquisition and remove properties sold in the year disposed. We are separately reporting in this section the 16 regional malls we acquired in the 2007 acquisition of The Mills Corporation, or the Mills acquisition. We do not include any properties located outside of the United States in this section. The following table sets forth these key operating statistics for:

 
  2008   %/Basis Points
Change(1)
  2007   %/Basis Points
Change(1)
  2006   %/Basis Point
Change(1)
 

Regional Malls:

                                     

Occupancy

                                     

Consolidated

    92.6%     -130 bps     93.9%     +90 bps     93.0%     -30 bps  

Unconsolidated

    91.9%     -80 bps     92.7%     -80 bps     93.5%     +80 bps  

Total Portfolio

    92.4%     -110 bps     93.5%     +30 bps     93.2%     +10 bps  

Average Base Rent per Square Foot

                                     

Consolidated

  $ 38.21     5.4%   $ 36.24     4.2%   $ 34.79     2.2%  

Unconsolidated

  $ 42.03     8.5%   $ 38.73     6.2%   $ 36.47     3.3%  

Total Portfolio

  $ 39.49     6.5%   $ 37.09     4.8%   $ 35.38     2.6%  

Comparable Sales per Square Foot

                                     

Consolidated

  $ 445     (5.6% ) $ 472     2.2%   $ 462     6.2%  

Unconsolidated

  $ 523     (1.5% ) $ 530     4.9%   $ 505     5.6%  

Total Portfolio

  $ 470     (4.3% ) $ 491     3.2%   $ 476     5.8%  

Premium Outlet Centers:

                                     

Occupancy

    98.9%     -80 bps     99.7%     +30 bps     99.4%     -20 bps  

Average Base Rent per Square Foot

  $ 27.65     7.7%   $ 25.67     5.9%   $ 24.23     4.6%  

Comparable Sales per Square Foot

  $ 513     1.8%   $ 504     7.0%   $ 471     6.1%  

The Mills®:

                                     

Occupancy

    94.5%     +40 bps     94.1%              

Average Base Rent per Square Foot

  $ 19.51     2.4%   $ 19.06              

Comparable Sales per Square Foot

  $ 372     0.1%   $ 372              

Mills Regional Malls:

                                     

Occupancy

    87.4%     -210 bps     89.5%              

Average Base Rent per Square Foot

  $ 36.99     3.8%   $ 35.63              

Comparable Sales per Square Foot

  $ 418     (5.8% ) $ 444              

Community/Lifestyle Centers:

                                     

Occupancy

                                     

Consolidated

    89.3%     -360 bps     92.9%     +140 bps     91.5%     +200 bps  

Unconsolidated

    93.3%     -330 bps     96.6%     +10 bps     96.5%     +40 bps  

Total Portfolio

    90.7%     -340 bps     94.1%     +90 bps     93.2%     +160 bps  

Average Base Rent per Square Foot

                                     

Consolidated

  $ 13.70     7.6%   $ 12.73     7.0%   $ 11.90     1.7%  

Unconsolidated

  $ 12.41     4.7%   $ 11.85     1.5%   $ 11.68     8.0%  

Total Portfolio

  $ 13.25     6.6%   $ 12.43     5.2%   $ 11.82     3.6%  

(1)
Percentages may not recalculate due to rounding.

            Occupancy Levels and Average Base Rent Per Square Foot.    Occupancy and average base rent are based on mall and freestanding Gross Leasable Area, or GLA, owned by us in the regional malls, and all tenants at The Mills, Premium Outlet Centers, and community/lifestyle centers. Our portfolio has maintained relatively stable occupancy and increased the aggregate average base rents despite the current economic climate.

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            Comparable Sales Per Square Foot.    Comparable sales include total reported retail tenant sales at owned GLA (for mall and freestanding stores with less than 10,000 square feet) in the regional malls, and all reporting tenants at The Mills and the Premium Outlet Centers and community/lifestyle centers. Retail sales at owned GLA affect revenue and profitability levels because sales determine the amount of minimum rent that can be charged, the percentage rent realized, and the recoverable expenses (common area maintenance, real estate taxes, etc.) that tenants can afford to pay.

International Property Data

            The following are selected key operating statistics for certain of our international properties.

 
  2008   % Change   2007   % Change   2006  

European Shopping Centers

                               

Occupancy

    98.4%           98.7%           97.1%  

Comparable sales per square foot

    €411     -2.5%     €421     7.7%     €391  

Average rent per square foot

    €30.11     1.8%     €29.58     12.5%     €26.29  

International Premium Outlet Centers(1)

                               

Occupancy

    99.9%           100%           100%  

Comparable sales per square foot

    ¥92,000     -1.3%     ¥93,169     4.4%     ¥89,238  

Average rent per square foot

    ¥4,685     1.3%     ¥4,626     -0.4%     ¥4,646  

(1)
Does not include one center in Mexico (Premium Outlets Punta Norte), one center in Korea (Yeoju Premium Outlets), and one shopping center in China.

Critical Accounting Policies

            The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America, or GAAP, requires management to use judgment in the application of accounting policies, including making estimates and assumptions. We base our estimates on historical experience and on various other assumptions believed to be reasonable under the circumstances. These judgments affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenue and expenses during the reporting periods. If our judgment or interpretation of the facts and circumstances relating to various transactions had been different, it is possible that different accounting policies would have been applied resulting in a different presentation of our financial statements. From time to time, we evaluate our estimates and assumptions. In the event estimates or assumptions prove to be different from actual results, adjustments are made in subsequent periods to reflect more current information. Below is a discussion of accounting policies that we consider critical in that they may require complex judgment in their application or require estimates about matters that are inherently uncertain. For a summary of our significant accounting policies, see Note 3 of the Notes to Consolidated Financial Statements.

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Results of Operations

            In addition to the activity discussed above in "Results Overview," the following acquisitions, property openings, and other activity affected our consolidated results from continuing operations in the comparative periods:

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            In addition to the activities discussed above and in "Results Overview", the following acquisitions, dispositions, and property openings affected our income from unconsolidated entities in the comparative periods:

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            For the purposes of the following comparisons between the years ended December 31, 2008 and 2007 and the years ended December 31, 2007 and 2006, the above transactions are referred to as the property transactions. In the following discussions of our results of operations, "comparable" refers to properties open and operating throughout both the current and prior year.

            In 2008 we had no consolidated property dispositions. During 2007, we disposed of five consolidated properties that had an aggregate book value of $91.6 million for aggregate sales proceeds of $56.4 million, resulting in a net loss on sale of $35.3 million. The loss on sale of these assets has been reported as discontinued operations in the consolidated statements of operations. The operating results of the properties that we sold or disposed during 2007 were not significant to our consolidated results of operations. The following is a list of consolidated property dispositions and the date of disposition for which we have reported the operations or results of sale with discontinued operations:

Property
  Date of Disposition

Lafayette Square

  December 27, 2007

University Mall

  September 28, 2007

Boardman Plaza

  September 28, 2007

Griffith Park Plaza

  September 20, 2007

Alton Square

  August 2, 2007

            We sold the following properties in 2006. Due to the limited significance of these properties' operations and result of disposition on our consolidated financial statements, we did not report these properties as discontinued operations.

Property
  Date of Disposition  

Northland Plaza

    December 22, 2006  

Trolley Square

    August 3, 2006  

Wabash Village

    July 27, 2006  

Year Ended December 31, 2008 vs. Year Ended December 31, 2007

            Minimum rents increased $137.2 million in 2008, of which the property transactions accounted for $64.6 million of the increase. Comparable rents increased $72.6 million, or 3.6%. This was primarily due to an increase in minimum rents of $82.1 million and an $8.5 million increase in straight-line rents, offset by a $16.4 million decrease in comparable property activity, primarily attributable to lower amounts of fair market value of in-place lease amortization.

            Overage rents decreased $9.8 million or 8.9%, as a result of a reduction in tenant sales for the period as compared to the prior year.

            Tenant reimbursements increased $42.8 million, due to a $26.9 million increase attributable to the property transactions and a $15.9 million, or 1.6%, increase in the comparable properties due to our ongoing initiative to convert leases to a fixed reimbursement methodology for common area maintenance costs.

            Management fees and other revenues increased $18.7 million principally as a result of the full year of additional management fees derived from managing the properties acquired in the Mills acquisition, and additional leasing and development fees as a result of incremental joint venture property activity.

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            Total other income decreased $56.6 million, and was principally the result of the following:

These decreases were offset by a $3.1 million increase in net other activity.

            Depreciation and amortization expense increased $63.8 million in 2008 primarily due to our acquisition, expansion and renovation activity and the accelerated depreciation of tenant improvements for tenant leases terminated during the period and for properties scheduled for redevelopment.

            Real estate taxes increased $21.3 million from the prior period, $9.0 million of which is related to the property transactions, and $12.3 million from our comparable properties due to the effect of increases resulting from reassessments, higher tax rates, and the effect of expansion and renovation activities.

            Repairs and maintenance decreased $12.3 million due to our cost savings efforts.

            Provision for credit losses increased $14.5 million primarily due to an increase in tenant bankruptcies and tenant delinquencies. This was reflected in total square footage lost to tenant bankruptcies of 1,104,000 during 2008 as compared to only 69,000 square feet in 2007. We anticipate a challenging environment for our tenants continuing into 2009.

            Home and regional office expense increased $8.3 million primarily due to increased personnel costs, primarily the result of the Mills acquisition, and the increased expense from certain incentive compensation plans.

            Other expenses increased $5.8 million due to increased consulting and professional fees, including legal fees and related costs.

            Interest expense increased $1.3 million despite an $823.9 million increase in consolidated borrowings to fund our development and redevelopment activities, and the full year impact of our borrowings to fund the Mills-related loans, due to a 55 basis point decline in our weighted average borrowing rates. This decrease in weighted average borrowing rates was driven primarily by a decline in the applicable LIBOR rate for a majority of our consolidated floating rate debt instruments, including the Credit Facility.

            We recognized a loss on extinguishment of debt of $20.3 million in the second quarter of 2008 related to the redemption of $200 million in remarketable debt securities. We extinguished the debt because the remarketing reset base rate was above the rate for 30-year U.S. Treasury securities at the date of redemption.

            Income tax expense of taxable REIT subsidiaries increased $14.9 million due primarily to a $19.5 million tax benefit recognized in 2007 related to the impairment charge resulting from of the write-off of our investment in a land joint venture in Phoenix, Arizona.

            Income from unconsolidated entities decreased $5.9 million, due primarily to the impact of the Mills acquisition (net of eliminations). On a net basis, our share of loss from SPG-FCM increased $4.7 million from the prior period due to a full year of SPG-FCM activity in 2008 as compared to only nine months of activity in 2007. The loss was driven by depreciation and amortization expense on asset basis step-ups in purchase accounting.

            In 2008, we recognized an impairment of $21.2 million primarily representing the write-down of a mall property to its estimated net realizable value and the write-off of predevelopment costs for various development opportunities that we no longer plan to pursue. In 2007, we recognized an impairment of $55.1 million related to a land joint venture in Phoenix, Arizona.

            The gain on sale of assets and interests in unconsolidated entities of $92.0 million in 2007 was primarily the result of Simon Ivanhoe selling its interest in certain assets located in Poland.

            In 2007, the loss on sale of discontinued operations of $35.3 million represents the net loss upon disposition of five non-core properties consisting of three regional malls and two community/lifestyle centers.

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            Preferred unit distribution requirements decreased $17.9 million as a result of the conversion or exchange of preferred units to units and the redemption of the Series G preferred units in the fourth quarter of 2007.

Year Ended December 31, 2007 vs. Year Ended December 31, 2006

            Minimum rents increased $133.9 million in 2007, of which the property transactions accounted for $87.0 million of the increase. Total amortization of the fair market value of in-place leases served to decrease minimum rents by $8.8 million due to certain in-place lease adjustments becoming fully amortized. Comparable rents increased $46.8 million, or 2.3%. This was primarily due to the leasing of space at higher rents that resulted in an increase in minimum rents of $54.6 million offset by a $9.2 million decrease in comparable property straight-line rents and fair market value of in-place lease amortization. In addition, rents from carts, kiosks, and other temporary tenants increased comparable rents by $1.4 million.

            Overage rents increased $14.2 million or 14.9%, reflecting increases in tenant sales.

            Tenant reimbursements increased $76.6 million, of which the property transactions accounted for $40.2 million. The remainder of the increase of $36.4 million, or 3.8%, was in comparable properties and was due to inflationary increases in property operating costs and our ongoing initiative of converting our leases to a fixed reimbursement methodology for common area maintenance costs.

            Management fees and other income increased $31.5 million principally as a result of additional management fees derived from the additional properties being managed from the Mills acquisition and additional leasing and development fees as a result of incremental property activity.

            Total other income increased $62.5 million, and was principally the result of the following:

            Property operating expenses increased $13.3 million, or 3.0%, primarily as a result of the property transactions and inflationary increases.

            Depreciation and amortization expense increased $49.4 million and is primarily a result of the property transactions.

            Real estate taxes increased $13.1 million from the prior period, $10.4 million of which is related to the property transactions, and $2.7 million from our comparable properties due to the effect of increases resulting from reassessments, higher tax rates, and the effect of expansion and renovation activities.

            Repairs and maintenance increased $14.2 million due to increased snow removal costs in 2007 over that of 2006, normal inflationary increases, and the effect of the property transactions.

            Advertising and promotion increased $5.9 million primarily due to the effect of the property transactions.

            Home and Regional office expense increased $7.3 million primarily due to increased personnel costs, primarily the result of the Mills acquisition, and the effect of incentive compensation plans.

            General and administrative expenses increased $2.9 million due to increased executive salaries, principally as a result of additional share-based payment amortization from the vesting of restricted stock grants.

            Interest expense increased $124.0 million due principally to the following:

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            Also impacting interest expense was the consolidation of Town Center at Cobb, Gwinnett Place, and Mall of Georgia as a result of our acquisition of additional ownership interests, and the assumption of debt related to the acquisition of Las Americas Premium Outlets.

            Income tax expense of taxable REIT subsidiaries decreased $22.7 million due primarily to a $19.5 million tax benefit recognized related to the impairment charge related to our write-off of our entire investment in Surprise Grand Vista JV I, LLC, which is developing land located in Phoenix, Arizona, along with a reduction in the taxable income for the management company as a result of structural changes made to our wholly-owned captive insurance entities.

            Income from unconsolidated entities decreased $72.7 million, due in part to the impact of the Mills transaction (net of eliminations). On a net income basis, our share of income from SPG-FCM approximates a net loss of $58.7 million for the year due to additional depreciation and amortization expenses on asset basis step-ups in purchase accounting approximating $102.2 million for the second through fourth quarters of 2007. Also contributing to the decrease is the prior year recognition of $15.6 million in income related to a beneficial interest that we held in 2006 in a regional mall entity. This beneficial interest was terminated in November 2006.

            In 2007, we recognized an impairment of $55.1 million related to our Surprise Grand Vista venture in Phoenix, Arizona. As described above, the charge to earnings resulted in a $19.5 million tax benefit, resulting in a net charge to earnings, before consideration of the limited partners' interest, of $35.6 million.

            We recorded a $92.0 million net gain on the sales of assets and interests in unconsolidated entities in 2007 primarily as a result of the sale of five assets in Poland by Simon Ivanhoe. In 2006, we recorded a gain related to the sale of a beneficial interest of $86.5 million, a $34.4 million gain on the sale of a 10.5% interest in Simon Ivanhoe, and the net gain on the sale of four non-core properties, including one joint venture property, of $12.2 million.

            In 2007, the loss on sale of discontinued operations of $35.3 million represents the net loss upon disposition of five non-core properties consisting of three regional malls and two community/lifestyle centers.

            Preferred unit distribution requirements decreased $28.0 million as a result of the redemption of the Series G preferred units in the fourth quarter of 2007 and the Series F preferred units in the fourth quarter of 2006.

Liquidity and Capital Resources

            Because we generate revenues primarily from long-term leases, our financing strategy relies primarily on long-term fixed rate debt. We manage our floating rate debt to be at or below 15-25% of total outstanding indebtedness by negotiating interest rates for each financing or refinancing based on current market conditions. Floating rate debt currently comprises approximately 15% of our total consolidated debt. We also enter into interest rate protection agreements as appropriate to assist in managing our interest rate risk. We derive most of our liquidity from leases that generate positive net cash flow from operations and distributions of capital from unconsolidated entities that totaled $1.9 billion during 2008. In addition, the Credit Facility provides an alternative source of liquidity as our cash needs vary from time to time. Also, Simon Property recently declared a dividend for the first quarter of 2009 that it intends to pay in cash and shares of Simon Property's common stock, with the cash component limited to 10% on an aggregate basis. As a result, we would make a corresponding distribution to unitholders comprised of 10% cash, with the balance being paid with units. Paying 90% of the 2009 first quarter dividend, and as a result our distributions, in a form other than cash allows Simon Property to satisfy its REIT taxable income distribution requirement while enhancing financial flexibility and balance sheet strength.

            Our balance of cash and cash equivalents increased $271.6 million during 2008 to $773.5 million as of December 31, 2008. December 31, 2008 and 2007 balances include $29.8 million and $41.3 million, respectively, related to our co-branded gift card programs, which we do not consider available for general working capital purposes.

            On December 31, 2008, we had available borrowing capacity of approximately $2.4 billion under the Credit Facility, net of outstanding borrowings of $1.0 billion and letters of credit of $15.7 million. During 2008, the maximum amount outstanding under the Credit Facility was $2.6 billion and the weighted average amount outstanding was $1.4 billion. The weighted average interest rate was 3.49% for the year ended December 31, 2008. The Credit Facility is scheduled to mature on January 11, 2010, which we can extend for another year at our option.

            We and/or Simon Property also have access to public equity and long term unsecured debt markets and access to private equity from institutional investors at the property level.

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            Our business model requires us to regularly access the debt and equity capital markets to raise funds for some of our acquisition activity, development and redevelopment capital, as well as to refinance many of our existing debt maturities. We are currently seeing significant turmoil in the capital markets. This has impacted access to debt and equity capital for many organizations, including ours. As demonstrated by recent financing activities (both secured and unsecured), we were able to successfully access capital in the third and fourth quarters of 2008; however, there is no assurance we will be able to do so on similar terms or conditions in future periods. We believe we have sufficient cash on hand and availability under the Credit Facility to address our debt maturities and capital needs through 2009.

            On February 16, 2007, SPG-FCM, a 50/50 joint venture between one of our affiliates and funds managed by Farallon Capital Management, L.L.C. ("Farallon"), entered into a definitive merger agreement to acquire all of the outstanding common stock of Mills for $25.25 per common share in cash. The acquisition of Mills and its interests in the 36 properties that remain at December 31, 2008 was completed in April 2007. As of December 31, 2008, we and Farallon had each funded $650.0 million into SPG-FCM to acquire all of the common stock of Mills. As part of the transaction, we also made loans to SPG-FCM and Mills primarily at rates of LIBOR plus 270-275 basis points. These funds were used by SPG-FCM and Mills to repay loans and other obligations of Mills, including the redemption of preferred stock, during 2007. As of December 31, 2008, the outstanding balance of our loan to SPG-FCM was $520.7 million, and the average outstanding balance during the twelve month period ended December 31, 2008 of all loans made to SPG-FCM and Mills was approximately $534.1 million. During 2008 and 2007, we recorded approximately $15.3 million and $39.1 million in interest income (net of inter-entity eliminations) related to these loans, respectively. We also recorded fee income, including fee income amortization related to up-front fees on loans made to SPG-FCM and Mills, during 2008 and 2007 of approximately $3.1 million and $17.4 million (net of inter-entity eliminations), respectively, for providing refinancing services to Mills' properties and SPG-FCM. The existing loan facility to SPG-FCM bears a rate of LIBOR plus 275 basis points and matures on June 7, 2009, with three available one-year extensions. Fees charged on loans made to SPG-FCM and Mills are amortized on a straight-line basis over the life of the loan.

            The Mills acquisition involved the purchase of all Mills' outstanding shares of common stock and common units for approximately $1.7 billion (at $25.25 per share or unit), the assumption of $954.9 million of preferred stock, the assumption of a proportionate share of property-level mortgage debt, of which SPG-FCM's share approximated $3.8 billion, the assumption of $1.2 billion in unsecured loans provided by us, costs to effect the acquisition, and certain liabilities and contingencies, including an ongoing investigation by the Securities and Exchange Commission, for an aggregate purchase price of approximately $8 billion. SPG-FCM has completed its purchase price allocations for the Mills acquisition using valuations developed with the assistance of a third-party professional appraisal firm.

            In conjunction with the Mills acquisition, we acquired a majority interest in two properties in which we previously held a 50% ownership interest (Town Center at Cobb and Gwinnett Place) and as a result we have consolidated these two properties at the date of acquisition.

            In addition to the loans provided to SPG-FCM, we also provide management services to substantially all of the properties in which SPG-FCM holds an interest.

            Our net cash flow from operating activities and distributions of capital from unconsolidated entities totaled $1.9 billion during 2008. In addition, we received net proceeds from our debt financing and repayment activities in 2008 of $764.8 million. These activities are further discussed below in "Financing and Debt". We also:

            In general, we anticipate that cash generated from operations will be sufficient to meet operating expenses, monthly debt service, recurring capital expenditures, and distributions to partners necessary to maintain Simon

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Property's REIT qualification on a long-term basis. In addition, we expect to be able to obtain capital for nonrecurring capital expenditures, such as acquisitions, major building renovations and expansions, as well as for scheduled principal maturities on outstanding indebtedness, from:

            We expect to generate positive cash flow from operations in 2009, and we consider these projected cash flows in our sources and uses of cash. These cash flows are principally derived from retail tenants, many of whom are experiencing considerable financial distress. A significant deterioration in projected cash flows from operations could cause us to increase our reliance on available funds from the Credit Facility, curtail planned capital expenditures, or seek other additional sources of financing as discussed above.

            Our unsecured debt currently consists of $10.7 billion of senior unsecured notes and the Credit Facility. The Credit Facility bears interest at LIBOR plus 37.5 basis points and an additional facility fee of 12.5 basis points. The Credit Facility matures January 11, 2010 and may be extended one year at our option.

            On May 19, 2008, we issued two tranches of senior unsecured notes totaling $1.5 billion at a weighted average fixed interest rate of 5.74% consisting of a $700.0 million tranche with a fixed interest rate of 5.30% due May 30, 2013 and a second $800.0 million tranche with a fixed interest rate of 6.125% due May 30, 2018. We used proceeds from the offering to reduce borrowings on the Credit Facility and for general working capital purposes.

            On June 16, 2008, we completed the redemption of the $200.0 million outstanding principal amount of its 7% Mandatory Par Put Remarketed Securities, or MOPPRS. The redemption was accounted for as an extinguishment and resulted in a charge in the second quarter of 2008 of approximately $20.3 million.

            On August 28, 2008, we repaid a $150.0 million unsecured note, which had a fixed rate of 5.38%.

            During the year ended December 31, 2008, we drew amounts from the Credit Facility to fund the redemption of the remarketable debt securities and the repayment of the $150.0 million unsecured note. Other amounts drawn on the Credit Facility during the period were primarily for general working capital purposes. We repaid a total of $2.7 billion on the Credit Facility during the year ended December 31, 2008. The total outstanding balance of the Credit Facility as of December 31, 2008 was $1.0 billion, and the maximum amount outstanding during the year was approximately $2.6 billion. During the year ended December 31, 2008, the weighted average outstanding balance was approximately $1.4 billion. The amount outstanding as of December 31, 2008 includes $446.3 million in Euro and Yen-denominated borrowings. In addition, subsequent to December 31, 2008, we repaid $600 million in unsecured notes, consisting of two $300 million tranches that bore rates of 3.75% and 7.13%, respectively, using proceeds from the Credit Facility.

            Total secured indebtedness was $6.3 billion and $5.3 billion at December 31, 2008 and 2007, respectively. During the twelve-month period ended December 31, 2008, we repaid $274.0 million in mortgage loans, unencumbering five properties.

            On January 15, 2008, we entered into a swap transaction that effectively converted $300.0 million of variable rate debt to fixed rate debt at a rate of 3.21%.

            On March 6, 2008, we borrowed $705 million on a term loan that matures March 5, 2012 and bears a rate of LIBOR plus 70 basis points. On May 27, 2008, the loan was increased to $735 million. This loan is secured by the cash flow distributed from six properties and has additional availability of $115 million through the maturity date.

            On July 30, 2008, we borrowed $190.0 million on a loan secured by Philadelphia Premium Outlets, which matures on July 30, 2014 and bears interest at a variable rate of LIBOR plus 185 basis points. On January 2, 2009, we executed a swap agreement that fixes the interest rate on this loan at 4.19%.

