-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, JUaiKUMfWEjXwB0ZCLbNuWN/vkZlYisAiapvL0c/GMIatsLpc8hl0lqSH4gXnsU1 DFAV00nPkmH1XeuW2i1vOw== 0000889812-99-001002.txt : 19990331 0000889812-99-001002.hdr.sgml : 19990331 ACCESSION NUMBER: 0000889812-99-001002 CONFORMED SUBMISSION TYPE: 10-K405 PUBLIC DOCUMENT COUNT: 7 CONFORMED PERIOD OF REPORT: 19981231 FILED AS OF DATE: 19990330 FILER: COMPANY DATA: COMPANY CONFORMED NAME: KIMCO REALTY CORP CENTRAL INDEX KEY: 0000879101 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 132744380 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K405 SEC ACT: SEC FILE NUMBER: 001-10899 FILM NUMBER: 99577180 BUSINESS ADDRESS: STREET 1: 3333 NEW HYDE PARK RD STREET 2: PO BOX 5020 CITY: NEW HYDE PARK STATE: NY ZIP: 11042 BUSINESS PHONE: 5168699000 MAIL ADDRESS: STREET 1: 3333 NEW HYDE PARK ROAD STREET 2: PO BOX 5020 CITY: NEW HYDE PARKQ STATE: NY ZIP: 11042 10-K405 1 ANNUAL REPORT UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) X ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE - --- ACT OF 1934 [NO FEE REQUIRED] For the fiscal year ended December 31, 1998 OR - --- TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED] For the transition period from __________ to __________ Commission file number 1-10899 --------------------------------------------------- Kimco Realty Corporation - -------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Maryland 13-2744380 - ------------------------------- -------------------------------------- (State of incorporation) (I.R.S. Employer Identification No.) 3333 New Hyde Park Road, New Hyde Park, NY 11042-0020 - -------------------------------------------------------------------------- (Address of principal executive offices) Zip Code Registrant's telephone number, including area code (516)869-9000 Securities registered pursuant to Section 12(b) of the Act: Name of each exchange on Title of each class which registered ------------------- ------------------------ Common Stock, par value $.01 per share New York Stock Exchange - -------------------------------------- ------------------------ Depositary Shares, each representing one-tenth of a share of 7-3/4% Class A Cumulative Redeemable Preferred Stock, par value $1.00 per share. New York Stock Exchange - -------------------------- ------------------------ Depositary Shares, each representing one-tenth of a share of 8-1/2% Class B Cumulative Redeemable Preferred Stock, par value $1.00 per share. New York Stock Exchange - -------------------------- ------------------------ Depositary Shares, each representing one-tenth of a share of 8-3/8% Class C Cumulative Redeemable Preferred Stock, par value $1.00 per share. New York Stock Exchange - -------------------------- ------------------------ Depositary Shares, each representing one-tenth of a share of 7-1/2% Class D Cumulative Convertible Preferred Stock, par value $1.00 per share. New York Stock Exchange - -------------------------- ------------------------ Securities registered pursuant to Section 12(g) of the Act: None - -------------------------------------------------------------------- (Title of class) Indicate by check mark whether the registrant (i) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (ii) has been subject to such filing requirements for the past 90 days. Yes X No --- --- Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. X --- The aggregate market value of the voting stock held by nonaffiliates of the registrant was approximately $2.0 billion based upon the closing price on the New York Stock Exchange for such stock on March 1, 1999. (APPLICABLE ONLY TO CORPORATE REGISTRANTS) Indicate the number of shares outstanding of each of the registrant's classes of common stock, as of the latest practicable date. 60,168,783 shares as of March 1, 1999. Page 1 of 69 DOCUMENTS INCORPORATED BY REFERENCE Part III incorporates certain information by reference to the Registrant's definitive proxy statement to be filed with respect to the Annual Meeting of Stockholders expected to be held on May 20, 1999. Index to Exhibits begins on page 37. 2 TABLE OF CONTENTS Form 10-K Report Item No. Page - -------- ------ PART I 1. Business . . . . . . . . . . . . . . . . . . . . . . . . . . 4 2. Properties . . . . . . . . . . . . . . . . . . . . . . . . . 15 3. Legal Proceedings. . . . . . . . . . . . . . . . . . . . . . 16 4. Submission of Matters to a Vote of Security Holders . . . . 16 Executive Officers of the Registrant . . . . . . . . . . . . 25 PART II 5. Market for the Registrant's Common Equity and Related Shareholder Matters . . . . . . . . . . . . . 27 6. Selected Financial Data . . . . . . . . . . . . . . . . . . 28 7. Management's Discussion and Analysis of Financial Condition and Results of Operations . . . . . . . . . . . 30 7A. Quantitative and Qualitative Disclosures About Market Risk. . 34 8. Financial Statements and Supplementary Data . . . . . . . . 34 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure . . . . . . . . . . . 34 PART III 10. Directors and Executive Officers of the Registrant . . . . . 35 11. Executive Compensation . . . . . . . . . . . . . . . . . . . 35 12. Security Ownership of Certain Beneficial Owners and Management . . . . . . . . . . . . . . . . . . . . . . . . 35 13. Certain Relationships and Related Transactions . . . . . . . 35 PART IV 14. Exhibits, Financial Statements, Schedules and Reports on Form 8-K . . . . . . . . . . . . . . . . . . . . . . . . . 36 3 PART I FORWARD-LOOKING STATEMENTS This annual report on Form 10-K, together with other statements and information publicly disseminated by Kimco Realty Corporation (the "Company"or "Kimco") contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The Company intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and include this statement for purposes of complying with these safe harbor provisions. Forward-looking statements, which are based on certain assumptions and describe our future plans, strategies and expectations, are generally identifiable by use of the words "believe," "expect," "intend," "anticipate," "estimate," "project" or similar expressions. You should not rely on forward-looking statements since they involve known and unknown risks, uncertainties and other factors which are, in some cases, beyond the Company's control and which could materially affect actual results, performances or achievements. Factors which may cause actual results to differ materially from current expectations include, but are not limited to,(i) general economic and local real estate conditions, (ii) financing risks, such as the inability to obtain equity or debt financing on favorable terms, (iii) changes in governmental laws and regulations, (iv) the level and volatility of interest rates (v) the availability of suitable acquisition opportunities and (vi) increases in operating costs. Accordingly, there is no assurance that the Company's expectations will be realized. Item 1. Business General Kimco Realty Corporation is one of the nation's largest owners and operators of neighborhood and community shopping centers. As of March 1, 1999, the Company's portfolio was comprised of 440 property interests including 368 neighborhood and community shopping center properties, two regional malls, 60 retail store leases, three parcels of undeveloped land, one distribution center, one stand-alone retail warehouse and five projects under development comprising a total of approximately 57.2 million square feet of leasable space located in 40 states. The Company believes its portfolio of neighborhood and community shopping center properties is the largest (measured by gross leasable area, "GLA") currently held by any publicly-traded real estate investment trust ("REIT"). The Company is a self-administered REIT and manages its properties through present management, which has owned and operated neighborhood and community shopping centers for more than 30 years. The Company has not engaged, nor does it expect to retain, any REIT advisors in connection with the operation of its properties. The Company's executive offices are located at 3333 New Hyde Park Road, New Hyde Park, New York 11042-0020 and its telephone number is (516)869-9000. Unless the context indicates otherwise, the term the "Company" as used herein is intended to include subsidiaries of the Company. History The Company began operations through its predecessor, The Kimco Corporation, which was organized in 1966 upon the contribution of several shopping center properties owned by its principal stockholders. In 1973, these principals formed the Company as a Delaware corporation, and in 1985, the operations of The Kimco Corporation were merged into the Company. The Company completed its initial public stock offering (the "IPO") in November 1991, and reorganized as a Maryland corporation during 1994. The Company's growth through its first fifteen years resulted primarily from the ground-up development and construction of its shopping centers. By 1981, the Company had assembled a portfolio of 77 properties that provided an established source of income and positioned the Company for an expansion of its asset base. At that time, the Company revised its strategy to focus on the acquisition of existing shopping centers because it believed that better opportunities existed to create value through the redevelopment and re-tenanting of existing shopping centers. Furthermore, the Company's management believed that existing properties with below market-rate leases were available in the market at attractive prices. As a result of this strategy, the Company has developed only two of the 291 neighborhood and community shopping centers added to the portfolio since 1981, as compared with 68 of the 77 properties owned prior to that time. 4 During 1998, the Company, through a merger transaction, completed the acquisition of The Price REIT, Inc., a Maryland corporation (the "Price REIT") (see Recent Developments - Price REIT Merger). Prior to the merger, Price REIT was a self-administered and self-managed equity REIT that was primarily focused on the acquisition, development, management and redevelopment of large retail community shopping center properties concentrated in the western part of the United States. With the completion of the Price REIT merger, the Company expanded its presence in certain western states including California, Arizona and Washington. In addition, Price REIT had strong ground-up development capabilities. These development capabilities, coupled with the Company's own construction management expertise, provides the Company, on a selective basis, the ability to pursue ground-up development opportunities. Investment and Operating Strategy The Company's investment objective has been to increase cash flow, current income and, consequently, the value of its existing portfolio of properties, and to seek continued growth through (i) the strategic re-tenanting, renovation and expansion of its existing centers, (ii) the selective acquisition of established income-producing real estate properties and properties requiring significant re-tenanting and redevelopment, primarily in neighborhood and community shopping centers and (iii)the selective acquisition of land parcels for the development of neighborhood and community shopping centers in geographic regions in which the Company presently operates. The Company intends to consider investments in other real estate sectors and in geographic markets where it does not presently operate should suitable opportunities arise. The Company's neighborhood and community shopping center properties are designed to attract local area customers and typically are anchored by a supermarket, discount department store or drugstore tenant offering day-to-day necessities rather than high-priced luxury items. The Company may either purchase or lease income-producing properties in the future, and may also participate with other entities in property ownership through partnerships, joint ventures or similar types of co-ownership. Equity investments may be subject to existing mortgage financing and other indebtedness or such financing or indebtedness may be incurred in connection with acquiring such investments. Any such financing or indebtedness will have priority over the Company's equity interest in such property. The Company may make loans to joint ventures in which it may or may not participate in the future. While the Company has historically held its properties for long-term investment, and accordingly has placed strong emphasis on its ongoing program of regular maintenance, periodic renovation and capital improvement, it is possible that properties in the portfolio may be sold, in whole or in part, as circumstances warrant, subject to REIT qualification rules. The Company emphasizes equity real estate investments, but may, at its discretion, invest in mortgages, other real estate interests and other investments. The mortgages in which the Company may invest may be either first mortgages, junior mortgages or other mortgage-related securities. The Company may legally invest in the securities of other issuers, for the purpose, among others, of exercising control over such entities, subject to the gross income and asset tests necessary for REIT qualification. The Company may, on a selective basis, acquire all or substantially all securities or assets of other REITs or similar entities where such investments would be consistent with the Company's investment policies. In any event, the Company does not intend that its investments in securities will require it to register as an "investment company" under the Investment Company Act of 1940. The Company seeks to reduce its operating and leasing risks through diversification achieved by the geographic distribution of its properties and a large tenant base. At December 31, 1998, the Company's single largest neighborhood and community shopping center accounted for only 1.5% of the Company's annualized base rental revenues and only 1.0% of the Company's total shopping center GLA. At December 31, 1998, the Company's five largest tenants include Kmart Corporation, The Home Depot, Kohls, Toys/Kids R' Us and TJX Companies, which represent approximately 13.7%, 3.0%, 2.5%, 1.8% and 1.5%, respectively, of the Company's annualized base rental revenues. The Company intends to maintain a conservative debt capitalization with a ratio of debt to total market capitalization of approximately 50% or less. As of December 31, 1998, the Company had a debt to total market capitalization ratio of approximately 32%. 5 The Company has authority to offer shares of capital stock or other senior securities in exchange for property and to repurchase or otherwise reacquire its common stock or any other securities and may engage in such activities in the future. At all times, the Company intends to make investments in such a manner as to be consistent with the requirements of the Internal Revenue Code of 1986, as amended (the "Code"), to qualify as a REIT unless, because of circumstances or changes in the Code (or in Treasury Regulations), the Board of Directors determines that it is no longer in the best interests of the Company to qualify as a REIT. The Company's policies with respect to the aforementioned activities may be reviewed and modified from time to time by the Company's Board of Directors without the vote of the Company's stockholders. Competition As one of the original participants in the growth of the shopping center industry and one of the nation's largest owners and operators of neighborhood and community shopping centers, the Company has established close relationships with a large number of major national and regional retailers and maintains a broad network of industry contacts. Management is associated with and/or actively participates in many shopping center and REIT industry organizations. Notwithstanding these relationships, there are numerous commercial developers, real estate companies, financial institutions and other investors that compete with the Company in seeking properties for acquisition and tenants who will lease space in these properties. Capital Resources Since the completion of the Company's IPO in 1991, the Company has utilized the public debt and equity markets as its principal source of capital. Since the IPO, the Company has completed additional offerings of its public unsecured debt and equity, raising in the aggregate over $1.9 billion for the purposes of repaying indebtedness, acquiring interests in neighborhood and community shopping centers and for expanding and improving properties in the portfolio. During August 1998, the Company established a $215 million, unsecured revolving credit facility, which is scheduled to expire in August 2001. This credit facility, which replaced both the Company's $100 million unsecured revolving credit facility and $150 million interim credit facility, has made available funds to both finance the purchase of properties and meet any short-term working capital requirements. As of December 31, 1998 there were no borrowings outstanding under the Company's unsecured revolving credit facility. The Company has also implemented a $200 million medium-term notes program (the "MTN program") pursuant to which it may from time to time offer for sale its senior unsecured debt for any general corporate purposes, including (i) funding specific liquidity requirements in its business, including property acquisitions, development and redevelopment costs, and (ii) managing the Company's debt maturities. (See Note 7 of the Notes to Consolidated Financial Statements included in this annual report on Form 10-K.) In addition to the public debt and equity markets as capital sources, the Company may, from time to time, obtain mortgage financing on selected properties. As of December 31, 1998, the Company had over 300 unencumbered property interests in its portfolio. Additionally, on August 31, 1998, the Company filed a shelf registration on Form S-3 for up to $750 million of debt securities, preferred stock, depositary shares, common stock and common stock warrants. As of March 1, 1999, the Company had approximately $493.2 million available for issuance under this shelf registration statement. It is management's intention that the Company continually have access to the capital resources necessary to expand and develop its business. Accordingly, the Company may seek to obtain funds through additional equity offerings, unsecured debt financings and/or mortgage financings in a manner consistent with its intention to operate with a conservative debt capitalization policy. The Company anticipates that cash flows from operations will continue to provide adequate capital to fund its operating and administrative expenses, regular debt service obligations and all dividend payments in accordance with REIT requirements in both the short-term and long-term. In addition, the Company anticipates that cash on hand, borrowings under its revolving credit facility, issuance of equity and public debt, as well as other debt and equity alternatives, will provide the necessary capital required by the Company. 6 Inflation and Other Business Issues Many of the Company's leases contain provisions designed to mitigate the adverse impact of inflation. Such provisions include clauses enabling the Company to receive payment of additional rent calculated as a percentage of tenants' gross sales above predetermined thresholds ("Percentage Rents"), which generally increase as prices rise, and/or escalation clauses, which generally increase rental rates during the terms of the leases. Such escalation clauses include increases in the consumer price index or similar inflation indices. In addition, many of the Company's leases are for terms of less than 10 years, which permits the Company to seek to increase rents upon renewal to market rates. Most of the Company's leases require the tenant to pay an allocable share of operating expenses, including common area maintenance costs, real estate taxes and insurance, thereby reducing the Company's exposure to increases in costs and operating expenses resulting from inflation. The Company periodically evaluates its exposure to short-term interest rates and will, from time to time, enter into interest rate protection agreements which mitigate, but do not eliminate, the effect of changes in interest rates on its floating-rate debt. As an owner of real estate, the Company is subject to risks arising in connection with the underlying real estate, including, among other factors, defaults or nonrenewal of tenant leases, the financial condition and stability of tenants, retailing trends, environmental matters and changes in real estate and zoning laws. The success of the Company also depends upon trends in the economy, including, but not limited to, interest rates, the availability of financing and capital on satisfactory terms, income tax laws, governmental regulations and legislation and population trends. Operating Practices Nearly all operating functions, including leasing, legal, construction, data processing, maintenance, finance and accounting, are administered by the Company from its executive offices in New Hyde Park, New York. The Company believes it is critical to have a management presence in its principal areas of operation; accordingly, the Company also maintains regional offices in Boca Raton, Orlando and Tampa, Florida; Philadelphia, Pennsylvania; Dayton and Cleveland, Ohio; Chicago, Illinois; Charlotte, North Carolina; Phoenix, Arizona and Los Angeles, California. A total of 199 persons are employed at the Company's executive and regional offices. The Company's regional offices are generally staffed by a manager and the support personnel necessary to both function as local representatives for leasing and promotional purposes and to complement the corporate office efforts to ensure that property inspection and maintenance objectives are achieved. The regional offices are important in reducing the time necessary to respond to the needs of the Company's tenants. Leasing and maintenance personnel from the corporate office also conduct regular inspections of each shopping center. The Company also employs a total of 59 persons at several of its larger properties in order to more effectively administer its maintenance and security responsibilities. Management Information Systems Virtually all operating activities are supported by a sophisticated computer software system designed to provide management with operating data necessary to make informed business decisions on a timely basis. These proprietary systems are continually expanded and enhanced by the Company and reflect a commitment to quality management and tenant relations. The Company has integrated an advanced mid-range computer with personal computer technology, creating a management information system that facilitates the development of property cash flow budgets, forecasts and related management information. Qualification as a REIT The Company has elected, commencing with its taxable year which began January 1, 1992, to qualify as a REIT under Sections 856 through 860 of the Code. If, as the Company believes, it is organized and operates in such a manner so as to qualify and remain qualified as a REIT under the Code, the Company generally will not be subject to Federal income tax, provided that distributions to its stockholders equal at least the amount of its REIT taxable income as defined under the Code. Recent Developments Price REIT Merger -- On January 13, 1998, the Company, REIT Sub, Inc., a Maryland corporation and a wholly owned subsidiary of the Company ("Merger Sub") and Price REIT, signed a definitive Agreement and Plan of Merger dated January 13, 1998, as amended March 5, 1998 and May 14, 1998 (the "Merger Agreement"). On June 19, 1998, upon approval by the shareholders of the Company and Price REIT, Price REIT was merged into Merger Sub, whereupon the separate existence of Price REIT ceased (the "Merger"). 7 In connection with the Merger, the Company acquired interests in 43 properties, located in 17 states, consisting of 39 retail community centers, one stand-alone retail warehouse, one project under development and two undeveloped land parcels, containing approximately 8.0 million square feet of GLA. The overall occupancy rate of the retail community centers was approximately 98%. For financial reporting purposes, the Merger was accounted for under the purchase method of accounting. Under the terms of the Merger Agreement each share of Price REIT common stock was exchanged for one share of Kimco common stock and .36 shares of depositary shares (the "Class D Depositary Shares"), each Class D Depositary Share representing a one-tenth fractional interest in a new issue of Kimco 7.5% Class D Cumulative Convertible Preferred Stock, par value $1.00 per share (the "Class D Preferred Stock"). On June 19, 1998, the Company issued 11,921,992 shares of its common stock and 429,159 shares of Class D Preferred Stock (represented by 4,291,590 Class D Depositary Shares) in connection with the Merger. The total Merger consideration was approximately $960 million, including the assumption of approximately $310 million of debt. Management has allocated the purchase price based on the fair value of assets and liabilities assumed. Such allocations are based on preliminary estimates, and are subject to revision. Additionally, in connection with the Merger, on May 18,1998, the Company entered into a purchase agreement with Price REIT and LB I Group Inc., an affiliate of Lehman Brothers Inc. ("LB I"), under which LB I agreed to purchase $65 million Class A Floating Rate Cumulative Preferred Stock of Price REIT ("Price REIT Preferred Stock"). In connection with the purchase agreement, Price REIT issued 65,000 shares of Price REIT Preferred Stock to LB I (with a total liquidation preference and purchase price of $65 million). As part of the Merger, the Company assumed Price REIT's obligations under the purchase agreement and, as part of the Merger consideration, the Price REIT Preferred Stock was exchanged for 650,000 depositary shares (the "Class E Depositary Shares"), each representing a one-tenth fractional interest in 65,000 shares of a new issue of Kimco Floating Rate Class E Cumulative Redeemable Preferred Stock, par value $1.00 per share (the "Class E Preferred Stock"). Dividends on the Class D Depositary Shares are cumulative and payable quarterly in arrears at the rate per depositary share equal to the greater of (i) 7.5% per annum based on a $25 per share initial value, or $1.875 per share, or (ii) the cash dividends on the shares of the Company's common stock into which a Class D Depositary Share is convertible plus $.0275 per quarter. The Class D Depositary Shares are convertible at any time into the Company's common stock at a conversion price of $40.25 per share of common stock or a conversion rate of 0.62112 for each Class D Depositary Share. The Class D Depositary Shares may be redeemed in whole, or from time to time, in part, on any date on or after June 19, 2001 at the option of the Company if, for any 20 trading days within any period of 30 consecutive trading days, including the last trading day of such period, the average closing price per share of the Company's common stock exceeds 120% of the conversion price or $48.30 per share. The dividend rate on the Class E Preferred Stock was equal to LIBOR plus 2% per annum, adjusted quarterly, and had an initial dividend rate of 7.68% per annum. The Class E Preferred Stock was redeemable at the option of the Company for 150 days after its issuance at a price equal to the liquidation preference of $1,000 per share plus accrued and unpaid dividends. The Company exercised its option in November 1998 to redeem all of the Class E Preferred Stock for $65.065 million, representing the liquidation preference of $65 million and approximately $65,000 of accrued dividends. (See Note 3 of the Notes to Consolidated Financial Statements included in this annual report on Form 10-K.) Shopping Center Acquisitions - In January 1998, the Company acquired seven properties, in separate transactions, consisting of: (i) Village on the Park I and II, adjoining shopping centers located in Aurora, Colorado, which are anchored by TJ Maxx and contain approximately 146,000 square feet of GLA; (ii) Phar-Mor Plaza, located in Englewood, Colorado, which is anchored by Phar-Mor and contains approximately 80,000 square feet of GLA; (iii) Heritage West Shopping Center, located in Lakewood, Colorado, which is anchored by Safeway Stores and contains approximately 83,000 square feet of GLA; (iv) Quincy Place Shopping Center, located in Aurora, Colorado, which is anchored by Blockbuster and contains approximately 44,000 square feet of GLA; (v) Spring Creek Shopping Center, located in Colorado Springs, Colorado, which is anchored by Cub Foods and contains approximately 108,000 square feet of GLA; (vi) East Bank Shopping Center, located in Aurora, Colorado, which is anchored by Albertson's and contains approximately 111,000 square feet of GLA; and (vii) West 38th Street Shopping Center, a single tenant property, located in Denver, Colorado, occupied by Payless Drugs comprising approximately 18,000 square feet of GLA. These properties were acquired for an aggregate purchase price of approximately $43.9 million, including the 8 assumption of approximately $1.4 million and $2.8 million of mortgage debt encumbering Phar-Mor Plaza and Quincy Place Shopping Center, respectively. In February 1998, the Company acquired The Shoppes at West Melbourne, located in West Melbourne, Florida, for a purchase price of approximately $11.0 million. The shopping center contains approximately 148,000 square feet of GLA and is anchored by Service Merchandise. In March 1998, the Company acquired three properties, in separate transactions, consisting of (i) Marshalls Plaza, (ii) South Plains Plaza and (iii) Poca Fiesta Shopping Center. Marshalls Plaza, located in Cranston, Rhode Island, is anchored by Marshalls and contains approximately 130,000 square feet of GLA. South Plains Plaza, located in Lubbock, Texas, is anchored by PetsMart and OfficeMax and contains approximately 108,000 square feet of GLA. Poca Fiesta Shopping Center, located in Mesa, Arizona, is anchored by Ross Stores, and contains approximately 136,000 square feet of GLA. These properties were acquired for an aggregate purchase price of approximately $33.5 million, including the assumption of approximately $6.6 million and $10.0 million of mortgage debt encumbering South Plains Plaza and Poca Fiesta Shopping Center, respectively. In April 1998, the Company acquired Wellington Park Shopping Center for a purchase price of approximately $10.9 million. Wellington Park Shopping Center, located in Cary, North Carolina, is anchored by Lowes Food and contains approximately 103,000 square feet of GLA. In May 1998, the Company acquired three properties, Bayshore Gardens Shopping Center, Lafayette Marketplace and the Phar-Mor building, in separate transactions, for an aggregate purchase price of approximately $37.1 million, which included the issuance of partnership units valued at approximately $5.0 million in connection with the Bayshore Gardens acquisition. Bayshore Gardens Shopping Center, located in Bradenton, Florida, is anchored by Publix and TJ Maxx, and contains approximately 163,000 square feet of GLA. Lafayette Marketplace, located in Lafayette, Indiana, is anchored by Michaels and Staples, and contains approximately 190,000 square feet of GLA. The Phar-Mor building, located in Greenville, South Carolina, is a 60,000 square foot building adjacent to a property previously acquired by the Company in December 1997 and is occupied by Phar-Mor. In July 1998, the Company acquired, in separate transactions, three neighborhood and community shopping centers comprising approximately 381,000 square feet of GLA in three states, for an aggregate purchase price of approximately $35.3 million. The properties acquired include (i) Shoppes at Rivergate, (ii)Center of the Hills and (iii) Juan Tabo Plaza. Shoppes at Rivergate, located in Goodlettsville, Tennessee, is anchored by Uptons Department Store and Stein Mart and contains approximately 171,000 square feet of GLA. Center of the Hills, located in Austin, Texas, is anchored by H.E.B. Grocery and contains approximately 153,000 square feet of GLA. Juan Tabo Plaza, located in Albuquerque, New Mexico, is anchored by Walgreens and contains approximately 57,000 square feet of GLA. In September, 1998, the Company acquired Northwest Square located in Columbus, Ohio for approximately $15.1 million. This shopping center is anchored by Borders Books and contains approximately 113,000 square feet of GLA. In October 1998, the Company acquired 3 shopping centers, in separate transactions, for approximately $51.0 million, including the assumption of approximately $28.4 million of mortgage debt in connection with two of the acquisitions. The properties acquired include (i) Oak Park Commons located in Plainfield, New Jersey; (ii) Trolley Station, located in Memphis, Tennessee and (iii) Vista Ridge Plaza, located in Lewisville, Texas. Oak Park Commons is anchored by A&P Supermarkets and Sears Hardware, and contains approximately 137,000 square feet of GLA. Trolley Station is anchored by Toys R' Us and OfficeMax, and contains approximately 167,000 square feet of GLA. Vista Ridge Plaza is anchored by Drug Emporium and contains approximately 94,000 square feet of GLA. During November, 1998, the Company acquired Westgate Plaza and North Point Shopping Center, in separate transactions, for an aggregate purchase price of approximately $33.0 million, $22.1 million of which was financed with mortgage debt on one of the properties. Westgate Plaza, located in Amarillo, Texas, is anchored by Kmart and Builders Square, and contains approximately 238,000 square feet of GLA. North Point Shopping Center, located in Joplin, Missouri, is anchored by Hobby Lobby, and contains approximately 147,000 square feet of GLA. 9 During December, 1998, the Company acquired three properties, in separate transactions, for an aggregate purchase price of approximately $32.2 million. Santee Town Center Promenade, located in Santee, California is anchored by Office Depot and Ross Stores, and contains approximately 97,000 square feet of GLA. Village Commons Shopping Center, located in Tallahassee, Florida, is anchored by Stein Mart and Ben Franklin and contains approximately 106,000 square feet of GLA. The Piers Shopping Center located in Port Richey, Florida, is anchored by Staples and Circuit City and contains approximately 103,000 square feet of GLA. Venture Stores, Inc. Properties Acquisition - In August 1997, certain subsidiaries of the Company acquired certain real estate assets from Venture Stores, Inc. ("Venture") consisting of interests in 49 fee and leasehold properties totaling approximately 5.9 million square feet of leasable area located in seven states. The aggregate price was approximately $130 million, consisting of $70.5 million in cash and the assumption of approximately $59.5 million of existing mortgage debt on certain of these properties. Simultaneously with this transaction, the Company entered into a long-term unitary net lease with Venture covering all premises occupied by Venture on these properties. As a result of this transaction, Venture was the primary or sole tenant at 60 of the Company's locations as of December 31, 1997. In January 1998, Venture filed for protection under Chapter 11 of the United States Bankruptcy Code. On April 27, 1998, Venture announced it would discontinue its retail operations and that it had reached an agreement to sell its leasehold position at 89 locations to the Company, including 56 properties pursuant to two unitary leases already in place with the Company, 30 properties pursuant to a master lease with Metropolitan Life Insurance Company ("Metropolitan Life") and three properties leased by Venture from others. The purchase price for the leasehold positions was $95.0 million, less certain closing adjustments, but is subject to upward adjustment based on the Company's success in re-tenanting the properties over a two-year period. On July 17, 1998, the Company purchased the leasehold positions with an initial cash payment to Venture of approximately $50 million. Simultaneous with this transaction, the Company leased 46 of these locations to Kmart Corporation. As a result of these additional leases to Kmart Corporation, Kmart Corporation accounted for approximately 13.7% of the Company's annualized base rental revenues as of December 31, 1998. The Company also reached an agreement with Metropolitan Life to purchase the 30 fee and leasehold positions which were leased by Metropolitan Life to Venture, for an aggregate purchase price of $167.5 million. This transaction was completed on July 1, 1998. During August 1998, the Company acquired from Venture five additional leasehold positions, including two leases already in place with the Company, for an aggregate purchase price of approximately $2.2 million. Simultaneous with this transaction, the Company leased these five locations, along with five other former Venture locations, to a national retailer. As of December 31, 1998, the Company has leased substantially all of the vacant space at 76 locations and sold 2 of the locations acquired in the above transactions (See Recent Developments - Property Dispositions). The Company is currently negotiating with other major retailers concerning the re-tenanting of the remaining locations. The Company, as a regular part of its business operations, will continue to actively seek properties for acquisition, which have below market-rate leases or other cash flow growth potential. Property Developments and Redevelopments - The Company has an ongoing program to reformat and re-tenant its properties to maintain or enhance its competitive position in the marketplace. During 1998, the Company substantially completed the redevelopment and re-tenanting of various shopping centers, most notably, its properties in Richboro, Pennsylvania; Mesa, Arizona; Upper Arlington, Ohio; Orlando, Florida and Charleston, South Carolina. The Company expended approximately $40 million in connection with its major redevelopment and re-tenanting projects during 1998. The Company is currently involved in redeveloping several other shopping centers, including its properties in Salem, New Hampshire; North Miami, Florida and Manhasset, New York. The Company anticipates its capital commitment toward these and other redevelopment projects will be approximately $30 million during 1999. 10 As of December 31, 1998, the Company was in progress on three ground-up development projects located in Bridgewater, New Jersey, Houston, Texas and Cedar Hill, Texas. These projects were substantially pre-leased prior to the commencement of construction. During 1998, the Company expended approximately $28.6 million in connection with the purchase of land and construction costs related to these projects. The Company anticipates its capital commitment toward these and other development projects including projects scheduled to begin in early 1999 in Chandler, Arizona and San Antonio, Texas, will be approximately $120 million during 1999. Each development and redevelopment project represents an opportunity for the Company to capitalize on its leasing, site planning, design and construction expertise. These projects, which are currently proceeding on schedule and in line with the Company's budgeted costs, are expected to contribute to growth in the Company's funds from operations in the future. Property Dispositions - During January 1998, the Company disposed of a property in Pinellas Park, Florida. Proceeds from the disposition totaling approximately $2.3 million, together with an additional $7.1 million cash investment, were used to acquire an exchange shopping center property located in Cranston, Rhode Island during March 1998. During December 1998, the Company disposed of a vacant distribution center and adjacent facility located in O'Fallon, Missouri, which were acquired as part of the Venture transactions, for $10 million, which amount approximated their net book value. