SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8-K/A

AMENDMENT NO. 1

CURRENT REPORT

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

Date of report (Date of earliest event reported)

July 5, 2005, (April 25, 2005)

THE MACERICH COMPANY

(Exact name of Registrant as Specified in Charter)

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

(Address of principal executive office)

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)

This Form 8-K/A, Amendment No. 1, is being filed for the purpose of filing the financial statements and pro forma financial information required by Item 9.01 with respect to the Current Report on Form 8-K filed by the registrant on April 29, 2005 regarding the acquisition of Wilmorite Properties, Inc (“Wilmorite”) and Wilmorite Holdings, L.P. (“Wilmorite Holdings”).

Item 9.01.  Financial Statements, Pro Forma Financial Information and Exhibits

Report of Independent Auditors

To the Partners of

Wilmorite Holdings, L.P.

In our opinion, the accompanying consolidated balance sheets and the related consolidated statements of operations and of cash flows present fairly, in all material respects, the financial position of Wilmorite Holdings, L.P. and its subsidiaries (the “Partnership”) at December 31, 2004 and 2003, and the results of their operations and their cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America.  These financial statements are the responsibility of the Partnership’s management.  Our responsibility is to express an opinion on these financial statements based on our audits.  We conducted our audits of these statements in accordance with auditing standards generally accepted in the United States of America.  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.  An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation.  We believe that our audits provide a reasonable basis for our opinion.

As discussed in Note 2, the Partnership’s 2003 consolidated financial statements have been restated.

PricewaterhouseCoopers

June 13, 2005

F-1

Wilmorite Holdings, L.P.

(A Limited Partnership)

Consolidated Balance Sheets

The accompanying notes are an integral part of these consolidated financial statements.

F-2

Wilmorite Holdings, L.P.

(A Limited Partnership)

Consolidated Statements of Operations

The accompanying notes are an integral part of these consolidated financial statements.

F-3

Wilmorite Holdings, L.P.

(A Limited Partnership)

Consolidated Statements of Cash Flows

The accompanying notes are an integral part of these consolidated financial statements.

F-4

The accompanying notes are an integral part of these consolidated financial statements.

F-5

Wilmorite Holdings, L.P.

(A Limited Partnership)

Notes to Consolidated Financial Statements

Years Ended December 31, 2004 and 2003

1.                        Organization

Wilmorite Holdings, L.P. (the “Partnership”) was formed as a limited partnership in February 2000, under the laws of the State of Delaware and is engaged in the development, acquisition, and operation of regional shopping centers located primarily in the northeastern United States.

On February 23, 2000, in a nontaxable transaction, certain partners exchanged units in their respective entities for units in the Partnership (“roll-up transaction”).  As most of the pre roll-up partnerships were under the common control of a certain (former general) partner, the roll-up transaction was accounted for as a reorganization of entities under common control with a corresponding purchase of minority interest and, pursuant to FASB Technical Bulletin 85-5, “Issues Relating to Accounting for Business Combinations,” and EITF 90-5, “Exchanges of Ownership Interest Between Entities Under Common Control,” the purchase method of accounting was utilized for a portion of the non-controlling interests.

On April 25, 2005, the Partnership was acquired by The Macerich Company, a publicly-traded real estate investment trust (“REIT”), through its affiliates (see Note 19).

2.                        Restatement

The Partnership’s consolidated financial statements for the year ended December 31, 2003 have been restated to reflect adjustments associated with revenue recognition in order to conform with generally accepted accounting principles.  Previously, rental revenues were recorded at the time when a tenant’s lease term commenced.  Presently, rental revenues are recorded when the tenant takes possession of the leased premises, which typically occurs before commencement.  This results in (i) an acceleration of revenue recognition for each lease where the possession of the premises occurs prior to the commencement and (ii) a reduction to the monthly rental revenue as the total due under the lease is amortized over a slightly longer period.