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            On September 23, 2008, we borrowed $170.0 million on a term loan that matures September 23, 2013 and bears interest at a rate of LIBOR plus 195 basis points. On November 4, 2008, the loan was increased to $220 million and on December 17, 2008, the loan was increased to its maximum availability of $260 million. This is a cross-collateralized loan that is secured by The Domain, Shops at Arbor Walk, and Palms Crossing. On January 2, 2009, we executed a swap agreement that fixes the interest rate on $200.0 million of this loan at 4.35%.

            Our consolidated debt, adjusted to reflect one fair value derivative outstanding at December 31, 2007 and the effect of fixing variable rate debt with interest rate swaps, and the effective weighted average interest rates for the years then ended consisted of the following (dollars in thousands):

Debt Subject to
  Adjusted Balance
as of
December 31,
2008
  Effective
Weighted
Average
Interest Rate
  Adjusted Balance
as of
December 31,
2007
  Effective
Weighted
Average
Interest Rate
 

Fixed Rate

  $ 15,424,318     5.76%   $ 14,056,008     5.88%  

Variable Rate

    2,618,214     1.31%     3,162,666     4.73%  
                   

  $ 18,042,532     5.12%   $ 17,218,674     5.67%  
                   

            As of December 31, 2008, we had interest rate cap protection agreements on $281.8 million of consolidated variable rate debt. We also hold $505.0 million of notional amount variable rate swap agreements that have a weighted average fixed pay rate of 3.29% and a weighted average variable receive rate of 2.75%. As of December 31, 2008, the net effect of these agreements effectively converted $505.0 million of variable rate debt to fixed rate debt.

            Contractual Obligations and Off-balance Sheet Arrangements:    The following table summarizes the material aspects of our future obligations as of December 31, 2008 (dollars in thousands):

 
  2009   2010 to 2011   2012 to 2014   After 2014   Total  

Long Term Debt

                               

Consolidated(1)

  $ 1,475,510   $ 5,352,250   $ 6,333,770   $ 4,863,803   $ 18,025,333  
                       

Pro Rata Share Of Long Term Debt:

                               
 

Consolidated(2)

  $ 1,464,866   $ 5,304,346   $ 6,164,777   $ 4,815,638   $ 17,749,627  
 

Joint Ventures(2)

    437,040     1,391,663     2,568,964     2,223,629     6,621,296  
                       

Total Pro Rata Share Of Long Term Debt

    1,901,906     6,696,009     8,733,741     7,039,267     24,370,923  

Consolidated Capital Expenditure Commitments(3)

    133,512     48,987             182,499  

Joint Venture Capital Expenditure Commitments(3)

    8,536     609             9,145  

Consolidated Ground Lease Commitments(4)

    16,530     32,626     49,821     653,052     752,029  
                       

Total

  $ 2,060,484   $ 6,778,231   $ 8,783,562   $ 7,692,319   $ 25,314,596  
                       

(1)
Represents principal maturities only and therefore, excludes net premiums and discounts of $17,199 and all required interest payments. We incurred interest expense during 2008 of $947.1 million, net of capitalized interest of $27.8 million.

(2)
Represents our pro rata share of principal maturities and excludes net premiums and discounts.

(3)
Represents our pro rata share of capital expenditure commitments.

(4)
Represents only the minimum non-cancellable lease period, excluding applicable lease extension and renewal options.

            Capital expenditure commitments presented in the table above represent new developments, redevelopments or renovation/expansions that we have committed to the completion of construction. The timing of these expenditures

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may vary due to delays in construction or acceleration of the opening date of a particular project. In addition, the amount includes our share of committed costs for joint venture developments.

            Our off-balance sheet arrangements consist primarily of our investments in real estate joint ventures which are common in the real estate industry and are described in Note 7 of the notes to the accompanying financial statements. Joint venture debt is the liability of the joint venture, is typically secured by the joint venture property, and is non-recourse to us. As of December 31, 2008, we had loan guarantees and other guarantee obligations to support $71.9 million and $6.6 million, respectively, to support our total $6.6 billion share of joint venture mortgage and other indebtedness presented in the table above.

            During 2008, the holders of 22,400 Series I preferred units exercised their rights to exchange the preferred units for shares of Simon Property's Series I preferred stock; we issued 5,151,776 Units to holders of Series I preferred units who exercised their conversion rights; we issued 1,187,238 units as a result of the conversion of 1,493,904 6% Convertible Perpetual Preferred Units; we issued 4,981 units as a result of the conversion of 6,583 7% Cumulative Convertible Preferred Units; and we redeemed 61,493 8% Cumulative Redeemable Preferred Units for cash.

            Buy-sell provisions are common in real estate partnership agreements. Most of our partners are institutional investors who have a history of direct investment in retail real estate. Our partners in our joint venture properties may initiate these provisions at any time. If we determine it is in our best interests to purchase the joint venture interest and we believe we have adequate liquidity to execute the purchase without hindering our cash flows, then we may initiate these provisions or elect to buy. If we decide to sell any of our joint venture interests, we expect to use the net proceeds to reduce outstanding indebtedness or to reinvest in development, redevelopment, or expansion opportunities.

            Acquisitions.    The acquisition of high quality individual properties or portfolios of properties remains an integral component of our growth strategy. Effective January 1, 2008 we acquired an additional 1.8% interest in Oxford Valley Mall and Lincoln Plaza (which gives us a combined ownership interest in each of 64.99%). On September 12, 2008 we acquired an additional 3.2% interest in White Oaks Mall (which gives us an ownership interest of 80.68%). On December 31, 2008 we acquired an additional 5% interest in Gateway Shopping Center for $2.6 million (which gives us 100% interest in the asset).

            Dispositions.    We continue to pursue the sale of properties that no longer meet our strategic criteria or that are not the primary retail venue within their trade area. On December 30, 2008, the joint venture partnership in which we own a 50% interest sold Cincinnati Mills for $8.3 million. No material gain or loss was recorded on this disposition. There were no other dispositions of properties during the year ended December 31, 2008.

            New Domestic Developments.    Given the significant downturn in the economy, we have substantially reduced our development spending. We expect to complete construction on Cincinnati Premium Outlets, a 400,000 square foot upscale manufacturers' outlet center located in Monroe, OH, during the third quarter of 2009. The estimated total cost of this project is $92 million, and the carrying amount of the construction in progress as of December 31, 2008 was $43 million. We expect to fund this project with available cash flow from operations and borrowings from the Credit Facility.

            Strategic Domestic Expansions and Renovations.    In addition to new development, we incur costs to renovate and/or expand selected properties. Current projects include a 600,000 square foot Phase II expansion at The Domain, a 220,000 square foot expansion of Camarillo Premium Outlets — The Promenade at, and the addition of Nordstrom and small shops at South Shore Plaza. We expect to fund these capital projects with available cash flow from operations and borrowings from the Credit Facility. We expect to invest a total of approximately $300 million (our share) on expansion and renovation activities in 2009.

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            The following table summarizes total capital expenditures on consolidated properties on a cash basis:

 
  2008   2007   2006  

New Developments

  $ 327   $ 432   $ 317  

Renovations and Expansions

    432     349     307  

Tenant Allowances

    72     106     52  

Operational Capital Expenditures

    43     130     92  
               

Total

  $ 874   $ 1,017   $ 768  
               

            International Development Activity.    We typically reinvest net cash flow from our international investments to fund future international development activity. We believe this strategy mitigates some of the risk of our initial investment and our exposure to changes in foreign currencies. We have also funded our European investments with Euro-denominated borrowings that act as a natural hedge against local currency fluctuations. This has also been the case with our Premium Outlet Centers in Japan and Mexico where we use Yen and Peso denominated financing, respectively. We expect our share of international development costs for 2009 will be approximately $140 million. We expect international development and redevelopment/expansion activity for 2009 to include:

            Currently, our net income exposure to changes in the volatility of the Euro, Yen, Peso and other foreign currencies is not material. In addition, since cash flows from international operations are currently being reinvested in other development projects, we do not expect to repatriate foreign denominated earnings in the near term.

            The carrying amount of our total combined investment in Simon Ivanhoe and GCI, as of December 31, 2008, including all related components of other comprehensive income, was $224.2 million. Our investments in Simon Ivanhoe and GCI are accounted for using the equity method of accounting. Currently two European developments are under construction which will add approximately 942,000 square feet of GLA for a total net cost of approximately €221 million, of which our share is approximately €53 million, or $74.8 million based on current Euro:USD exchange rates.

            On October 20, 2005, Ivanhoe Cambridge, Inc., or Ivanhoe, an affiliate of Caisse de dépôt et placement du Québec, effectively acquired our former partner's 39.5% ownership interest in Simon Ivanhoe. On February 13, 2006, we sold a 10.5% interest in this joint venture to Ivanhoe for €45.2 million, or $53.9 million and recorded a gain on the disposition of $34.4 million. This gain is reported in "gain on sales of interests in unconsolidated entities" in the 2006 consolidated statements of operations. We then settled all remaining share purchase commitments from the company's founders, including the early settlement of some commitments by purchasing an additional 25.8% interest for €55.1 million, or $65.5 million. As a result of these transactions, we and Ivanhoe each own a 50% interest in Simon Ivanhoe at December 31, 2007 and 2008.

            As of December 31, 2008, the carrying amount of our 40% joint venture investment in the seven Japanese Premium Outlet Centers including all related components of other comprehensive income was $312.6 million. Currently, Ami Premium Outlets, a 227,000 square foot Premium Outlet Center, is under construction in Ami, Japan. The project's total projected net cost is JPY 15.5 billion, of which our share is approximately JPY 6.2 billion, or $68.5 million based on applicable Yen:USD exchange rates.

            As of December 31, 2008, the carrying amount of our 32.5% joint venture investment in GMI including all related components of other comprehensive income was $53.9 million. Currently, one center is open in Changshu, China and three additional centers are under development. The three centers under development will add approximately 1.5 million square feet of GLA for a total net cost of approximately CNY 1.6 billion, of which our share is approximately CNY 523 million, or $76.8 million based on applicable CNY:USD exchange rates.

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            During 2008, we acquired shares of stock of Liberty International, PLC, or Liberty. Liberty operates regional shopping centers and is the owner of other prime retail assets throughout the U.K. Liberty is a U.K. FTSE 100 listed company, with shareholders' funds of £4.7 billion and property investments of £8.6 billion, of which its U.K. regional shopping centers comprise 75%. Assets of the group under control or joint control amount to £11.0 billion. Liberty converted into a U.K. Real Estate Investment Trust (REIT) on January 1, 2007. Our interest in Liberty is less than 5% of their shares and is adjusted to their quoted market price, including a related foreign exchange component.

Distributions and Stock Repurchase Program

            On January 30, 2009, Simon Property's Board of Directors approved a quarterly common stock dividend of $0.90 per share, to be paid in a combination of cash and shares of its common stock. The distribution rate on our units is equal to the dividend rate on Simon Property's common stock. While our unitholders will have the right to elect to receive their distribution in either cash or units, we have announced that the aggregate cash component of the distribution will not exceed 10% of the total distribution, or $0.09 per unit. If the number of unitholders electing to receive cash would result in the payment of cash in excess of this 10% limitation, we will allocate the cash payment on a pro rata basis among those unitholders making the cash election. Simon Property has reserved the right to elect to pay the first quarter dividend, and as a result our distribution, all in cash. Simon Property's Board of Directors reviews and approves Simon Property's dividends and, as a result, our distributions, on a quarterly basis, and no determination has been made about whether the remaining 2009 distributions will be paid in a similar combination of cash and common stock. Paying all or a portion of its remaining 2009 dividends in a combination of cash and common stock allows Simon Property to satisfy its REIT taxable income distribution requirement under existing IRS revenue procedures, while enhancing financial flexibility and balance sheet strength.

            Distributions during 2008 aggregated $3.60 per unit and distributions during 2007 aggregated $3.36 per unit all paid in cash. We must pay a minimum amount of distributions to maintain Simon Property's status as a REIT. Our distributions typically exceed our net income generated in any given year primarily because of depreciation, which is a "non-cash" expense. Future distributions will be determined by the Simon Property Board of Directors based on actual results of operations, cash available for distributions, and what may be required to maintain Simon Property's status as a REIT.

            On July 26, 2007, Simon Property's Board of Directors authorized a stock repurchase program under which Simon Property may purchase up to $1.0 billion of its common stock over the next twenty-four months as market conditions warrant. Simon Property may repurchase the shares in the open market or in privately negotiated transactions. During 2008, no purchases were made as part of this program. The program had remaining availability of approximately $950.7 million at December 31, 2008. As Simon Property repurchases shares under this program, we repurchase an equal number of our units from Simon Property.

Forward-Looking Statements

            Certain statements made in this section or elsewhere in this report may be deemed "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Although we believe the expectations reflected in any forward-looking statements are based on reasonable assumptions, we can give no assurance that our expectations will be attained, and it is possible that our actual results may differ materially from those indicated by these forward-looking statements due to a variety of risks, uncertainties and other factors. Such factors include, but are not limited to: the impact of a prolonged recession, our ability to meet debt service requirements, the availability and terms of financing, changes in our credit rating, changes in market rates of interest and foreign exchange rates for foreign currencies, the ability to hedge interest rate risk, risks associated with the acquisition, development and expansion of properties, general risks related to retail real estate, the liquidity of real estate investments, environmental liabilities, changes in market rental rates, trends in the retail industry, relationships with anchor tenants, the inability to collect rent due to the bankruptcy or insolvency of tenants or otherwise, risks relating to joint venture properties, competitive market forces, risks related to international activities, insurance costs and coverage, terrorist activities, and maintenance of our status as a real estate investment trust. We discuss these and other risks and uncertainties under the heading "Risk Factors" in our most recent Annual Report on Form 10-K. We may update that discussion in subsequent Quarterly Reports on Form 10-Q, but otherwise we undertake no duty or obligation to update or revise these forward-looking statements, whether as a result of new information, future developments, or otherwise.

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Item 7A.    Qualitative and Quantitative Disclosure About Market Risk

            Please refer to the Management's Discussion and Analysis of Financial Condition and Results of Operations included in Item 7 under the caption Liquidity and Capital Resources.

Item 8.    Financial Statements and Supplementary Data

            Reference is made to the Index to Financial Statements contained in Item 15.

Item 9.    Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

            None.

Item 9A.    Controls and Procedures

            Evaluation of Disclosure Controls and Procedures.    We carried out an evaluation under the supervision and with participation of management, including Simon Property's chief executive officer and chief financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this Annual Report on Form 10-K pursuant to Exchange Act Rule 13a-15. Based upon that evaluation, our management, including the chief executive officer and chief financial officer, concluded that our disclosure controls and procedures were effective as of December 31, 2008.

            Changes in Internal Control Over Financial Reporting.    There was no change in our internal control over financial reporting (as defined in Rule 13a-15(f)) that occurred during the fourth quarter of 2008 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

            Management's Report on Internal Control over Financial Reporting.    We are responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rule 13a-15(f) or 15d-15(f) promulgated under the Securities Exchange Act of 1934 as a process designed by, or under the supervision of, Simon Property's Board of Directors, principal executive and principal financial officers and effected by Simon Property's management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that:

            Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

            We assessed the effectiveness of our internal control over financial reporting as of December 31, 2008. In making this assessment, we used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control-Integrated Framework.

            Based on that assessment, we believe that, as of December 31, 2008, our internal control over financial reporting is effective based on those criteria.

            Our independent registered public accounting firm has issued an audit report on their assessment of our internal control over financial reporting. Their report is included within Item 9A of this Form 10-K.

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Report Of Independent Registered Public Accounting Firm

The Board of Directors of Simon Property Group, Inc.
and The Partners of Simon Property Group, L.P.:

            We have audited Simon Property Group, L.P. and Subsidiaries' internal control over financial reporting as of December 31, 2008 based on criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (the COSO criteria). Simon Property Group, L.P. and Subsidiaries' management is responsible for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management's Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Partnership's internal control over financial reporting based on our audit.

            We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

            A company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

            Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

            In our opinion, Simon Property Group, L.P. and Subsidiaries maintained, in all material respects, effective internal control over financial reporting as of December 31, 2008, based on the COSO criteria.

            We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of Simon Property Group, L.P. and Subsidiaries as of December 31, 2008 and 2007, and the related consolidated statements of operations and comprehensive income, partners' equity and cash flows for each of the three years in the period ended December 31, 2008 of Simon Property Group, L.P. and Subsidiaries, and the financial statement schedule listed in the Index at Item 15, and our report dated February 25, 2009 expressed an unqualified opinion thereon.


 

 

/s/ ERNST & YOUNG LLP

Indianapolis, Indiana
February 25, 2009

 

 

Item 9B.    Other Information

            During the fourth quarter of the year covered by this report, the Audit Committee of Simon Property Group, Inc.'s Board of Directors approved certain non-audit tax compliance services to be provided by Ernst & Young, LLP, the Company's independent registered public accounting firm. This disclosure is made pursuant to Section 10A(i)(2) of the Securities Exchange Act of 1934, as added by Section 202 of the Sarbanes-Oxley Act of 2002.

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Part III

Item 10.    Directors, Executive Officers and Corporate Governance

            We are a limited partnership and Simon Property is our sole general partner. We do not have any directors or executive officers or any equity securities registered under the Securities Exchange Act of 1934. Comparable information for Simon Property can be found in its periodic reports and proxy statements it files with the Securities and Exchange Commission.

Item 11.    Executive Compensation

            We are a limited partnership and Simon Property is our sole general partner. We do not have any directors or executive officers or any equity securities registered under the Securities Exchange Act of 1934. Comparable information for Simon Property can be found in its periodic reports and proxy statements it files with the Securities and Exchange Commission.

Item 12.    Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

            We are a limited partnership and Simon Property is our sole general partner. We do not have any directors or executive officers or any equity securities registered under the Securities Exchange Act of 1934. Comparable information for Simon Property can be found in its periodic reports and proxy statements it files with the Securities and Exchange Commission.

Item 13.    Certain Relationships and Related Transactions, and Director Independence

            We are a limited partnership and Simon Property is our sole general partner. We do not have any directors or executive officers or any equity securities registered under the Securities Exchange Act of 1934. Comparable information for Simon Property can be found in its periodic reports and proxy statements it files with the Securities and Exchange Commission.

Item 14.    Principal Accountant Fees and Services

            The Audit Committee of Simon Property's Board of Directors pre-approves all audit and permissible non-audit services to be provided by Ernst & Young LLP, our independent registered public accounting firm, prior to commencement of services. The Audit Committee has delegated to the Chairman of the Audit Committee the authority to pre-approve specific services up to specified individual and aggregate fee amounts. These pre-approval decisions are presented to the full Audit Committee at the next scheduled meeting after such approvals are made. We have incurred fees as shown below for services from Ernst & Young as our independent registered public accounting firm. Ernst & Young has advised us that it has billed or will bill these indicated amounts for the following categories of services for the years ended December 31, 2008 and 2007, respectively:

 
  2008   2007  

Audit Fees (1)

  $ 2,708,010   $ 2,981,600  

Audit-Related Fees (2)

    5,253,726     8,085,232  

Tax Fees (3)

    969,871     1,440,800  

All Other Fees

         

(1)
Audit Fees include fees for the audit of the financial statements and the effectiveness of internal control over financial reporting for us, Simon Property, and certain of our subsidiaries and services associated with Securities and Exchange Commission registration statements, periodic reports, and other documents issued in connection with securities offerings. Audit Fees for 2007 also include $525,000 of fees associated with specific audit procedures directed at our investment in SPG-FCM Ventures, LLC, "SPG-FCM," (our 50/50 joint venture that acquired The Mills Corporation) that will not recur.

(2)
Audit-Related Fees include audits of individual properties and schedules of recoverable common area maintenance costs to comply with lender, joint venture partner or tenant requirements and accounting consultation and due diligence services. Audit-Related Fees for 2007 include approximately $3 million of fees associated with our investment in SPG-FCM which are not recurring in nature. Our share of these

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(3)
Tax Fees include fees for international and other tax consulting services. Tax Fees also include return compliance services associates with the tax returns for The Mills Corporation and related subsidiaries and joint ventures. Our share of these fees for 2008 and 2007 is approximately 35% and 39%, respectively.

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Part IV

Item 15.    Exhibits and Financial Statement Schedules

(1)

 
   
  Page No.  
(1)   Financial Statements        

 

 

Report of Independent Registered Public Accounting Firm

 

 

72

 
    Consolidated Balance Sheets as of December 31, 2008 and 2007     73  
    Consolidated Statements of Operations for the years ended December 31, 2008, 2007 and 2006     74  
    Consolidated Statements of Cash Flow for the years ended December 31, 2008, 2007 and 2006     75  
    Consolidated Statements of Partners' Equity for the years ended December 31, 2008, 2007 and 2006     76  

 

 

Notes to Financial Statements

 

 

77

 

(2)

 

Financial Statement Schedule

 

 

 

 

 

 

Simon Property Group, L.P.. and Subsidiaries Schedule III — Schedule of Real Estate and Accumulated Depreciation

 

 

111

 

 

 

Notes to Schedule III

 

 

118

 

(3)

 

Exhibits

 

 

 

 

 

 

The Exhibit Index attached hereto is hereby incorporated by reference to this Item.

 

 

119

 

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Report of Independent Registered Public Accounting Firm

The Board of Directors of Simon Property Group, Inc.
and The Partners of Simon Property Group, L.P.:

            We have audited the accompanying consolidated balance sheets of Simon Property Group, L.P. and Subsidiaries as of December 31, 2008 and 2007, and the related consolidated statements of operations and comprehensive income, partners' equity and cash flows for each of the three years in the period ended December 31, 2008. Our audit also included the financial statement schedule listed in the Index at Item 15. These financial statements and schedule are the responsibility of the Partnership's management. Our responsibility is to express an opinion on these financial statements and schedule based on our audits.

            We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). 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 that our audits provide a reasonable basis for our opinion.

            In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Simon Property Group, L.P. and Subsidiaries at December 31, 2008 and 2007, and the consolidated results of their operations and their cash flows for each of the three years in the period ended December 31, 2008, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein.

            We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), Simon Property Group, L.P. and Subsidiaries' internal control over financial reporting as of December 31, 2008, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 25, 2009, expressed an unqualified opinion thereon.


 

 

/s/ ERNST & YOUNG LLP

Indianapolis, Indiana
February 25, 2009

 

 

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Simon Property Group, L.P. and Subsidiaries
Consolidated Balance Sheets
(Dollars in thousands, except unit amounts)

 
  December 31,
2008
  December 31,
2007
 

ASSETS:

             
 

Investment properties, at cost

  $ 25,205,715   $ 24,415,025  
   

Less — accumulated depreciation

    6,184,285     5,312,095  
           

    19,021,430     19,102,930  
 

Cash and cash equivalents

    773,544     501,982  
 

Tenant receivables and accrued revenue, net

    414,856     447,224  
 

Investment in unconsolidated entities, at equity

    1,663,886     1,886,891  
 

Deferred costs and other assets

    1,202,256     1,118,635  
 

Note receivable from related party

    520,700     548,000  
           
   

Total assets

  $ 23,596,672   $ 23,605,662  
           

LIABILITIES:

             
 

Mortgages and other indebtedness

  $ 18,042,532   $ 17,218,674  
 

Accounts payable, accrued expenses, intangibles, and deferred revenue

    1,086,248     1,251,044  
 

Cash distributions and losses in partnerships and joint ventures, at equity

    380,730     352,798  
 

Other liabilities, minority interest, and accrued distributions

    179,970     180,644  
           
   

Total liabilities

    19,689,480     19,003,160  
           

COMMITMENTS AND CONTINGENCIES

             

7.75%/8.00% Cumulative Redeemable Preferred Units, 850,698 units issued and outstanding, respectively, at liquidation value

   
85,070
   
85,070
 

PARTNERS' EQUITY:

             
 

Preferred units, 11,612,005 and 19,611,057 units outstanding, respectively. Liquidation values $564,159 and $962,737, respectively

    570,344     969,251  
 

General Partner, 231,319,644 and 223,034,282 units outstanding, respectively

    2,614,638     2,816,775  
 

Limited Partners, 56,368,410 and 57,913,250 units outstanding, respectively

    637,140     731,406  
           
   

Total partners' equity

    3,822,122     4,517,432  
           
   

Total liabilities and partners' equity

  $ 23,596,672   $ 23,605,662  
           

The accompanying notes are an integral part of these statements.

