UNITED STATES

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported) August 2, 2007

THE MACERICH COMPANY

(Exact Name of Registrant as Specified in its Charter)

MARYLAND

 

1-12504

 

95-4448705

(State or Other Jurisdiction of

 

(Commission File Number)

 

(I.R.S. Employer Identification No.)

Incorporation)

 

 

 

 

 

 

 

 

 

401 Wilshire Boulevard, Suite 700, Santa Monica, California 90401

(Address of principal executive office, including zip code)

 

Registrant’s telephone number, including area code  (310) 394-6000

N/A

(Former name, former address and former fiscal year, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 




ITEM 2.02             RESULTS OF OPERATIONS AND FINANCIAL CONDITION.

The Company issued a press release on August 2, 2007, announcing results of operations for the Company for the quarter ended June 30, 2007 and such press release is furnished as Exhibit 99.1 hereto.

The press release included as an exhibit with this report is being furnished pursuant to Item 2.02 and Item 7.01 of Form 8-K and shall not be deemed to be “filed” with the SEC or incorporated by reference into any other filing with the SEC.

ITEM 7.01             REGULATION FD DISCLOSURE.

On August 2, 2007, the Company made available on its website a quarterly financial supplement containing financial and operating information of the Company (“Supplemental Financial Information”) for the three and six months ended June 30, 2007 and such Supplemental Financial Information is furnished as Exhibit 99.2 hereto.

The Supplemental Financial Information included as an exhibit with this report is being furnished pursuant to Item 7.01 of Form 8-K and shall not be deemed to be “filed” with the SEC or incorporated by reference into any other filing with the SEC.

ITEM 9.01             FINANCIAL STATEMENTS AND EXHIBITS.

Listed below are the financial statements, pro forma financial information and exhibits furnished as part of this report:

(a), (b) and (c) Not applicable.

(d) Exhibits.

Exhibit Index attached hereto and incorporated herein by reference.

2




SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, The Macerich Company has duly caused this report to be signed by the undersigned, hereunto duly authorized, in the City of Santa Monica, State of California, on August 2, 2007.

THE MACERICH COMPANY

 

 

 

 

 

By:  THOMAS E. O’HERN

 

 

 

 

 

 

 

 

/s/ Thomas E. O’Hern

 

 

Executive Vice President,

 

 

Chief Financial Officer

 

 

and Treasurer

 

 

3




EXHIBIT INDEX

EXHIBIT

 

 

 

 

NUMBER

 

NAME

 

 

 

 

 

99.1

 

Press Release dated August 2, 2007

 

 

 

 

 

 

 

99.2

 

Supplemental Financial Information for the three and six months ended June 30, 2007

 

4



Exhibit 99.1

PRESS RELEASE

For:

THE MACERICH COMPANY

 

 

Press Contact:

Arthur Coppola, President and Chief Executive Officer

 

 

 

or

 

 

 

Thomas E. O’Hern, Executive Vice President and
Chief Financial Officer

 

 

 

(310) 394-6000

 

MACERICH ANNOUNCES SECOND QUARTER RESULTS

Santa Monica, CA (8/02/07) - - The Macerich Company (NYSE Symbol: MAC) today announced results of operations for the quarter ended June 30, 2007 which included total funds from operations (“FFO”) diluted of $100.7 million or $1.04 per share, up 8.2% compared to $.96 per share-diluted for the quarter ended June 30, 2006. For the six months ended June 30, 2007, FFO-diluted was $177.1 million compared to $175.4 million for the six months ended June 30, 2006.  Net income available to common stockholders for the quarter ended June 30, 2007 was $13.4 million or $.19 per share-diluted compared to $25.7 million or $.36 per share-diluted for the quarter ended June 30, 2006.  For the six months ended June 30, 2007, net income was $16.0 million compared to $33.1 million for the six months ended June 30, 2006.    The Company’s definition of FFO is in accordance with the definition provided by the National Association of Real Estate Investment Trusts (“NAREIT”). A reconciliation of net income to FFO and net income per common share-diluted (“EPS”) to FFO per share-diluted is included in the financial tables accompanying this press release.

Recent Highlights:

·                  During the quarter, Macerich signed 343,000 square feet of specialty store leases at average initial rents of $43.71 per square foot.  Starting base rent on new lease signings was 26.2% higher than the expiring base rent.

·                  Mall tenant annual sales per square foot for the year ended June 30, 2007 were $458 compared to $433 at June 30, 2006.

·                  Portfolio occupancy at June 30, 2007 was 93.2% compared to 92.1% at June 30, 2006.  On a same center basis, occupancy was 93.2% at June 30, 2007 compared to 92.8% at June 30, 2006.

·                  FFO per share-diluted increased 8.2% compared to the second quarter of 2006.  Contributing to this increase was same center net operating income growth of 3.4%.

Commenting on results, Arthur Coppola president and chief executive officer of Macerich stated, “The quarter reflected continuing strong fundamentals with occupancy gains, strong releasing spreads and solid same center growth in net operating income.  In addition, we continue to strengthen our balance sheet with the recent refinancing of Scottsdale Fashion Square which contributed to a further reduction in our floating rate debt.   We continue to make excellent progress on our significant pipeline of developments and redevelopments which we expect to fuel earnings growth in the years to come.”




Redevelopment and Development Activity

SanTan Village, a 1.2 million square foot regional shopping center on 120 acres, will be the first regional shopping center developed in the fast-growing area of Gilbert, Arizona and the first regional mall opened in the Phoenix metroplex since the opening of Chandler Fashion Center in 2001.  Currently 90% committed, the first phase of the open-air shopping center, including approximately 100 specialty retailers and Dillard’s, is scheduled to open in October, 2007. Remaining retail phases are slated to open in 2008.

Phase-I of The Promenade at Casa Grande, a 1 million square foot, 120 acre regional shopping center in fast growing Pinal County, Arizona, is 90% committed and scheduled to open in November, 2007. The first phase features mini-anchors, restaurants and shops.  Bed, Bath & Beyond, Claire’s, Cost Plus World Market, Fashion Bug, Olive Garden, Mimi’s Café and Sports Authority will join the existing line up which includes Dillard’s, JCPenney, Target, Kohl’s and Harkins Theaters. Phase II is scheduled to open spring 2008.

At Flagstaff Mall, in Flagstaff, Arizona the first phase of the 287,000 square foot power center addition is scheduled for a fall 2007 opening. Home Depot will anchor The Marketplace and will open with first-to-market retailers including Shoe Pavilion, Marshall’s, Best Buy, Old Navy, Linens ‘n Things, Cost Plus World Market and Petco.

At Freehold Raceway Mall in Freehold, New Jersey, construction continues on the 110,000 square foot lifestyle expansion which is slated to open in November, 2007.   The project is 85% committed. New retailers include Borders, The Cheesecake Factory, P.F. Chang’s, Jared and The Territory Ahead. New retailers joining the existing 1.6 million-square-foot regional shopping center, which is undergoing an interior renovation, include Ruehl,  Robot Galaxy, Solstice, Charlotte Russe, Amuse and Pro Image.

Scottsdale Fashion Square, the 2 million square foot luxury flagship, is undergoing a $130 million redevelopment and expansion.  Phase I of the expansion is expected to begin fall 2007 with the demolition of the vacant anchor space, acquired from Federated, and an adjacent parking structure. A 65,000 square foot, first-to-market Barneys New York, will anchor additional 100,000-square-feet of new shop space slated to open fall 2009.

Construction continues on the combined redevelopment, expansion and interior renovation of The Oaks, an upscale 1.1 million square foot super-regional shopping center in California’s affluent Thousand Oaks. The project is expected to be completed in fall 2008. The market’s first Nordstrom department store is under construction.

At Estrella Falls, plans continue to move forward. Infrastructure improvements are underway and the site plan approval process for the regional shopping center is anticipated to be completed in fall 2007. The adjacent power center is expected to open in phases beginning in 2008. Regional shopping center retailers announced to date include Coach, Chico’s, White House/Black Market and Industrial Ride Shop; announced power center retailers include Bashas’, Staples, Shoe Pavilion and Razmataz. The mall is projected to open in phases beginning in 2009.




