GGP Ggp Inc. (delisted)

General Growth Properties, Inc. (NYSE:GGP) reported today its annual and fourth quarter 2007 operating results. For the full year 2007, Core Funds From Operations (Core FFO) per fully diluted share were $2.97 as compared to $2.96 for the full year 2006. For the fourth quarter 2007, Core FFO per fully diluted share were $0.92 versus $0.99 of Core FFO per fully diluted share in the comparable 2006 quarter. For the full year, Earnings per share � diluted (EPS) were $1.18 in 2007 as compared to $0.24 in 2006. EPS were $0.24 for the fourth quarter of 2007 versus EPS of $0.29 in the fourth quarter of 2006. Funds From Operations (FFO) per fully diluted share for the full year 2007 were $3.71 in 2007 as compared to $3.06 of FFO per fully diluted share for the full year 2006. FFO per fully diluted share were $0.64 in the fourth quarter of 2007 and were $1.02 in the fourth quarter of 2006. �Our core retail real estate business continues to deliver solid operating results,� said John Bucksbaum, the Chief Executive Officer of General Growth. �We are prepared to handle the expected weaker economic environment and will be well positioned to benefit when the economy begins to show improvement.� FINANCIAL AND OPERATIONAL HIGHLIGHTS Core FFO is defined as Funds From Operations excluding the Real Estate Property Net Operating Income (NOI) from the Master Planned Communities segment and the benefit from (provision for) income taxes. Core FFO for the fourth quarter of 2007 was $271.2 million or $0.92 per fully diluted share as compared to $292.0 million or $0.99 per fully diluted share in the fourth quarter of 2006. As previously reported, in the fourth quarter of 2007 the Company recognized approximately $52 million, or approximately $0.18 per fully diluted share, in litigation costs related to the judgment in the Caruso Affiliated Holdings and Glendale Galleria matter. This cost, as well as the reclassification of our 50% share of such costs recognized as litigation costs from Unconsolidated Properties in the third quarter 2007, are a result of our potential responsibility as managing agent of the property, and such amounts have been reported as litigation provision in the fourth quarter of 2007. Excluding such litigation provisions, Core FFO per fully diluted share for the fourth quarter 2007 and the full year 2007 increased approximately 10.7% and 11.3%, respectively, over the prior year periods. EPS in the fourth quarter of 2007 were $0.24, a $.05 decline from the comparable period of 2006, primarily as a result of our previously-announced $77 million, net of related income tax benefit, non-cash impairment charge recorded in the fourth quarter of 2007 relating to our two Maryland Master Planned Communities. For the full year 2007, EPS were $1.18, as compared to $0.24 of EPS in 2006. Full year EPS in 2007 as compared to 2006 increased approximately $1.32 as a result of the approximate $324 million income tax benefit recognized in 2007 related to the ownership restructuring of certain of our operating properties. FFO per share declined to $0.64 in the fourth quarter of 2007 from $1.02 in the fourth quarter of 2006. In addition to the impact of the impairment charge and litigation costs discussed above, recurring Master Planned Community NOI was significantly lower in 2007 due to the sales volume declines discussed below. Core FFO per share guidance Our guidance for future operating performance is given only for Core FFO per share as operating results for our Master Planned Communities segment, and our income tax expense that is largely a function of such operations, are very difficult to estimate in advance. In addition, we believe that FFO is a less meaningful supplemental measure for the Master Planned Communities segment of our business because it does not facilitate an understanding of the operating performance of this business as our primary strategy in this segment is to develop and sell land in a manner that increases the value of the remaining land. Actual EPS, FFO (including these excluded items), NOI and Core FFO will be provided each quarter. Full year per share guidance will also be updated on a quarterly basis; however, such guidance will only be given for Core FFO per share. � � � � Actual Core FFO per share in 2007 was approximately $2.97 per share. We currently expect 2008 Core FFO per share to be in the range of $3.58 to $3.61 per share, 20.5% to 21.5% above the calculated Core FFO per share amount described above for 2007. Such significant increases in Core FFO per share for 2008 reflect the elimination of certain 2007 items described above. SEGMENT RESULTS Retail and Other Segment NOI for the fourth quarter of 2007 was $719.0 million, a 12.2% increase over the $641.1 million reported for the fourth quarter of 2006. The majority of such increase in NOI is attributable primarily to increased minimum rents and tenant recovery revenues due to expansions and new property openings since the fourth quarter of 2006 as well as, with respect to renewal tenants, increased aggregate tenant charges. Revenues from consolidated properties were $868.0 million for the fourth quarter of 2007, an increase of 19.2% compared to $728.0 million for the same period in 2006. The majority of such increase is due to the acquisition of our venture partner�s interest in the Homart I properties in July of 2007. Revenues from unconsolidated properties, at the Company�s ownership share, for the quarter declined 19.6% to $163.2 million, compared to $203.0 million in the fourth quarter of 2006. The decline in revenues for the fourth quarter of 2007 as compared to 2006 is due to the acquisition of our venture partner�s interest in the Homart I properties in July of 2007. Comparable NOI from consolidated properties in the fourth quarter of 2007 increased by 5.9% compared to the same period last year. � � � � Comparable NOI from unconsolidated properties at the Company's ownership share for the quarter increased by approximately 5.3% compared to the fourth quarter of 2006. Total tenant sales and comparable tenant sales, both on a trailing 12 month basis at December 2007, increased 4.3% and 1.4%, respectively, compared to the same periods last year. Retail Center occupancy was 93.8% at December 31, 2007 as compared to 93.6% at December 31, 2006. Sales per square foot for fourth quarter 2007 (on a trailing 12 month basis) were $462 versus $453 in the fourth quarter of 2006. Master Planned Communities Segment NOI for the fourth quarter of 2007 for the properties in the Master Planned Communities segment was a loss of $119.9 million for consolidated properties and income of $2.2 million for unconsolidated properties as compared to income of $48.8 million and $7.3 million, respectively, in the fourth quarter of 2006. For the full year 2007, NOI from consolidated properties was a loss of $98.7 million and NOI from unconsolidated properties was income of $27.2 million, as compared to income of $106.7 million and $23.3 million, respectively, for the full year 2006. NOI declines in 2007 are due to the recognition of the aggregate $127.6 million of Maryland property impairment charges described above which are not offset by the related income tax benefits of such impairment charges. Land sale revenues for the fourth quarter of 2007 were $31.5 million for consolidated properties and $15.5 million for unconsolidated properties, compared to $205.2 million and $25.2 million, respectively, for the fourth quarter of 2006. Consolidated land sale revenues in the fourth quarter of 2006 were impacted significantly as a result of the inclusion of a single $123 million sale, a sales pattern which did not recur in the fourth quarter of 2007. Land sale revenues for the full year 2007 were below 2006 amounts as the current sales pace has significantly diminished in recent months, a trend expected to continue well into 2008. This sales pace is consistent with our strategy in this segment of our business to manage our sales volume to maximize overall value for all remaining land within the community rather than focus on individual sales objectives in any particular year or quarter. CONFERENCE CALL/WEBCAST General Growth Properties, Inc. will host a live Webcast of its conference call regarding this announcement on our website, www.ggp.com. This Webcast will take place on Tuesday, February 12, 2008, at 9:00 a.m. Eastern Time (8:00 a.m. CT, 6:00 a.m. PT). The Webcast can be accessed by selecting the conference call icon on the GGP home page. The Company is one of the largest U.S.-based publicly traded Real Estate Investment Trusts (REIT) based upon market capitalization. The Company currently has ownership interest in, or management responsibility for, a portfolio of over 200 regional shopping malls in 45 states, as well as ownership in master planned community developments and commercial office buildings. The Company�s portfolio totals approximately 200 million square feet and includes over 24,000 retail stores nationwide. The Company is listed on the New York Stock Exchange under the symbol GGP. For more information, please visit the Company website at http://www.ggp.com. NON-GAAP SUPPLEMENTAL FINANCIAL MEASURES AND DEFINITIONS FUNDS FROM OPERATIONS (FFO) The Company, consistent with real estate industry and investment community preferences, uses FFO as a supplemental measure of operating performance for a REIT. The National Association of Real Estate Investment Trusts (NAREIT) defines FFO as net income (loss) (computed in accordance with Generally Accepted Accounting Principles (GAAP)), excluding gains (or losses) from cumulative effects of accounting changes, extraordinary items and sales of properties, plus real estate related depreciation and amortization and after adjustments for unconsolidated partnerships and joint ventures. The Company considers FFO a supplemental measure for equity REITs and a complement to GAAP measures because it facilitates an understanding of the operating performance of the Company�s properties. FFO does not give effect to real estate depreciation and amortization since these amounts are computed to allocate the cost of a property over its useful life. Since values for well-maintained real estate assets have historically increased or decreased based upon prevailing market conditions, the Company believes that FFO provides investors with a clearer view of the Company�s operating performance. However, we believe that Funds From Operations is a less meaningful supplemental measure of performance for the Master Planned Communities segment of our business. Funds From Operations does not facilitate an understanding of the operating performance of the Master Planned Communities segment of our business as our primary strategy in this segment is to develop and sell land in a manner that increases the value of the remaining land. In addition, the Master Planned Communities segment of our business is operated within taxable REIT subsidiaries and therefore our income tax expense is largely attributable to this segment of the business. To isolate these parts of the Company from the Retail and Other segment for which Funds From Operations is a relevant measure of operating performance, the Company also uses Core FFO as an operating measure. Core FFO is defined as Funds From Operations excluding the Real Estate Property Net Operating Income from the Master Planned Communities segment and the provision for income taxes. In order to provide a better understanding of the relationship between Core FFO, FFO and GAAP net income, a reconciliation of Core FFO and FFO to GAAP net income has been provided. Neither Core FFO nor FFO represent cash flows from operating activities in accordance with GAAP, neither should be considered as an alternative to GAAP net income and neither is necessarily indicative of cash available to fund cash needs. In addition, the Company has presented FFO on a consolidated and unconsolidated basis (at the Company�s ownership share) as the Company believes that given the significance of the Company�s operations that are owned through investments accounted for on the equity method of accounting, the detail of the operations of the Company�s unconsolidated properties provides important insights into the income and FFO produced by such investments for the Company as a whole. REAL ESTATE PROPERTY NET OPERATING INCOME (NOI) AND COMPARABLE NOI The Company believes that Real Estate Property Net Operating Income (NOI) is a useful supplemental measure of the Company�s operating performance. The Company defines NOI as operating revenues (rental income, land sales, tenant recoveries and other income) less property and related expenses (real estate taxes, land sales operating costs, repairs and maintenance, marketing and other property expenses). As with FFO described above, NOI has been reflected on a consolidated and unconsolidated basis (at the Company�s ownership share). Other REITs may use different methodologies for calculating NOI, and accordingly, the Company�s NOI may not be comparable to other REITs. Because NOI excludes general and administrative expenses, interest expense, depreciation and amortization, gains and losses from property dispositions, minority interest in consolidated joint ventures, and extraordinary items, it provides a performance measure that, when compared year over year, reflects the revenues and expenses directly associated with owning and operating commercial real estate properties and the impact on operations from trends in occupancy rates, rental rates, land values and operating costs. This measure thereby provides an operating perspective not immediately apparent from GAAP operating or net income. The Company uses NOI to evaluate its operating performance on a property-by-property basis because NOI allows the Company to evaluate the impact that factors such as lease structure, lease rates and tenant base, which vary by property, have on the Company�s operating results, gross margins and investment returns. In addition, management believes that NOI provides useful information to the investment community about the Company�s operating performance. However, due to the exclusions noted above, NOI should only be used as an alternative measure of the Company�s financial performance. For reference, and as an aid in understanding management�s computation of NOI, a reconciliation of NOI to consolidated operating income as computed in accordance with GAAP has been presented. Comparable NOI excludes from both years the NOI of properties with significant physical or merchandising changes and those properties acquired or opened during the relevant comparative accounting periods. PROPERTY INFORMATION The Company has presented information on its consolidated and unconsolidated properties separately in the accompanying financial schedules. As a significant portion of the Company�s total operations are structured as joint venture arrangements which are unconsolidated, management of the Company believes that operating data with respect to all properties owned provides important insights into the income produced by such investments for the Company as a whole. In addition, the individual items of revenue and expense for the unconsolidated properties have been presented at the Company�s ownership share of such unconsolidated ventures. As substantially all of the management operating philosophies and strategies are the same regardless of ownership structure, an aggregate presentation of NOI and other operating statistics yields a more accurate representation of the relative size and significance of such elements to the Company�s overall operations. FORWARD LOOKING STATEMENTS This press release contains forward-looking statements, including full year 2008 Core FFO per share guidance and expected sales trends in the Master Planned Communities segment. Actual results may differ materially from the results suggested by these forward-looking statements, for a number of reasons, including, but not limited to, the retail market, tenant occupancy and tenant bankruptcies, the level of indebtedness and interest rates, market conditions, land sales in the Master Planned Communities segment, the cost and success of development and re-development projects and ability to successfully manage growth. Readers are referred to the documents filed by General Growth Properties, Inc. with the SEC, specifically the most recent report on Form 10-K, which further identify the important risk factors which could cause actual results to differ materially from the forward-looking statements in this release. The Company disclaims any obligation to update any forward-looking statements. GENERAL GROWTH PROPERTIES, INC. OVERVIEW (In thousands, except per share amounts) � � � Three Months Ended Twelve Months Ended December 31, December 31, 2007 2006 2007 2006 Funds From Operations ("FFO") � Company stockholders $ 157,034 $ 247,415 $ 907,010 $ 740,566 Operating Partnership unitholders 33,388 � 53,838 193,798 � 161,795 Operating Partnership $ 190,422 � $ 301,253 $ 1,100,808 � $ 902,361 � Increase (decrease) in FFO over comparable prior year period (36.8 ) % 13.3 % 22.0 � % 1.2 % � FFO per share: Company stockholders - basic $ 0.64 $ 1.02 $ 3.72 $ 3.07 Operating Partnership - basic 0.64 1.02 3.72 3.07 Operating Partnership - diluted 0.64 1.02 3.71 3.06 Increase (decrease) in diluted FFO over comparable prior year period (37.3 ) % 12.1 % 21.2 % 0.3 % � Core Funds From Operations ("Core FFO") Core FFO $ 271,232 $ 292,028 $ 880,933 $ 871,940 Core FFO per share - diluted 0.92 0.99 2.97 2.96 Increase (decrease) in Core FFO over comparable prior year period (7.1 ) % 14.7 % 1.0 % 2.8 % � Dividends Dividends paid per share $ 0.50 $ 0.45 $ 1.85 $ 1.68 Payout ratio (% of diluted FFO paid out) 78.1 % 44.1 % 49.9 % 54.9 % � Real Estate Property Net Operating Income ("NOI") Retail and Other: Consolidated $ 613,507 $ 511,991 $ 2,054,063 $ 1,840,915 Unconsolidated 105,448 � 129,152 419,535 � 450,050 Total Retail and Other 718,955 � 641,143 2,473,598 � 2,290,965 Master Planned Communities: Consolidated (119,924 ) 48,765 (98,659 ) 106,730 Unconsolidated 2,163 � 7,349 27,204 � 23,257 Total Master Planned Communities (117,761 ) 56,114 (71,455 ) 129,987 Total Real estate property net operating income $ 601,194 � $ 697,257 $ 2,402,143 � $ 2,420,952 � December 31, December 31, Selected Balance Sheet Information 2007 2006 Cash and cash equivalents $ 99,534 $ 97,139 � Investment in real estate: Net land, buildings and equipment $22,359,249 $19,564,992 Developments in progress 987,936 673,900 Net investment in and loans to/from Unconsolidated Real Estate Affiliates 1,803,366 1,326,615 Investment land and land held for development and sale 1,639,372 � 1,655,838 Net investment in real estate $26,789,923 � $23,221,345 � Total assets $28,814,319 $25,241,445 � Mortgage, notes and loans payable $24,282,139 $20,521,967 Minority interest - Preferred 121,482 182,828 Minority interest - Common 351,362 347,753 Stockholders' equity 1,456,696 � 1,664,079 Total capitalization (at cost) $26,211,679 � $22,716,627 � Consolidated Properties Unconsolidated Properties (a) Average Average Outstanding Interest Outstanding Interest Summarized Debt Information Balance Rate (d) Balance Rate (d) Fixed rate (c) $20,830,080 5.52 % $ 2,750,369 5.67 % Variable rate (c) 3,247,457 � 6.76 298,606 � 7.42 Totals $24,077,537 � (b) 5.68 % $ 3,048,975 � 5.84 % � (a) Reflects the Company's share of debt relating to the properties owned by the Unconsolidated Real Estate Affiliates. (b) Excludes special improvement districts liability of $71.8 million, minority interest adjustment of $65.4 million and purchase accounting mark-to-market adjustments of $67.4 million. (c) Includes the effects of interest rate swaps. (d) Rates include the effects of deferred finance costs and the effect of a 360 day rate applied over a 365 day period. GENERAL GROWTH PROPERTIES, INC. CONSOLIDATED STATEMENTS OF INCOME (In thousands, except per share amounts) � � � � � Three Months Ended Twelve Months Ended December 31, December 31, 2007 2006 2007 2006 Revenues: Minimum rents $ 544,440 $ 458,872 $ 1,933,674 $ 1,753,508 Tenant recoveries 233,548 197,364 859,801 773,034 Overage rents 46,438 38,372 89,016 75,945 Land sales 31,538 205,159 145,649 423,183 Management and other fees 26,180 35,668 106,584 115,798 Other 46,524 � 36,388 � 127,077 � 114,815 � Total revenues 928,668 � 971,823 � 3,261,801 � 3,256,283 � Expenses: Real estate taxes 66,480 51,807 246,484 218,549 Repairs and maintenance 65,287 54,139 216,536 199,078 Marketing 19,134 14,151 54,664 48,626 Other property operating costs 108,271 90,928 421,228 373,020 Land sales operations 151,462 156,394 244,308 316,453 Provision for (recovery of) doubtful accounts (4,640 ) 4,996 5,426 22,078 Property management and other costs 43,770 47,509 198,610 181,033 General and administrative 16,076 4,146 37,005 18,800 Litigation provision 89,225 - 89,225 - Depreciation and amortization 142,610 � 177,852 � 670,454 � 690,194 � Total expenses 697,675 � 601,922 � 2,183,940 � 2,067,831 � Operating income 230,993 369,901 1,077,861 1,188,452 � Interest income 1,637 2,868 8,641 11,585 Interest expense (319,333 ) (275,759 ) (1,174,097 ) (1,117,437 ) Income (loss) before income taxes, minority interest and equity in income of Unconsolidated Real Estate Affiliates (86,703 ) 97,010 (87,595 ) 82,600 Benefit from (provision for) income taxes 37,709 (46,864 ) 294,160 (98,984 ) Minority interest (16,241 ) (21,718 ) (77,012 ) (37,761 ) Equity in income of Unconsolidated Real Estate Affiliates 123,961 � 42,628 � 158,401 � 114,241 � Income from continuing operations 58,726 71,056 287,954 60,096 Discontinued operations - loss on disposition - � (823 ) - � (823 ) Net income $ 58,726 � $ 70,233 � $ 287,954 � $ 59,273 � � Basic Earnings Per Share: Continuing operations $ 0.24 $ 0.29 $ 1.18 $ 0.25 Discontinued operations - � - � - � - � Total basic earnings per share $ 0.24 � $ 0.29 � $ 1.18 � $ 0.25 � � Diluted Earnings Per Share: Continuing operations $ 0.24 $ 0.29 $ 1.18 $ 0.24 Discontinued operations - � - � - � - � Total diluted earnings per share $ 0.24 � $ 0.29 � $ 1.18 � $ 0.24 � GENERAL GROWTH PROPERTIES, INC. PORTFOLIO RESULTS AND FUNDS FROM OPERATIONS ("FFO") (In thousands) � � � Three Months Ended December 31, 2007 Consolidated Unconsolidated Segment Retail and Other Properties Properties Basis Property revenues: Minimum rents $ 544,440 $ 96,337 $ 640,777 Tenant recoveries 233,548 39,098 272,646 Overage rents 46,438 6,360 52,798 Other, including minority interest 43,613 � 21,440 � 65,053 � Total property revenues 868,039 � 163,235 � 1,031,274 � Property operating expenses: Real estate taxes 66,480 9,863 76,343 Repairs and maintenance 65,287 10,443 75,730 Marketing 19,134 3,609 22,743 Other property operating costs 108,271 33,836 142,107 Provision for (recovery of) doubtful accounts (4,640 ) 36 � (4,604 ) Total property operating expenses 254,532 � 57,787 � 312,319 � Retail and other net operating income 613,507 � 105,448 � 718,955 � � Master Planned Communities Land sales 31,538 15,459 46,997 Land sales operations (23,862 ) (13,296 ) (37,158 ) Master Planned Communities net operating income before impairment charge 7,676 2,163 9,839 � Columbia and Fairwood Communities impairment charge (127,600 ) - � (127,600 ) Master Planned Communities net operating income (loss) (119,924 ) 2,163 (117,761 ) � � � Real estate property net operating income 493,583 107,611 $ 601,194 � � Management and other fees 26,180 7,046 Property management and other costs (19,466 ) (921 ) Headquarters/regional costs (24,304 ) (10,951 ) General and administrative (16,076 ) 199 Litigation provision (89,225 ) 37,112 Depreciation on non-income producing assets, including headquarters building (2,800 ) - Interest income 1,637 2,616 Interest expense (319,333 ) (37,972 ) Benefit from (provision for) income taxes 37,709 (758 ) Preferred unit distributions (2,947 ) - Other FFO from minority interest 1,451 � 31 � FFO 86,409 104,013 Equity in FFO of Unconsolidated Properties 104,013 � (104,013 ) Operating Partnership FFO $ 190,422 � $ - � � Includes reclassifications of litigation and legal costs from GGP/Homart II to GGP. � Three Months Ended December 31, 2006 Consolidated Unconsolidated Segment Retail and Other Properties Properties Basis Property revenues: Minimum rents $ 458,872 $ 116,194 $ 575,066 Tenant recoveries 197,364 47,805 245,169 Overage rents 38,372 9,792 48,164 Other, including minority interest 33,404 � 29,206 � 62,610 � Total property revenues 728,012 � 202,997 � 931,009 � Property operating expenses: Real estate taxes 51,807 14,696 66,503 Repairs and maintenance 54,139 12,388 66,527 Marketing 14,151 3,981 18,132 Other property operating costs 90,928 43,245 134,173 Provision for (recovery of) doubtful accounts 4,996 � (465 ) 4,531 � Total property operating expenses 216,021 � 73,845 � 289,866 � Retail and other net operating income 511,991 � 129,152 � 641,143 � � Master Planned Communities Land sales 205,159 25,210 230,369 Land sales operations (156,394 ) (17,861 ) (174,255 ) Master Planned Communities net operating income 48,765 7,349 56,114 � � � Real estate property net operating income 560,756 136,501 $ 697,257 � � Management and other fees 35,668 2,808 Property management and other costs (24,829 ) (192 ) Headquarters/regional costs (22,680 ) (10,285 ) General and administrative (4,146 ) (1,531 ) Depreciation on non-income producing assets, including headquarters building (3,351 ) - Interest income 2,868 4,349 Interest expense (275,759 ) (49,418 ) Provision for income taxes (46,864 ) (25 ) Preferred unit distributions (4,126 ) - Other FFO from minority interest 1,509 � - � FFO 219,046 82,207 Equity in FFO of Unconsolidated Properties 82,207 � (82,207 ) Operating Partnership FFO $ 301,253 � $ - � GENERAL GROWTH PROPERTIES, INC. PORTFOLIO RESULTS AND FUNDS FROM OPERATIONS ("FFO") (In thousands) � � � � Twelve Months Ended December 31, 2007 Consolidated Unconsolidated Segment Retail and Other Properties Properties Basis Property revenues: Minimum rents $ 1,933,674 $ 406,241 $ 2,339,915 Tenant recoveries 859,801 173,486 1,033,287 Overage rents 89,016 12,213 101,229 Other, including minority interest 115,910 � 82,884 � 198,794 � Total property revenues 