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Simon Property Group, L.P. and Subsidiaries
Consolidated Statements of Operations and Comprehensive Income
(Dollars in thousands, except per unit amounts)

 
  For the Year Ended December 31,  
 
  2008   2007   2006  

REVENUE:

                   
 

Minimum rent

  $ 2,291,919   $ 2,154,713   $ 2,020,856  
 

Overage rent

    100,222     110,003     95,767  
 

Tenant reimbursements

    1,065,957     1,023,164     946,554  
 

Management fees and other revenues

    132,471     113,740     82,288  
 

Other income

    192,586     249,179     186,689  
               
   

Total revenue

    3,783,155     3,650,799     3,332,154  
               

EXPENSES:

                   
 

Property operating

    455,874     454,510     441,203  
 

Depreciation and amortization

    969,477     905,636     856,202  
 

Real estate taxes

    334,657     313,311     300,174  
 

Repairs and maintenance

    107,879     120,224     105,983  
 

Advertising and promotion

    96,783     94,340     88,480  
 

Provision for credit losses

    24,035     9,562     9,500  
 

Home and regional office costs

    144,865     136,610     129,334  
 

General and administrative

    20,987     19,587     16,652  
 

Other

    67,721     61,954     64,397  
               
   

Total operating expenses

    2,222,278     2,115,734     2,011,925  
               

OPERATING INCOME

    1,560,877     1,535,065     1,320,229  

Interest expense

    (947,140 )   (945,852 )   (821,858 )

Loss on extinguishment of debt

    (20,330 )        

Minority interest in income of consolidated entities

    (12,431 )   (13,936 )   (11,524 )

Income tax (expense) benefit of taxable REIT subsidiaries

    (3,581 )   11,322     (11,370 )

Income from unconsolidated entities

    32,246     38,120     110,819  

Impairment charge

    (21,172 )   (55,061 )    

Gain on sale of assets and interests in unconsolidated entity

        92,044     132,787  
               
   

Income from continuing operations

    588,469     661,702     719,083  

Results of operations from discontinued operations

   
(25

)
 
(117

)
 
418
 

Loss on disposal or sale of discontinued operations, net

        (35,252 )   84  
               

NET INCOME

    588,444     626,333     719,585  

Preferred unit requirement

    (58,718 )   (76,655 )   (104,674 )
               

NET INCOME AVAILABLE TO UNITHOLDERS

  $ 529,726   $ 549,678   $ 614,911  
               

NET INCOME AVAILABLE TO UNITHOLDERS
ATTRIBUTABLE TO:

                   
   

General Partner

  $ 422,517   $ 436,164   $ 486,145  
   

Limited Partners

    107,209     113,514     128,766  
               
   

Net income

  $ 529,726   $ 549,678   $ 614,911  
               

BASIC EARNINGS PER UNIT

                   
   

Income from continuing operations

  $ 1.88   $ 2.09   $ 2.20  
   

Discontinued operations

  $     (0.13 )    
               
   

Net Income

  $ 1.88   $ 1.96   $ 2.20  
               

DILUTED EARNINGS PER UNIT

                   
   

Income from continuing operations

  $ 1.87   $ 2.08   $ 2.19  
   

Discontinued operations

  $     (0.13 )    
               
   

Net Income

  $ 1.87   $ 1.95   $ 2.19  
               
 

Net income

  $ 588,444   $ 626,333   $ 719,585  
 

Unrealized loss on interest rate hedges

    (50,973 )   (10,760 )   6,518  
 

Net income (loss) on derivative instruments reclassified from accumulated other comprehensive income (loss) into interest expense

    (3,205 )   902     2,263  
 

Currency translation adjustments

    (6,953 )   6,297     1,706  
 

Changes in available-for-sale securities and other

    (168,619 )   2,020     1,404  
               
 

Comprehensive Income

  $ 358,694   $ 624,792   $ 731,476  
               

The accompanying notes are an integral part of these statements.

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Simon Property Group, L.P. and Subsidiaries
Consolidated Statements of Cash Flows
(Dollars in thousands)

 
  For the Year Ended December 31,  
 
  2008   2007   2006  

CASH FLOWS FROM OPERATING ACTIVITIES:

                   
 

Net income

  $ 588,444   $ 626,333   $ 719,585  
   

Adjustments to reconcile net income to net cash provided by operating activities —

                   
     

Depreciation and amortization

    956,827     875,284     812,718  
     

Gain on sale of interest in unconsolidated entity

        (92,044 )   (132,787 )
     

Impairment charge

    21,172     55,061      
     

(Loss) gain on disposal or sale of discontinued operations, net

        35,252     (84 )
     

Straight-line rent

    (33,672 )   (20,907 )   (17,020 )
     

Minority interest

    12,431     13,936     11,524  
     

Minority interest distributions

    (28,251 )   (91,032 )   (37,200 )
     

Equity in income of unconsolidated entities

    (32,246 )   (38,120 )   (110,819 )
     

Distributions of income from unconsolidated entities

    118,665     101,998     94,605  
   

Changes in assets and liabilities —

                   
     

Tenant receivables and accrued revenue, net

    (14,312 )   (40,976 )   (3,799 )
     

Deferred costs and other assets

    (22,698 )   (70,138 )   (126,989 )
     

Accounts payable, accrued expenses, intangibles, deferred revenues and other liabilities

    39,873     113,753     69,214  
               
       

Net cash provided by operating activities

    1,606,233     1,468,400     1,278,948  
               

CASH FLOWS FROM INVESTING ACTIVITIES:

                   
   

Acquisitions

        (263,098 )   (158,394 )
   

Funding of loans to related parties

    (8,000 )   (2,752,400 )    
   

Repayments of loans from related parties

    35,300     2,204,400      
   

Capital expenditures, net

    (874,286 )   (1,017,472 )   (767,710 )
   

Cash impact from the consolidation and de-consolidation of properties

        6,117     8,762  
   

Net proceeds from sale of partnership interest, other assets and discontinued operations

        56,374     209,039  
   

Investments in unconsolidated entities

    (137,509 )   (687,327 )   (157,309 )
   

Purchase of marketable and non-marketable securities

    (345,594 )   (12,655 )   (5,581 )
   

Distributions of capital from unconsolidated entities and other

    309,217     416,485     263,761  
               
       

Net cash used in investing activities

    (1,020,872 )   (2,049,576 )   (607,432 )
               

CASH FLOWS FROM FINANCING ACTIVITIES:

                   
   

Partnership contributions and issuance of units

    11,106     156,710     217,237  
   

Purchase of preferred units and partnership units

    (16,009 )   (83,993 )   (16,150 )
   

Preferred unit redemptions

    (1,845 )   (300,468 )   (393,558 )
   

Minority interest contributions

    4,005     2,903     2,023  
   

Partnership distributions

    (1,075,895 )   (1,020,674 )   (954,159 )
   

Mortgage and other indebtedness proceeds, net of transaction costs

    4,456,975     5,577,083     5,507,735  
   

Mortgage and other indebtedness principal payments

    (3,692,136 )   (4,177,763 )   (4,442,332 )
               
       

Net cash (used in) provided by financing activities

    (313,799 )   153,798     (79,204 )
               

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

   
271,562
   
(427,378

)
 
592,312
 

CASH AND CASH EQUIVALENTS, beginning of year

   
501,982
   
929,360
   
337,048
 
               

CASH AND CASH EQUIVALENTS, end of year

  $ 773,544   $ 501,982   $ 929,360  
               

The accompanying notes are an integral part of these statements.

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Consolidated Statements of Partners' Equity
(Dollars in thousands)

 
  Preferred
Units
  Simon Property
(Managing General
Partner)
  Limited
Partners
  Total Partners'
Equity
 

Balance at December 31, 2005

  $ 1,396,679   $ 3,227,274   $ 865,565   $ 5,489,518  
                   

General partner contributions (414,659 units)

          14,906           14,906  

Series J preferred stock premium and amortization

    (329 )               (329 )

Accretion of preferred units

    587                 587  

Series C preferred units (1,149,077 units) converted to limited partner common units (869,552 units)

    (32,174 )         32,174      

Series I preferred units redeemed (11,377 units)

    (569 )               (569 )

Series I preferred units (283,907 units) converted to common units (222,933 units)

    (14,195 )   14,195            

Limited partner units converted to common units (86,800 units)

          1,247     (1,247 )    

Series F preferred stock redemption (8,000,000 units)

    (192,989 )               (192,989 )

Series K preferred stock issuance (8,000,000 units)

    200,000                 200,000  

Series K preferred stock redemption (8,000,000 units)

    (200,000 )               (200,000 )

Stock incentive program (415,098 units, net)

                       

Amortization of stock incentive

          23,369           23,369  

Common units retired (70,000)

          (6,405 )         (6,405 )

Other (includes 191,938 limited partner units converted to cash)

          608     (16,145 )   (15,537 )

Adjustment to limited partners' interest from increased ownership in the Operating Partnership

          (3,951 )   3,951      

Distributions

    (104,674 )   (671,812 )   (177,673 )   (954,159 )

Net income

    104,674     486,145     128,766     719,585  

Other comprehensive income (loss)

          9,446     2,445     11,891  
                   

Balance at December 31, 2006

  $ 1,157,010   $ 3,095,022   $ 837,836   $ 5,089,868  
                   

General partner contributions (231,025 units)

          7,604           7,604  

Series J preferred stock premium and amortization

    (328 )               (328 )

Accretion of preferred units

    1,157                 1,157  

Issuance of 147,241 limited partner common units for the purchase of Maine Premium Outlets

                16,362     16,362  

Issuance of 67,309 limited partner common units to the Mills limited partners

                8,055     8,055  

Series C preferred units (160,865 units) converted to limited partner common units (121,727 units)

    (4,504 )         4,504      

Series D preferred units redeemed (7,266 units)

    (218 )               (218 )

Series I preferred units redeemed (5,000 units)

    (250 )               (250 )

Series I preferred units (65,907 units) converted to common units (51,987 units)

    (3,296 )   3,296            

Series I preferred units (606,400 units) converted to limited partner common units (478,144 units)

    (30,320 )         30,320      

Limited partner units converted to common units (1,692,474 units)

          22,781     (22,781 )    

Series G preferred stock redemption (3,000,000 units)

    (150,000 )               (150,000 )

Series L preferred stock issuance (6,000,000 units)

    150,000                 150,000  

Series L preferred stock redemption (6,000,000 units)

    (150,000 )               (150,000 )

Treasury unit purchase (572,000 units)

          (49,269 )         (49,269 )

Stock incentive program (222,725 units, net)

                       

Amortization of stock incentive

          26,779           26,779  

Common units retired (23,000)

          (2,291 )         (2,291 )

Other (includes 322,135 limited partner units converted to cash)

          571     (34,726 )   (34,155 )

Adjustment to limited partners' interest from increased ownership in the Operating Partnership

          26,466     (26,466 )    

Distributions

    (76,655 )   (749,196 )   (194,823 )   (1,020,674 )

Net income

    76,655     436,164     113,514     626,333  

Other comprehensive income (loss)

          (1,152 )   (389 )   (1,541 )
                   

Balance at December 31, 2007

  $ 969,251   $ 2,816,775   $ 731,406   $ 4,517,432  
                   

General partner contributions (282,106 units)

          11,886           11,886  

Series J preferred stock premium and amortization

    (329 )               (329 )

Series C preferred units (6,583 units) converted to limited partner common units (4,981 units)

    (184 )         184      

Series D preferred units redeemed (61,493 units)

    (1,845 )               (1,845 )

Series I preferred units (6,437,072 units) converted to common units (5,151,776 units)

    (321,854 )   321,854            

Series I preferred units (1,493,904 units) converted to limited partner common units (1,187,238 units)

    (74,695 )         74,695      

Limited partner units converted to common units (2,574,608 units)

          31,351     (31,351 )    

Stock incentive program (276,872 units, net)

                       

Amortization of stock incentive

          28,640           28,640  

Other (includes 162,451 limited partner units converted to cash)

          (450 )   (16,011 )   (16,461 )

Adjustment to limited partners' interest from increased ownership in the Operating Partnership

          (23,455 )   23,455      

Distributions

    (58,718 )   (811,327 )   (205,850 )   (1,075,895 )

Net income

    58,718     422,517     107,209     588,444  

Other comprehensive income (loss)

          (183,153 )   (46,597 )   (229,750 )
                   

Balance at December 31, 2008

  $ 570,344   $ 2,614,638   $ 637,140   $ 3,822,122  
                   

The accompanying notes are an integral part of these statements.

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Simon Property Group, L.P. and Subsidiaries

Notes to Consolidated Financial Statements

(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

1.    Organization

            Simon Property Group, L.P. is a Delaware limited partnership and the majority-owned subsidiary of Simon Property Group, Inc. In these notes to consolidated financial statements, the terms "Operating Partnership", "we", "us" and "our" refer to Simon Property Group, L.P., and its subsidiaries and the term "Simon Property" refers to Simon Property Group, Inc. Simon Property is a self-administered and self-managed real estate investment trust ("REIT") under the Internal Revenue Code of 1986, as amended (the "Code"). Pursuant to our partnership agreement, we are required to pay all expenses of Simon Property.

            We own, develop, and manage retail real estate in five retail real estate platforms: regional malls, Premium Outlet Centers®, The Mills®, community/lifestyle centers, and international properties. As of December 31, 2008, we owned or held an interest in 324 income-producing properties in the United States, which consisted of 164 regional malls, 16 additional regional malls and four additional community centers acquired as a result of the 2007 acquisition of The Mills Corporation, or the Mills acquisition, 70 community/lifestyle centers, 16 The Mills, 40 Premium Outlet Centers, and 14 other shopping centers or outlet centers in 41 states and Puerto Rico. We also own interests in four parcels of land held in the United States for future development. Internationally, we have ownership interests in 52 European shopping centers (France, Italy, and Poland); seven Premium Outlet Centers in Japan; one Premium Outlet Center in Mexico; one Premium Outlet Center in Korea; and one shopping center in China. Also, through joint venture arrangements we have ownership interests in the following properties under development internationally: a 24% interest in two shopping centers in Italy, a 40% interest in a Premium Outlet Center in Japan, and a 32.5% interests in three additional shopping centers under construction in China.

            We generate the majority of our revenues from leases with retail tenants including:

            We also grow by generating supplemental revenues from the following activities:

2.    Basis of Presentation and Consolidation

            The accompanying consolidated financial statements include the accounts of all majority-owned subsidiaries, and all significant intercompany amounts have been eliminated.

            We consolidate properties that are wholly owned or properties that we own less than 100% but we control. Control of a property is demonstrated by, among other factors, our ability to:

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Simon Property Group, L.P. and Subsidiaries

Notes to Consolidated Financial Statements (Continued)

(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

2.    Basis of Presentation and Consolidation (Continued)

            We also consolidate all variable interest entities, or VIE, when we are determined to be the primary beneficiary. Our determination of the primary beneficiary of a VIE considers all relationships between us and the VIE, including management agreements and other contractual arrangements, when determining the party obligated to absorb the majority of the expected losses, as defined in FASB Interpretation No. 46 (revised), Consolidation of Variable Interest Entities (FIN 46(R)). There have been no changes during 2008 in conclusions about whether an entity qualifies as a VIE or whether we are the primary beneficiary of any previously identified VIE. During 2008, we have not provided financial or other support to a previously identified VIE that we were not previously contractually obligated to provide.

            The deficit minority interest balances included in deferred costs and other assets in the accompanying consolidated balance sheets represent outside partners' interests in the net equity of certain properties. We record deficit minority interests when a joint venture agreement provides for the settlement of deficit capital accounts before distributing the proceeds from the sale of joint venture assets or the joint venture partner is obligated to make additional contributions to the extent of any capital account deficits and has the ability to fund such additional contributions.

            Investments in partnerships and joint ventures represent noncontrolling ownership interests in properties. We account for these investments using the equity method of accounting. We initially record these investments at cost and we subsequently adjust for net equity in income or loss, which we allocate in accordance with the provisions of the applicable partnership or joint venture agreement, and cash contributions and distributions. The allocation provisions in the partnership or joint venture agreements are not always consistent with the legal ownership interests held by each general or limited partner or joint venture investee primarily due to partner preferences.

            As of December 31, 2008, we consolidated 203 wholly-owned properties and consolidated 18 additional properties that are less than wholly-owned, but which we control or for which we are the primary beneficiary. We account for the remaining 165 properties using the equity method of accounting (joint venture properties). We manage the day-to-day operations of 93 of the 165 joint venture properties but have determined that our partner or partners have substantive participating rights in regards to the assets and operations of these joint venture properties. Additionally, we account for our investment in SPG-FCM Ventures, LLC, or SPG-FCM, which acquired The Mills Corporation and its majority-owned subsidiary, The Mills Limited Partnership, or collectively Mills, in April 2007, using the equity method of accounting. We have determined that SPG-FCM is not a VIE and that Farallon Capital Management, L.L.C., or Farallon, our joint venture partner, has substantive participating rights with respect to the assets and operations of SPG-FCM pursuant to the applicable partnership agreements.

            We allocate our net operating results after preferred distributions based on our partners' respective ownership. In addition, Simon Property owns series of our preferred units that have terms comparable to outstanding shares of Simon Property preferred stock. Simon Property's weighted average ownership interest in us was as follows:

 
  For the Year Ended
December 31,
 
 
  2008   2007   2006  

Weighted average ownership interest

    79.8 %   79.4 %   79.1 %

            As of December 31, 2008 and 2007, Simon Property's ownership interest was 80.4% and 79.4%, respectively. We adjust the limited partners' interest at the end of each period to reflect their ownership interest. Preferred distributions in the accompanying statements of operations and cash flows represent distributions on outstanding preferred units of limited partnership interest.

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Notes to Consolidated Financial Statements (Continued)

(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

3.    Summary of Significant Accounting Policies

            We record investment properties at cost. Investment properties include costs of acquisitions; development, predevelopment, and construction (including allocable salaries and related benefits); tenant allowances and improvements; and interest and real estate taxes incurred related to construction. We capitalize improvements and replacements from repair and maintenance when the repair and maintenance extend the useful life, increase capacity, or improve the efficiency of the asset. All other repair and maintenance items are expensed as incurred. We capitalize interest on projects during periods of construction until the projects are ready for their intended purpose based on interest rates in place during the construction period. The amount of interest capitalized during each year is as follows:

 
  For the Year Ended
December 31,
 
 
  2008   2007   2006  

Capitalized interest

  $ 27,847   $ 35,793   $ 30,115  

            We record depreciation on buildings and improvements utilizing the straight-line method over an estimated original useful life, which is generally 10 to 40 years. We review depreciable lives of investment properties periodically and we make adjustments when necessary to reflect a shorter economic life. We record depreciation on tenant allowances, tenant inducements and tenant improvements utilizing the straight-line method over the term of the related lease or occupancy term of the tenant, if shorter. We record depreciation on equipment and fixtures utilizing the straight-line method over seven to ten years.

            We review investment properties for impairment on a property-by-property basis whenever events or changes in circumstances indicate that the carrying value of investment properties may not be recoverable. These circumstances include, but are not limited to, declines in cash flows, occupancy and comparable sales per square foot at the property. We recognize an impairment of investment property when the estimated undiscounted operating income before depreciation and amortization plus its residual value is less than the carrying value of the property. To the extent impairment has occurred, we charge to income the excess of carrying value of the property over its estimated fair value. We may decide to sell properties that are held for use and the sale prices of these properties may differ from their carrying values.

            Certain of our real estate assets contain asbestos. The asbestos is appropriately contained, in accordance with current environmental regulations, and we have no current plans to remove the asbestos. If these properties were demolished, certain environmental regulations are in place which specify the manner in which the asbestos must be handled and disposed. Because the obligation to remove the asbestos has an indeterminable settlement date, we are not able to reasonably estimate the fair value of this asset retirement obligation.

            We allocate the purchase price of acquisitions to the various components of the acquisition based upon the relative value of each component in accordance with Statement of Financial Accounting Standards (SFAS) No. 141 "Business Combinations" (SFAS 141). These components typically include buildings, land and intangibles related to in-place leases and we estimate:

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Notes to Consolidated Financial Statements (Continued)

(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

3.    Summary of Significant Accounting Policies (Continued)

            Amounts allocated to building are depreciated over the estimated remaining life of the acquired building or related improvements. We amortize amounts allocated to tenant improvements, in-place lease assets and other lease-related intangibles over the remaining life of the underlying leases. We also estimate the value of other acquired intangible assets, if any, which are amortized over the remaining life of the underlying related leases or intangibles.

            SFAS No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets" (SFAS 144) provides a framework for the evaluation of impairment of long-lived assets, the treatment of assets held for sale or to be otherwise disposed of, and the reporting of discontinued operations. SFAS 144 requires us to reclassify any material operations related to consolidated properties sold during the period to discontinued operations. During 2007, we reported the net loss upon sale on our five consolidated assets sold in "loss on sale of discontinued operations" in the consolidated statements of operations and comprehensive income. The operating results of the assets disposed of in 2007 were not significant to our consolidated results of operations. There were no consolidated assets sold during 2008.

            We consider all highly liquid investments purchased with an original maturity of 90 days or less to be cash and cash equivalents. Cash equivalents are carried at cost, which approximates fair value. Cash equivalents generally consist of commercial paper, bankers acceptances, Eurodollars, repurchase agreements, and money markets. Our gift card programs are administered by banks. We collect gift card funds at the point of sale and then remit those funds to the banks for further processing. As a result, cash and cash equivalents, as of December 31, 2008 and 2007, includes a balance of $29.8 million and $41.3 million, respectively, related to these gift card programs which we do not consider available for general working capital purposes. Financial instruments that potentially subject us to concentrations of credit risk include our cash and cash equivalents and our trade accounts receivable. We place our cash and cash equivalents with institutions with high credit quality. However, at certain times, such cash and cash equivalents may be in excess of FDIC and SIPC insurance limits. See Notes 4, 8, and 10 for disclosures about non-cash investing and financing transactions.

            Marketable securities consist primarily of the investments of our captive insurance subsidiaries, our investment in shares of stock of Liberty International PLC, or Liberty, our deferred compensation plan investments, and certain investments held to fund the debt service requirements of debt previously secured by investment properties that have been sold. Non-marketable securities includes an investment that we acquired in 2008.

            The types of securities included in the investment portfolio of our captive insurance subsidiaries typically include U.S. Treasury or other U.S. government securities as well as corporate debt securities with maturities ranging from 1 to 10 years. These securities are classified as available-for-sale and are valued based upon quoted market prices or using discounted cash flows when quoted market prices are not available. The amortized cost of debt securities, which approximates fair value, held by our captive insurance subsidiaries is adjusted for amortization of premiums and accretion of discounts to maturity. Our investment in Liberty is also accounted for as an available-for-sale security. Liberty operates regional shopping centers and is owner of other retail assets throughout the U.K. Liberty is a U.K. FTSE 100 listed company. Liberty converted into a U.K. Real Estate Investment Trust (REIT) on January 1, 2007. Our interest in Liberty is less than 5% of their shares and is adjusted to their quoted market price, including a related foreign exchange component. Changes in the values of these securities are recognized in accumulated other comprehensive income (loss) until the gain or loss is realized and recorded in other income, and includes the effect of changes in foreign exchange rates on foreign currency denominated investments. However, if we determine a decline

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Simon Property Group, L.P. and Subsidiaries

Notes to Consolidated Financial Statements (Continued)

(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

3.    Summary of Significant Accounting Policies (Continued)


in value is other than temporary, then we recognize the unrealized loss in earnings to write down the investments to their net realizable value.

            Our insurance subsidiaries are required to maintain statutory minimum capital and surplus as well as maintain a minimum liquidity ratio. Therefore, our access to these securities may be limited. Our deferred compensation plan investments are classified as trading securities and are valued based upon quoted market prices. The investments have a matching liability recorded as the amounts are fully payable to the employees that earned the compensation. Changes in the values of these securities are recognized in earnings, but because of the matching liability the impact to net income is zero. As of December 31, 2008 and 2007, we have investments of $53.4 million and $55.9 million, respectively, which must be used to fund the debt service requirements of debt related to investment properties sold. These investments are classified as held-to-maturity and are recorded at amortized cost as we have the ability and intent to hold these investments to maturity. During 2008, we made an investment of $70 million in a non-marketable security that we account for under the cost method. To the extent an other-than-temporary decline in fair value is deemed to have occurred, we would adjust this investment to its fair value.

            We hold marketable securities that total $316.7 million and $260.4 million at December 31, 2008 and 2007, respectively, and are considered to have Level 1 fair value inputs. The underlying aggregate unrealized loss on our marketable securities as of December 31, 2008 was $165.3 million. In addition, we have derivative instruments, primarily interest rate swap agreements, with a gross liability balance of $19.4 million and $6.8 million, at December 31, 2008 and 2007, respectively, which are classified as having Level 2 inputs. As defined by Statement of Financial Accounting Standard No. 157, "Fair Value Measurements" (SFAS 157), Level 1 fair value inputs are quoted prices for identical items in active, liquid and visible markets such as stock exchanges, and Level 2 fair value inputs include observable information for similar items in active or inactive markets. We appropriately consider counterparty creditworthiness in the valuations.