Accordingly, the Partnership’s equity as of January 1, 2003 has been restated to reflect an increase in partners’ capital of $3,741,464 which correspondingly resulted in beginning of year partners’ capital of $354,778,827 versus previously reported opening equity of $351,037,363.  In addition, the Partnership restated the 2003 Statement of Operations to reflect an increase to both rental income and equity in earnings of unconsolidated affiliates (Note 4) of $546,877 and $264,552, respectively, which correspondingly resulted in net loss of $32,750,617 versus previously reported net loss of $33,562,046, thereby increasing partners’ capital to $294,018,490 versus previously reported partners’ capital of $289,465,597 as of December 31, 2003.

3.                        Significant Accounting Policies

Principles of Consolidation

The accompanying consolidated financial statements of the Partnership include the accounts of the Partnership and the entities it controls through majority ownership or contractual relationship with the general partner.  When the Partnership’s ownership is less than 100%, the remaining interest is reflected as minority interest in these consolidated financial statements.  All significant intercompany balances and transactions have been eliminated in these consolidated financial statements.

F-6

In both 2002 and 2003, the Partnership acquired an interest in the same two entities (Note 4), where it has the ability to exercise significant influence, but does not have either financial or operating control, and, accordingly accounts for these investments utilizing the equity method in which they are reflected in “Investments in unconsolidated affiliates”.

Shopping Mall Property

Shopping mall property is stated at cost less accumulated depreciation which is not in excess of the individual properties’ estimated gross undiscounted future cash flows.  This assessment was made based on the Partnership’s continued ownership and use of such properties as well as considering the current and future occupancy levels.  Costs related to the development, redevelopment, construction and improvement of properties are capitalized.  Interest incurred during development, redevelopment and construction projects is capitalized until construction is substantially complete.  Expenditures for maintenance and repairs are charged to operations as incurred.  Renovations or improvements which improve the asset or extend the life of the asset are capitalized.  When real property and equipment is retired or disposed of, the cost and related accumulated depreciation are eliminated from the asset and the accumulated depreciation accounts and any resulting gain or loss is reflected in the Consolidated Statements of Operations.

Depreciation is calculated primarily using the straight-line method over the estimated useful lives of the assets, which are as follows:

The Partnership periodically reviews its properties for impairment.  When there is an impairment indicator, the Partnership determines whether a shopping mall property is impaired.  In performing this analysis, potential alternatives and probabilities thereof are considered.  Should these considerations change, an impairment could occur which could impact the results of operations.  In cases where the Partnership does not expect to recover its carrying costs, the Partnership recognizes an impairment loss.

Upon meeting certain criteria of SFAS No. 144 – “Accounting for the Impairment or Disposal of Long-Lived Assets,” the Partnership classifies shopping mall property as held for sale.  The results of operations of those properties classified as held for sale are reflected as discontinued operations in these consolidated financial statements for all periods reported (see Note 16).  In addition, these properties are carried at the lower of (i) carrying value (cost less accumulated depreciation) or (ii) estimated fair value less costs to sell and, depreciation of the assets is discontinued.  If the criteria for held for sale classification ceases to be met, shopping mall property is reclassified as held for continued ownership and use in operations and is valued at the lower of its (i) carrying value before it was classified as held for sale, adjusted for any depreciation expense that would have been recognized had it been continuously classified as held for continued ownership and use or (ii) estimated fair value at the date of the subsequent reclassification.

Cash and Cash Equivalents

Cash and cash equivalents include all cash and highly liquid investments purchased with original maturities of three months or less.

F-7

Concentration of Credit Risk

Financial instruments that are exposed to concentration of credit risk are cash and accounts receivable.  The Partnership places its cash with high quality credit institutions.  At times, such balances may be in excess of the FDIC insurance limit.

The Partnership believes that its tenant base is diversified.  However, the Partnership performs business with national retailers which may operate under various separate store brands.  None of these national retailers constitute greater than 10% of the Partnership’s revenues.