Financing Activity

In July, a $550 million refinancing of Scottsdale Fashion Square was completed.  The loan bears interest at a 5.66% fixed rate with a seven year term.  The Company used its prorata share of excess proceeds, $162 million, to pay down its line of credit which reduced floating rate debt as a percentage of total outstanding indebtedness to under 6%.

The Macerich Company is a fully integrated self-managed and self-administered real estate investment trust, which focuses on the acquisition, leasing, management, development and redevelopment of regional malls throughout the United States.  The Company is the sole general partner and owns an 85% ownership interest in The Macerich Partnership, L.P.  Macerich now owns approximately 77 million square feet of gross leaseable area consisting primarily of interests in 73 regional malls.  Additional information about The Macerich Company can be obtained from the Company’s web site at www.macerich.com.

Investor Conference Call

The Company will provide an online Web simulcast and rebroadcast of its quarterly earnings conference call.  The call will be available on The Macerich Company’s website at www.macerich.com and through CCBN at www.earnings.com.  The call begins today, August 2, 2007 at 10:30 AM Pacific Time. To listen to the call, please go to any of these web sites at least 15 minutes prior to the call in order to register and download audio software if needed. An online replay at www.macerich.com will be available for one year after the call.

Note:  This release contains statements that constitute forward-looking statements. Stockholders are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks, uncertainties and other factors that may cause actual results, performance or achievements of the Company to vary materially from those anticipated, expected or projected.  Such factors include, among others, general industry, economic and business conditions, which will, among other things, affect demand for retail space or retail goods, availability and creditworthiness of current and prospective tenants, anchor or tenant bankruptcies, closures, mergers or consolidations, lease rates and terms, interest rate fluctuations, availability and cost of financing and operating expenses; adverse changes in the real estate markets including, among other things, competition from other companies, retail formats and technology, risks of real estate development and redevelopment, acquisitions and dispositions; governmental actions and initiatives (including legislative and regulatory changes); environmental and safety requirements; and terrorist activities which could adversely affect all of the above factors.  The reader is directed to the Company’s various filings with the Securities and Exchange Commission, including the Annual Report on Form 10-K for the year ended December 31, 2006, for a discussion of such risks and uncertainties, which discussion is incorporated herein by reference.

(See attached tables)

##




THE MACERICH COMPANY

FINANCIAL HIGHLIGHTS

(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

 

 

Results before SFAS 144 (e)

 

Impact of SFAS 144 (e)

 

Results after SFAS 144 (e)

 

 

 

For the Three Months

 

For the Three Months

 

For the Three Months

 

 

 

Ended June 30,

 

Ended June 30,

 

Ended June 30,

 

 

 

Unaudited

 

Unaudited

 

Results of Operations:

 

2007

 

2006

 

2007

 

2006

 

2007

 

2006

 

Minimum rents

 

$

125,921

 

$

127,483

 

($20

)

($10,892

)

$

125,901

 

$

116,591

 

Percentage rents

 

2,922

 

2,754

 

(60

)

(208

)

2,862

 

2,546

 

Tenant recoveries

 

67,995

 

65,932

 

144

 

(5,307

)

68,139

 

60,625

 

Management Companies’ revenues

 

9,599

 

7,369

 

 

 

9,599

 

7,369

 

Other income

 

9,352

 

6,341

 

(65

)

(381

)

9,287

 

5,960

 

Total revenues

 

215,789

 

209,879

 

(1

)

(16,788

)

215,788

 

193,091

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shopping center and operating expenses

 

69,172

 

70,151

 

(398

)

(6,153

)

68,774

 

63,998

 

Management Companies’ operating expenses

 

18,519

 

12,125

 

 

 

18,519

 

12,125

 

Income tax (benefit) expense

 

(787

)

218

 

 

 

(787

)

218

 

Depreciation and amortization

 

60,404

 

59,411

 

 

(3,401

)

60,404

 

56,010

 

REIT general and administrative expenses

 

4,412

 

3,292

 

 

 

4,412

 

3,292

 

Interest expense

 

62,226

 

71,188

 

35

 

(3,040

)

62,261

 

68,148

 

Loss on early extinguishment of debt

 

 

 

 

 

 

 

Gain (loss) on sale or writedown of assets

 

1,183

 

62,961

 

1,096

 

(62,961

)

2,279

 

 

Equity in income of unconsolidated joint ventures (c)

 

18,997

 

17,861

 

 

 

18,997

 

17,861

 

Minority interests in consolidated joint ventures

 

(55

)

(37,904

)

28

 

37,363

 

(27

)

(541

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) from continuing operations

 

21,968

 

36,412

 

1,486

 

(29,792

)

23,454

 

6,620

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Discontinued Operations:

 

 

 

 

 

 

 

 

 

 

 

 

 

(Loss) gain on sale of assets

 

 

 

(1,124

)

25,952

 

(1,124

)

25,952

 

(Loss) income from discontinued operations

 

 

 

(362

)

3,840

 

(362

)

3,840

 

 Income before minority interests of OP

 

21,968

 

36,412

 

 

 

21,968

 

36,412

 

Income allocated to minority interests of OP

 

2,398

 

4,770

 

 

 

2,398

 

4,770

 

Net income before preferred dividends

 

19,570

 

31,642

 

 

 

19,570

 

31,642

 

Preferred dividends and distributions (a)

 

6,122

 

5,970

 

 

 

6,122

 

5,970

 

Net income to common stockholders

 

$

13,448

 

$

25,672

 

$

0

 

$

0

 

$

13,448

 

$

25,672

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average number of shares outstanding - basic

 

71,528

 

71,458

 

 

 

 

 

71,528

 

71,458

 

Average shares outstanding, assuming

 

 

 

 

 

 

 

 

 

 

 

 

 

full conversion of OP Units (d)

 

84,552

 

85,023

 

 

 

 

 

84,552

 

85,023

 

Average shares outstanding - diluted for FFO (a) (d)

 

96,701

 

88,650

 

 

 

 

 

96,701

 

88,650

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Per share income- diluted before discontinued operations

 

 

 

 

 

 

 

$

0.21

 

$

0.01

 

Net income per share-basic

 

$

0.19

 

$

0.36

 

 

 

 

 

$

0.19

 

$

0.36

 

Net income per share- diluted (a)

 

$

0.19

 

$

0.36

 

 

 

 

 

$

0.19

 

$

0.36

 

Dividend declared per share

 

$

0.71

 

$

0.68

 

 

 

 

 

$

0.71

 

$

0.68

 

Funds from operations “FFO” (b) (d)- basic

 

$

89,409

 

$

82,860

 

 

 

 

 

$

89,409

 

$

82,860

 

Funds from operations “FFO” (a) (b) (d) - diluted

 

$

100,696

 

$

85,327

 

 

 

 

 

$

100,696

 

$

85,327

 

FFO per share- basic(b) (d)

 

$

1.06

 

$

0.98

 

 

 

 

 

$

1.06

 

$

0.98

 

FFO per share- diluted (a) (b) (d)

 

$

1.04

 

$

0.96

 

 

 

 

 

$

1.04

 

$

0.96

 

 




THE MACERICH COMPANY

FINANCIAL HIGHLIGHTS

(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

 

 

Results before SFAS 144 (e)

 

Impact of SFAS 144 (e)

 

Results after SFAS 144 (e)

 

 

 

For the Six Months

 

For the Six Months

 

For the Six Months

 

 

 

Ended June 30,

 

Ended June 30,

 

Ended June 30,

 

 

 

Unaudited

 

Unaudited

 

Results of Operations:

 

2007

 

2006

 

2007

 

2006

 

2007

 

2006

 

Minimum rents

 

$

249,913

 

$

261,069

 

($30

)

($22,390

)

$

249,883

 

$

238,679

 

Percentage rents

 

6,706

 

5,720

 

(79

)

(804

)