            In January 2006, an entity controlled by the Simon family assigned to us its right to receive cash flow, capital distributions, and related profits and losses with respect to a portion of its ownership interest in the Mall of America through Mall of America Associates, or MOAA. This beneficial interest was transferred subject to a credit facility repayable from MOAA's distributions from the property. As a result of this assignment, we began recognizing our share of MOAA's income during the first quarter of 2006, including the proportionate share of earnings of MOAA since August 2004 through the first quarter of 2006 of $10.2 million. This income is included with "income from unconsolidated entities" in our consolidated statement of operations. We accounted for our beneficial interests in MOAA under the equity method of accounting. On November 2, 2006, the Simon family entity sold its partnership interest to an affiliate of another partner in MOAA and settled all pending litigation, terminating our beneficial interests. As a result of this sale, we ceased recording income from this property's operations, and recorded a gain of approximately $86.5 million as a result of the receipt of $102.2 million of capital transaction proceeds assigned to us from this arrangement which is included in "gain on sale of assets and interests in unconsolidated entities" in the consolidated statements of operations and comprehensive income.

            We prepared the accompanying consolidated financial statements in accordance with accounting principles generally accepted in the United States, or GAAP. GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and revenues and expenses during the reported period. Our actual results could differ from these estimates.

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Simon Property Group, L.P. and Subsidiaries

Notes to Consolidated Financial Statements (Continued)

(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

3.    Summary of Significant Accounting Policies (Continued)

            SFAS No. 131, "Disclosures about Segments of an Enterprise and Related Information" (SFAS 131) requires disclosure of certain operating and financial data with respect to separate business activities within an enterprise. Our primary business is the ownership, development, and management of retail real estate. We have aggregated our retail operations, including regional malls, Premium Outlet Centers, The Mills, and community/lifestyle centers, into one reportable segment because they have similar economic characteristics and we provide similar products and services to similar types of tenants. Further, all material operations are within the United States and no customer or tenant comprises more than 10% of consolidated revenues.

            Deferred costs and other assets include the following as of December 31:

 
  2008   2007  

Deferred financing and lease costs, net

  $ 237,619   $ 221,433  

In-place lease intangibles, net

    33,280     66,426  

Acquired above market lease intangibles, net

    32,812     49,741  

Marketable securities of our captive insurance companies

    105,860     116,260  

Goodwill

    20,098     20,098  

Other marketable securities

    210,867     144,188  

Minority interests

    173,923     163,196  

Prepaids, notes receivable and other assets, net

    387,797     337,293  
           

  $ 1,202,256   $ 1,118,635  
           

            Deferred Financing and Lease Costs.    Our deferred costs consist primarily of financing fees we incurred in order to obtain long-term financing and internal and external leasing commissions and related costs. We record amortization of deferred financing costs on a straight-line basis over the terms of the respective loans or agreements. Our deferred leasing costs consist primarily of capitalized salaries and related benefits in connection with lease originations. We record amortization of deferred leasing costs on a straight-line basis over the terms of the related leases. Details of these deferred costs as of December 31 are as follows:

 
  2008   2007  

Deferred financing and lease costs

  $ 444,220   $ 401,153  

Accumulated amortization

    (206,601 )   (179,720 )
           

Deferred financing and lease costs, net

  $ 237,619   $ 221,433  
           

            We report amortization of deferred financing costs, amortization of premiums, and accretion of discounts as part of interest expense. Amortization of deferred leasing costs are a component of depreciation and amortization expense. We amortize debt premiums and discounts, which are included in mortgages and other indebtedness, over the remaining terms of the related debt instruments. These debt premiums or discounts arise either at the debt issuance or

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Notes to Consolidated Financial Statements (Continued)

(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

3.    Summary of Significant Accounting Policies (Continued)


as part of the purchase price allocation of the fair value of debt assumed in acquisitions. The accompanying statements of operations and comprehensive income includes amortization as follows:

 
  For the Year Ended December 31,  
 
  2008   2007   2006  

Amortization of deferred financing costs

  $ 17,044   $ 15,467   $ 18,716  

Amortization of debt premiums net of discounts

    (14,701 )   (23,000 )   (28,163 )

Amortization of deferred leasing costs

    31,674     26,033     22,259  

            Intangible Assets.    The average life of in-place lease intangibles is approximately 5.5 years and is amortized over the remaining life of the leases of the related property on the straight-line basis and is included with depreciation and amortization in the consolidated statements of operations and comprehensive income. The fair market value of above and below market leases are amortized into revenue over the remaining lease life as a component of reported minimum rents. The weighted average remaining life of these intangibles approximates 2 years. The unamortized amounts of below market leases are included in accounts payable, accrued expenses, intangibles and deferred revenues on the consolidated balance sheets were $94.3 million and $146.7 million as of December 31, 2008 and 2007, respectively. The amount of amortization of above and below market leases, net for the year ended December 31, 2008, 2007, and 2006 was $35.4 million, $44.6 million, and $53.3 million, respectively. If a lease is terminated prior to the original lease termination, any remaining unamortized intangible is charged to the income statement.

            Details of intangible assets as of December 31 are as follows:

 
  2008   2007  

In-place lease intangibles

  $ 160,125   $ 190,151  

Accumulated amortization

    (126,845 )   (123,725 )
           

In-place lease intangibles, net

  $ 33,280   $ 66,426  
           

Acquired above market lease intangibles

  $ 144,224   $ 144,224  

Accumulated amortization

    (111,412 )   (94,483 )
           

Acquired above market lease intangibles, net

  $ 32,812   $ 49,741  
           

            Estimated future amortization, and the increasing (decreasing) effect on minimum rents for our above and below market leases recorded as of December 31, 2008 are as follows:

 
  Below Market
Leases
  Above Market
Leases
  Increase to
Minimum
Rent, Net
 

2009

  $ 33,590   $ (13,388 ) $ 20,202  

2010

    22,702     (6,958 )   15,744  

2011

    17,228     (4,909 )   12,319  

2012

    12,297     (3,703 )   8,594  

2013

    5,105     (2,592 )   2,513  

Thereafter

    3,372     (1,262 )   2,110  
               

  $ 94,294   $ (32,812 ) $ 61,482  
               

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Notes to Consolidated Financial Statements (Continued)

(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

3.    Summary of Significant Accounting Policies (Continued)

            We account for our derivative financial instruments pursuant to SFAS 133 "Accounting for Derivative Instruments and Hedging Activities," as amended by SFAS 138, "Accounting for Derivative Instruments and Hedging Activities." We use a variety of derivative financial instruments in the normal course of business to manage or hedge the risks associated with our indebtedness and interest payments as described in Note 8 and record all derivatives on our balance sheets at fair value. We require that hedging derivative instruments be highly effective in reducing the risk exposure that they are designated to hedge. We formally designate any instrument that meets these hedging criteria as a hedge at the inception of the derivative contract.

            We adjust our balance sheets on an ongoing basis to reflect the current fair market value of our derivatives. We record changes in the fair value of these derivatives each period in earnings or other comprehensive income, as appropriate. The ineffective portion of the hedge is immediately recognized in earnings to the extent that the change in value of a derivative does not perfectly offset the change in value of the instrument being hedged. The unrealized gains and losses held in accumulated other comprehensive income will be reclassified to earnings over time as the hedged items are recognized in earnings. We have a policy of only entering into contracts with major financial institutions based upon their credit ratings and other factors.

            We use standard market conventions to determine the fair values of derivative instruments, and techniques such as discounted cash flow analysis, option pricing models, and termination cost to determine fair value at each balance sheet date. All methods of assessing fair value result in a general approximation of value and such value may never actually be realized.

            The components of our accumulated other comprehensive income (loss) consisted of the following as of December 31:

 
  2008   2007  

Cumulative translation adjustments

  $ (2,524 ) $ 4,429  

Accumulated derivative (losses) gains, net

    (39,100 )   15,078  

Net unrealized (losses) gains on marketable securities, net

    (165,336 )   3,283  
           

Total accumulated other comprehensive (loss) income

  $ (206,960 ) $ 22,790  
           

            Included in cumulative translation adjustment is the gain related to the impact of exchange rate fluctuations on foreign currency denominated debt of $46.9 million and $35.4 million at December 31, 2008 and 2007, respectively, that hedges the currency exposure related to certain of our foreign investments. The net unrealized losses as of December 31, 2008 of $165.3 million represents the valuation and related currency adjustments for our marketable securities, including our investment in Liberty. We do not consider the decline in value of any of our marketable securities to be an other-than-temporary decline in value as these market value declines have existed for a short period of time, and we have the ability and intent to hold these securities. Further, as it relates to Liberty, we believe their underlying operating fundamentals remain substantially unchanged.

            We, as a lessor, retain substantially all of the risks and benefits of ownership of the investment properties and account for our leases as operating leases. We accrue minimum rents on a straight-line basis over the terms of their respective leases. Substantially all of our retail tenants are also required to pay overage rents based on sales over a

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Notes to Consolidated Financial Statements (Continued)

(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

3.    Summary of Significant Accounting Policies (Continued)

stated base amount during the lease year. We recognize overage rents only when each tenant's sales exceed the applicable sales threshold.

            We structure our leases to allow us to recover a significant portion of our property operating, real estate taxes, repairs and maintenance, and advertising and promotion expenses from our tenants. A substantial portion of our leases, other than those for anchor stores, require the tenant to reimburse us for a substantial portion of our operating expenses, including common area maintenance, or CAM, real estate taxes and insurance. This significantly reduces our exposure to increases in costs and operating expenses resulting from inflation. Such property operating expenses typically include utility, insurance, security, janitorial, landscaping, food court and other administrative expenses. We accrue reimbursements from tenants for recoverable portions of all these expenses as revenue in the period the applicable expenditures are incurred. For approximately 75% of our leases in the U.S. regional mall portfolio, we receive a fixed payment from the tenant for the CAM component. We are continually working towards converting the remainder of our leases to the fixed payment methodology. Without the fixed-CAM component, CAM expense reimbursements are based on the tenant's proportionate share of the allocable operating expenses and CAM capital expenditures for the property. We also receive escrow payments for these reimbursements from substantially all our non-fixed CAM tenants and monthly fixed CAM payments throughout the year. We recognize differences between estimated recoveries and the final billed amounts in the subsequent year. These differences were not material in any period presented. Our advertising and promotional costs are expensed as incurred.

            Management fees and other revenues are generally received from our unconsolidated joint venture properties as well as third parties. Management fee revenue is earned based on a contractual percentage of joint venture property revenue. Development fee revenue is earned on a contractual percentage of hard costs to develop a property. Leasing fee revenue is earned on a contractual per square foot charge based on the square footage of current year leasing activity. We recognize revenue for these services provided when earned based on the underlying activity.

            Insurance premiums written and ceded are recognized on a pro-rata basis over the terms of the policies. Insurance losses are reflected in property operating expenses in the accompanying statements of operations and comprehensive income and include estimates for losses incurred but not reported as well as losses pending settlement. Estimates for losses are based on evaluations by third-party actuaries and management's best estimates. Total insurance reserves for our insurance subsidiaries and other self-insurance programs as of December 31, 2008 and 2007 approximated $116.5 million and $121.4 million, respectively.

            We recognize fee revenues from our co-branded gift card programs when the fees are earned under the related arrangements with the card issuer. Generally, these revenues are recorded at the issuance of the gift card for handling fees.

            We record a provision for credit losses based on our judgment of a tenant's creditworthiness, ability to pay and probability of collection. In addition, we also consider the retail sector in which the tenant operates and our historical collection experience in cases of bankruptcy, if applicable. Accounts are written off when they are deemed to be no

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Notes to Consolidated Financial Statements (Continued)

(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

3.    Summary of Significant Accounting Policies (Continued)

longer collectible. Presented below is the activity in the allowance for credit losses and includes the activities related to discontinued operations during the following years:

 
  For the Year Ended December 31,  
 
  2008   2007   2006  

Balance at Beginning of Year

  $ 33,810   $ 32,817   $ 35,239  

Consolidation of previously unconsolidated entities

        495     321  

Provision for Credit Losses

    24,037     9,672     9,730  

Accounts Written Off

    (13,197 )   (9,174 )   (12,473 )
               

Balance at End of Year

  $ 44,650   $ 33,810   $ 32,817  
               

            As a partnership, the allocated share of our income or loss for each year is included in the income tax returns of the partners; accordingly, no accounting for income taxes is required in the accompanying consolidated financials statements. State income, franchise or other taxes were not significant in any of the periods presented.

            Simon Property and two of our subsidiaries are taxed as REITs under Sections 856 through 860 of the Internal Revenue Code and applicable Treasury regulations relating to REIT qualification. In order to maintain this REIT status, the regulations require each REIT to distribute at least 90% of its taxable income to stockholders and meet certain other asset and income tests as well as other requirements. We intend to continue to make distributions to Simon Property and to assist Simon Property in meeting the asset and income tests and other REIT requirements in order to allow it to adhere to these requirements and maintain its REIT status. Our subsidiary REIT entities will generally not be liable for federal corporate income taxes as long as they continue to distribute in excess of 100% of their taxable income. Thus, we made no provision for federal income taxes for these entities in the accompanying consolidated financial statements. If Simon Property or either of our REIT subsidiaries fail to qualify as a REIT, Simon Property or that entity will be subject to tax at regular corporate rates for the years in which it failed to qualify. If Simon Property lost its REIT status, it could not elect to be taxed as a REIT for four years unless its failure to qualify was due to reasonable cause and certain other conditions were satisfied.

            Simon Property has also elected taxable REIT subsidiary, or TRS, status for some of our subsidiaries. This enables us to provide services that would otherwise be considered impermissible for REITs and participate in activities that don't qualify as "rents from real property". For these entities, deferred tax assets and liabilities are established for temporary differences between the financial reporting basis and the tax basis of assets and liabilities at the enacted tax rates expected to be in effect when the temporary differences reverse. A valuation allowance for deferred tax assets is provided if we believe all or some portion of the deferred tax asset may not be realized. An increase or decrease in the valuation allowance that results from the change in circumstances that causes a change in our judgment about the realizability of the related deferred tax asset is included in income.

            As of December 31, 2008 and 2007, we had a net deferred tax asset of $8.9 million and $19.8 million, respectively, related to our TRS subsidiaries. The net deferred tax asset is included in deferred costs and other assets in the accompanying consolidated balance sheets and consists primarily of operating losses and other carryforwards for federal income tax purposes as well as the timing of the deductibility of losses or reserves from insurance subsidiaries. No valuation allowance has been recorded as we believe these amounts will be realized. State income, franchise or other taxes were not significant in any of the periods presented. The income tax benefit in 2007 results primarily from the tax deductibility of a $55.1 million impairment charge.

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Notes to Consolidated Financial Statements (Continued)

(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

3.    Summary of Significant Accounting Policies (Continued)

            We made certain reclassifications of prior period amounts in the financial statements to conform to the 2008 presentation. The reclassifications were to amounts reported in the consolidated statement of cash flows and had no impact on previously reported operating results.

4.    Real Estate Acquisitions, Disposals, and Impairment

            We acquire properties to generate both current income and long-term appreciation in value. We acquire individual properties or portfolios of other retail real estate companies that meet our investment criteria. We sell properties which no longer meet our strategic criteria. Our consolidated acquisition and disposal activity for the periods presented are highlighted as follows:

            Effective January 1, 2008, we acquired additional interests in three existing consolidated properties of between 1.8% and 5%, for an aggregate $6.2 million in cash. Two of the properties continue to have a minority interest holder. We now own 100% of the third property.

            As a result of the Mills acquisition which is more fully discussed in Note 7, we consolidated two regional mall properties, Town Center at Cobb and Gwinnett Place. In addition to the Mills acquisition, on March 1, 2007, we acquired the remaining 40% interest in both University Park Mall and University Center located in Mishawaka, Indiana from our partner and as a result, we now own 100% of these properties. On March 28, 2007, we acquired The Maine Outlet, a 112,000 square foot outlet center located in Kittery, Maine, adjacent to our Kittery Premium Outlets property. On August 23, 2007, we acquired Las Americas Premium Outlets, a 560,000 square foot upscale outlet center located in San Diego, California. We also purchased an additional 1% interest in Bangor Mall on July 13, 2007, and an additional 6.5% interest in Montgomery Mall on November 1, 2007. The aggregate purchase price of the consolidated assets acquired during 2007, excluding Town Center and Cobb and Gwinnett Place, was approximately $394.2 million, including the assumption of our share of debt of the properties acquired.

            On November 1, 2006, we acquired the remaining 50% interest in Mall of Georgia, a regional mall property for $252.6 million, including the assumption of our $96.0 million share of debt. As a result, we now own 100% of Mall of Georgia and the property was consolidated as of the acquisition date.

            We had no consolidated property dispositions during the year ended December 31, 2008.

            During the year ended December 31, 2007, we sold five consolidated properties for which we received net proceeds of $56.4 million and recorded our share of a loss on the disposals (net) totaling $35.3 million.

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Notes to Consolidated Financial Statements (Continued)

(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

4.    Real Estate Acquisitions, Disposals, and Impairment (Continued)

            During the year ended December 31, 2006, we sold three consolidated properties and one property in which we held a 50% interest and accounted for under the equity method. We received net proceeds of $52.7 million and recorded our share of a gain on the dispositions totaling $12.2 million.

            Impairment.    In 2008, we recorded an impairment charge of $21.2 million. This resulted primarily from a $10.5 million reduction in the carrying value of a regional mall to its estimated net realizable value and the write-off of predevelopment costs related to various projects that we no longer plan to pursue development.

5.    Per Unit Data

            We determine basic earnings per unit based on the weighted average number of units outstanding during the period. We determine diluted earnings per unit based on the weighted average number of units outstanding combined with the incremental weighted average units that would have been outstanding assuming all dilutive potential common units were converted into units at the earliest date possible. The following table sets forth the computation of our basic and diluted earnings per unit.

 
  For the Year Ended December 31,  
 
  2008   2007   2006  

Income from continuing operations, after preferred unit requirement

  $ 529,751   $ 585,047   $ 614,409  

Discontinued operations

    (25 )   (35,369 )   502  
               

Net Income available to Unitholders — Basic & Diluted

  $ 529,726   $ 549,678   $ 614,911  
               

Weighted Average Units Outstanding — Basic

    282,508,087     281,034,711     279,567,279  

Effect of stock options of Simon Property

    551,057     778,471     903,255  
               

Weighted Average Units Outstanding — Diluted

    283,059,144     281,813,182     280,470,534  
               

            For the year ending December 31, 2008, potentially dilutive securities include Simon Property stock options, convertible preferred stock and certain series of our preferred units The only security that had a dilutive effect for the years ended December 31, 2008, 2007 and 2006 were Simon Property stock options.

            We accrue distributions when they are declared. The taxable nature of the distributions declared for each of the years ended as indicated is summarized as follows:

 
  For the Year Ended
December 31,
 
 
  2008   2007   2006  

Total distributions paid per common unit

  $ 3.60   $ 3.36   $ 3.04  
               

Percent taxable as ordinary income

    84.7 %   92.9 %   81.4 %

Percent taxable as long-term capital gains

    1.2 %   7.1 %   18.6 %

Percent nontaxable as return of capital

    14.1 %        
               

    100.0 %   100.0 %   100.0 %
               

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Notes to Consolidated Financial Statements (Continued)

(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

6.    Investment Properties

            Investment properties consist of the following as of December 31:

 
  2008   2007  

Land

  $ 2,795,026   $ 2,798,452  

Buildings and improvements

    22,112,944     21,364,915  
           

Total land, buildings and improvements

    24,907,970     24,163,367  

Furniture, fixtures and equipment

    297,745     251,658  
           

Investment properties at cost

    25,205,715     24,415,025  

Less — accumulated depreciation

    6,184,285     5,312,095  
           

Investment properties at cost, net

  $ 19,021,430   $ 19,102,930  
           

Construction in progress included above

  $ 358,254   $ 647,303  
           

7.    Investments in Unconsolidated Entities

            Joint ventures are common in the real estate industry. We use joint ventures, primarily with institutional investors, to finance properties, develop new properties, and diversify our risk in a particular property or portfolio. We held joint venture ownership interests in 103 properties in the U.S. as of December 31, 2008 and December 31, 2007. We also held interests in two joint ventures which owned 52 European shopping centers as of December 31, 2008 and 51 as of December 31, 2007. We also held an interest in seven joint venture properties under operation in Japan, one joint venture property in Mexico, one joint venture property in Korea, and one joint venture property in China. We account for these joint venture properties using the equity method of accounting.

            Substantially all of our joint venture properties are subject to rights of first refusal, buy-sell provisions, or other sale rights for partners which are customary in real estate joint venture agreements and the industry. Our partners in these joint ventures may initiate these provisions at any time (subject to any applicable lock up or similar restrictions), which will result in either the sale of our interest or the use of available cash or borrowings to acquire the joint venture interest.

            On February 16, 2007, SPG-FCM, a 50/50 joint venture between one of our affiliates and funds managed by Farallon Capital Management, L.L.C., or Farallon, entered into a definitive merger agreement to acquire all of the outstanding common stock of Mills for $25.25 per common share in cash. The acquisition of Mills and its interests in the 36 properties that remain at December 31, 2008 was completed in April 2007. As of December 31, 2008, we and Farallon had each funded $650.0 million into SPG-FCM to acquire all of the common stock of Mills. As part of the transaction, we also made loans to SPG-FCM and Mills at rates of LIBOR plus 270-275 basis points. These funds were used by SPG-FCM and Mills to repay loans and other obligations of Mills, including the redemption of preferred stock, during 2007. As of December 31, 2008, the outstanding balance of our loan to SPG-FCM was $520.7 million, and the average outstanding balance during the year ended December 31, 2008 of all loans made to SPG-FCM and Mills was approximately $534.1 million. During 2008 and 2007, we recorded approximately $15.3 million and $39.1 million in interest income (net of inter- entity eliminations) related to these loans, respectively. We also recorded fee income, including fee income amortization related to up-front fees on loans made to SPG-FCM and Mills, during 2008 and 2007 of approximately $3.1 million and $17.4 million (net of inter-entity eliminations), respectively, for providing refinancing services to Mills' properties and SPG-FCM. The existing loan facility to SPG-FCM bears a rate of LIBOR plus 275 basis points and matures on June 7, 2009, with three available one-year extensions. Fees charged on loans made to SPG-FCM and Mills are amortized on a straight-line basis over the life of the loan.

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Notes to Consolidated Financial Statements (Continued)

(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

7.    Investments in Unconsolidated Entities (Continued)

            As a result of the change in control of Mills, holders of Mills' Series F convertible cumulative redeemable preferred stock had the right to require the repurchase of their shares for cash equal to the liquidation preference per share plus accrued and unpaid dividends. During the second quarter of 2007, all of the holders of Mills' Series F preferred stock exercised this right, and Mills redeemed this series of preferred stock for approximately $333.2 million, including accrued dividends. Further, as of August 1, 2007, The Mills Corporation was liquidated and the holders of the remaining series' of Mills preferred stock were paid a liquidation preference of approximately $693.0 million, including accrued dividends.

            During the third quarter of 2007, the holders of less than 5,000 common units in the Mills' operating partnership, or Mills Units, received $25.25 in cash, and those holding 5,000 or more Mills Units had the option to exchange for cash of $25.25, or units of the Operating Partnership based on a fixed exchange ratio of 0.211 Operating Partnership units for each Mills Unit. That option expired on August 1, 2007. Holders electing to exchange received 66,036 units in the Operating Partnership for their Mills Units. The remaining Mills Units were exchanged for cash.

            Effective July 1, 2007, we or an affiliate of ours began serving as the manager for substantially all of the properties in which SPG-FCM holds an interest. In conjunction with the Mills acquisition, we acquired a majority interest in two properties in which we previously held a 50% ownership interest (Town Center at Cobb and Gwinnett Place) and as a result we have consolidated these two properties at the date of acquisition. We have reclassified the results of these properties in the Joint Venture Statement of Operations into "Income from consolidated joint venture interests."

            The Mills acquisition involved the purchase of all of Mills' outstanding shares of common stock and common units for approximately $1.7 billion (at $25.25 per share or unit), the assumption of $954.9 million of preferred stock, the assumption of a proportionate share of property-level mortgage debt, of which SPG-FCM's share approximated $3.8 billion, the assumption of $1.2 billion in unsecured loans provided by us, costs to effect the acquisition, and certain liabilities and contingencies, including an ongoing investigation by the Securities and Exchange Commission, for an aggregate purchase price of approximately $8 billion. SPG-FCM has finalized its purchase price allocations for the Mills acquisition. The valuations were developed with the assistance of a third-party professional appraisal firm.