Tenant Coordination and Construction Management Fees

In connection with the building-out of tenant spaces, the Partnership incurs construction supervision and other associated costs.  These services are performed by an affiliate and are generally based upon a percentage of total costs, whether incurred by the Partnership or the tenant.  Depending upon the nature of the underlying improvement, these fees are capitalized, provided that a minimum threshold is exceeded on an individual basis, to either buildings or tenant improvements and depreciated over the respective estimated useful life.  See Note 11 for the total amount charged and the portion capitalized for the years ended December 31, 2004 and 2003.

Deferred Leasing Fees and Costs

Deferred Leasing Fees

In connection with leasing tenant space, the Partnership incurs certain internal costs which are capitalized to the extent permitted by generally accepted accounting principles.  In addition, in instances where these fees are paid to third party brokers, the Partnership defers the entire amount.  Capitalized amounts are amortized over the related lease term.

Deferred Leasing Costs

From time to time, the Partnership incurs certain other leasing costs including lease termination fees, lease acquisition costs, or other incentives for the purpose of redeploying tenant space.  Such costs are amortized over the lease term of the new tenant.

Deferred Financing Costs and Reciprocal Easement Agreements

The Partnership incurs costs in obtaining long-term financing.  Such costs are amortized over the term of the related debt agreement and are reflected within financial expense in the Consolidated Statements of Operations.  In addition, the Partnership incurs costs in entering into reciprocal easement agreements with department stores, which are amortized over the life of the related agreement.  Amortization is unaffected by the classification of shopping mall property.

Rental Revenues

Minimum rents from tenants are recognized on the straight-line basis.  The excess of accrued straight-line rents over billings, if any, is reflected as deferred rent receivable on the accompanying Consolidated Balance Sheets, net of a reserve for uncollectible amounts of $4,190,594 and $4,133,237, at December 31, 2004 and December 31, 2003, respectively.  The established reserve is a function of each individual tenant’s remaining lease term in conjunction with an internal assessment of their creditworthiness.  Based upon provisions of tenant leases, revenues associated with tenant reimbursements are recognized in the period in which the expenses are incurred.  Percentage rent is recognized when the tenant reports sales exceeding the annual applicable sales breakpoint.

F-8

Minority Interest

Minority interest, with the exception of that portion considered redeemable as discussed below, is allocated based on the minority interest’s ownership percentage of the underlying entities.  The ownership percentage is determined by dividing the number of partnership units held by the minority interest during the reporting period by the respective number of partnership units outstanding during the reporting period.  Prior to 2004, minority interest included on the Consolidated Balance Sheets was reduced to zero since the distributions to these limited partners exceeded their basis and there is no liability on the part of these partners for the obligations of the respective partnership; in 2004, the income associated with the minority interest exceeded the distributions.  In addition, the redeemable equity in one of the properties is reflected on the Consolidated Balance Sheets at its redemption amount (Note 15).

Use of Estimates

The preparation of the financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Estimates are used by the Partnership when accounting for certain items such as (i) the reserve allowance on accounts and deferred rent receivables; (ii) compensation expense associated with the Long-Term Incentive Plan; and (iii) in determining the useful lives of shopping mall property and the undiscounted cash flows whenever there is an impairment indicator.  Actual results could differ from these and other estimates.

Derivatives

The Partnership generally maintains an overall interest rate risk-management strategy that incorporates the use of derivative instruments (interest rate caps) to minimize earnings fluctuations that could be caused by interest rate volatility.  The Partnership does not enter into derivative financial instrument contracts for trading or speculative purposes.  The use of these hedging products is consistent with the Partnership’s risk management objective to reduce exposure to variability in future cash flows attributable to possible increases in LIBOR relating to its floating-rate debt.

Interest rate caps are recognized on the Consolidated Balance Sheets as a deferred cost at its fair market value of $0 and $18,293 at December 31, 2004 and 2003, respectively.  Losses from the decline in value of the interest rate caps of $18,293 and $185,396 have been charged to operations for the years ended December 31, 2004 and 2003, respectively.

Debt Extinguishments

In 2002, the Partnership adopted certain provisions of Financial Accounting Standards No. 145 “Rescission of FASB No. 4, 44 and 64, Amendment of FASB No. 13, and Technical Corrections.”  This standard requires that gains and losses on debt extinguishments which are other than extraordinary be accounted for within income from operations.  Accordingly, the Partnership has classified $0 and $1,962,607 of losses within financial expense for the years ended December 31, 2004 and 2003, respectively.

F-9

4.                        Investment in Tysons

On July 1, 2002, the Partnership acquired a 43.5% interest in (i) an LLC that owns a shopping center and (ii) an LLC that owns an office building, both located in McLean, Virginia (“Tysons”).

On September 30, 2003, the Partnership purchased an additional 6.5% interest in Tysons, bringing the total ownership interests held in both LLC’s to 50%.  The acquisition price was approximately $46,172,000 consisting of $31,793,000 in cash, plus other purchase price adjustments of $165,000, plus the proportionate share of debt assumed of $14,214,000.  This acquisition price values the net assets of Tysons at approximately $710,000,000 and thus, created a basis difference for the Partnership of approximately $10,500,000, which is amortized over the life of the underlying assets of Tysons, and amounted to $262,004 and $65,501 for the years ended December 31, 2004 and 2003, respectively.

Tysons’ financial statements for the year ended December 31, 2003 were restated to reflect adjustments associated with revenue recognition as described in Note 2.  Accordingly, Tysons equity as of January 1, 2003 was restated to reflect an increase in members’ capital of $306,687 which correspondingly resulted in beginning of year members’ capital of $330,178,600 versus previously reported opening equity of $329,871,913.  In addition, Tysons restated the 2003 Statement of Operations to reflect an increase to rental income of $586,264, which correspondingly resulted in net income of $24,513,466 versus previously reported net income of $23,927,202 thereby increasing end of year members’ capital to $366,798,901 versus previously reported members’ capital of $365,905,950 as of December 31, 2003.  Proportionally, the Partnership’s share of the increase to 2003 net income was $264,552, resulting in equity in earnings of $12,495,601 versus $12,231,049 as previously reported.

As of the dates of both of the acquisitions, the purchase price was allocated in accordance with Financial Accounting Standards No. 141, “Business Combinations,” which requires identification of all assets acquired and liabilities assumed.

A summary of the Tysons balance sheets at December 31, 2004 and 2003 and statements of operations for the years ended December 31, 2004 and December 31, 2003, respectively, are as follows:

F-10

Balance Sheets

Statements of Operations

The Partnership’s share of income as determined from applying its ownership percentage to Tysons’ reported income as presented above is different from that presented in the Consolidated Statements of Operations due to the elimination of the Partnership’s share of intercompany charges for years 2004 and 2003 and the change in percentage ownership in 2003.

F-11

5.                        Restricted Deposits

Restricted deposits are comprised of the following at:

6.                        Shopping Mall Property

Shopping mall property is comprised of the following at:

Depreciation expense amounted to $25,822,257 and $28,909,869 for the years ended December 31, 2004 and 2003, respectively.

F-12

7.                        Deferred Costs

Deferred costs are comprised of the following at:

For the years ended December 31, 2004 and 2003, amortization expense amounted to $3,868,847 and $5,487,915, respectively, and includes $2,342,865 and $4,175,664, respectively, for the amortization of financing costs which, except for the portion related to discontinued operations, are included in financial expense in the Consolidated Statements of Operations.  The aforementioned amortization expense does not include $614,353 and $341,596 for the years ended December 31, 2004 and 2003, respectively, relating to the amortization of lease incentives which have been reflected as an adjustment to revenues within the Consolidated Statements of Operations.

8.                        Debt

Debt is comprised of the following at:

Fixed rate mortgage notes - The mortgage notes bear interest at fixed rates ranging from 5.11% to 8.58% per annum (weighted average of 6.80% at December 31, 2004), and require payments of principal and/or interest and have various maturity dates through 2030 (weighted average remaining term 8.86 years).