6,627

 

4,916

 

Tenant recoveries

 

135,778

 

133,338

 

15

 

(10,370

)

135,793

 

122,968

 

Management Companies’ revenues

 

18,353

 

14,626

 

 

 

18,353

 

14,626

 

Other income

 

16,946

 

13,289

 

(146

)

(697

)

16,800

 

12,592

 

Total revenues

 

427,696

 

428,042

 

(240

)

(34,261

)

427,456

 

393,781

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shopping center and operating expenses

 

137,851

 

138,278

 

(456

)

(12,436

)

137,395

 

125,842

 

Management Companies’ operating expenses

 

36,274

 

26,839

 

 

 

36,274

 

26,839

 

Income tax (benefit) expense

 

(907

)

(315

)

 

 

(907

)

(315

)

Depreciation and amortization

 

117,492

 

122,951

 

2

 

(7,530

)

117,494

 

115,421

 

REIT general and administrative expenses

 

9,785

 

6,990

 

 

 

9,785

 

6,990

 

Interest expense

 

129,781

 

143,153

 

35

 

(6,224

)

129,816

 

136,929

 

Loss on early extinguishment of debt

 

877

 

1,782

 

 

 

877

 

1,782

 

Gain (loss) on sale or writedown of assets

 

2,646

 

62,460

 

1,385

 

(62,961

)

4,031

 

(501

)

Equity in income of unconsolidated joint ventures (c)

 

33,480

 

38,877

 

 

 

33,480

 

38,877

 

Minority interests in consolidated joint ventures

 

(1,546

)

(38,407

)

30

 

37,403

 

(1,516

)

(1,004

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) from continuing operations

 

31,123

 

51,294

 

1,594

 

(33,629

)

32,717

 

17,665

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Discontinued Operations:

 

 

 

 

 

 

 

 

 

 

 

 

 

(Loss) gain on sale of assets

 

 

 

(1,413

)

25,952

 

(1,413

)

25,952

 

(Loss) income from discontinued operations

 

 

 

(181

)

7,677

 

(181

)

7,677

 

 Income before minority interests of OP

 

31,123

 

51,294

 

 

 

31,123

 

51,294

 

Income allocated to minority interests of OP

 

2,865

 

6,230

 

 

 

2,865

 

6,230

 

Net income before preferred dividends

 

28,258

 

45,064

 

 

 

28,258

 

45,064

 

Preferred dividends and distributions (a)

 

12,244

 

11,939

 

 

 

12,244

 

11,939

 

Net income to common stockholders

 

$

16,014

 

$

33,125

 

$

0

 

$

0

 

$

16,014

 

$

33,125

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average number of shares outstanding - basic

 

71,597

 

70,152

 

 

 

 

 

71,597

 

70,152

 

Average shares outstanding, assuming

 

 

 

 

 

 

 

 

 

 

 

 

 

full conversion of OP Units (d)

 

84,792

 

83,807

 

 

 

 

 

84,792

 

83,807

 

Average shares outstanding - diluted for FFO (a) (d)

 

88,419

 

87,434

 

 

 

 

 

88,419

 

87,434

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Per share income- diluted before discontinued operations

 

 

 

 

 

 

 

$

0.24

 

$

0.07

 

Net income per share-basic

 

$

0.22

 

$

0.47

 

 

 

 

 

$

0.22

 

$

0.47

 

Net income per share- diluted (a)

 

$

0.22

 

$

0.47

 

 

 

 

 

$

0.22

 

$

0.47

 

Dividend declared per share

 

$

1.42

 

$

1.36

 

 

 

 

 

$

1.42

 

$

1.36

 

Funds from operations “FFO” (b) (d)- basic

 

$

171,900

 

$

170,504

 

 

 

 

 

$

171,900

 

$

170,504

 

Funds from operations “FFO” (a) (b) (d) - diluted

 

$

177,051

 

$

175,437

 

 

 

 

 

$

177,051

 

$

175,437

 

FFO per share- basic(b) (d)

 

$

2.04

 

$

2.04

 

 

 

 

 

$

2.04

 

$

2.04

 

FFO per share- diluted (a) (b) (d)

 

$

2.00

 

$

2.01

 

 

 

 

 

$

2.00

 

$

2.01

 

 




THE MACERICH COMPANY

FINANCIAL HIGHLIGHTS

(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

(a)      On February 25, 1998, the Company sold $100,000 of convertible preferred stock representing 3.627 million shares. The convertible preferred shares can be converted on a 1 for 1 basis for common stock. These preferred shares are not assumed converted for  purposes of net income per share - diluted for 2007 and 2006 as they would be antidilutive to those calculations. The weighted average preferred shares outstanding are assumed converted for purposes of FFO per share -diluted as they are dilutive to those calculations for all periods presented.

On April 25, 2005, in connection with the acquisition of Wilmorite Holdings, L.P. and its affiliates, the Company issued as part of the consideration participating and non-participating convertible preferred units in MACWH, LP. These preferred units are not assumed converted for purposes of net income per share - diluted and FFO per share - diluted for 2007 and 2006 as they would be antidilutive to those calculations.

On March 16, 2007, the Company issued $950 million of convertible senior notes. These notes are not assumed converted for purposes of net income per share - diluted for 2007 as they would be antidilutive to the calculation. These notes are assumed converted for purposes of FFO per share - diluted for the three months ended June 30, 2007 as they are dilutive to the calculation.

(b)     The Company uses FFO in addition to net income to report its operating and financial results and considers FFO and FFO-diluted as supplemental measures for the real estate industry and a supplement to Generally Accepted Accounting Principles (GAAP) measures. NAREIT defines FFO as net income (loss) (computed in accordance with GAAP), excluding gains (or losses) from extraordinary items and sales of depreciated operating properties, plus real estate related depreciation and amortization and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures are calculated to reflect FFO on the same basis. FFO and FFO on a fully diluted basis are useful to investors in comparing operating and financial results between periods. This is especially true since FFO excludes real estate depreciation and amortization, as the Company believes real estate values fluctuate based on market conditions rather than depreciating in value ratably on a straight-line basis over time. FFO on a fully diluted basis is one of the measures investors find most useful in measuring the dilutive impact of outstanding convertible securities. FFO does not represent cash flow from operations as defined by GAAP, should not be considered as an alternative to net income as defined by GAAP and is not indicative of cash available to fund all cash flow needs. FFO as presented may not be comparable to similarly titled measures reported by other real estate investment trusts.

Effective January 1, 2003, gains or losses on sale of undepreciated assets and the impact of SFAS 141 have been included in FFO. The inclusion of gains on sales of undepreciated assets (decreased) increased FFO for the three and six months ended June 30, 2007 and 2006 by $(0.2) million, $0.7 million, $3.5 million and $3.6 million, respectively, or by $.00 per share, $0.01 per share, $0.04 per share and $.04 per share, respectively. Additionally, SFAS 141 increased FFO for the three and six months ended June 30, 2007 and 2006 by $3.5 million, $7.5 million, $4.3 million and $8.9 million, respectively, or by $.04 per share, $0.08 per share, $0.05 per share and $0.10 per share, respectively.

(c)      This includes, using the equity method of accounting, the Company’s prorata share of the equity in income or loss of its unconsolidated joint ventures  for all periods presented.

(d)     The Macerich Partnership, LP (the “Operating Partnership” or the “OP”) has operating partnership units (“OP units”). Each OP unit can be converted into a share of Company stock. Conversion of the OP units not owned by the Company has been assumed for purposes of calculating the FFO per share and the weighted average number of shares outstanding. The computation of average shares for FFO - - diluted includes the effect of outstanding stock options and restricted stock using the treasury method and assumes conversion of MACWH, LP preferred and common units to the extent they are dilutive to the calculation. For the three and six months ended June 30, 2007 and 2006, the MACWH, LP preferred units were antidilutive to FFO.

(e)      In October 2001, the FASB issued SFAS No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets” (“SFAS 144”). SFAS 144 addresses financial accounting and reporting for the impairment or disposal of long-lived assets. The Company adopted SFAS 144 on January 1, 2002. The Company has classified the results of operations for all of the below dispositions to discontinued operations.