            In addition we sold our interest in Cincinnati Mills and Broward and Westland Malls, which we acquired through the Mills acquisition, and recognized no gain or loss on these dispositions.

Joint Venture Property Refinancing Activity

            The following joint venture property refinancing activity occurred during the period, some of which resulted in our receiving significant excess refinancing proceeds or making contributions:

            On December 5, 2008, we refinanced Ontario Mills, a joint venture property in which we own a 25% interest, with a $75.0 million, LIBOR plus 296 basis points variable-rate mortgage that matures December 5, 2013. We subsequently entered into a swap agreement that essentially fixes the interest rate at 5.13%. The balances of the previous mortgages were $135.6 million and required a contribution by the partners to retire the loan. Our net share of the contribution was $15.7 million.

            During 2008, we refinanced Fashion Valley Mall, a joint venture property in which we own a 50% interest, with a $200.0 million, LIBOR plus 200 bps variable-rate mortgage that matures October 9, 2013. The balances of the two previous mortgages, which were repaid, were $153.6 million and $29.1 million and bore interest at a fixed rate of 6.49% and 6.58%, respectively. We received our share of the excess refinancing proceeds of approximately $7.1 million on the closing of the new mortgage loan.

            On October 1, 2008, we refinanced Mall of New Hampshire, a joint venture property in which we own a 49.14% interest, with a $136.7 million, 6.23% fixed-rate mortgage that matures October 5, 2015. The balances of the two previous mortgages, which were repaid, were $93.5 million and $7.8 million and bore interest at a fixed rate of 6.96%

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Notes to Consolidated Financial Statements (Continued)

(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

7.    Investments in Unconsolidated Entities (Continued)


and 8.53%, respectively. We received our share of the excess refinancing proceeds of approximately $18.7 million on the closing of the new mortgage loan.

            On November 15, 2007, we refinanced Aventura Mall, a joint venture property in which we own a 33.3% interest, with a $430.0 million, 5.905% fixed-rate mortgage that matures on December 11, 2017. The balance of the previous $200.0 million 6.61% fixed-rate mortgage was repaid, and we received our share of the excess refinancing proceeds of approximately $71.4 million.

            On November 1, 2007, we refinanced West Town Mall, a joint venture property in which we own a 50% interest, with a $210.0 million, 6.3375% fixed-rate mortgage that matures on December 1, 2017. The balance of the previous $76.0 million 6.90% fixed-rate mortgage was repaid, and we received our share of the excess refinancing proceeds of approximately $66.4 million.

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Notes to Consolidated Financial Statements (Continued)

(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

7.    Investments in Unconsolidated Entities (Continued)

Summary Financial Information

            A summary of our investments in joint ventures and share of income from such joint ventures follow. We condensed into separate line items major captions of the statements of operations for joint venture interests sold or consolidated. Consolidation occurs when we acquire an additional interest in the joint venture and as a result, gain control of the property or become the primary beneficiary of a VIE. We reclassified these line items into "Income from discontinued joint venture interests" and "Income from consolidated joint venture interests" so that we may present comparative results of operations for those joint venture interests held as of December 31, 2008. Balance sheet information for the joint ventures is as follows:

 
  December 31,
2008
  December 31,
2007
 

BALANCE SHEETS

             

Assets:

             

Investment properties, at cost

  $ 21,472,490   $ 21,009,416  

Less — accumulated depreciation

    3,892,956     3,217,446  
           

    17,579,534     17,791,970  

Cash and cash equivalents

    805,411     747,575  

Tenant receivables and accrued revenue, net

    428,322     435,093  

Investment in unconsolidated entities, at equity

    230,497     258,633  

Deferred costs and other assets

    594,578     713,180  
           
 

Total assets

  $ 19,638,342   $ 19,946,451  
           

Liabilities and Partners' Equity:

             

Mortgages and other indebtedness

  $ 16,686,701   $ 16,507,076  

Accounts payable, accrued expenses, intangibles, and deferred revenue

    1,070,958     972,699  

Other liabilities

    982,254     825,279  
           
 

Total liabilities

    18,739,913     18,305,054  

Preferred units

    67,450     67,450  

Partners' equity

    830,979     1,573,947  
           
 

Total liabilities and partners' equity

  $ 19,638,342   $ 19,946,451  
           

Our Share of:

             

Total assets

  $ 8,056,873   $ 8,040,987  
           

Partners' equity

  $ 533,929   $ 776,857  

Add: Excess Investment

    749,227     757,236  
           

Our net Investment in Joint Ventures

  $ 1,283,156   $ 1,534,093  
           

Mortgages and other indebtedness

  $ 6,632,419   $ 6,568,403  
           

            "Excess Investment" represents the unamortized difference of our investment over our share of the equity in the underlying net assets of the joint ventures acquired. We amortize excess investment over the life of the related properties, typically no greater than 40 years, and the amortization is included in the reported amount of income from unconsolidated entities.

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Notes to Consolidated Financial Statements (Continued)

(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

7.    Investments in Unconsolidated Entities (Continued)

            As of December 31, 2008, scheduled principal repayments on joint venture properties' mortgages and other indebtedness are as follows:

2009

  $ 1,511,663  

2010

    1,694,633  

2011

    1,630,437  

2012

    2,538,381  

2013

    1,563,591  

Thereafter

    7,724,784  
       

Total principal maturities

    16,663,489  

Net unamortized debt premiums and discounts

    23,212  
       

Total mortgages and other indebtedness

  $ 16,686,701  
       

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Notes to Consolidated Financial Statements (Continued)

(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

7.    Investments in Unconsolidated Entities (Continued)

            This debt becomes due in installments over various terms extending through 2036 with interest rates ranging from 1.00% to 10.61% and a weighted average rate of 4.99% at December 31, 2008.

 
  For the Year Ended December 31,  
 
  2008   2007   2006  

STATEMENTS OF OPERATIONS

                   

Revenue:

                   
 

Minimum rent

  $ 1,956,129   $ 1,682,671   $ 1,060,896  
 

Overage rent

    130,549     119,134     89,968  
 

Tenant reimbursements

    1,005,638     852,312     540,560  
 

Other income

    199,774     201,075     147,549  
               
   

Total revenue

    3,292,090     2,855,192     1,838,973  

Operating Expenses:

                   
 

Property operating

    671,268     580,910     366,122  
 

Depreciation and amortization

    775,887     627,929     318,589  
 

Real estate taxes

    263,054     220,474     131,359  
 

Repairs and maintenance

    124,272     113,517     83,331  
 

Advertising and promotion

    70,425     62,182     42,096  
 

Provision for credit losses

    24,053     22,448     4,620  
 

Other

    177,298     162,570     125,976  
               
   

Total operating expenses

    2,106,257     1,790,030     1,072,093  
               

Operating Income

    1,185,833     1,065,162     766,880  

Interest expense

    (969,420 )   (853,307 )   (415,425 )

(Loss) income from unconsolidated entities

    (5,123 )   665     1,204  

Loss on sale of asset

        (6,399 )   (6 )
               

Income from Continuing Operations

    211,290     206,121     352,653  

Income from consolidated joint venture interests

        2,562     14,070  

Income from discontinued joint venture interests

    47     202     736  

Gain on disposal or sale of discontinued operations, net

        198,956     20,375  
               

Net Income

  $ 211,337   $ 407,841   $ 387,834  
               

Third-Party Investors' Share of Net Income

  $ 132,111   $ 232,586   $ 232,499  
               

Our Share of Net Income

    79,226     175,255     155,335  

Amortization of Excess Investment

    (46,980 )   (46,503 )   (49,546 )

Income from Beneficial Interests and Other, net

            15,605  

Write-off of Investment Related to Properties Sold

            (2,846 )

Our Share of Net Gain Related to Properties/Assets Sold

        (90,632 )   (7,729 )
               

Income from Unconsolidated Entities, Net

  $ 32,246   $ 38,120   $ 110,819  
               

2006 Acquisition and Disposition Activity

            On November 1, 2006, we acquired the remaining 50% interest in Mall of Georgia, a regional mall property for $252.6 million, which includes our $96.0 million share of debt. As a result, we now own 100% of Mall of Georgia and the property was consolidated as of the acquisition date. We have reclassified the results of this property in the Joint Venture Statement of Operations into "Income from consolidated joint venture interests."

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Notes to Consolidated Financial Statements (Continued)

(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

7.    Investments in Unconsolidated Entities (Continued)

            Impairment Charge.    On December 28, 2005, we invested $50.0 million of equity for a 40% interest in a joint venture with Toll Brothers, Inc. and Meritage Homes Corp. to purchase a 5,485-acre land parcel in northwest Phoenix from DaimlerChrysler Corporation for $312 million. The principal use of the land upon attaining entitled status is to develop single-family homesites by our partners. As a result of the downturn in the residential market, during the fourth quarter of 2007, we recorded an impairment charge of $55.1 million, $36.5 million net of tax benefit, representing our entire equity investment in this joint venture, including interest capitalized on our invested equity.

International Joint Venture Investments

            European Joint Ventures.    We conduct our international operations in Europe through our two European joint venture investment entities; Simon Ivanhoe S.à.r.l., or Simon Ivanhoe, and Gallerie Commerciali Italia, or GCI. The carrying amount of our total combined investment in these two joint venture investments is $224.2 million and $361.3 million as of December 31, 2008 and 2007, respectively, including all related components of other comprehensive income. We have a 50% ownership in Simon Ivanhoe and a 49% ownership in GCI as of December 31, 2008.

            On October 20, 2005, Ivanhoe Cambridge, Inc., or Ivanhoe, an affiliate of Caisse de dépôt et placement du Québec, effectively acquired our former partner's 39.5% ownership interest in Simon Ivanhoe. On February 13, 2006, pursuant to the terms of our October 20, 2005 transaction with Ivanhoe, we sold a 10.5% interest in this joint venture to Ivanhoe for €45.2 million, or $53.9 million, and recorded a gain on the disposition of $34.4 million. This gain is reported in "gain (loss) on sales of assets and interests in unconsolidated entities, net" in the 2006 consolidated statement of operations and comprehensive income (loss). We then settled all remaining share purchase commitments from the company's founders, including the early settlement of some commitments by purchasing an additional 25.8% interest in Simon Ivanhoe for €55.1 million, or $65.5 million. As a result of these transactions, we and Ivanhoe each own a 50% interest in Simon Ivanhoe at December 31, 2007 and 2008.

            On July 5, 2007, Simon Ivanhoe completed the sale of five non-core assets in Poland and we presented our share of the gain upon this disposition in "gain (loss) on sale of assets and interests in unconsolidated entities, net" in the consolidated statement of operations and comprehensive income.

            Asian Joint Ventures.    We conduct our international Premium Outlet operations in Japan through joint ventures with Mitsubishi Estate Co., Ltd. and Sojitz Corporation. The carrying amount of our investment in these Premium Outlet joint ventures in Japan is $312.6 million and $273.0 million as of December 31, 2008 and 2007, respectively, including all related components of other comprehensive income. We have a 40% ownership in these Japan Premium Outlet Centers through a joint venture arrangement. During 2007, we also completed construction and opened our first Premium Outlet in Korea. As of December 31, 2008 and 2007 respectively, our investment in our Premium Outlet in Korea, for which we hold a 50% ownership interest, approximated $18.0 million and $23.1 million including all related components of other comprehensive income.

            During 2006, we finalized the formation of joint venture arrangements to develop and operate shopping centers in China. The shopping centers will be anchored by Wal-Mart stores and we own a 32.5% interest in the joint venture entities, and a 32.5% ownership in the management operation overseeing these projects, collectively referred to as Great Mall Investments, Ltd., or GMI. During 2008, we completed construction and opened our first center in China, and have three additional centers under construction and due for completion in 2009. As of December 31, 2008 and 2007 respectively, our investment in our centers in China approximated $53.9 million and $33.7 million including all related components of other comprehensive income. Our projected total equity commitment upon completion for all four centers in China is $53.7 million.

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Notes to Consolidated Financial Statements (Continued)

(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

8.    Indebtedness and Derivative Financial Instruments

            Our mortgages and other indebtedness, excluding the impact of derivative instruments except for our fair value interest rate swaps, consist of the following as of December 31:

 
  2008   2007  

Fixed-Rate Debt:

             

Mortgages and other notes, including $15,312 and $24,845 net premiums, respectively. Weighted average interest and maturity of 6.11% and 4.1 years at December 31, 2008.

  $ 4,192,430   $ 4,836,761  

Unsecured notes, including $1,887 and $9,680 net premiums, respectively. Weighted average interest and maturity of 5.69% and 4.7 years at December 31, 2008.

    10,726,887     9,384,680  

7% Mandatory Par Put Remarketed Securities, including $4,568 premiums in 2007 that were redeemed in June 2008.

        204,568  
           

Total Fixed-Rate Debt

    14,919,317     14,426,009  

Variable-Rate Debt:

             

Mortgages and other notes, at face value, respectively. Weighted average interest and maturity of 2.00% and 3.3 years.

    2,076,927     441,143  

Credit Facility (see below)

    1,046,288     2,351,612  
           

Total Variable-Rate Debt

    3,123,215     2,792,755  

Fair value interest rate swaps

        (90 )
           

Total Mortgages and Other Indebtedness, Net

  $ 18,042,532   $ 17,218,674  
           

            General.    At December 31, 2008, we have pledged 76 properties as collateral to secure related mortgage notes including 7 pools of cross-defaulted and cross-collateralized mortgages encumbering a total of 39 properties. Under these cross-default provisions, a default under any mortgage included in the cross-defaulted package may constitute a default under all such mortgages and may lead to acceleration of the indebtedness due on each property within the collateral package. Of our 76 encumbered properties, indebtedness on 18 of these encumbered properties and our unsecured notes are subject to various financial performance covenants relating to leverage ratios, annual real property appraisal requirements, debt service coverage ratios, minimum net worth ratios, debt-to-market capitalization, and/or minimum equity values. Our mortgages and other indebtedness may be prepaid but are generally subject to payment of a yield-maintenance premium or defeasance. As of December 31, 2008, we were in compliance with all our debt covenants.

            Some of our limited partners guarantee a portion of our consolidated debt through foreclosure guarantees. In total, 53 limited partners provide guarantees of foreclosure of $285.3 million of our consolidated debt at three consolidated properties. In each case, the loans were made by unrelated third party institutional lenders and the guarantees are for the benefit of each lender. In the event of foreclosure of the mortgaged property, the proceeds from the sale of the property are first applied against the amount of the guarantee and also reduce the amount payable under the guarantee. To the extent the sale proceeds from the disposal of the property do not cover the amount of the guarantee, then the limited partner is liable to pay the difference between the sale proceeds and the amount of the guarantee so that the entire amount guaranteed to the lender is satisfied. The debt is non-recourse to us and our affiliates.

Unsecured Debt

            Our unsecured debt currently consists of $10.7 billion of senior unsecured notes and $1.0 billion outstanding under our $3.5 billion credit facility, or the Credit Facility. The Credit Facility bears interest at LIBOR plus 37.5 basis

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Notes to Consolidated Financial Statements (Continued)

(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

8.    Indebtedness and Derivative Financial Instruments (Continued)


points and an additional facility fee of 12.5 basis points. The Credit Facility is scheduled to mature on January 11, 2010, which we can extend for another year at our option.

            On May 19, 2008, we issued two tranches of senior unsecured notes totaling $1.5 billion at a weighted average fixed interest rate of 5.74% consisting of a $700.0 million tranche with a fixed interest rate of 5.30% due May 30, 2013 and a second $800.0 million tranche with a fixed interest rate of 6.125% due May 30, 2018. We used proceeds from the offering to reduce borrowings on the Credit Facility and for general working capital purposes.

            On June 16, 2008, we completed redemption of the $200.0 million outstanding principal amount of its 7% Mandatory Par Put Remarketed Securities, or MOPPRS. The redemption was accounted for as an extinguishment and resulted in a charge in the second quarter of 2008 of approximately $20.3 million.

            On August 28, 2008, we repaid a $150.0 million unsecured note, which had a fixed rate of 5.38%.

            During the year ended December 31, 2008, we drew amounts from the Credit Facility to fund the redemption of the remarketable debt securities and the repayment of the $150.0 million unsecured note. Other amounts drawn on the Credit Facility were primarily for general working capital purposes. We repaid a total of $2.7 billion on the Credit Facility during the year ended December 31, 2008. The total outstanding balance of the Credit Facility as of December 31, 2008 was $1.0 billion, and the maximum amount outstanding during the year was approximately $2.6 billion. During the year ended December 31, 2008, the weighted average outstanding balance of the Credit Facility was approximately $1.4 billion. The amount outstanding as of December 31, 2008 includes $446.3 million in Euro and Yen-denominated borrowings. In addition, subsequent to December 31, 2008, we repaid $600 million in unsecured notes, consisting of two $300 million tranches that bore rates of 3.75% and 7.13%, respectively, using proceeds from the Credit Facility.

Secured Debt

            The balance of fixed and variable rate mortgage notes was $6.3 billion and $5.3 billion as of December 31, 2008 and 2007, respectively. Of the 2008 amount, $5.3 billion is nonrecourse to us. The fixed-rate mortgages generally require monthly payments of principal and/or interest. The interest rates of variable-rate mortgages are typically based on LIBOR. During the twelve-month period ended December 31, 2008, we repaid $274.0 million in mortgage loans, unencumbering five properties.

            On January 15, 2008, we entered into a swap transaction that effectively converted $300.0 million of variable rate debt to fixed rate debt at a net rate of 3.21%.

            On March 6, 2008, we borrowed $705 million on a term loan that matures March 5, 2012 and bears interest at a rate of LIBOR plus 70 basis points. On May 27, 2008, the loan was increased to $735 million. This loan is secured by the cash flow distributed from six properties and has additional availability of $115 million through the maturity date.

            On July 30, 2008, we borrowed $190.0 million on a loan secured by Philadelphia Premium Outlets, which matures on July 30, 2014 and bears interest at a variable rate of LIBOR plus 185 basis points. On January 2, 2009, we executed a swap agreement that fixes the interest rate of this loan at 4.19%.

            On September 23, 2008, we borrowed $170.0 million on a term loan that matures September 23, 2013 and bears interest at a rate of LIBOR plus 195 basis points. On November 4, 2008, the loan was increased to $220 million and on December 17, 2008, the loan was increased to its maximum availability of $260 million. This is a cross- collateralized loan that is secured by The Domain, Shops at Arbor Walk, and Palms Crossing. On January 2, 2009, we executed a swap agreement that fixes the interest rate on $200.0 million of this loan at 4.35%.

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Notes to Consolidated Financial Statements (Continued)

(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

8.    Indebtedness and Derivative Financial Instruments (Continued)

Debt Maturity and Other

            Our scheduled principal repayments on indebtedness as of December 31, 2008 are as follows:

2009

  $ 1,475,510  

2010

    2,301,674  

2011

    3,050,576  

2012

    2,938,395  

2013

    2,034,735  

Thereafter

    6,224,443  
       

Total principal maturities

    18,025,333  

Net unamortized debt premium and other

    17,199  
       

Total mortgages and other indebtedness

  $ 18,042,532  
       

            Our cash paid for interest in each period, net of any amounts capitalized, was as follows:

 
  For the Year Ended December 31,  
 
  2008   2007   2006  

Cash paid for interest

  $ 1,001,718   $ 983,219   $ 845,964  

Derivative Financial Instruments

            Our exposure to market risk due to changes in interest rates primarily relates to our long-term debt obligations. We manage exposure to interest rate market risk through our risk management strategy by a combination of interest rate protection agreements to effectively fix or cap a portion of variable rate debt, or in the case of a fair value hedge, effectively convert fixed rate debt to variable rate debt. We are also exposed to foreign currency risk on financings of certain foreign operations. Our intent is to offset gains and losses that occur on the underlying exposures, with gains and losses on the derivative contracts hedging these exposures. We do not enter into either interest rate protection or foreign currency rate protection agreements for speculative purposes.

            We may enter into treasury lock agreements as part of an anticipated debt issuance. If the anticipated transaction does not occur, the cost is charged to net income. Upon completion of the debt issuance, the cost of these instruments is recorded as part of accumulated other comprehensive income and is amortized to interest expense over the life of the debt agreement.

            As of December 31, 2008, we reflected the fair value of outstanding consolidated derivatives in other liabilities for $19.4 million. In addition, we recorded the benefits from our treasury lock and interest rate hedge agreements in accumulated other comprehensive loss and the unamortized balance of these agreements is $3.3 million as of December 31, 2008. The net deficit from terminated swap agreements is also recorded in accumulated other comprehensive loss and the unamortized balance is $3.4 million as of December 31, 2008. As of December 31, 2008, our outstanding LIBOR based derivative contracts consisted of:

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Notes to Consolidated Financial Statements (Continued)

(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

8.    Indebtedness and Derivative Financial Instruments (Continued)

            Within the next year, we expect to reclassify to earnings approximately $10.9 million of loss of the current balance held in accumulated other comprehensive loss. The amount of ineffectiveness relating to fair value and cash flow hedges recognized in income during the periods presented was not material.

            Our joint ventures may also enter into interest rate swaps or caps, which are recorded at fair value on the joint ventures' balance sheet. Included in our accumulated other comprehensive income (loss) as of December 31, 2008 and 2007 is our share of the joint ventures accumulated derivative gains or (losses) of $(19.6) million and $(5.8) million, respectively.

Fair Value of Financial Instruments

            The carrying value of our variable-rate mortgages and other loans approximates their fair values. We estimate the fair values of consolidated fixed-rate mortgages using cash flows discounted at current borrowing rates and other indebtedness using cash flows discounted at current market rates. We estimate the fair values of consolidated fixed-rate unsecured notes using quoted market prices, or, if no quoted prices are available, we use quoted market prices for securities with similar terms and maturities. The fair values of financial instruments and our related discount rate assumptions used in the estimation of fair value for our consolidated fixed-rate mortgages and other indebtedness as of December 31 is summarized as follows:

 
  2008   2007  

Fair value of fixed-rate mortgages and other indebtedness (in millions)

  $ 12,385   $ 14,742  

Average discount rates assumed in calculation of fair value of fixed-rate mortgages

    6.33 %   5.23 %

9.    Rentals under Operating Leases

            Future minimum rentals to be received under noncancelable tenant operating leases for each of the next five years and thereafter, excluding tenant reimbursements of operating expenses and percentage rent based on tenant sales volume as of December 31, 2008 are as follows:

2009

  $ 1,898,110  

2010

    1,762,658  

2011

    1,584,012  

2012

    1,402,718  

2013

    1,209,345  

Thereafter

    3,731,109  
       

  $ 11,587,952  
       

            Approximately 0.6% of future minimum rents to be received are attributable to leases with an affiliate of one of our limited partners.

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(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

10.    Partners' Equity

            Mezzanine Equity.    Preferred units whose redemption is outside our control have been classified as temporary equity in the accompanying consolidated balance sheets. Such units are described in the following paragraph.

            7.75%/8.00% Cumulative Redeemable Preferred Units.    During 2003, in connection with the purchase of additional interest in Kravco, we issued 7.75%/8.00% Cumulative Redeemable Preferred Units that accrue cumulative distributions at a rate of 7.75% of the liquidation value for the period beginning December 5, 2003, and ending December 31, 2004, 8.00% of the liquidation value for the period beginning January 1, 2005, and ending December 31, 2009, 10.00% of the liquidation value for the period beginning January 1, 2010, and ending December 31, 2010, and 12% of the liquidation value thereafter. These distributions are payable quarterly in arrears. A holder may require us to repurchase the 7.75% preferred units on or after January 1, 2009, or any time the aggregate liquidation value of the outstanding units exceeds 10% of the book value of our partners' equity. We may redeem the 7.75% preferred units on or after January 1, 2011, or earlier upon the occurrence of certain tax triggering events. Our intent is to redeem these units after January 1, 2009, after the occurrence of a tax-triggering event, which we expect to be in 2009. The redemption price is the liquidation value plus accrued and unpaid distributions, payable in cash or interest in one or more properties mutually agreed upon.

Unit Issuances and Repurchases

            In 2008, eight limited partners exchanged 2,574,608 units for an equal number of shares of common stock of Simon Property. We issued an equal number of units to Simon Property, increasing its ownership interest in us.

            We issued 282,106 units to Simon Property related to employee and director stock options exercised during 2008. We used the net proceeds from the option exercises of approximately $11.9 million for general working capital purposes.

            On July 26, 2007, the Simon Property Board of Directors authorized a common stock repurchase program under which Simon Property may purchase up to $1.0 billion of its common stock over the next twenty-four months as market conditions warrant. Simon Property may purchase the shares in the open market or in privately negotiated transactions. During 2008, no purchases were made as part of this program. Simon Property's share repurchase program had remaining availability of approximately $950.7 million at December 31, 2008.