2,998,401 � 674,824 � 3,673,225 � Property operating expenses: Real estate taxes 246,484 50,478 296,962 Repairs and maintenance 216,536 40,559 257,095 Marketing 54,664 12,233 66,897 Other property operating costs 421,228 150,041 571,269 Provision for doubtful accounts 5,426 � 1,978 � 7,404 � Total property operating expenses 944,338 � 255,289 � 1,199,627 � Retail and other net operating income 2,054,063 � 419,535 � 2,473,598 � � Master Planned Communities Land sales 145,649 85,017 230,666 Land sales operations (116,708 ) (57,813 ) (174,521 ) Master Planned Communities net operating income before impairment charge 28,941 27,204 56,145 � Columbia and Fairwood Communities impairment charge (127,600 ) - � (127,600 ) Master Planned Communities net operating income (loss) (98,659 ) 27,204 (71,455 ) � � � Real estate property net operating income 1,955,404 446,739 $ 2,402,143 � � Management and other fees 106,584 19,869 Property management and other costs (84,583 ) (3,029 ) Headquarters/regional costs (114,027 ) (42,305 ) General and administrative (37,005 ) (3,700 ) Litigation provision (89,225 ) - Depreciation on non-income producing assets, including headquarters building (12,006 ) - Interest income 8,641 16,417 Interest expense (1,174,097 ) (176,937 ) Benefit from (provision for) income taxes 294,160 (2,830 ) Preferred unit distributions (12,963 ) - Other FFO from minority interest 5,639 � 62 � FFO 846,522 254,286 Equity in FFO of Unconsolidated Properties 254,286 � (254,286 ) Operating Partnership FFO $ 1,100,808 � $ - � � � Twelve Months Ended December 30, 2006 Consolidated Unconsolidated Segment Retail and Other Properties Properties Basis Property revenues: Minimum rents $ 1,753,508 $ 428,337 $ 2,181,845 Tenant recoveries 773,034 187,782 960,816 Overage rents 75,945 15,966 91,911 Other, including minority interest 99,779 � 88,552 � 188,331 � Total property revenues 2,702,266 � 720,637 � 3,422,903 � Property operating expenses: Real estate taxes 218,549 58,832 277,381 Repairs and maintenance 199,078 43,768 242,846 Marketing 48,626 13,184 61,810 Other property operating costs 373,020 154,010 527,030 Provision for doubtful accounts 22,078 � 793 � 22,871 � Total property operating expenses 861,351 � 270,587 � 1,131,938 � Retail and other net operating income 1,840,915 � 450,050 � 2,290,965 � � Master Planned Communities Land sales 423,183 85,561 508,744 Land sales operations (316,453 ) (62,304 ) (378,757 ) Master Planned Communities net operating income 106,730 23,257 129,987 � � � Real estate property net operating income 1,947,645 473,307 $ 2,420,952 � � Management and other fees 115,798 7,556 Property management and other costs (89,892 ) (1,088 ) Headquarters/regional costs (91,141 ) (37,042 ) General and administrative (18,800 ) (3,974 ) Depreciation on non-income producing assets, including headquarters building (13,106 ) - Interest income 11,585 15,039 Interest expense (1,117,437 ) (185,438 ) Provision for income taxes (98,984 ) (582 ) Preferred unit distributions (17,264 ) - Other FFO from minority interest 6,179 � - � FFO 634,583 267,778 Equity in FFO of Unconsolidated Properties 267,778 � (267,778 ) Operating Partnership FFO $ 902,361 � $ - � GENERAL GROWTH PROPERTIES, INC. SUPPLEMENTAL DISCLOSURE OF CERTAIN REVENUES AND EXPENSES REFLECTED IN FFO (In thousands) � � � � � Three Months Ended Three Months Ended December 31, 2007 December 31, 2006 Consolidated Unconsolidated Consolidated Unconsolidated Properties Properties Properties Properties Minimum rents: Above- and below-market tenant leases, net $ 2,485 $ 2,716 $ 10,440 $ 2,367 Straight-line rent (2,315 ) 290 (2,587 ) (1,027 ) Other property operating costs: Non-cash ground rent expense (2,694 ) (193 ) (2,132 ) (193 ) Real estate taxes: Real estate tax stabilization agreement (981 ) - (981 ) - Interest expense: Mark-to-market adjustments on debt 4,063 765 7,367 1,025 Amortization of deferred finance costs (5,288 ) (344 ) (3,475 ) (421 ) Debt extinguishment costs: Write-off of mark-to-market adjustments 1,167 - 460 - Write-off of deferred finance costs (154 ) (2 ) - � (15 ) Totals $ (3,717 ) $ 3,231 � $ 9,092 � $ 1,736 � � � Twelve Months Ended Twelve Months Ended December 31, 2007 December 31, 2006 Consolidated Unconsolidated Consolidated Unconsolidated Properties Properties Properties Properties Minimum rents: Above- and below-market tenant leases, net $ 30,988 $ 9,791 $ 39,661 $ 9,627 Straight-line rent 24,334 7,445 34,176 7,605 Other property operating costs: Non-cash ground rent expense (7,479 ) (769 ) (6,368 ) (785 ) Real estate taxes: Real estate tax stabilization agreement (3,924 ) - (3,810 ) - Interest expense: Mark-to-market adjustments on debt 28,536 3,916 32,153 3,859 Amortization of deferred finance costs (18,916 ) (1,658 ) (16,079 ) (1,808 ) Debt extinguishment costs: Write-off of mark-to-market adjustments 4,932 - 3,945 - Write-off of deferred finance costs (3,255 ) (2 ) (6,150 ) (456 ) Totals $ 55,216 � $ 18,723 � $ 77,528 � $ 18,042 � � � � � � � � � � � � WEIGHTED AVERAGE SHARES (In thousands) � Three Months Ended Twelve Months Ended December 31, December 31, 2007 2006 2007 2006 � Basic 243,867 241,779 243,992 241,222 Diluted 244,258 242,739 244,538 242,054 Assuming full conversion of Operating Partnership units: Basic 295,718 294,391 296,125 293,923 Diluted 296,109 295,351 296,671 294,755 GENERAL GROWTH PROPERTIES, INC. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO GAAP FINANCIAL MEASURES (In thousands) � � � � � � Three Months Ended Twelve Months Ended December 31, December 31, 2007 2006 2007 2006 Reconciliation of Real Estate Property Net Operating Income ("NOI") to GAAP Operating Income Real estate property net operating income: Segment basis $ 601,194 $ 697,257 $ 2,402,143 $ 2,420,952 Unconsolidated Properties (107,611 ) (136,501 ) (446,739 ) (473,307 ) Consolidated Properties 493,583 560,756 1,955,404 1,947,645 Management and other fees 26,180 35,668 106,584 115,798 Property management and other costs (19,466 ) (24,829 ) (84,583 ) (89,892 ) Headquarters/regional costs (24,304 ) (22,680 ) (114,027 ) (91,141 ) General and administrative (16,076 ) (4,146 ) (37,005 ) (18,800 ) Litigation provision (89,225 ) - (89,225 ) - Depreciation and amortization (142,610 ) (177,852 ) (670,454 ) (690,194 ) Minority interest in NOI of Consolidated Properties and other 2,911 � 2,984 � 11,167 � 15,036 � Operating income $ 230,993 � $ 369,901 � $ 1,077,861 � $ 1,188,452 � � � Reconciliation of Core FFO to Funds From Operations ("FFO") and to GAAP Net Income Core FFO $ 271,232 $ 292,028 $ 880,933 $ 871,940 Master Planned Communities net operating income (loss) (117,761 ) 56,114 (71,455 ) 129,987 Benefit from (provision for) income taxes 36,951 � (46,889 ) 291,330 � (99,566 ) Funds From Operations - Operating Partnership 190,422 301,253 1,100,808 902,361 Depreciation and amortization of capitalized real estate costs (164,438 ) (218,617 ) (797,189 ) (835,656 ) Minority interest in depreciation of Consolidated Properties and other 45,292 5,828 45,944 8,401 Minority interest to Operating Partnership unitholders (12,550 ) (17,408 ) (61,609 ) (15,010 ) Income from continuing operations 58,726 71,056 287,954 60,096 Loss on disposition, net of minority interest - � (823 ) - � (823 ) Net income $ 58,726 � $ 70,233 � $ 287,954 � $ 59,273 � � Reconciliation of Equity in NOI of Unconsolidated Properties to GAAP Equity in Income of Unconsolidated Affiliates Equity in Unconsolidated Properties: NOI $ 107,611 $ 136,501 $ 446,739 $ 473,307 Net property management fees and costs 6,125 2,616 16,840 6,468 Net interest expense (35,356 ) (45,069 ) (160,520 ) (170,399 ) Litigation provision 37,112 - - - Headquarters, general and administrative, income taxes and minority interest in FFO (11,479 ) (11,841 ) (48,773 ) (41,598 ) FFO of unconsolidated properties 104,013 82,207 254,286 267,778 Depreciation and amortization of capitalized real estate costs (24,628 ) (44,118 ) (138,741 ) (158,567 ) Other, including gain on sales of investment properties 44,576 � 4,539 � 42,856 � 5,030 � Equity in income of unconsolidated real estate affiliates $ 123,961 � $ 42,628 � $ 158,401 � $ 114,241 � � � Reconciliation of Weighted Average Shares Outstanding Basic: Weighted average number of shares outstanding - FFO per share 295,718 294,391 296,125 293,923 Conversion of Operating Partnership units (51,851 ) (52,612 ) (52,133 ) (52,701 ) Weighted average number of Company shares outstanding - GAAP EPS 243,867 � 241,779 � 243,992 � 241,222 � � Diluted: Weighted average number of shares outstanding - FFO per share 296,109 295,351 296,671 294,755 Conversion of Operating Partnership units (51,851 ) (52,612 ) (52,133 ) (52,701 ) Weighted average number of Company shares outstanding - GAAP EPS 244,258 � 242,739 � 244,538 � 242,054 