On June 9, 2006, Scottsdale 101 in Arizona was sold. The sale of this property resulted in a gain on sale in 2006, at the Company’s prorata share, of $25.8 million.

On July 13, 2006, Park Lane Mall in Nevada was sold. The sale of this property resulted in a gain on sale of $5.9 million in 2006.

On July 27, 2006, Greeley Mall in Colorado and Holiday Village in Montana were sold. The sale of these properties resulted in gains on sale of $21.3 million and $7.4 million, respectively, in 2006.

On August 11, 2006, Great Falls Marketplace in Montana was sold. The sale of this property resulted in a gain on sale of $11.8 million in 2006.

On December 29, 2006, Citadel Mall in Colorado Springs, Colorado, Crossroads Malls in Oklahoma City, Oklahoma and Northwest Arkansas Mall in Fayetteville, Arkansas were sold. The sale of these properties resulted in a total gain on sale of $132.7 million in 2006.




THE MACERICH COMPANY

FINANCIAL HIGHLIGHTS

(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

 

 

June 30,

 

December 31,

 

 

 

2007

 

2006

 

 

 

(UNAUDITED)

 

Summarized Balance Sheet Information

 

 

 

 

 

Cash and cash equivalents

 

$

49,034

 

$

269,435

 

Investment in real estate, net (h)

 

$

5,914,882

 

$

5,755,283

 

Investments in unconsolidated entities (i)

 

$

987,021

 

$

1,010,380

 

Total assets

 

$

7,498,814

 

$

7,562,163

 

Mortgage and notes payable

 

$

5,123,549

 

$

4,993,879

 

Pro rata share of debt on unconsolidated entities

 

$

1,665,475

 

$

1,664,447

 

 

 

 

 

 

 

Total common shares outstanding:

 

71,642

 

71,568

 

Total preferred shares outstanding:

 

3,627

 

3,627

 

Total partnership/preferred units outstanding:

 

15,687

 

16,342

 

 

 

 

June 30,

 

June 30,

 

 

 

2007

 

2006

 

 

 

(UNAUDITED)

 

Additional financial data as of:

 

 

 

 

 

Occupancy of centers (f)

 

93.20

%

92.10

%

Comparable quarter change in same center sales (f) (g)

 

1.21

%

4.40

%

 

 

 

 

 

 

Additional financial data for the six months ended:

 

 

 

 

 

Acquisitions of property and equipment - including  joint ventures at pro rata

 

$          5,216

 

$      265,455

 

Redevelopment and expansions of centers- including joint ventures at pro rata

 

$      248,353

 

$        80,864

 

Renovations of centers-  including joint ventures at pro rata

 

$        19,778

 

$        26,070

 

Tenant allowances- including joint ventures at pro rata

 

$        13,515

 

$        13,624

 

Deferred leasing costs- including joint ventures at pro rata

 

$        15,406

 

$        13,606

 

 


(f)        excludes redevelopment properties (Santan Village Phase 2, Santa Monica Place, The Oaks, Twenty Ninth Street and Westside Pavilion Adjacent)

(g)     includes mall and freestanding stores.

(h)     includes construction in process on wholly owned assets of $455,552 at June 30, 2007 and $294,115 at December 31, 2006.

(i)         the Company’s pro rata share of construction in process on unconsolidated entities of $51,996 at June 30, 2007 and $45,268 at December 31, 2006.

PRORATA SHARE OF JOINT VENTURES

 

 

For the Three Months

 

For the Six Months

 

 

 

Ended June 30,

 

Ended June 30,

 

 

 

(UNAUDITED)

 

(UNAUDITED)

 

 

 

(All amounts in thousands)

 

(All amounts in thousands)

 

 

 

2007

 

2006

 

2007

 

2006

 

Revenues:

 

 

 

 

 

 

 

 

 

Minimum rents

 

$

61,985

 

$

59,100

 

$

123,875

 

$

117,470

 

Percentage rents

 

1,938

 

1,894

 

4,225

 

4,522

 

Tenant recoveries

 

28,602

 

26,403

 

57,791

 

54,006

 

Other

 

3,291

 

3,139

 

5,954

 

6,676

 

Total revenues

 

95,816

 

90,536

 

191,845

 

182,674

 

 

 

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

 

 

Shopping center expenses

 

32,807

 

29,286

 

63,395

 

60,444

 

Interest expense

 

23,751

 

23,292

 

48,068

 

42,753

 

Depreciation and amortization

 

20,696

 

20,585

 

45,084

 

41,164

 

Total operating expenses

 

77,254

 

73,163

 

156,547

 

144,361

 

Gain (loss) on sale of assets

 

362

 

244

 

(2,020

)

244

 

Equity in income of joint ventures

 

73

 

244

 

202

 

320

 

Net income

 

$

18,997

 

$

17,861

 

$

33,480

 

$

38,877

 

 




THE MACERICH COMPANY

FINANCIAL HIGHLIGHTS

(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

 

 

For the Three Months

 

For the Six Months

 

 

 

Ended June 30,

 

Ended June 30,

 

 

 

(UNAUDITED)

 

(UNAUDITED)

 

 

 

(All amounts in thousands)

 

(All amounts in thousands)

 

 

 

2007

 

2006

 

2007

 

2006

 

RECONCILIATION OF NET INCOME TO FFO   (b)(e)

 

 

 

 

 

 

 

 

 

Net income - available to common stockholders

 

$

13,448

 

$

25,672

 

$

16,014

 

$

33,125

 

 

 

 

 

 

 

 

 

 

 

Adjustments to reconcile net income to FFO- basic

 

 

 

 

 

 

 

 

 

Minority interest in OP

 

2,398

 

4,770

 

2,865

 

6,230

 

Gain on sale of consolidated assets

 

(1,183

)

(62,961

)

(2,646

)

(62,460

)

plus (loss) gain on undepreciated asset sales- consolidated assets

 

(542

)

3,255

 

339

 

3,376

 

plus minority interest share of (loss) gain on sale of consolidated joint ventures

 

(488

)

37,008

 

348

 

37,008

 

(Gain) loss on sale of assets from unconsolidated entities (pro rata share)

 

(362

)

(244

)

2,020

 

(244

)

plus gain on undepreciated asset sales- unconsolidated entities (pro rata share)

 

350

 

244

 

350

 

244

 

Depreciation and amortization on consolidated assets

 

60,404

 

59,411

 

117,492

 

122,951

 

Less depreciation and amortization allocable to minority interests on consolidated joint ventures

 

(1,332

)

(1,247

)

(2,326

)

(3,222

)

Depreciation and amortization on joint ventures (pro rata)

 

20,696

 

20,585

 

45,084

 

41,164

 

Less: depreciation on personal property and amortization of loan costs and interest rate caps

 

(3,980

)

(3,633

)

(7,640

)

(7,668

)

 

 

 

 

 

 

 

 

 

 

Total FFO - basic

 

89,409

 

82,860

 

171,900

 

170,504

 

 

 

 

 

 

 

 

 

 

 

Additional adjustment to arrive at FFO -diluted

 

 

 

 

 

 

 

 

 

Preferred stock dividends earned

 

2,575

 

2,467

 

5,151

 

4,933

 

Convertible debt - interest expense

 

8,712

 

 

 

 

Total FFO - diluted

 

$

100,696

 

$

85,327

 

$

177,051

 

$

175,437

 

 

 

 

For the Three Months

 

For the Six Months

 

 

 

Ended June 30,

 

Ended June 30,

 

 

 

(UNAUDITED)

 

(UNAUDITED)

 

 

 

2007

 

2006

 

2007

 

2006

 

Reconciliation of EPS to FFO per diluted share:

 

 

 

 

 

 

 

 

 

Earnings per share - Diluted

 

$

0.19

 

$

0.36

 

$

0.22

 

$

0.47

 

Per share impact of depreciation and amortization of real estate

 