            Holders of our Series I 6% Convertible Perpetual Preferred Units had the right to convert these preferred units into units during the year ended December 31, 2008. A total of 6,437,072 Series I preferred units were converted into 5,151,776 units for the year then ended.

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(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

10.    Partners' Equity (Continued)

Preferred Units

            The following table summarizes the carrying values of each series of preferred units that were outstanding as of December 31:

 
  2008   2007  

Series C 7.00% Cumulative Convertible Preferred Units, 2,700,000 units authorized, 94,235 and 100,818 issued and outstanding

  $ 2,639   $ 2,823  

Series D 8.00% Cumulative Redeemable Preferred Units, 2,700,000 units authorized, 1,356,814 and 1,418,307 issued and outstanding

    40,704     42,549  

6% Series I Convertible Perpetual Preferred Units, 19,000,000 units authorized, 9,108,635 and 17,039,611 issued and outstanding

    455,432     851,981  

Series J 83/8% Cumulative Redeemable Preferred Units, 1,000,000 units authorized, 796,948 issued and outstanding, including unamortized premium of $6,185 and $6,514 in 2008 and 2007, respectively.

    46,032     46,361  

7.5% Cumulative Redeemable Preferred Units, 260,000 authorized, 255,373 issued and outstanding

    25,537     25,537  
           

  $ 570,344   $ 969,251  
           

            The following series of preferred units had previously issued units in years prior to 2007, but had no shares outstanding at the end of 2008 and 2007, and the authorized units for each series are as follows: Series B 6.5% Convertible Preferred Units (5,000,000 units); Series E 8.00% Cumulative Redeemable Preferred Units (1,000,000 units); Series F 8.75% Cumulative Redeemable Preferred Units (8,000,000 units); Series G 7.89% Cumulative Step-Up Premium Rate Convertible Preferred Units (3,000,000 units); and Series H Variable Rate Preferred Units (4,530,000 units), Series K Variable Rate Redeemable Preferred Units (8,000,000 units); and Series L Variable Rate Redeemable Preferred Units (6,000,000 units).

            Series C 7.00% Cumulative Convertible Preferred Units.    Each Series C 7.00% preferred unit has a liquidation value of $28.00 and accrues cumulative distributions at a rate of $1.96 annually, payable quarterly in arrears. The Series C preferred units are convertible at the holders' option on or after August 27, 2004, into either a like number of shares of 7.00% Cumulative Convertible Preferred Stock of Simon Property with terms substantially identical to the Series C preferred units or into our common units at a ratio of 0.75676 to one provided that the closing stock price of Simon Property common stock exceeds $37.00 for any three consecutive trading days prior to the conversion date. We may redeem the Series C preferred units at their liquidation value plus accrued and unpaid distributions on or after August 27, 2009, payable in units. In the event of the death of a holder of Series C preferred units, or the occurrence of certain tax triggering events, we may be required to redeem the Series C preferred units at their liquidation value payable at our option in either cash (the payment of which may be made in four equal annual installments) or common units. During 2008, holders converted 6,583 of the preferred units into 4,981 common units.

            Series D 8.00% Cumulative Redeemable Preferred Units.    Each Series D 8.00% preferred unit has a liquidation value of $30.00 and accrues cumulative distributions at a rate of $2.40 annually, which is payable quarterly in arrears. The Series D preferred units are each paired with one Series C preferred unit or the common units into which the Series C preferred units may be converted. We may redeem the Series D preferred units at their liquidation value plus accrued and unpaid distributions on or after August 27, 2009, payable in either new preferred units having the same terms as the Series D preferred units, except that the distribution coupon rate would be reset to a market rate, or in units. The Series D preferred units are convertible at the holder's option on or after August 27, 2004, into 8.00% Cumulative Redeemable Preferred Stock of Simon Property with terms substantially identical to the Series D preferred units. In the event of the death of a holder or the occurrence of certain tax triggering events, we may be

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10.    Partners' Equity (Continued)


required to redeem the Series D preferred units owned by such holder at their liquidation value payable at our option in either cash (the payment of which may be made in four equal annual installments) or common units. During 2008, one holder redeemed 61,493 of the preferred units for $1.8 million.

            Series I 6% Convertible Perpetual Preferred Units.    On October 14, 2004, we issued 18,015,506 Series I 6% convertible perpetual preferred units as part of our acquisition of the Chelsea Property Group (Chelsea). Distributions are made quarterly, at an annual rate of 6% per unit. On or after October 14, 2009, we have the option to redeem the Series I preferred units, in whole or in part, for cash only at a liquidation preference of $50.00 per unit plus accumulated and unpaid distributions. However, if the redemption date falls between the record date and the distribution payment date, the redemption price will be equal to only the liquidation preference per unit, and will not include any amount of distributions declared and payable on the corresponding distribution payment date. The redemption may occur only if, for 20 trading days within a period of 30 consecutive trading days ending on the trading day before notice of redemption is issued, the closing price per share of common stock exceeds 130% of the applicable conversion price. The Series I preferred units are convertible into a number of fully paid and non-assessable common units upon the occurrence of a conversion triggering event. A conversion triggering event includes the following: (a) if we call the Series I preferred units for redemption; or, (b) if Simon Property is a party to a consolidation, merger, binding share exchange, or sale of all or substantially all of its assets; or, (c) if the closing sale price of Simon Property's common stock for at least 20 trading days in a period of 30 consecutive trading days ending on the last trading day of the preceding fiscal quarter exceeds 125% of the applicable conversion price. If the closing price condition is not met at the end of any fiscal quarter, then conversions are not permitted in the following fiscal quarter. If a holder of Series I preferred units converts its Series I preferred units into common units, then the holder may also elect to convert those units into common stock of Simon Property, on a one-for-one basis in accordance with our partnership agreement. The holder of Series I preferred units also has the option to exchange the Series I preferred units for an equal number of shares of Series I preferred stock of Simon Property; however, we may elect to pay cash in lieu of the conversion. In 2008, holders of Series I preferred units exchanged 22,400 Series I preferred units for an equal number of shares of Series I preferred stock of Simon Property. In prior years, 1,093,042 Series I preferred units were exchanged for an equal number of shares of Series I preferred stock of Simon Property. During 2008, we also issued 1,187,238 units as a result of the conversion of 1,493,904 Series I preferred units.

            As of December 31, 2008, the conversion trigger price of $77.88 was not met and, as a result, conversion of the Series I preferred units will not be permitted through March 31, 2009. A total of 6,437,072 Series I preferred units were converted into 5,151,776 units during 2008 as the conversion trigger price was met at the quarterly determination dates during 2008.

            Series J 83/8% Cumulative Redeemable Preferred Units.    We issued this series of preferred units in 2004 to replace a series of Chelsea preferred units. Distributions accrue quarterly at an annual rate of 83/8% per unit. We can redeem this series, in whole or in part, on and after October 15, 2027 at a redemption price of $50.00 per unit, plus accumulated and unpaid distributions. These preferred units were issued at a premium of $7,553 as of the date of our acquisition of Chelsea.

            7.5% Cumulative Redeemable Preferred Units.    We issued this series of preferred units in connection with the purchase of an additional interest in a joint venture. The preferred units accrue cumulative quarterly distributions at a rate of $7.50 annually. We may redeem the preferred units on or after November 10, 2013, unless there is the occurrence of certain tax triggering events such as death of the initial holder, or the transfer of any units to any person or entity other than the persons or entities entitled to the benefits of the original holder. The redemption price is the liquidation value ($100.00 per preferred unit) plus accrued and unpaid distributions, payable either in cash or shares of our common stock of Simon Property. In the event of the death of a holder of the preferred units, the occurrence of certain tax triggering events applicable to the holder, or on or after November 10, 2006, the holder may require us to redeem the preferred units at the same redemption price payable at our option in either cash or units.

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(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

10.    Partners' Equity (Continued)

            Notes Receivable from Former CPI Stockholders.    Notes receivable of $17,199 from stockholders of an entity we acquired in 1998 are reflected as a deduction from partners' equity in the accompanying financial statements. The notes do not bear interest and become due at the time the underlying shares are sold.

            The Simon Property Group 1998 Stock Incentive Plan.    We, along with Simon Property, have a stock incentive plan (the "1998 Plan"), which provides for the grant of awards with respect to the equity of Simon Property during a ten-year period, in the form of options to purchase shares of Simon Property common stock ("Options"), stock appreciation rights ("SARs"), restricted stock grants and performance unit awards (collectively, "Awards"). Options may be granted which are qualified as "incentive stock options" within the meaning of Section 422 of the Code and Options which are not so qualified. An aggregate of 11,300,000 shares of common stock have been reserved for issuance under the 1998 Plan. Additionally, the partnership agreement requires Simon Property to sell shares to us, at fair value, sufficient to satisfy the exercising of stock options, and for Simon Property to purchase common units for cash in an amount equal to the fair market value of such shares issued on the exercise of stock options.

            Administration.    The 1998 plan is administered by Simon Property's Compensation Committee of the Board of Directors. The committee determines which eligible individuals may participate and the type, extent and terms of the awards to be granted to them. In addition, the committee interprets the 1998 plan and makes all other determinations deemed advisable for its administration. Options granted to employees become exercisable over the period determined by the committee. The exercise price of an employee option may not be less than the fair market value of the shares on the date of grant. Employee options generally vest over a three-year period and expire ten years from the date of grant. Since 2001, Simon Property has not granted any options to employees, except for a series of reload options we assumed as part of a prior business combination.

            Automatic Awards For Eligible Directors.    Directors of Simon Property who are not employees or employees of affiliates of Simon Property ("Eligible Directors") receive automatic awards under the 1998 plan. Until 2003, these awards took the form of stock options. Since then, the awards have been shares of restricted stock of Simon Property.

            Each eligible director receives on the first day of the first calendar month following his or her initial election an award of restricted stock with a value of $82,500 (pro-rated for partial years of service). Thereafter, as of the date of each annual meeting of stockholders, eligible directors who are re-elected receive an award of restricted stock having a value of $82,500. In addition, eligible directors who serve as chairpersons of the standing committees (excluding the Executive Committee) receive an additional annual award of restricted stock having a value of $10,000 (in the case of the Audit Committee) or $7,500 (in the case of all other standing committees). The Lead Director also receives an annual restricted stock award having a value of $12,500. The restricted stock vests in full after one year.

            Once vested, the delivery of the shares of restricted stock (including reinvested dividends) is deferred under our Director Deferred Compensation Plan until the director retires, dies or becomes disabled or otherwise no longer serves as a director. The directors may vote and are entitled to receive dividends on the underlying shares; however, any dividends on the shares of restricted stock must be reinvested in shares of common stock and held in the deferred compensation plan until the shares of a restricted stock are delivered to the former director.

            In addition to automatic awards, eligible directors may be granted discretionary awards under the 1998 plan.

            Restricted Stock.    The 1998 Plan also provides for shares of restricted common stock of Simon Property to be granted to certain employees at no cost to those employees, subject to achievement of certain financial and return-based performance measures established by the Compensation Committee related to the most recent year's performance (the "Restricted Stock Program"). Restricted Stock Program grants vest annually over a four-year period (25% each year) beginning on January 1 of the year following the year in which the restricted stock award is granted. The cost of restricted stock grants, which is based upon the stock's fair market value on the grant date, is charged to partners' equity and subsequently amortized against our earnings over the vesting period. Through December 31, 2008

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Notes to Consolidated Financial Statements (Continued)

(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

10.    Partners' Equity (Continued)


a total of 4,738,409 shares of restricted stock, net of forfeitures, have been awarded under the plan. Information regarding restricted stock awards are summarized in the following table for each of the years presented:

 
  For the Year Ended December 31,  
 
  2008   2007   2006  

Restricted stock shares awarded during the year, net of forfeitures

    276,872     222,725     415,098  

Weighted average fair value of shares granted during the year

  $ 85.77   $ 120.55   $ 84.33  

Amortization expense

  $ 28,640   $ 26,779   $ 23,369  

            The weighted average life of our outstanding options as of December 31, 2008 is 2.3 years. Information relating to Director Options and Employee Options from December 31, 2005 through December 31, 2008 is as follows:

 
  Director Options   Employee Options  
 
  Options   Weighted Average
Exercise Price
Per Share
  Options   Weighted Average
Exercise Price
Per Share
 

Shares under option at December 31, 2005

    37,500   $ 27.80     1,527,922   $ 30.39  
                   

Granted

        N/A     70,000     90.87  

Exercised

    (18,000 )   27.68     (396,659 )   36.02  

Forfeited

    (3,000 )   24.25     (3,000 )   24.47  
                   

Shares under option at December 31, 2006

    16,500   $ 28.57     1,198,263   $ 32.07  
                   

Granted

        N/A     23,000     99.03  

Exercised, none were forfeited during the period

    (16,500 )   28.57     (214,525 )   32.62  
                   

Shares under option at December 31, 2007

      $     1,006,738   $ 33.48  
                   

Granted

                 

Exercised, none were forfeited during the period

            (282,106 )   41.96  
                   

Shares under option at December 31, 2008

      $     724,632   $ 30.18  
                   

 

 
  Outstanding and Exercisable  
Employee Options:

Range of Exercise Prices
  Options   Weighted
Average
Remaining
Contractual
Life in
Years
  Weighted
Average
Exercise Price
Per Share
 

$22.36 - $30.38

    615,583     1.96   $ 25.13  

$30.39 - $46.97

    59,749     5.09     46.97  

$46.98 - $63.51

    26,300     5.17     50.17  

$63.52 - $99.03

    23,000     0.24     99.03  
                 
 

Total

    724,632         $ 30.18  
                 

            We also maintain a tax-qualified retirement 401(k) savings plan and offer no other postretirement or post employment benefits to our employees.

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Simon Property Group, L.P. and Subsidiaries

Notes to Consolidated Financial Statements (Continued)

(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

10.    Partners' Equity (Continued)

Exchange Rights

            Limited partners have the right to exchange all or any portion of their units for shares of Simon Property common stock on a one-for-one basis or cash, as selected by Simon Property. The amount of cash to be paid if the exchange right is exercised and the cash option is selected will be based on the trading price of Simon Property's common stock at that time.

Unit Distributions

            On January 30, 2009, Simon Property's Board of Directors approved a quarterly common stock dividend of $0.90 per share, to be paid in a combination of cash and shares of its common stock. The distribution rate on our units is equal to the dividend rate on Simon Property's common stock. While our unitholders will have the right to elect to receive their distribution in either cash or units, we have announced that the aggregate cash component of the distribution will not exceed 10% of the total distribution, or $0.09 per unit. If the number of unitholders electing to receive cash would result in our payment of cash in excess of this 10% limitation, we will allocate the cash payment on a pro rata basis among those unitholders making the cash election. Simon Property has reserved the right to elect to pay the first quarter dividend, and as a result our distribution, all in cash. Simon Property's Board of Directors reviews and approves Simon Property's dividends and, as a result, our distributions, on a quarterly basis, and no determination has been made about whether the remaining 2009 dividends will be paid in a similar combination of cash and common stock. Paying all or a portion of its remaining 2009 dividends in a combination of cash and common stock allows Simon Property to satisfy its REIT taxable income distribution requirement under existing IRS revenue procedures, while enhancing financial flexibility and balance sheet strength.

11.    Commitments and Contingencies

Litigation

            As previously disclosed, for several years we have been defending actions brought by the Attorneys General of Massachusetts, New Hampshire and Connecticut in their respective state courts and similar litigation brought by other parties alleging that the sale of co-branded, bank-issued gift cards by our affiliate, SPGGC, Inc., at certain of our properties, violated state gift certificate and consumer protection laws. We previously reported the dismissal of the New Hampshire litigation. During the fourth quarter of 2008, the complaint in the Massachusetts litigation was dismissed and we settled the Connecticut litigation. The only remaining legal proceedings involving gift card sales are two purported class actions brought by private parties in New York. With the resolution of the remaining Attorneys General's actions in 2008, we no longer believe that the ultimate outcome of these related actions would have a material adverse effect on our financial position, results of operations or cash flows and, accordingly, we do not expect to report further developments in these actions.

            We are also involved in various other legal proceedings that arise in the ordinary course of our business. We believe that such litigation, claims and administrative proceedings will not have a material adverse impact on our financial position or our results of operations. We record a liability when a loss is considered probable and the amount can be reasonably estimated.

Lease Commitments

            As of December 31, 2008, a total of 29 of the consolidated properties are subject to ground leases. The termination dates of these ground leases range from 2009 to 2090. These ground leases generally require us to make fixed annual rental payments, or a fixed annual rental plus a percentage rent component based upon the revenues or

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Simon Property Group, L.P. and Subsidiaries

Notes to Consolidated Financial Statements (Continued)

(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

11.    Commitments and Contingencies (Continued)


total sales of the property. Some of these leases also include escalation clauses and renewal options. We incurred ground lease expense included in other expense as follows:

 
  For the Year Ended December 31,  
 
  2008   2007   2006  

Ground lease expense

  $ 30,681   $ 30,499   $ 29,301  

            Future minimum lease payments due under these ground leases for years ending December 31, excluding applicable extension options, are as follows:

2009

  $ 16,530  

2010

    16,288  

2011

    16,338  

2012

    16,451  

2013

    16,699  

Thereafter

    669,723  
       

  $ 752,029  
       

Insurance

            We maintain commercial general liability, fire, flood, extended coverage and rental loss insurance on all of our properties in the United States through wholly-owned captive insurance entities and other self-insurance mechanisms. Rosewood Indemnity, Ltd. and Bridgewood Insurance Company, Ltd. are our wholly-owned captive insurance subsidiaries, and have agreed to indemnify our general liability carrier for a specific layer of losses for the properties that are covered under these arrangements. The carrier has, in turn, agreed to provide evidence of coverage for this layer of losses under the terms and conditions of the carrier's policy. A similar policy written through these captive insurance entities also provides initial coverage for property insurance and certain windstorm risks at the properties located in coastal windstorm locations.

            We currently maintain insurance coverage against acts of terrorism on all of our properties in the United States on an "all risk" basis in the amount of up to $1 billion per occurrence for certified foreign acts of terrorism and $500 million per occurrence for non-certified domestic acts of terrorism. The current federal laws which provide this coverage are expected to operate through 2014. Despite the existence of this insurance coverage, any threatened or actual terrorist attacks in high profile markets could adversely affect our property values, revenues, consumer traffic and tenant sales.

Guarantees of Indebtedness

            Joint venture debt is the liability of the joint venture and is typically secured by the joint venture property, which is non-recourse to us. As of December 31, 2008, we had loan guarantees and other guarantee obligations of $71.9 million and $6.6 million, respectively, to support our total $6.6 billion share of joint venture mortgage and other indebtedness in the event the joint venture partnership defaults under the terms of the underlying arrangement. Mortgages which are guaranteed by us are secured by the property of the joint venture and that property could be sold in order to satisfy the outstanding obligation.

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Simon Property Group, L.P. and Subsidiaries

Notes to Consolidated Financial Statements (Continued)

(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

11.    Commitments and Contingencies (Continued)

Concentration of Credit Risk

            We are subject to risks incidental to the ownership and operation of commercial real estate. These risks include, among others, the risks normally associated with changes in the general economic climate, trends in the retail industry, creditworthiness of tenants, competition for tenants and customers, changes in tax laws, interest rate and foreign currency levels, the availability of financing, and potential liability under environmental and other laws. Our regional malls, Premium Outlet Centers, The Mills, and community/lifestyle centers rely heavily upon anchor tenants like most retail properties. Four retailers occupied 532 of the approximately 1,376 anchor stores in the properties as of December 31, 2008. An affiliate of one of these retailers is one of our limited partners.

Limited Life Partnerships

            FASB Statement No. 150, "Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity" (SFAS 150) establishes standards for how an issuer classifies and measures certain financial instruments with characteristics of both liabilities and equity. It requires that an issuer classify a financial instrument that is within its scope as a liability. The effective date of a portion of the Statement has been indefinitely postponed by the FASB. We have certain transactions, arrangements, or financial instruments that have been identified that appear to meet the criteria for liability recognition in accordance with paragraphs 9 and 10 under SFAS 150 due to the finite life of certain joint venture arrangements. However, SFAS 150 requires disclosure of the estimated settlement value of these non-controlling interests. As of December 31, 2008 and 2007, the estimated settlement value of these non-controlling interests was approximately $130 million and $145 million, respectively. The minority interest amount recognized as a liability on the consolidated balance sheets related to these non-controlling interests was approximately $23 million as of December 31, 2008 and 2007.

12.    Related Party Transactions

            Our management company provides management, insurance, and other services to Melvin Simon & Associates, Inc., a related party, and other non-owned properties. Amounts for services provided by our management company and its affiliates to our unconsolidated joint ventures and other related parties were as follows:

 
  For the Year Ended December 31,  
 
  2008   2007   2006  

Amounts charged to unconsolidated joint ventures

  $ 125,663   $ 95,564   $ 62,879  

Amounts charged to properties owned by related parties

    4,980     5,049     9,494  

            During 2008 and 2007, we recorded interest income of $15.3 million and $39.1 million, respectively, and financing fee income of $3.1 million and $17.4 million, respectively, net of inter-entity eliminations, related to the loans that we have provided to Mills and SPG-FCM and lending financing services to those entities and the properties in which they hold an ownership interest.

13.    Recently Issued Accounting Pronouncements

            In December 2007, the FASB issued SFAS No. 141(R), "Business Combinations", (SFAS 141(R)), and SFAS No. 160, "Noncontrolling Interests in Consolidated Financial Statements"(SFAS 160). SFAS 141(R) requires an acquirer to measure the identifiable assets acquired, the liabilities assumed and any noncontrolling interest in the acquiree at their fair values on the acquisition date, with goodwill being the excess value over the net identifiable assets acquired, and that costs of acquisition be expensed as incurred. SFAS 160 clarifies that a noncontrolling interest in a subsidiary should be reported as equity in the consolidated balance sheet and the noncontrolling interest's share of

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Simon Property Group, L.P. and Subsidiaries

Notes to Consolidated Financial Statements (Continued)

(Dollars in thousands, except unit and per unit amounts and where indicated as in millions or billions)

13.    Recently Issued Accounting Pronouncements (Continued)


earnings is included in consolidated net income. The calculation of earnings per share will continue to be based on income amounts attributable to the parent. SFAS 141(R) and SFAS 160 are effective for financial statements issued for fiscal years beginning after December 15, 2008. Early adoption is prohibited. We do not expect the adoption of SFAS 141(R) or SFAS 160 will have a significant impact on our results of operations or financial position other than the reclassification of certain noncontrolling interests on a prospective and retrospective basis.

            In March 2008, the FASB issued SFAS No. 161, "Disclosures about Derivative Instruments and Hedging Activities — an amendment of FASB Statement No. 133." This statement amends and expands the disclosure requirements of SFAS 133. This statement is effective for fiscal years beginning after November 15, 2008, and interim periods within those fiscal years. We are in the process of determining the impact of adopting this statement.

14.    Quarterly Financial Data (Unaudited)

            Quarterly 2008 and 2007 data is summarized in the table below and, as disclosed in Note 3, the amounts have been reclassified from previously disclosed amounts in accordance with the discontinued operations provisions of SFAS No. 144 and reflect dispositions through December 31, 2008. Income from continuing operations, income from continuing operations per unit — Basic, and income from continuing operations per unit — Diluted as previously reported in the September 30, 2007 Form 10-Q were $227,532, $0.74, and $0.74, respectively, and are presented below as $236,470, $0.77, and $0.77, respectively. All other amounts previously reported are equal to the amounts reported below. Quarterly amounts may not equal annual amounts due to rounding.

 
  First Quarter   Second Quarter   Third Quarter   Fourth Quarter  

2008

                         

Total revenue

  $ 895,298   $ 922,947   $ 935,594   $ 1,029,316  

Operating income

    351,958     379,406     383,695     445,818  

Income from continuing operations

    126,921     111,661     156,979     192,908  

Net income available to common unitholders

    87,933     76,572     112,809     145,203  

Income from continuing operations per unit — Basic

  $ 0.39   $ 0.34   $ 0.50   $ 0.65  

Net income per unit — Basic

  $ 0.39   $ 0.34   $ 0.50   $ 0.65  

Income from continuing operations per unit — Diluted

  $ 0.39   $ 0.34   $ 0.50   $ 0.64  

Net income per unit — Diluted

  $ 0.39   $ 0.34   $ 0.50   $ 0.64  

Weighted average units outstanding

    281,224,467     282,382,491     282,384,237     284,025,809  

Diluted weighted average units outstanding

    281,841,042     282,971,297     282,953,695     284,422,986  

2007

                         

Total revenue

  $ 852,141   $ 855,932   $ 907,145   $ 1,035,581  

Operating income

    348,966     333,551     378,699     473,849  

Income from continuing operations

    144,066     95,248     236,470     185,918  

Net income available to common unitholders

    98,381     59,917     164,937     112,929  

Income from continuing operations per unit — Basic

  $ 0.44   $ 0.27   $ 0.77   $ 0.60  

Net income per unit — Basic

  $ 0.44   $ 0.27   $ 0.74   $ 0.51  

Income from continuing operations per unit — Diluted

  $ 0.44   $ 0.27   $ 0.77   $ 0.60  

Net income per unit — Diluted

  $ 0.44   $ 0.27   $ 0.74   $ 0.51  

Weighted average units outstanding

    280,858,656     281,282,172     281,028,487     280,944,298  

Diluted weighted average units outstanding

    281,716,125     281,119,027     281,774,055     281,617,542  

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SIGNATURES

            Pursuant to the requirements of Section 13 or 15 (d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

  SIMON PROPERTY GROUP, L.P.