Variable rate mortgage notes - The mortgage notes bear interest at variable rates ranging from 3.76% to 5.04% per annum (weighted average of 4.88% at December 31, 2004), and require payments of principal and/or interest and have various maturity dates through December 2006 (weighted average remaining term .85 years).  A certain mortgage contains an interest rate cap if the base rate exceeds a preset amount.

F-13

Revolving and term loans – On March 27, 2003, the Partnership replaced its $28,500,000 revolving term loan with a $200,000,000 Revolving and Term Loan Agreement.  The Revolving and Term Loan Agreement is comprised of a $100,000,000 revolving loan and a $100,000,000 term loan, both of which mature on March 27, 2006, but can be extended one year upon satisfaction of certain conditions.  Monthly payments of interest are required on both the revolving and term loans and for which has been determined by reference to LIBOR plus 3.0% (effective rate of 5.21% at December 31, 2004).  Until maturity, principal payments are not required on the revolving loan whereas the term loan requires quarterly payments of $1,000,000 each. The revolving and term loans are guaranteed by the general partner (the “General Partner”).  At December 31, 2004 and 2003, the outstanding principal balance on the revolving loan was $43,115,000 and $76,115,000, respectively, while the outstanding principal balance on the term loan was $94,000,000 and $98,000,000, respectively.  On April 25, 2005, these loans were repaid in connection with the acquisition of the Partnership (Note 19).

Notes payable - Notes payable consisted of the following:

A mezzanine note requiring variable monthly payments consisting of principal and interest at LIBOR plus 2.5%, with a maturity date of May 1, 2004.  This note was entirely paid on December 1, 2003.

A mezzanine note requiring monthly payments of interest only at LIBOR plus 4.0%, with a maturity date of March 1, 2005.   On March 28, 2003, this note was entirely paid with proceeds received in connection with the Revolving and Term loans.

A mezzanine note requiring variable monthly payments consisting of principal and interest at a minimum LIBOR of 3.0% plus a 6.25% margin, with a maturity date of June 11, 2004.  On March 28, 2003, this note was entirely paid with proceeds received in connection with the Revolving and Term loans.

A note requiring variable monthly payments consisting of principal and interest at LIBOR plus 3.0%, with a maturity date of June 28, 2007.  On March 28, 2003, this note was entirely paid with proceeds received in connection with the Revolving and Term loans.

Notes payable affiliate - Notes payable affiliate consisted of the following:

Five separate notes to related parties, as assumed by the Partnership from one of the underlying entities, relating to the 2001 acquisition of three shopping malls.  These uncollateralized notes required fixed monthly payments of principal and interest at 10%, with a maturity date of January 6, 2006.  On March 28, 2003, these notes were entirely paid with proceeds received in connection with the Revolving and Term loans.

A note to a related party, as assumed by the Partnership from one of the underlying entities.  The uncollateralized note required fixed quarterly payments of principal and interest at a fixed rate of 10% with a maturity date of January 31, 2005.  On March 28, 2003, the note was entirely paid with proceeds received in connection with the Revolving and Term loans.

Certain mortgage notes contain terms and conditions which, among others, provide for prepayment premiums, limitations related to additional financing, financial performance covenants, and limitations on distributions.

F-14

Based on borrowing rates available to the Partnership for mortgage loans with similar terms and maturities, the fair value of the mortgage notes and other debts payable exceeds the recorded amounts by approximately $42,400,000 and $30,300,000 at December 31, 2004 and 2003, respectively.

Annual principal payments are as follows:

9.                        Minority Interest

The changes in minority interest are as follows:

10.                 Capital

There are two classes of partners:

•                  Corporate general partner, a real estate investment trust (“REIT”)

•                  Limited partners

All of the aforementioned partners have been issued Common Units.  Effective July 1, 2002, and in conjunction with the acquisition described in Note 4, certain partners have been issued Preferred Units.  In addition, on January 1, 2004, certain partners were issued Preferred Units.  At December 31, 2004 and 2003, the number of issued and outstanding units were as follows:  Common Units of 461,103.597 for both years and Preferred Units of 47,861.896 and 46,920.886, respectively.

On April 25, 2005, the Partnership and the General Partner were acquired by a publicly-traded REIT (see Note 19).

F-15

The activity in the Partners’ capital accounts is comprised of the following:

Distributions

The Partnership is required to distribute operating cash flow, as defined in the Partnership Agreement, within sixty days after the end of each fiscal quarter, and at such other times as shall be necessary or appropriate to ensure continued treatment of the General Partner as a REIT.  Upon the occurrence of certain events, excess proceeds, if any, are required to be distributed within ninety days after the Partnership’s receipt thereof.  Although the amount of quarterly distributions payable on the Common Units is determined by the Board of Directors of the General Partner, the Preferred Unit holders are entitled to receive a 9% guaranteed payment in preference (“Distribution Preference”) to the Common Unit holders.  In 2004, the Partnership distributed operating cash flow to the Preferred and Common Unit holders of $4,659,039 and $26,025,000, respectively, while in 2003, the Preferred and Common Unit holders received $4,590,000 and $25,525,000, respectively.  There were no distributions of excess proceeds in either 2004 or 2003.  See Note 19 regarding Subsequent Event.

In addition, an arrangement exists between the Partnership and certain minority interest holders whereby the latter’s interest in earnings is generally limited to $600,000 per year, which the Partnership is required to distribute on a monthly basis.

F-16

On December 31, 2004, the Partnership assigned and transferred its ownership interests in two wholly-owned entities (“the Entities”) to a Common Unit holder.  As a result, the assets, liabilities and equity of the Entities as of December 31, 2004 were distributed to the Common Unit holder and are thus not included in the Consolidated Balance Sheet as of December 31, 2004.  Since the equity balances of the Entities as of December 31, 2004 were in a deficit position, the assignment and transfer is reflected as a net contribution within these consolidated financial statements.  The results of operations of the Entities are included in discontinued operations for the years ended December 31, 2004 and 2003 (Note 16).  The assets, liabilities and equity of the Entities that were distributed at December 31, 2004 are as follows:

Preferred Units

On July 1, 2002, the Partnership issued 46,920.886 Series A Preferred Units (“Preferred Units”) to certain partners at a per unit price of $1,086.94 (“Original Issue Price”).  The Partnership issued an additional 941.01 Preferred Units at the Original Issue Price on January 1, 2004.  Those additional Preferred Units were authorized by the Board of Directors of the General Partner on April 19, 2002, and issued to certain partners and officers pursuant to binding agreements, which were obtained before the September 1, 2002 expiration date for the offering of such additional Preferred Units.  The 9% Distribution Preference described above is payable on the Original Issue Price and is both annual and cumulative.  While both the Preferred Units and Common Units contain equal voting rights, the Preferred Units contain a distribution preference in the event of a liquidation of the Partnership.

F-17

The Preferred Units have certain conversion and redemption rights.  Specifically, at any time, Preferred Units can be converted into Common Units on a one-for-one basis, regardless of fluctuations in the price of the Common Units, and automatically convert to Common Units in the event of an initial public offering by the General Partner. In addition, on or after July 1, 2007, any Preferred Unit holder has the right to require the Partnership to redeem all, or any portion, of the Preferred Units owned by such holder at the Original Issue Price plus accrued but unpaid guaranteed payments, if any.  At the option of the Partnership, the redemption is payable either in cash or over a five-year term, bearing interest at 9% using a 15-year amortization period.

The Partnership Agreement requires the retention of at least $7,000,000 of unrestricted cash and cash equivalents, so long as any Preferred Units are outstanding, unless this provision is waived by the General Partner.

See Note 19 regarding Subsequent Event.