$

0.90

 

$

0.89

 

$

1.80

 

$

1.83

 

Per share impact of gain on sale of depreciated assets

 

($0.03

)

($0.26

)

($0.01

)

($0.27

)

Per share impact of preferred stock not dilutive to EPS

 

($0.02

)

($0.03

)

($0.01

)

($0.02

)

Fully Diluted FFO per share

 

$

1.04

 

$

0.96

 

$

2.00

 

$

2.01

 

 

 

 

For the Three Months

 

For the Six Months

 

 

 

Ended June 30,

 

Ended June 30,

 

 

 

(UNAUDITED)

 

(UNAUDITED)

 

 

 

(All amounts in thousands)

 

(All amounts in thousands)

 

 

 

2007

 

2006

 

2007

 

2006

 

THE MACERICH COMPANY RECONCILIATION OF NET INCOME TO EBITDA

 

 

 

 

 

 

 

 

 

Net income - available to common stockholders

 

$

13,448

 

$

25,672

 

$

16,014

 

$

33,125

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

62,226

 

71,188

 

129,781

 

143,153

 

Interest expense - unconsolidated entities (pro rata)

 

23,751

 

23,292

 

48,068

 

42,753

 

Depreciation and amortization - consolidated assets

 

60,404

 

59,411

 

117,492

 

122,951

 

Depreciation and amortization - unconsolidated entities (pro rata)

 

20,696

 

20,585

 

45,084

 

41,164

 

Minority interest

 

2,398

 

4,770

 

2,865

 

6,230

 

Less: Interest expense and depreciation and amortization allocable to minority interests on consolidated joint ventures

 

(1,766

)

(2,060

)

(3,201

)

(4,927

)

Loss on early extinguishment of debt

 

 

 

877

 

1,782

 

Gain on sale of assets - consolidated assets

 

(1,183

)

(62,961

)

(2,646

)

(62,460

)

Loss (gain) on sale of assets - unconsolidated entities (pro rata)

 

(362

)

(244

)

2,020

 

(244

)

Add: Minority interest share of (loss) gain on sale of consolidated joint ventures

 

(488

)

37,008

 

348

 

37,008

 

Income tax (benefit) expense

 

(787

)

218

 

(907

)

(315

)

Preferred dividends

 

6,122

 

5,970

 

12,244

 

11,939

 

 

 

 

 

 

 

 

 

 

 

EBITDA (j)

 

$

184,459

 

$

182,849

 

$

368,039

 

$

372,159

 

 




THE MACERICH COMPANY

FINANCIAL HIGHLIGHTS

(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

THE MACERICH COMPANY

RECONCILIATION OF EBITDA TO SAME CENTERS - NET OPERATING INCOME (“NOI”)

 

 

For the Three Months

 

For the Six Months

 

 

 

Ended June 30,

 

Ended June 30,

 

 

 

(UNAUDITED)

 

(UNAUDITED)

 

 

 

(All amounts in thousands)

 

(All amounts in thousands)

 

 

 

2007

 

2006

 

2007

 

2006

 

 

 

 

 

 

 

 

 

 

 

EBITDA (j)

 

$

184,459

 

$

182,849

 

$

368,039

 

$

372,159

 

 

 

 

 

 

 

 

 

 

 

Add:

REIT general and administrative expenses

 

4,412

 

3,292

 

9,785

 

6,990

 

 

Management Companies’ revenues (c)

 

(9,599

)

(7,369

)

(18,353

)

(14,626

)

 

Management Companies’ operating expenses (c)

 

18,519

 

12,125

 

36,274

 

26,839

 

 

Lease termination income of comparable centers

 

(2,134

)

(1,796

)

(5,531

)

(10,365

)

 

EBITDA of non-comparable centers

 

(20,724

)

(19,910

)

(40,799

)

(40,415

)

 

 

 

 

 

 

 

 

 

 

 

 

SAME CENTERS - Net operating income (“NOI”) (k)

 

$

174,933

 

$

169,191

 

$

349,415

 

$

340,582

 

 


(j)         EBITDA represents earnings before interest, income taxes, depreciation, amortization, minority interest, extraordinary items, gain (loss) on sale of assets and preferred dividends and includes joint ventures at their pro rata share. Management considers EBITDA to be an appropriate supplemental measure to net income because it helps investors understand the ability of the Company to incur and service debt and make capital expenditures. EBITDA should not be construed as an alternative to operating income as an indicator of the Company’s operating performance, or to cash flows from operating activities (as determined in accordance with GAAP) or as a measure of liquidity. EBITDA, as presented, may not be comparable to similarly titled measurements reported by other companies.

(k)      The Company presents same-center NOI because the Company believes it is useful for investors to evaluate the operating performance of comparable centers. Same-center NOI is calculated using total EBITDA and subtracting out EBITDA from non-comparable centers and eliminating the management companies and the Company’s general and administrative expenses.



Exhibit 99.2

 

Supplemental Financial Information

For the three and six months ended June 30, 2007




The Macerich Company

Supplemental Financial and Operating Information

Table of Contents

All information included in this supplemental financial package is unaudited, unless otherwise indicated.

 

Page No.

 

 

 

Corporate overview

 

 

Overview

 

1

Capital information and market capitalization

 

2

Changes in total common and equivalent shares

 

3

 

 

 

Financial data

 

 

Supplemental FFO information

 

4

Capital expenditures

 

5

 

 

 

Operational data

 

 

Sales per square foot

 

6

Occupancy

 

7

Rent

 

8

Cost of occupancy

 

9

 

 

 

Balance sheet information

 

 

Debt summary

 

10

Outstanding debt by maturity

 

11

 

This supplemental financial information should be read in connection with the Company’s second quarter 2007 earnings announcement (included as Exhibit 99.1 of the Company’s Current Report on 8-K, event date August 2, 2007) as certain disclosures, definitions and reconciliations in such announcement have not been included in this supplemental financial information.

  




The Macerich Company

Supplemental Financial and Operating Information

Overview

The Macerich Company (the “Company”) is involved in the acquisition, ownership, development, redevelopment, management and leasing of regional and community shopping centers located throughout the United States.  The Company is the sole general partner of, and owns a majority of the ownership interests in, The Macerich Partnership, L.P., a Delaware limited partnership (the “Operating Partnership”).

As of June 30, 2007, the Operating Partnership owned or had an ownership interest in 73 regional shopping centers and 18 community shopping centers aggregating approximately 77 million square feet of gross leasable area (“GLA”).  These 91 regional and community shopping centers are referred to hereinafter as the “Centers”, unless the context requires otherwise.

The Company is a self-administered and self-managed real estate investment trust (“REIT”) and conducts all of its operations through the Operating Partnership and the Company’s management companies (collectively, the “Management Companies”).

All references to the Company in this Exhibit include the Company, those entities owned or controlled by the Company and predecessors of the company, unless the context indicates otherwise.

1




The Macerich Company

Supplemental Financial and Operating Information (unaudited)

Capital Information and Market Capitalization

 

 

Period Ended

 

dollars in thousands except per share data

 

6/30/2007

 

12/31/2006

 

12/31/2005

 

12/31/2004

 

Closing common stock price per share

 

$

82.42

 

$

86.57

 

$

67.14

 

$

62.80

 

52 week high

 

$

103.59

 

$

87.10

 

$

71.22

 

$

64.66

 

52 week low

 

$

68.80

 

$

66.70

 

$

53.10

 

$

38.90

 

 

 

 

 

 

 

 

 

 

 

Shares outstanding at end of period

 

 

 

 

 

 

 

 

 

Class A participating convertible preferred units

 

2,855,393

 

2,855,393

 

2,855,393

 

 

Class A non-participating convertible preferred units

 

219,828

 

287,176

 

287,176

 

 

Series A cumulative convertible redeemable preferred stock

 

3,627,131

 

3,627,131

 

3,627,131

 

3,627,131

 

Common shares and operating partnership units

 

84,253,796

 

84,767,432

 

73,446,422

 

72,923,605

 

Total common and equivalent shares outstanding

 

90,956,148

 

91,537,132

 

80,216,122

 

76,550,736

 

 

 

 

 

 

 

 

 

 

 

Portfolio capitalization data

 

 

 

 

 

 

 

 

 

Total portfolio debt, including joint ventures at pro rata

 

$

6,741,937

 

$

6,620,271

 

$

6,863,690

 

$

4,377,388

 

 

 

 

 

 

 

 

 

 

 

Equity market capitalization

 

7,496,606

 

7,924,369

 

5,385,710

 

4,807,386

 

 

 

 

 

 

 

 

 

 

 

Total market capitalization

 

$

14,238,543

 

$

14,544,640

 

$

12,249,400

 

$

9,184,774

 

 

 

 

 

 

 

 

 

 

 

Leverage ratio (%) (a)

 

47.4

%

45.5

%

56.0

%

47.7

%

 

 

 

 

 

 

 

 

 

 

Floating rate debt as a percentage of total market capitalization

 

3.4

%

9.5

%

13.0

%

13.0

%

 

 

 

 

 

 

 

 

 

 

Floating rate debt as a percentage of total debt

 

7.1

%

20.8

%

35.7

%

27.0

%

 


(a) Debt as a percentage of total market capitalization

2




The Macerich Company

Supplemental Financial and Operating Information (unaudited)

Changes in Total Common and Equivalent Shares

 

 

Operating
Partnership
(“OP”) Units

 

Company
Common
Shares

 

Class A
Participating
Convertible
Preferred
Units
(“PCPU’s”)

 

Class A Non-
Participating
Convertible
Preferred
Units
(“NPCPU’s”)

 

Series A
Cumulative
Convertible
Redeemable
Preferred
Stock

 

Total
Common
and
Equivalent
Shares

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 Balance as of December 31, 2006

 

13,199,524

 

71,567,908

 

2,855,393

 

287,176

 

3,627,131

 

91,537,132

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 Repurchase of common shares

 

 

(807,000

)

 

 

 

(807,000

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 Conversion of OP units to common shares

 

(395,756

)

395,756

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 Conversion of NPCPU’s to common shares

 

 

67,348

 

 

(67,348

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 Conversion of OP units to cash

 

(598

)

 

 

 

 

(598

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 Issuance of stock from stock option exercises, restricted stock issuance or other share-based plans

 

 

225,704

 

 

 

 

225,704

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 Balance as of March 31, 2007

 

12,803,170

 

71,449,716

 

2,855,393

 

219,828

 

3,627,131

 

90,955,238

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 Conversion of OP units to common shares

 

(191,263

)

191,263

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 Issuance of stock from stock option exercises, restricted stock issuance or other share-based plans

 

 

910

 

 

 

 

910

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 Balance as of June 30, 2007

 

12,611,907

 

71,641,889

 

2,855,393

 

219,828

 

3,627,131

 

90,956,148

 

 

3




The Macerich Company

Supplemental Financial and Operating Information (unaudited)

Supplemental Funds from Operations (“FFO”) Information (a)

 

 

 

 

As of June 30,

 

dollars in millions

 

2007

 

2006

 

 

 

 

 

 

 

Straight line rent receivable

 

$

52.5

 

$

43.7

 

 

 

 

For the Three Months Ended June 30,

 

For the Six Months Ended June 30,

 

 

 

2007

 

2006

 

2007

 

2006

 

 

 

 

 

 

 

 

 

 

 

Lease termination fees

 

$

3.1

 

$

2.3

 

$

6.5

 

$

11.3

 

 

 

 

 

 

 

 

 

 

 

Straight line rental income

 

$

3.2

 

$

3.1

 

$

4.8

 

$

5.5

 

 

 

 

 

 

 

 

 

 

 

Gain on sales of undepreciated assets

 

$

(0.2

)

$

3.5

 

$

0.7

 

$

3.6

 

 

 

 

 

 

 

 

 

 

 

Amortization of acquired above- and below-market leases (SFAS 141)

 

$

3.5

 

$

4.3

 

$

7.5

 

$

8.9

 

 

 

 

 

 

 

 

 

 

 

Amortization of debt premiums

 

$

3.5

 

$

4.5

 

$

7.4

 

$

9.3

 

 

 

 

 

 

 

 

 

 

 

Interest capitalized

 

$

9.7

 

$

3.3

 

$

15.6

 

$

8.4

 


(a) All joint venture amounts included at pro rata.

 

4




The Macerich Company

Supplemental Financial and Operating Information (unaudited)

Capital Expenditures

 

 

For the Six
Months Ended

 

Year Ended

 

Year Ended

 

Year Ended

 

dollars in millions

 

6/30/07

 

12/31/06

 

12/31/05

 

12/31/04

 

Consolidated Centers

 

 

 

 

 

 

 

 

 

Acquisitions of property and equipment

 

$

3.3

 

$

580.5

 

$

1,767.2

 

$

301.1

 

Development, redevelopment and expansions of Centers

 

240.7

 

184.3

 

77.2

 

139.3

 

Renovations of Centers

 

14.6

 

51.4

 

51.1

 

21.2

 

Tenant allowances

 

8.9

 

27.0

 

21.8

 

10.9

 

Deferred leasing charges

 

13.3

 

21.6

 

21.8

 

16.8

 

Total

 

$

280.8

 

$

864.8

 

$

1,939.1

 

$

489.3

 

 

 

 

 

 

 

 

 

 

 

Joint Venture Centers (a)

 

 

 

 

 

 

 

 

 

Acquisitions of property and equipment

 

$

1.9

 

$

28.7

 

$

736.4

 

$

41.1

 

Development, redevelopment and expansions of Centers

 

7.6

 

48.8

 

79.4

 

6.6

 

Renovations of Centers

 

5.2

 

8.1

 

32.2

 

10.1

 

Tenant allowances

 

4.6

 

13.8

 

8.9

 

10.5

 

Deferred leasing charges

 

2.1

 

4.3

 

5.1

 

3.7

 

Total

 

$

21.4

 

$

103.7

 

$

862.0

 

$

72.0

 

 


(a) All joint venture amounts at pro rata.

5




The Macerich Company

Supplemental Financial and Operating Information (unaudited)

Sales Per Square Foot (a)

 

Consolidated
Centers

 

Unconsolidated
Centers

 

Total
Centers

 

6/30/2007 (b)

 

$

443

 

$

474

 

$

458

 

12/31/06

 

$

435

 

$

470

 

$

452

 

12/31/05

 

$

395

 

$

440

 

$

417

 

12/31/04

 

$

368

 

$

414

 

$

391

 

 


(a) Sales are based on reports by retailers leasing mall and freestanding stores for the trailing 12 months for tenants which have occupied such stores for a minimum of 12 months.  Sales per square foot are based on tenants 10,000 square feet and under, for regional malls.

(b) Due to tenant sales reporting timelines, the data presented is as of May 31, 2007.

6




The Macerich Company

Supplemental Financial and Operating Information (unaudited)

Occupancy

Period Ended

 

Consolidated
Centers (a)

 

Unconsolidated
Centers (a)

 

Total Centers (a)

 

6/30/07

 

92.9

%

93.5

%

93.2

%

12/31/06

 

93.0

%

94.2

%

93.6

%

12/31/05

 

93.2

%

93.8

%

93.5

%

12/31/04

 

92.6

%

92.4

%

92.5

%

 


(a) Occupancy data excludes space under development and redevelopment.

7




The Macerich Company

Supplemental Financial and Operating Information (unaudited)

Rent

 

 

Average Base Rent
PSF (a)

 

Average Base Rent
PSF on Leases
Commencing During
the Period (b)

 

Average Base Rent
PSF on Leases
Expiring (c)

 

Consolidated Centers

 

 

 

 

 

 

 

06/30/07

 

$

38.27

 

$

42.67

 

$

34.21

 

12/31/06

 

$

37.55

 

$

38.40

 

$

31.92

 

12/31/05

 

$

34.23

 

$

35.60

 

$

30.71

 

12/31/04

 

$

32.60

 

$

35.31

 

$

28.84

 

 

 

 

 

 

 

 

 

Joint Venture Centers

 

 

 

 

 

 

 

06/30/07

 

$

38.65

 

$

46.38

 

$

34.87

 

12/31/06

 

$

37.94

 

$

41.43

 

$

36.19

 

12/31/05

 

$

36.35

 

$

39.08

 

$

30.18

 

12/31/04

 

$

33.39

 

$

36.86

 

$

29.32

 

 


(a) Average base rent per square foot is based on Mall and Freestanding Store GLA for spaces 10,000 square feet and under, occupied as of the applicable date, for each of the Centers owned by the Company.  Leases for La Encantada and the expansion area of Queens Center were excluded for Years 2005 and 2004.

(b) The average base rent per square foot on lease signings commencing during the period represents the actual rent to be paid during the first twelve months for tenant leases 10,000 square feet and under.  Lease signings for La Encantada and the expansion area of Queens Center were excluded for Years 2005 and 2004.

(c) The average base rent per square foot on leases expiring during the period represents the final year minimum rent, on a cash basis, for all tenant leases 10,000 square feet and under expiring during the year.  Leases for La Encantada and the expansion area of Queens Center were excluded for Years 2005 and 2004.

8




The Macerich Company

Supplemental Financial and Operating Information (unaudited)

Cost of Occupancy

 

 

For Years Ended December 31,

 

Consolidated Centers

 

2006

 

2005

 

2004

 

Minimum rents

 

8.1

%

8.3

%

8.3

%

Percentage rents

 

0.4

%

0.5

%

0.4

%

Expense recoveries (a)

 

3.7

%

3.6

%

3.7

%

Total

 

12.2

%

12.4

%

12.4

%

 

 

 

For Years Ended December 31,

 

Joint Venture Centers

 

2006

 

2005

 

2004

 

Minimum rents

 

7.2

%

7.4

%

7.7

%

Percentage rents

 

0.6

%

0.5

%

0.5

%

Expense recoveries (a)

 

3.1

%

3.0

%

3.2

%

Total

 

10.9

%

10.9

%

11.4

%

 


(a) Represents real estate tax and common area maintenance charges.

9




The Macerich Company

Supplemental Financial and Operating Information (unaudited)

Debt Summary

 

 

As of June 30, 2007

 

dollars in thousands

 

Fixed Rate

 

Variable Rate (a)

 

Total

 

Consolidated debt

 

$

4,791,523

 

$

284,939

 

$

5,076,462

 

Unconsolidated debt

 

1,472,698

 

192,777

 

1,665,475

 

Total debt

 

$

6,264,221

 

$

477,716

 

$

6,741,937

 

 

 

 

 

 

 

 

 

Weighted average interest rate

 

5.57

%

6.20

%

5.62

%

 

 

 

 

 

 

 

 

Weighted average maturity (years)

 

 

 

 

 

4.48

 

 


(a) Excludes swapped floating rate debt.  Swapped debt is included in fixed debt category.

10




The Macerich Company

Supplemental Financial and Operating Information (unaudited)

Outstanding Debt by Maturity

 

dollars in thousands

 

As of June 30, 2007

 

Center/Entity

 

Maturity Date

 

Interest
Rate (a)

 

Fixed

 

Floating

 

Total Debt
Balance (a)

 

I. Consolidated Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Borgata (b)

 

10/11/07

 

5.39

%

$

14,609

 

$

 

$

14,609

 

Victor Valley, Mall of

 

03/01/08

 

4.60

%

51,823

 

 

51,823

 

Westside Pavilion

 

07/01/08

 

6.67

%

92,779

 

 

92,779

 

Village Fair North

 

07/15/08

 

5.89

%

11,046

 

 

11,046

 

Fresno Fashion Fair

 

08/10/08

 

6.52

%

64,095

 

 

64,095

 

South Towne Center

 

10/10/08

 

6.61

%

64,000

 

 

64,000

 

Queens Center

 

03/01/09

 

6.88

%

91,283

 

 

91,283

 

South Plains Mall

 

03/01/09

 

8.22

%

59,209

 

 

59,209

 

Carmel Plaza

 

05/01/09

 

8.18

%

26,465

 

 

26,465

 

Paradise Valley Mall

 

05/01/09

 

5.89

%

21,698

 

 

21,698

 

Northridge Mall

 

07/01/09

 

4.84

%

81,826

 

 

81,826

 

Wilton Mall

 

11/01/09

 

4.79

%

45,614

 

 

45,614

 

Macerich Partnership Term Loan (c)

 

04/25/10

 

6.30

%

450,000

 

 

450,000

 

Macerich Partnership Line of Credit (d)

 

04/25/10

 

6.23

%

400,000

 

 

400,000

 

Vintage Faire Mall

 

09/01/10

 

7.89

%

64,884

 

 

64,884

 

Eastview Commons

 

09/30/10

 

5.46

%

8,966

 

 

8,966

 

Santa Monica Place

 

11/01/10

 

7.70

%

79,545

 

 

79,545

 

Valley View Center

 

01/01/11

 

5.72

%

125,000

 

 

125,000

 

Danbury Fair Mall

 

02/01/11

 

4.64

%

179,688

 

 

179,688

 

Shoppingtown Mall

 

05/11/11

 

5.01

%

45,435

 

 

45,435

 

Capitola Mall

 

05/15/11

 

7.13

%

40,166

 

 

40,166

 

Freehold Raceway Mall

 

07/07/11

 

4.68

%

180,600

 

 

180,600

 

Pacific View

 

08/31/11

 

7.16

%

82,881

 

 

82,881

 

Pacific View

 

08/31/11

 

7.00

%

6,676

 

 

6,676

 

Rimrock Mall

 

10/01/11

 

7.45

%

43,146

 

 

43,146

 

Prescott Gateway

 

12/01/11

 

5.78

%

60,000

 

 

60,000

 

The Macerich Company - Convertible Senior Notes (e)

 

03/15/12

 

3.48

%

941,056

 

 

941,056

 

Tucson La Encantada

 

06/01/12

 

5.60

%

78,000

 

 

78,000

 

Chandler Fashion Center

 

11/01/12

 

5.14

%

103,423

 

 

103,423

 

Chandler Fashion Center

 

11/01/12

 

6.00

%

67,944

 

 

67,944

 

Towne Mall

 

11/01/12

 

4.99

%

15,066

 

 

15,066

 

Pittsford Plaza (f)

 

01/01/13

 

5.02

%

15,872

 

 

15,872

 

Deptford Mall

 

01/15/13

 

5.41

%

172,500

 

 

172,500

 

Queens Center

 

03/31/13

 

7.00

%

218,861

 

 

218,861

 

Greeley - Defeaseance

 

09/01/13

 

6.18

%

27,981

 

 

27,981

 

FlatIron Crossing

 

12/01/13

 

5.23

%

189,412

 

 

189,412

 

Great Northern Mall

 

12/01/13

 

5.19

%

40,618

 

 

40,618

 

Eastview Mall

 

01/18/14

 

5.10

%

101,943

 

 

101,943

 

Fiesta Mall

 

01/01/15

 

4.88

%

84,000

 

 

84,000

 

Flagstaff Mall

 

11/01/15

 

4.97

%

37,000

 

 

37,000

 

Valley River Center

 

02/01/16

 

5.59

%

120,000

 

 

120,000

 

Salisbury, Center at

 

05/01/16

 

5.79

%

115,000

 

 

115,000

 

Marketplace Mall (g)

 

12/10/17

 

5.30

%

14,968

 

 

14,968

 

Chesterfield Towne Center

 

01/01/24

 

9.07

%

56,445

 

 

56,445

 

Total Fixed Rate Debt for Consolidated Assets

 

 

 

5.49

%

$

4,791,523

 

$

 

$

4,791,523

 

 

 

 

 

 

 

 

 

 

 

 

 

Greece Ridge Center

 

11/06/07

 

5.97

%

 

72,000

 

72,000

 

La Cumbre Plaza

 

08/09/08

 

6.20

%

 

30,000

 

30,000

 

Twenty Ninth Street

 

06/05/09

 

6.12

%

 

105,176

 

105,176

 

Casa Grande (h)

 

08/16/09

 

6.75

%

 

13,763

 

13,763

 

Panorama Mall

 

02/28/10

 

6.16

%

 

50,000

 

50,000

 

Macerich Partnership Line of Credit

 

04/25/10

 

6.47

%

 

14,000

 

14,000

 

Total Floating Rate Debt for Consolidated Assets

 

 

 

6.15

%

$

 

$

284,939

 

$

284,939

 

Total Debt for Consolidated Assets

 

 

 

5.53

%

$

4,791,523

 

$

284,939

 

$

5,076,462

 

 

 

 

 

 

 

 

 

 

 

 

 

 

11




 

 

 

As of June 30, 2007

 

Center/Entity

 

Maturity Date

 

Interest
Rate (a)

 

Fixed

 

Floating

 

Total Debt
Balance (a)

 

II. Unconsolidated Joint Ventures (At Company’s pro rata share):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Scottsdale Fashion Square (50%) (i)

 

08/31/07

 

5.39

%

$

78,111

 

$

 

$

78,111

 

Scottsdale Fashion Square (50%) (i)

 

08/31/07

 

5.39

%

33,328

 

 

33,328

 

Metrocenter Mall (15%) (j)

 

02/09/08

 

4.80

%

16,800

 

 

16,800

 

Broadway Plaza (50%)

 

08/01/08

 

6.68

%

30,494

 

 

30,494

 

Chandler Festival (50%)

 

10/01/08

 

4.37

%

15,012

 

 

15,012

 

Chandler Gateway (50%)

 

10/01/08

 

5.19

%

9,469

 

 

9,469

 

Washington Square (51%)

 

02/01/09

 

6.70

%

50,768

 

 

50,768

 

Inland Center (50%)

 

02/11/09

 

4.64

%

27,000

 

 

27,000

 

Biltmore Fashion Park (50%)

 

07/10/09

 

4.68

%

38,997

 

 

38,997

 

Redmond Office (51%)

 

07/10/09

 

6.77

%

34,747

 

 

34,747

 

Redmond Retail (51%)

 

08/01/09

 

4.81

%

37,106

 

 

37,106

 

Corte Madera, The Village at (50.1%)

 

11/01/09

 

7.75

%

32,932

 

 

32,932

 

Ridgmar (50%)

 

04/11/10

 

6.07

%

28,700

 

 

28,700

 

Kitsap Mall/Place (51%)

 

06/01/10

 

8.06

%

29,405

 

 

29,405

 

Cascade (51%)

 

07/01/10

 

5.10

%

20,267

 

 

20,267

 

Stonewood Mall (51%)

 

12/11/10

 

7.41

%

37,958

 

 

37,958

 

Arrowhead Towne Center (33.3%)

 

10/01/11

 

6.38

%

26,836

 

 

26,836

 

Hilton Village (50%)

 

02/01/12

 

5.21

%

4,300

 

 

4,300

 

SanTan Village Phase 2 (34.9%)

 

02/01/12

 

5.33

%

15,705

 

 

15,705

 

Northpark Center (50%)

 

05/10/12

 

5.41

%

94,169

 

 

94,169

 

NorthPark Center (50%)

 

05/10/12

 

8.33

%

41,913

 

 

41,913

 

NorthPark Land (50%)

 

05/10/12

 

8.33

%

40,484

 

 

40,484

 

Kierland Greenway (24.5%)

 

01/01/13

 

5.85

%

16,039

 

 

16,039

 

Kierland Main Street (24.5%)

 

01/02/13

 

4.99

%

3,821

 

 

3,821

 

Tyson’s Corner (50%)

 

02/17/14

 

4.78

%

170,504

 

 

170,504

 

Lakewood Mall (51%)

 

06/01/15

 

5.41

%

127,500

 

 

127,500

 

Eastland Mall (50%)

 

06/01/16

 

5.79

%

84,000

 

 

84,000

 

Empire Mall (50%)

 

06/01/16

 

5.79

%

88,150

 

 

88,150

 

Granite Run (50%)

 

06/01/16

 

5.83

%

60,212

 

 

60,212

 

Mesa Mall (50%)

 

06/01/16

 

5.79

%

43,625

 

 

43,625

 

Rushmore (50%)

 

06/01/16

 

5.79

%

47,000

 

 

47,000

 

Southern Hills (50%)

 

06/01/16

 

5.79

%

50,750

 

 

50,750

 

Valley Mall (50%)

 

06/01/16

 

5.83

%

23,443

 

 

23,443

 

West Acres (19%)

 

10/01/16

 

6.41

%

13,153

 

 

13,153

 

Total Fixed Rate Debt for Unconsolidated Assets

 

 

 

5.83

%

$

1,472,698

 

$

 

$

1,472,698

 

 

 

 

 

 

 

 

 

 

 

 

 

NorthPark Land (50%)

 

08/30/07

 

8.25

%

 

3,500

 

3,500

 

Camelback Colonnade (75%)

 

10/09/07

 

6.01

%

 

31,125

 

31,125

 

Boulevard Shops (50%)

 

12/16/07

 

6.57

%

 

10,700

 

10,700

 

Chandler Village Center (50%)

 

12/19/07

 

6.97

%

 

8,643

 

8,643

 

Metrocenter Mall (15%)

 

02/09/08

 

8.73

%

 

3,240

 

3,240

 

Desert Sky Mall (50%)

 

03/06/08

 

6.42

%

 

25,750

 

25,750

 

Superstition Springs Center (33.3%)

 

09/09/08

 

5.69

%

 

22,498

 

22,498

 

Kierland Tower Lofts (15%)

 

12/14/08

 

7.13

%

 

4,252

 

4,252

 

Washington Square (51%)

 

02/01/09

 

7.32

%

 

16,769

 

16,769

 

Los Cerritos Center (51%)

 

07/01/11

 

5.88

%

 

66,300

 

66,300

 

Total Floating Rate Debt for Unconsolidated Assets

 

 

 

6.28

%

$

 

$

192,777

 

$

192,777

 

Total Debt for Unconsolidated Assets

 

 

 

5.89

%

$

1,472,698

 

$

192,777

 

$

1,665,475

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Debt

 

 

 

5.62

%

$

6,264,221

 

$

477,716

 

$

6,741,937

 

Percentage to Total

 

 

 

 

 

92.91

%

7.09

%

100.00

%


(a)   The debt balances include the unamortized debt premiums/discounts. Debt premiums/discounts represent the excess of the fair value of debt over the principal value of debt assumed in various acquisitions and are amortized into interest expense over the remaining term of the related debt in a manner that approximates the effective interest method. The annual interest rate in the above table represents the effective interest rate, including the debt premiums/discounts.

(b)   This loan was paid off in full on July 11, 2007.

(c)    This debt has an interest rate swap agreement which effectively fixes the interest rate from December 1, 2005 to April 25, 2010.

(d)   This debt has an interest rate swap agreement which effectively fixes the interest rate from September 12, 2006 to April 25, 2011.

(e)    These convertible senior notes were issued on 3/16/07 in an aggregate amount of $950.0 million. The above table includes the unamortized discount of $9.4 million and the annual interest rate represents the effective interest rate, including the discount.

(f)     This property is a consolidated joint venture. The above debt balance represents the Company’s pro rata share of 63.64%.

(g)   This property is a consolidated joint venture. The above debt balance represents the Company’s pro rata share of 37.5%.

(h)   This property is a consolidated joint venture. The above debt balance represents the Company’s pro rata share of 51.3%.

(i)    On July 2, 2007, the joint venture replaced the existing loan with a new $550 million fixed rate loan bearing interest at 5.66% that matures in July 2013.

(j)     This debt has an interest rate swap agreement which effectively fixes the interest rate from January 15, 2005 to February 15, 2008.

12