 

By

 

    /s/ DAVID SIMON

David Simon
Chairman of the Board of Directors
and Chief Executive Officer of
Simon Property Group, Inc., General Partner

March 2, 2009

            Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

Signature   Capacity   Date

 

 

 

 

 
    /s/ DAVID SIMON

David Simon
  Chairman of the Board of Directors
and Chief Executive Officer of
Simon Property Group, Inc., General Partner
(Principal Executive Officer)
  March 2, 2009

    /s/ HERBERT SIMON

Herbert Simon

 

Co-Chairman Emeritus

 

March 2, 2009

    /s/ MELVIN SIMON

Melvin Simon

 

Co-Chairman Emeritus

 

March 2, 2009

    /s/ RICHARD S. SOKOLOV

Richard S. Sokolov

 

President, Chief Operating Officer of
Simon Property Group, Inc., General Partner
and Director

 

March 2, 2009

    /s/ BIRCH BAYH

Birch Bayh

 

Director

 

March 2, 2009

    /s/ MELVYN E. BERGSTEIN

Melvyn E. Bergstein

 

Director

 

March 2, 2009

    /s/ LINDA WALKER BYNOE

Linda Walker Bynoe

 

Director

 

March 2, 2009

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Signature   Capacity   Date

 

 

 

 

 
    /s/ PIETER S. VAN DEN BERG

Pieter S. van den Berg
  Director   March 2, 2009

    /s/ REUBEN S. LEIBOWITZ

Reuben S. Leibowitz

 

Director

 

March 2, 2009

    /s/ J. ALBERT SMITH, JR.

J. Albert Smith, Jr.

 

Director

 

March 2, 2009

    /s/ KAREN N. HORN

Karen N. Horn

 

Director

 

March 2, 2009

    /s/ STEPHEN E. STERRETT

Stephen E. Sterrett

 

Executive Vice President
and Chief Financial Officer of
Simon Property Group, Inc., General Partner
(Principal Financial Officer)

 

March 2, 2009

    /s/ JOHN DAHL

John Dahl

 

Senior Vice President
and Chief Accounting Officer of
Simon Property Group, Inc., General Partner
(Principal Accounting Officer)

 

March 2, 2009

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SCHEDULE III

Simon Property Group, L.P. and Subsidiaries
Real Estate and Accumulated Depreciation
December 31, 2008
(Dollars in thousands)

 
   
  Initial Cost (Note 3)   Cost Capitalized
Subsequent to
Acquisition (Note 3)
  Gross Amounts At Which
Carried At December 31, 2008
   
   
Name, Location
  Encumbrances   Land   Buildings and
Improvements
  Land   Buildings and
Improvements
  Land   Buildings and Improvements   Total (1)   Accumulated
Depreciation (2)
  Date of
Construction or
Acquisition

Regional Malls

                                                         

Anderson Mall, Anderson, SC

  $ 27,755   $ 1,712   $ 15,227   $ 1,363   $ 19,920   $ 3,075   $ 35,147   $ 38,222   $ 13,173   1972

Arsenal Mall, Watertown, MA

    1,090     15,505     47,680         9,642     15,505     57,322     72,827     14,268   1999 (Note 4)

Bangor Mall, Bangor, ME

    80,000     5,478     59,740         8,336     5,478     68,076     73,554     16,533   2004 (Note 5)

Barton Creek Square, Austin, TX

        2,903     20,929     7,983     59,959     10,886     80,888     91,774     37,244   1981

Battlefield Mall, Springfield, MO

    94,530     3,919     27,231     3,225     61,405     7,144     88,636     95,780     44,137   1970

Bay Park Square, Green Bay, WI

        6,358     25,623     4,133     23,438     10,491     49,061     59,552     18,164   1980

Bowie Town Center, Bowie, MD

        2,710     65,044     235     5,206     2,945     70,250     73,195     20,419   2001

Boynton Beach Mall, Boynton Beach, FL

        22,240     78,804     4,666     25,616     26,906     104,420     131,326     33,023   1985

Brea Mall, Brea, CA

        39,500     209,202         25,119     39,500     234,321     273,821     68,588   1998 (Note 4)

Broadway Square, Tyler, TX

        11,470     32,431         21,590     11,470     54,021     65,491     19,376   1994 (Note 4)

Brunswick Square, East Brunswick, NJ

    83,452     8,436     55,838         27,827     8,436     83,665     92,101     31,304   1973

Burlington Mall, Burlington, MA

        46,600     303,618     19,600     87,961     66,200     391,579     457,779     96,968   1998 (Note 4)

Castleton Square, Indianapolis, IN

        26,250     98,287     7,434     69,346     33,684     167,633     201,317     51,133   1972

Century III Mall, West Mifflin, PA

    81,930     17,380     102,364     10     8,437     17,390     110,801     128,191     61,726   1979

Charlottesville Fashion Square, Charlottesville, VA

            54,738         13,580         68,318     68,318     22,858   1997 (Note 4)

Chautauqua Mall, Lakewood, NY

        3,257     9,641         16,214     3,257     25,855     29,112     10,859   1971

Chesapeake Square, Chesapeake, VA

    70,841     11,534     70,461         7,445     11,534     77,906     89,440     35,341   1989

Cielo Vista Mall, El Paso, TX

        1,005     15,262     608     43,508     1,613     58,770     60,383     30,773   1974

College Mall, Bloomington, IN

        1,003     16,245     720     43,130     1,723     59,375     61,098     25,054   1965

Columbia Center, Kennewick, WA

        17,441     66,580         21,461     17,441     88,041     105,482     28,211   1987

Copley Place, Boston, MA

    200,000         378,045         78,878         456,923     456,923     83,023   2002 (Note 4)

Coral Square, Coral Springs, FL

    83,134     13,556     93,630         13,987     13,556     107,617     121,173     44,897   1984

Cordova Mall, Pensacola, FL

        18,626     73,091     7,321     43,797     25,947     116,888     142,835     29,187   1998 (Note 4)

Cottonwood Mall, Albuquerque, NM

        10,122     69,958         3,316     10,122     73,274     83,396     30,708   1996

Crossroads Mall, Omaha, NE

    41,150     639     30,658     409     35,783     1,048     66,441     67,489     26,719   1994 (Note 4)

Crystal River Mall, Crystal River, FL

    14,916     5,393     20,241         4,857     5,393     25,098     30,491     9,077   1990

DeSoto Square, Bradenton, FL

    64,153     9,011     52,675         8,107     9,011     60,782     69,793     22,276   1973

Domain, The, Austin, TX (Note 6)

        45,152     197,010         52,560     45,152     249,570     294,722     15,462   2005

Edison Mall, Fort Myers, FL

        11,529     107,350         28,267     11,529     135,617     147,146     40,169   1997 (Note 4)

Fashion Mall at Keystone, Indianapolis, IN

            120,579         48,162         168,741     168,741     49,510   1997 (Note 4)

Firewheel Town Center, Garland, TX

        8,636     82,716         23,617     8,636     106,333     114,969     14,381   2004

Forest Mall, Fond Du Lac, WI

    16,478     721     4,491         8,792     721     13,283     14,004     7,180   1973

Forum Shops at Caesars, The, Las Vegas, NV

    524,657         276,567         204,235         480,802     480,802     108,579   1992

111


Table of Contents

SCHEDULE III

Simon Property Group, L.P. and Subsidiaries
Real Estate and Accumulated Depreciation
December 31, 2008
(Dollars in thousands)

 
   
  Initial Cost (Note 3)   Cost Capitalized
Subsequent to
Acquisition (Note 3)
  Gross Amounts At Which
Carried At December 31, 2008
   
   
Name, Location
  Encumbrances   Land   Buildings and
Improvements
  Land   Buildings and
Improvements
  Land   Buildings and Improvements   Total (1)   Accumulated
Depreciation (2)
  Date of
Construction or
Acquisition

Great Lakes Mall, Mentor, OH

        12,302     100,362         10,656     12,302     111,018     123,320     41,141   1961

Greenwood Park Mall, Greenwood, IN

        2,423     23,445     5,275     114,688     7,698     138,133     145,831     44,094   1979

Gulf View Square, Port Richey, FL

        13,690     39,991     2,023     20,097     15,713     60,088     75,801     22,595   1980

Gwinnett Place, Duluth, GA

    115,000     17,051     141,191         4,210     17,051     145,401     162,452     38,335   1998 (Note 5)

Haywood Mall, Greenville, SC

        11,585     133,893     6     18,976     11,591     152,869     164,460     56,637   1998 (Note 4)

Independence Center, Independence, MO

    200,000     5,042     45,798         32,209     5,042     78,007     83,049     30,951   1994 (Note 4)

Ingram Park Mall, San Antonio, TX

    77,180     733     17,163     73     19,934     806     37,097     37,903     19,914   1979

Irving Mall, Irving, TX

        6,737     17,479     2,533     41,225     9,270     58,704     67,974     31,356   1971

Jefferson Valley Mall, Yorktown Heights, NY

        4,868     30,304         24,516     4,868     54,820     59,688     26,133   1983

Knoxville Center, Knoxville, TN

    58,446     5,006     21,617     3,712     35,324     8,718     56,941     65,659     27,153   1984

La Plaza Mall, McAllen, TX

        1,375     9,828     6,569     38,146     7,944     47,974     55,918     20,715   1976

Laguna Hills Mall, Laguna Hills, CA

        27,928     55,446         16,694     27,928     72,140     100,068     21,952   1997 (Note 4)

Lakeline Mall, Austin, TX

        10,088     81,568     14     15,742     10,102     97,310     107,412     34,197   1995

Lenox Square, Atlanta, GA

        38,213     492,411         58,481     38,213     550,892     589,105     154,881   1998 (Note 4)

Lima Mall, Lima, OH

        7,662     35,338         9,611     7,662     44,949     52,611     18,738   1965

Lincolnwood Town Center, Lincolnwood, IL

        7,907     63,480     28     7,435     7,935     70,915     78,850     34,674   1990

Livingston Mall, Livingston, NJ

        22,214     105,250         36,557     22,214     141,807     164,021     37,760   1998 (Note 4)

Longview Mall, Longview, TX

    30,839     259     3,567     124     7,931     383     11,498     11,881     5,461   1978

Mall of Georgia, Mill Creek, GA

    185,238     47,492     326,633         3,826     47,492     330,459     377,951     63,130   1999 (Note 5)

Maplewood Mall, Minneapolis, MN

        17,119     80,758         11,225     17,119     91,983     109,102     20,774   2002 (Note 4)

Markland Mall, Kokomo, IN

    21,818         7,568         10,056         17,624     17,624     8,852   1968

McCain Mall, N. Little Rock, AR

            9,515     10,530     12,180     10,530     21,695     32,225     15,541   1973

Melbourne Square, Melbourne, FL

        15,762     55,891     4,160     27,929     19,922     83,820     103,742     25,959   1982

Menlo Park Mall, Edison, NJ

        65,684     223,252         33,429     65,684     256,681     322,365     84,104   1997 (Note 4)

Midland Park Mall, Midland, TX

    31,852     687     9,213         12,459     687     21,672     22,359     12,438   1980

Miller Hill Mall, Duluth, MN

        2,998     18,092         27,471     2,998     45,563     48,561     26,800   1973

Montgomery Mall, Montgomeryville, PA

    89,460     27,105     86,915         25,243     27,105     112,158     139,263     23,114   2004 (Note 5)

Muncie Mall, Muncie, IN

    7,381     172     5,776     52     27,118     224     32,894     33,118     15,399   1970

North East Mall, Hurst, TX

        128     12,966     19,010     148,611     19,138     161,577     180,715     59,473   1971

Northfield Square Mall, Bourbonnais, IL

    29,067     362     53,396         1,240     362     54,636     54,998     30,675   2004 (Note 5)

Northgate Mall, Seattle, WA

        24,369     115,992         93,581     24,369     209,573     233,942     51,408   1987

Northlake Mall, Atlanta, GA

    67,423     33,400     98,035         4,324     33,400     102,359     135,759     45,679   1998 (Note 4)

Northwoods Mall, Peoria, IL

        1,185     12,779     2,451     37,093     3,636     49,872     53,508     27,003   1983

Oak Court Mall, Memphis, TN

        15,673     57,304         8,756     15,673     66,060     81,733     22,571   1997 (Note 4)

Ocean County Mall, Toms River, NJ

        20,404     124,945         23,684     20,404     148,629     169,033     42,213   1998 (Note 4)

112


Table of Contents

SCHEDULE III

Simon Property Group, L.P. and Subsidiaries
Real Estate and Accumulated Depreciation
December 31, 2008
(Dollars in thousands)

 
   
  Initial Cost (Note 3)   Cost Capitalized
Subsequent to
Acquisition (Note 3)
  Gross Amounts At Which
Carried At December 31, 2008
   
   
Name, Location
  Encumbrances   Land   Buildings and
Improvements
  Land   Buildings and
Improvements
  Land   Buildings and Improvements   Total (1)   Accumulated
Depreciation (2)
  Date of
Construction or
Acquisition

Orange Park Mall, Orange Park, FL

        12,998     65,121         40,115     12,998     105,236     118,234     38,028   1994 (Note 4)

Orland Square, Orland Park, IL

        35,514     129,906         21,808     35,514     151,714     187,228     50,348   1997 (Note 4)

Oxford Valley Mall, Langhorne, PA

    74,805     24,544     100,287         7,881     24,544     108,168     132,712     44,939   2003 (Note 4)

Paddock Mall, Ocala, FL

        11,198     39,727         16,180     11,198     55,907     67,105     16,770   1980

Penn Square Mall, Oklahoma City, OK

    65,828     2,043     155,958         27,936     2,043     183,894     185,937     53,104   2002 (Note 4)

Pheasant Lane Mall, Nashua, NH

        3,902     155,068     550     14,786     4,452     169,854     174,306     48,112   2004 (Note 5)

Phipps Plaza, Atlanta, GA

        19,200     210,610         21,669     19,200     232,279     251,479     69,196   1998 (Note 4)

Plaza Carolina, Carolina, PR

    236,901     15,493     279,560         11,798     15,493     291,358     306,851     45,077   2004 (Note 4)

Port Charlotte Town Center,
Port Charlotte, FL

    50,998     5,471     58,570         15,396     5,471     73,966     79,437     28,559   1989

Prien Lake Mall, Lake Charles, LA

        1,842     2,813     3,091     36,807     4,933     39,620     44,553     17,982   1972

Richmond Town Square,
Richmond Heights, OH

    44,739     2,600     12,112         59,924     2,600     72,036     74,636     39,566   1966

River Oaks Center, Calumet City, IL

        30,884     101,224         10,726     30,884     111,950     142,834     35,903   1997 (Note 4)

Rockaway Townsquare, Rockaway, NJ

        44,116     212,257     27     31,359     44,143     243,616     287,759     67,050   1998 (Note 4)

Rolling Oaks Mall, San Antonio, TX

        1,929     38,609         14,027     1,929     52,636     54,565     24,504   1988

Roosevelt Field, Garden City, NY

        164,058     702,008     2,117     39,064     166,175     741,072     907,247     214,402   1998 (Note 4)

Ross Park Mall, Pittsburgh, PA

        23,541     90,203         71,846     23,541     162,049     185,590     52,602   1986

Santa Rosa Plaza, Santa Rosa, CA

        10,400     87,864         10,039     10,400     97,903     108,303     29,416   1998 (Note 4)

Shops at Mission Viejo, The,
Mission Viejo, CA

        9,139     54,445     7,491     145,967     16,630     200,412     217,042     74,101   1979

South Hills Village, Pittsburgh, PA

        23,445     125,840         16,698     23,445     142,538     165,983     45,546   1997 (Note 4)

South Shore Plaza, Braintree, MA

        101,200     301,495         68,214     101,200     369,709     470,909     94,453   1998 (Note 4)

Southern Park Mall, Boardman, OH

        16,982     77,767     97     23,786     17,079     101,553     118,632     38,609   1970

SouthPark, Charlotte, NC

        42,092     188,055     100     165,073     42,192     353,128     395,320     76,472   2002 (Note 4)

St. Charles Towne Center, Waldorf, MD

        7,710     52,934     1,180     26,829     8,890     79,763     88,653     35,872   1990

Stanford Shopping Center, Palo Alto, CA

    240,000         339,537         5,914         345,451     345,451     59,939   2003 (Note 4)

Summit Mall, Akron, OH

    65,000     15,374     51,137         37,647     15,374     88,784     104,158     27,201   1965

Sunland Park Mall, El Paso, TX

    33,734     2,896     28,900         7,120     2,896     36,020     38,916     19,949   1988

Tacoma Mall, Tacoma, WA

    122,687     37,803     125,826         73,353     37,803     199,179     236,982     55,789   1987

Tippecanoe Mall, Lafayette, IN

        2,897     8,439     5,517     44,478     8,414     52,917     61,331     32,228   1973

Town Center at Aurora, Aurora, CO

        9,959     56,832     6     56,463     9,965     113,295     123,260     34,436   1998 (Note 4)

Town Center at Boca Raton, Boca Raton, FL

        64,200     307,317         151,838     64,200     459,155     523,355     121,435   1998 (Note 4)

Town Center at Cobb, Kennesaw, GA

    280,000     32,585     158,225         10,577     32,585     168,802     201,387     42,921   1998 (Note 5)

Towne East Square, Wichita, KS

        8,525     18,479     1,429     39,772     9,954     58,251     68,205     30,712   1975

113


Table of Contents

SCHEDULE III

Simon Property Group, L.P. and Subsidiaries
Real Estate and Accumulated Depreciation
December 31, 2008
(Dollars in thousands)

 
   
  Initial Cost (Note 3)   Cost Capitalized
Subsequent to
Acquisition (Note 3)
  Gross Amounts At Which
Carried At December 31, 2008
   
   
Name, Location
  Encumbrances   Land   Buildings and
Improvements
  Land   Buildings and
Improvements
  Land   Buildings and Improvements   Total (1)   Accumulated
Depreciation (2)
  Date of
Construction or
Acquisition

Towne West Square, Wichita, KS

    50,520     972     21,203     61     11,960     1,033     33,163     34,196     17,703   1980

Treasure Coast Square, Jensen Beach, FL

        11,124     72,990     3,067     34,067     14,191     107,057     121,248     36,073   1987

Tyrone Square, St. Petersburg, FL

        15,638     120,962         28,764     15,638     149,726     165,364     51,781   1972

University Park Mall, Mishawaka, IN

    100,000     16,768     112,158     7,000     47,833     23,768     159,991     183,759     79,097   1996 (Note 4)

Upper Valley Mall, Springfield, OH

    47,904     8,421     38,745         10,739     8,421     49,484     57,905     17,660   1979

Valle Vista Mall, Harlingen, TX

    40,000     1,398     17,159     372     20,659     1,770     37,818     39,588     18,165   1983

Virginia Center Commons, Glen Allen, VA

        9,764     50,547     4,149     9,454     13,913     60,001     73,914     24,645   1991

Walt Whitman Mall, Huntington Station, NY

        51,700     111,258     3,789     43,113     55,489     154,371     209,860     56,032   1998 (Note 4)

Washington Square, Indianapolis, IN

    30,194     16,800     36,495     462     27,599     17,262     64,094     81,356     36,259   1974

West Ridge Mall, Topeka, KS

    68,711     5,453     34,132     1,168     22,444     6,621     56,576     63,197     22,658   1988

Westminster Mall, Westminster, CA

        43,464     84,709         29,676     43,464     114,385     157,849     31,882   1998 (Note 4)

White Oaks Mall, Springfield, IL

    50,000     3,024     35,692     2,102     40,247     5,126     75,939     81,065     28,355   1977

Wolfchase Galleria, Memphis, TN

    225,000     15,881     128,276         9,358     15,881     137,634     153,515     45,898   2002 (Note 4)

Woodland Hills Mall, Tulsa, OK

    78,612     34,211     187,123         12,898     34,211     200,021     234,232     50,452   2004 (Note 5)

Premium Outlet Centers

                                                         

Albertville Premium Outlets, Albertville, MN

        3,900     97,059         3,318     3,900     100,377     104,277     20,303   2004 (Note 4)

Allen Premium Outlets, Allen, TX

        13,855     43,687     97     22,194     13,952     65,881     79,833     13,097   2004 (Note 4)

Aurora Farms Premium Outlets, Aurora, OH

        2,370     24,326         2,285     2,370     26,611     28,981     11,525   2004 (Note 4)

Camarillo Premium Outlets, Camarillo, CA

        16,670     224,721     558     42,303     17,228     267,024     284,252     36,705   2004 (Note 4)

Carlsbad Premium Outlets, Carlsbad, CA

        12,890     184,990     96     1,679     12,986     186,669     199,655     28,057   2004 (Note 4)

Carolina Premium Outlets, Smithfield, NC

    19,696     3,170     59,863         2,038     3,170     61,901     65,071     15,197   2004 (Note 4)

Chicago Premium Outlets, Aurora, IL

        659     118,005     4,940     11,407     5,599     129,412     135,011     24,875   2004 (Note 4)

Clinton Crossings Premium Outlets,
Clinton, CT

        2,060     107,556     472     1,855     2,532     109,411     111,943     20,326   2004 (Note 4)

Columbia Gorge Premium Outlets,
Troutdale, OR

        7,900     16,492         785     7,900     17,277     25,177     6,402   2004 (Note 4)

Desert Hills Premium Outlets, Cabazon, CA

        3,440     338,679         3,522     3,440     342,201     345,641     48,475   2004 (Note 4)

Edinburgh Premium Outlets, Edinburgh, IN

        2,857     47,309         11,006     2,857     58,315     61,172     13,726   2004 (Note 4)

Folsom Premium Outlets, Folsom, CA

        9,060     50,281         2,717     9,060     52,998     62,058     13,571   2004 (Note 4)

Gilroy Premium Outlets, Gilroy, CA

        9,630     194,122         4,358     9,630     198,480     208,110     36,472   2004 (Note 4)

Houston Premium Outlets, Cypress, TX

        21,159     69,350         28,755     21,159     98,105     119,264     3,335   2007

Jackson Premium Outlets, Jackson, NJ

        6,413     104,013     3     2,778     6,416     106,791     113,207     16,211   2004 (Note 4)

Jersey Shore Premium Outlets, Tinton Falls, NJ

        16,141     50,979         73,424     16,141     124,403     140,544     858   2007

Johnson Creek Premium Outlets,
Johnson Creek, WI

        2,800     39,546         4,458     2,800     44,004     46,804     6,986   2004 (Note 4)

Kittery Premium Outlets, Kittery, ME

    43,556     11,832     94,994         4,557     11,832     99,551     111,383     12,049   2004 (Note 4)

Las Americas Premium Outlets, San Diego, CA

    180,000     45,168     251,878         1,252     45,168     253,130     298,298     10,166   2007 (Note 4)

Las Vegas Outlet Center, Las Vegas, NV

        13,085     160,777         4,144     13,085     164,921     178,006     21,023   2004 (Note 4)

Las Vegas Premium Outlets, Las Vegas, NV

        25,435     134,973         58,647     25,435     193,620     219,055     28,121   2004 (Note 4)

114


Table of Contents

SCHEDULE III

Simon Property Group, L.P. and Subsidiaries
Real Estate and Accumulated Depreciation
December 31, 2008
(Dollars in thousands)

 
   
  Initial Cost (Note 3)   Cost Capitalized
Subsequent to
Acquisition (Note 3)
  Gross Amounts At Which
Carried At December 31, 2008
   
   
Name, Location
  Encumbrances   Land   Buildings and
Improvements
  Land   Buildings and
Improvements
  Land   Buildings and Improvements   Total (1)   Accumulated
Depreciation (2)
  Date of
Construction or
Acquisition

Leesburg Corner Premium Outlets,
Leesburg, VA

        7,190     162,023         2,930     7,190     164,953     172,143     32,161   2004 (Note 4)

Liberty Village Premium Outlets,
Flemington, NJ

        5,670     28,904         1,712     5,670     30,616     36,286     9,240   2004 (Note 4)

Lighthouse Place Premium Outlets,
Michigan City, IN

    88,623     6,630     94,138         4,019     6,630     98,157     104,787     23,683   2004 (Note 4)

Napa Premium Outlets, Napa, CA

        11,400     45,023         1,349     11,400     46,372     57,772     9,239   2004 (Note 4)

North Georgia Premium Outlets,
Dawsonville, GA

        4,300     132,325         1,709     4,300     134,034     138,334     25,352   2004 (Note 4)

Orlando Premium Outlets, Orlando, FL

        14,040     304,410     16,100     45,228     30,140     349,638     379,778     42,526   2004 (Note 4)

Osage Beach Premium Outlets,
Osage Beach, MO

        9,460     85,804     3     3,417     9,463     89,221     98,684     18,910   2004 (Note 4)

Petaluma Village Premium Outlets,
Petaluma, CA

        13,322     14,067         2,918     13,322     16,985     30,307     5,619   2004 (Note 4)

Philadelphia Premium Outlets, Limerick, PA

    190,000     16,676     105,249         15,481     16,676     120,730     137,406     6,310   2006

Rio Grande Valley Premium Outlets,
Mercedes, TX

        12,693     41,547     1     34,874     12,694     76,421     89,115     6,576   2005

Round Rock Premium Outlets,
Round Rock, TX

        21,977     82,252         2,796     21,977     85,048     107,025     10,897   2005

Seattle Premium Outlets, Seattle, WA

        13,557     103,722     12     3,181     13,569     106,903     120,472     16,207   2004 (Note 4)

St. Augustine Premium Outlets,
St. Augustine, FL

        6,090     57,670     2     6,825     6,092     64,495     70,587     14,436   2004 (Note 4)

The Crossings Premium Outlets,
Tannersville, PA

    53,992     7,720     172,931         8,821     7,720     181,752     189,472     28,388   2004 (Note 4)

Vacaville Premium Outlets, Vacaville, CA

        9,420     84,850         4,540     9,420     89,390     98,810     21,354   2004 (Note 4)

Waikele Premium Outlets, Waipahu, HI

        22,630     77,316         872     22,630     78,188     100,818     15,658   2004 (Note 4)

Waterloo Premium Outlets, Waterloo, NY

    72,822     3,230     75,277         5,701     3,230     80,978     84,208     18,137   2004 (Note 4)

Woodbury Common Premium Outlets,
Central Valley, NY

        11,110     862,559     1,658     3,182     12,768     865,741     878,509     125,123   2004 (Note 4)

Wrentham Village Premium Outlets,
Wrentham, MA

        4,900     282,031         3,124     4,900     285,155     290,055     47,852   2004 (Note 4)

Community/Lifestyle Centers

                                                         

Arboretum at Great Hills, Austin, TX

        7,640     36,774     71     8,248     7,711     45,022     52,733     13,249   1998 (Note 4)

Bloomingdale Court, Bloomingdale, IL

    26,592     8,748     26,184         9,684     8,748     35,868     44,616     16,295   1987

Brightwood Plaza, Indianapolis, IN

        65     128         337     65     465     530     311   1965

Charles Towne Square, Charleston, SC

            1,768     370     10,636     370     12,404     12,774     6,225   1976

Chesapeake Center, Chesapeake, VA

        5,352     12,279         532     5,352     12,811     18,163     4,523   1989

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Table of Contents

SCHEDULE III

Simon Property Group, L.P. and Subsidiaries
Real Estate and Accumulated Depreciation
December 31, 2008
(Dollars in thousands)

 
   
  Initial Cost (Note 3)   Cost Capitalized
Subsequent to
Acquisition (Note 3)
  Gross Amounts At Which
Carried At December 31, 2008
   
   
Name, Location
  Encumbrances   Land   Buildings and
Improvements
  Land   Buildings and
Improvements
  Land   Buildings and Improvements   Total (1)   Accumulated
Depreciation (2)
  Date of
Construction or
Acquisition

Countryside Plaza, Countryside, IL

        332     8,507     2,554     9,002     2,886     17,509     20,395     7,031   1977

Dare Centre, Kill Devil Hills, NC

    1,640         5,702         189         5,891     5,891     747   2004 (Note 4)

DeKalb Plaza, King of Prussia, PA

    3,071     1,955     3,405         1,105     1,955     4,510     6,465     1,518   2003 (Note 4)

Eastland Plaza, Tulsa, OK

        651     3,680         80     651     3,760     4,411     3,280   1986

Forest Plaza, Rockford, IL

    14,585     4,132     16,818     453     9,689     4,585     26,507     31,092     8,573   1985

Gateway Shopping Centers, Austin, TX

    87,000     24,549     81,437         7,719     24,549     89,156     113,705     17,706   2004 (Note 4)

Great Lakes Plaza, Mentor, OH

        1,028     2,025         3,680     1,028     5,705     6,733     2,842   1976

Greenwood Plus, Greenwood, IN

        1,131     1,792         3,735     1,131     5,527     6,658     2,678   1979

Henderson Square, King of Prussia, PA

    14,616     4,223     15,124         147     4,223     15,271     19,494     2,705   2003 (Note 4)

Highland Lakes Center, Orlando, FL

    15,189     7,138     25,284         1,217     7,138     26,501     33,639     12,026   1991

Ingram Plaza, San Antonio, TX

        421     1,802     4     59     425     1,861     2,286     1,183   1980

Keystone Shoppes, Indianapolis, IN

            4,232         974         5,206     5,206     1,730   1997 (Note 4)

Knoxville Commons, Knoxville, TN

        3,731     5,345         1,738     3,731     7,083     10,814     4,819   1987

Lake Plaza, Waukegan, IL

        2,487     6,420         1,059     2,487     7,479     9,966     3,325   1986

Lake View Plaza, Orland Park, IL

    19,388     4,702     17,543         13,062     4,702     30,605     35,307     12,767   1986

Lakeline Plaza, Austin, TX

    21,256     5,822     30,875         6,984     5,822     37,859     43,681     13,634   1998

Lima Center, Lima, OH

        1,808     5,151         6,788     1,808     11,939     13,747     4,176   1978

Lincoln Crossing, O'Fallon, IL

    2,935     674     2,192         630     674     2,822     3,496     1,169   1990

Lincoln Plaza, King of Prussia, PA

            21,299         1,942         23,241     23,241     8,204   2003 (Note 4)

MacGregor Village, Cary, NC

    6,596     502     8,897         183     502     9,080     9,582     1,150   2004 (Note 4)

Mall of Georgia Crossing, Mill Creek, GA

        9,506     32,892         260     9,506     33,152     42,658     10,703   2004 (Note 5)

Markland Plaza, Kokomo, IN

        206     738         6,234     206     6,972     7,178     2,513   1974

Martinsville Plaza, Martinsville, VA

            584         408         992     992     720   1967

Matteson Plaza, Matteson, IL

    8,537     1,771     9,737         2,685     1,771     12,422     14,193     6,044   1988

Muncie Plaza, Muncie, IN

        267     10,509     87     1,350     354     11,859     12,213     3,959   1998

New Castle Plaza, New Castle, IN

        128     1,621         1,417     128     3,038     3,166     1,893   1966

North Ridge Plaza, Joliet, IL

        2,831     7,699         3,231     2,831     10,930     13,761     4,450   1985

North Ridge Shopping Center, Raleigh, NC

    8,056     385     12,838         406     385     13,244     13,629     1,768   2004 (Note 4)

Northwood Plaza, Fort Wayne, IN

        148     1,414         1,543     148     2,957     3,105     1,695   1974

Palms Crossing, McAllen, TX (Note 6)

        13,923     45,925         5,837     13,923     51,762     65,685     2,802   2006

Park Plaza, Hopkinsville, KY

        300     1,572         217     300     1,789     2,089     1,750   1968

Pier Park, Panama City Beach, FL

          25,992     73,158         41,120     25,992     114,278     140,270     3,404   2006

Regency Plaza, St. Charles, MO

    4,003     616     4,963         569     616     5,532     6,148     2,296   1988

Richardson Square Mall, Richardson, TX

        6,285         1,268     15,506     7,553     15,506     23,059     322   1977

Rockaway Convenience Center, Rockaway, NJ

        5,149     26,435         6,543     5,149     32,978     38,127     7,673   1998 (Note 4)

Rockaway Town Plaza, Rockaway, NJ

            18,698         1,765         20,463     20,463     2,335   2004

Shops at Arbor Walk, Austin, TX (Note 6)

        930     42,546         5,210     930     47,756     48,686     4,026   2005

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Table of Contents

SCHEDULE III

Simon Property Group, L.P. and Subsidiaries
Real Estate and Accumulated Depreciation
December 31, 2008
(Dollars in thousands)

 
   
  Initial Cost (Note 3)   Cost Capitalized
Subsequent to
Acquisition (Note 3)
  Gross Amounts At Which
Carried At December 31, 2008
   
   
Name, Location
  Encumbrances   Land   Buildings and
Improvements
  Land   Buildings and
Improvements
  Land   Buildings and Improvements   Total (1)   Accumulated
Depreciation (2)
  Date of
Construction or
Acquisition

Shops at North East Mall, The, Hurst, TX

        12,541     28,177     402     5,782     12,943     33,959     46,902     13,879   1999

St. Charles Towne Plaza, Waldorf, MD

    25,613     8,377     18,993         2,918     8,377     21,911     30,288     9,784   1987

Teal Plaza, Lafayette, IN

        99     878         3,011     99     3,889     3,988     2,071   1962

Terrace at the Florida Mall, Orlando, FL

        2,150     7,623         5,201     2,150     12,824     14,974     4,043   1989

Tippecanoe Plaza, Lafayette, IN

            745     234     5,037     234     5,782     6,016     3,006   1974

University Center, Mishawaka, IN

        3,071     7,413         3,095     3,071     10,508     13,579     7,115   1980

Washington Plaza, Indianapolis, IN

        941     1,697         398     941     2,095     3,036     2,561   1976

Waterford Lakes Town Center, Orlando, FL

        8,679     72,836         14,176     8,679     87,012     95,691     31,000   1999

West Ridge Plaza, Topeka, KS

    5,158     1,376     4,560         1,770     1,376     6,330     7,706     2,866   1988

White Oaks Plaza, Springfield, IL

    15,741     3,169     14,267         1,392     3,169     15,659     18,828     6,595   1986

Wolf Ranch, Georgetown, TX

        22,118     51,547         5,489     22,118     57,036     79,154     7,695   2004

Other Properties

                                                         

Crossville Outlet Center, Crossville, TN

        263     4,380         229     263     4,609     4,872     712   2004 (Note 4)

Factory Merchants Branson, Branson, MO

        1,383     19,637     1     846     1,384     20,483     21,867     1,681   2004 (Note 4)

Factory Shoppes at Branson Meadows, Branson, MO

    9,160         5,205         228         5,433     5,433     707   2004 (Note 4)

Factory Stores of America — Boaz, AL

    2,678         924         7         931     931     104   2004 (Note 4)

Factory Stores of America — Georgetown, KY

    6,349     148     3,610         47     148     3,657     3,805     461   2004 (Note 4)

Factory Stores of America — Graceville, FL

    1,886     12     408         60     12     468     480     55   2004 (Note 4)

Factory Stores of America — Lebanon. MO

    1,586     24     214             24     214     238     40   2004 (Note 4)

Factory Stores of America —
Nebraska City, NE

    1,488     26     566         13     26     579     605     80   2004 (Note 4)

Factory Stores of America — Story City, IA

    1,841     7     526             7     526     533     64   2004 (Note 4)

Factory Stores of North Bend,
North Bend, WA

        2,143     36,197         1,901     2,143     38,098     40,241     5,498   2004 (Note 4)

Nanuet Mall, Nanuet, NY

        27,310     162,993         3,427     27,310     166,420     193,730     104,236   1998 (Note 4)

Palm Beach Mall, West Palm Beach, FL

    50,953     11,962     112,437         35,542     11,962     147,979     159,941     94,848   1967

Raleigh Springs Mall, Memphis, TN

        4,663     28,604         12,892     4,663     41,496     46,159     40,567   1971

University Mall, Pensacola, FL

        4,256     26,657         3,908     4,256     30,565     34,821     13,258   1994

Development Projects

                                                         

Cincinnati Premium Outlets, Monroe, OH

        14,117     32,157             14,117     32,157     46,274       2008

Other pre-development costs

        31,890     26,844             31,890     26,844     58,734        

Other

        3,304     3,818     665     344     3,969     4,162     8,131     3,363    
                                         

  $ 5,208,029     2,606,933   $ 17,523,294   $ 188,093   $ 4,589,650   $ 2,795,026   $ 22,112,944   $ 24,907,970   $ 6,015,677    
                                         

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Simon Property Group, L.P. and Subsidiaries

Notes to Schedule III as of December 31, 2008

(Dollars in thousands)

(1)    Reconciliation of Real Estate Properties:

            The changes in real estate assets for the years ended December 31, 2008, 2007, and 2006 are as follows:

 
  2008   2007   2006  

Balance, beginning of year

  $ 24,163,367   $ 22,644,299   $ 21,551,247  
 

Acquisitions and consolidations

    7,640     743,457     402,095  
 

Improvements

    797,717     1,057,663     772,806  
 

Disposals and de-consolidations

    (60,754 )   (282,052 )   (81,849 )
               

Balance, close of year

  $ 24,907,970   $ 24,163,367   $ 22,644,299  
               

            The unaudited aggregate cost of real estate assets for federal income tax purposes as of December 31, 2008 was $18,390,068.

(2)    Reconciliation of Accumulated Depreciation:

            The changes in accumulated depreciation and amortization for the years ended December 31, 2008, 2007, and 2006 are as follows:

 
  2008   2007   2006  

Balance, beginning of year

  $ 5,168,565   $ 4,479,198   $ 3,694,807  
 

Acquisitions and consolidations (5)

        12,714     64,818  
 

Depreciation expense

    871,556     808,041     767,726  
 

Disposals

    (24,444 )   (131,388 )   (48,153 )
               

Balance, close of year

  $ 6,015,677   $ 5,168,565   $ 4,479,198  
               

            Depreciation of our investment in buildings and improvements reflected in the consolidated statements of operations and comprehensive income is calculated over the estimated original lives of the assets as follows:

(3)
Initial cost generally represents net book value at December 20, 1993, except for acquired properties and new developments after December 20, 1993. Initial cost also includes any new developments that are opened during the current year. Costs of disposals of property are first reflected as a reduction to cost capitalized subsequent to acquisition.

(4)
Not developed/constructed by us or our predecessors. The date of construction represents the acquisition date.

(5)
Property initial cost for these properties is the cost at the date of consolidation for properties previously accounted for under the equity method of accounting. Accumulated depreciation amounts for properties consolidated which were previously accounted for under the equity method of accounting include the minority interest holders' portion of accumulated depreciation.

(6)
Secured by a $260,000 cross-collateralized and cross-defaulted mortgage loan facility.

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Table of Contents

Exhibits
   

2

 

Agreement and Plan of Merger, dated as February 12, 2007, by and among SPG-FCM Ventures, LLC, SPG-FCM Acquisitions, Inc., SPG-FCM Acquisitions, L.P., The Mills Corporation, and The Mills Limited Partnership (incorporated by reference to Exhibit 2.1 to Simon Property Group, Inc.'s Current Report on Form 8-K filed February 23, 2007).

3.1

 

Second Amended and Restated Certificate of Limited Partnership of the Limited Partnership (incorporated by reference to Exhibit 3.1 of Simon Property Group, L.P.'s Annual Report on Form 10-K for 2002).

3.2

 

Eighth Amended and Restated Limited Partnership Agreement (incorporated by reference to Exhibit 10.1 of Simon Property Group, Inc.'s Current Report on Form 8-K dated May 8, 2008).

3.3

 

Agreement between Simon Property Group, Inc. and Simon Property Group, L.P. dated March 7, 2007, but effective as of August 27, 1999, regarding a prior agreement filed under an exhibit 99.1 to Form S-3/A of Simon Property Group, L.P. on November 20, 1996.

4(a)

 

Indenture, dated as of November 26, 1996, by and among Simon Property Group, L.P. and The Chase Manhattan Bank, as trustee (incorporated by reference to Exhibit 4.1 to the Registration Statement on Form S-3 filed on October 21, 1996 (Reg. No. 333-11491)).

10.1

 

$3,500,000,000 Credit Agreement, dated as of December 15, 2005, among Simon Property Group, L.P., the Institutions named therein as Lenders and the Institutions named therein as Co-Agents (incorporated by reference to Exhibit 99.2 of Simon Property Group, L.P.'s Current Report on Form 8-K filed on December 20, 2005).

10.2

 

Amendment to Credit Agreement among Simon Property Group, L.P., the Institutions named therein as Lenders and the Institutions named therein as Co-Agents, dated October 4, 2007 (incorporated by reference to Exhibit 10.3 of Simon Property Group, L.P.'s Annual Report on Form 10-K for 2007).

10.3*

 

Simon Property Group, L.P. 1998 Stock Incentive Plan, as amended (incorporated by reference to Exhibit 10.2 to Simon Property Group,  Inc.'s Current Report on Form 8-K dated May 8, 2008).

10.4(b)

 

Option Agreement to acquire the Excluded Retail Property (Previously filed as Exhibit 10.10).

10.5

 

Voting Agreement dated as of June 20, 2004 among the Simon Property Group, Inc., Simon Property Group, L.P., and certain holders of shares of common stock of Chelsea Property Group, Inc. and/or common units of CPG Partners, L.P. (incorporated by reference to Exhibit 99.3 to the Current Report on Form 8-K filed by Simon Property Group, L.P. on June 22, 2004).

12

 

Statement regarding computation of ratios.

21

 

List of Subsidiaries of the Company.

23.1

 

Consent of Ernst & Young LLP.

31.1

 

Certification by the Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2

 

Certification by the Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32

 

Certification by the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.


(a)
Does not include supplemental indentures which authorize the issuance of debt securities series, none of which exceeds 10% of the total assets of Simon Property Group, L.P. on a consolidated basis. Simon Property Group, L.P. agrees to file copies of any such supplemental indentures upon the request of the Commission.

(b)
Incorporated by reference to the exhibit indicated filed with the Annual Report on Form 10-K for the year ended December 31, 1993 by a predecessor of Simon Property Group, L.P.

*
Represents a management contract, or compensatory plan, contract or arrangement required to be filed pursuant to Regulation S-K.

119




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Exhibit 12


SIMON PROPERTY GROUP, L.P.
Computation of Ratio of Earnings to Fixed Charges
(in thousands)

 
  For the Year Ended December 31,  
 
  2008   2007   2006   2005   2004  

Earnings:

                               
 

Pre-tax income from continuing operations

  $ 592,050   $ 650,380   $ 730,453   $ 473,557   $ 466,128  
 

Add:

                               
   

Pre-tax (loss) income from 50% or greater than 50% owned unconsolidated entities

    (29,093 )   (9,061 )   45,313     49,939     46,124  
   

Minority interest in income of majority owned subsidiaries

    12,431     13,936     11,524     13,743     9,687  
   

Distributed income from less than 50% owned unconsolidated entities

    61,482     51,594     53,000     66,165     45,909  
   

Amortization of capitalized interest

    4,927     2,462     5,027     2,772     2,525  
 

Fixed Charges

    1,254,111     1,196,718     958,818     904,324     748,643  
 

Less:

                               
   

Income from unconsolidated entities

    (32,246 )   (38,120 )   (110,819 )   (81,807 )   (81,113 )
   

Interest capitalization

    (28,451 )   (37,270 )   (34,073 )   (15,502 )   (15,546 )
                       

Earnings

  $ 1,835,211   $ 1,830,639   $ 1,659,243   $ 1,413,191   $ 1,222,357  
                       

Fixed Charges:

                               
 

Portion of rents representative of the interest factor

    8,996     9,032     9,052     8,869     7,092  
 

Interest on indebtedness (including amortization of debt expense)

    1,196,334     1,150,416     915,693     879,953     726,025  
 

Interest capitalized

    28,451     37,270     34,073     15,502     15,546  
 

Loss on extinguishment of debt

    20,330                  
                       

Fixed Charges

  $ 1,254,111   $ 1,196,718   $ 958,818   $ 904,324   $ 748,643  
                       

Ratio of Earnings to Fixed Charges

    1.46 x   1.53 x   1.73 x   1.56 x   1.63 x
                       

            For purposes of calculating the ratio of earnings to fixed charges, "earnings" have been computed by adding fixed charges, excluding capitalized interest, to income from continuing operations including income from minority interests and our share of income from 50%-owned affiliates which have fixed charges, and including our share of distributed operating income from less than 50%-owned affiliates instead of our share of income from the less than 50%-owned affiliates. There are generally no restrictions on our ability to receive distributions from our unconsolidated joint ventures where no preference in favor of the other owners of the joint venture exists. "Fixed charges" consist of interest costs, whether expensed or capitalized, the interest component of rental expenses, losses on extinguishment of debt, and amortization of debt issuance costs.

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Exhibit 21


List of Subsidiaries of Simon Property Group, L.P.

Subsidiary
 
Jurisdiction

The Retail Property Trust

  Massachusetts

Simon Property Group (Illinois), L.P. 

  Illinois

Simon Property Group (Texas), L.P. 

  Texas

Shopping Center Associates

  New York

Simon Capital Limited Partnership

  Delaware

M.S. Management Associates, Inc. 

  Delaware

Rosewood Indemnity, Ltd. 

  Bermuda

Marigold Indemnity, Ltd. 

  Delaware

Bridgewood Insurance Company, Ltd. 

  Bermuda

Simon Business Network, LLC

  Delaware

Simon Brand Ventures, LLC

  Indiana

Simon Global Limited

  United Kingdom

Simon Services, Inc. 

  Delaware

Simon Property Group Administrative Services Partnership, L.P. 

  Delaware

SPGGC, LLC

  Virginia

Kravco Simon Investments, L.P. 

  Pennsylvania

SPG ML Holdings, LLC

  Delaware

Simon Management Associates II, LLC

  Delaware

Simon Management Associates, LLC

  Delaware

CPG Partners, L.P. 

  Delaware

            Omits names of subsidiaries that as of December 31, 2008 were not, in the aggregate, a "significant subsidiary."

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List of Subsidiaries of Simon Property Group, L.P.

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Exhibit 23.1


Consent of Independent Registered Public Accounting Firm

            We consent to the incorporation by reference in the Registration Statement (Form S-3 No. 333-132513) of Simon Property Group, L.P. and in the related prospectus of our reports dated February 25, 2009, with respect to the consolidated financial statements and schedule of Simon Property Group, L.P. and Subsidiaries, and the effectiveness of internal control over financial reporting of Simon Property Group, L.P. and Subsidiaries included in this Annual Report (Form 10-K) for the year ended December 31, 2008.

 
   
    /s/ ERNST & YOUNG LLP
Indianapolis, Indiana
February 25, 2009
   

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Consent of Independent Registered Public Accounting Firm

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Exhibit 31.1


Certification by the Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities
Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

            I, David Simon, certify that:

            1.         I have reviewed this Annual Report on Form 10-K of Simon Property Group, L.P.;

            2.         Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

            3.         Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

            4.         The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f) and 15d-15(f)) for the registrant and have:

            5.         The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent function):


Date: March 2, 2009

 

 

 

 

/s/ DAVID SIMON

David Simon
Chairman of the Board of Directors and
Chief Executive Officer of
Simon Property Group, Inc., General Partner

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Certification by the Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

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Exhibit 31.2


Certification by the Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities
Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

            I, Stephen E. Sterrett, certify that:

            1.         I have reviewed this Annual Report on Form 10-K of Simon Property Group, L.P.;

            2.         Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

            3.         Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

            4.         The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f) and 15d-15(f) for the registrant and have:

            5.         The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent function):


Date: March 2, 2009

 

 

 

 

/s/ STEPHEN E. STERRETT

Stephen E. Sterrett
Executive Vice President and Chief Financial Officer of
Simon Property Group, Inc., General Partner

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Certification by the Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

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Exhibit 32


CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

            In connection with the Annual Report of Simon Property Group, L.P., on Form 10-K for the period ending December 31, 2008 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), each of the undersigned, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

/s/ DAVID SIMON

David Simon
Chairman of the Board of Directors
and Chief Executive Officer of
Simon Property Group, Inc., General Partner
March 2, 2009
   

/s/ STEPHEN E. STERRETT

Stephen E. Sterrett
Executive Vice President and
Chief Financial Officer of
Simon Property Group, Inc., General Partner
March 2, 2009

 

 

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CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002