Liquidity and Redemption

In general, each class of partner cannot freely transfer either its Preferred and/or Common Units.  However, the Partnership Agreement contains a number of provisions whereby certain partners have specific redemption rights at designated time intervals.  Redemption requests may be satisfied either in cash or through the distribution of properties, as set forth in the Partnership Agreement, whether in connection with a liquidation of the Partnership or otherwise.  See Note 19 regarding Subsequent Event.

General

The Partnership Agreement specifies that the General Partner will be reimbursed for all expenses incurred relating to the management, operation, furtherance of business, or of any other benefit to the Partnership, including any expenses paid or incurred by the General Partner to maintain status as a REIT.  Accordingly, such items have been charged to the expense of the Partnership.  In addition, the General Partner may require that a certain partner exchange its Partnership Units with the General Partner for its shares or vice versa, to avoid either characterization of the General Partner as a “pension-held REIT” or for any other purpose, as the case may be.  See Note 19 regarding Subsequent Event.

Awards for Stock Appreciation Rights

Partners’ capital includes the portion of awards for stock appreciation rights which are to be settled in Common Units.  The impact of such awards on partners’ capital is as follows:

See Note 17 for additional information concerning this plan and Note 19 regarding Subsequent Event.

F-18

11.                 Related Party Transactions

Management and other related services

Affiliated companies provide various services to the Partnership which are summarized as follows:

An affiliate charges a tenant coordination or construction management fee in addition to providing other construction services (engineering), in preparing the leased space for business. Another affiliate, which provides executive management services to the Partnership, employs certain individuals who are either officers and/or directors in both the Partnership and/or its General Partner.   In addition, the Partnership obtains both property and liability insurance through a group policy that is purchased by an affiliate.  Also, the Partnership leases an office building from an affiliate.  For all of these services, the Partnership owed the affiliates $140,658 and $904,585 at December 31, 2004 and 2003, respectively.  The amount of insurance charged to the Partnership included in prepaid expenses on the accompanying consolidated balance sheets was $143,329 and $0 at December 31, 2004 and 2003, respectively.  In addition, the Partnership has recorded a liability to an affiliate in the amount of $1,200,000 at December 31, 2004 relating to a draw against a letter of credit provided by the Partnership for an affiliate for which the affiliate is not obligated to repay the Partnership (Note 14).

The following charges from affiliates have been capitalized:

An affiliate also charges Tysons (Note 4) a tenant coordination or construction management fee in addition to providing other construction services (engineering), in preparing Tysons leased space for business.  Tysons was charged $1,189,043 and $303,671 during the years ended December 31, 2004 and 2003, respectively for such fees and services.  In addition, Tysons obtains both property and liability insurance through a group policy that is purchased by an affiliate of the Partnership.  Tysons was charged $1,000,279 and $1,143,316 during the years ended December 31, 2004 and 2003, respectively for insurance.

F-19

The Partnership performs certain management-related services for affiliates which are not owned by the Partnership.  Gross revenues primarily consist of management fees, equipment rental, and payroll charges, and amounted to $3,461,773 and $5,021,728, for the years ended December 31, 2004 and 2003, respectively.  Included in accounts receivable affiliates, as related to these charges, is $1,224,317 and $1,615,948 at December 31, 2004 and 2003, respectively.

Marketing Fund

Pursuant to each lease agreement, the tenant contributes an amount to a fund that was established to enhance the business activity of the shopping mall through advertising, marketing, promotions, in addition to community relations and customer service.  The landlord generally matches 25% of such tenant contributions.

During the year ended December 31, 2003, the marketing fund was controlled by an affiliate of the Partnership.  Landlord matching contributions amounted to $1,540,819 for the year ended December 31, 2003.

On January 1, 2004, substantially all of the assets of the affiliate were purchased by the Partnership for $222,722, which included cash of $75,503 plus the assumption of liabilities in the amount of $147,219.  Accordingly, the results of operations of the marketing fund activity are included in the Consolidated Statement of Operations for the year ended December 31, 2004.

Note Receivable – Affiliate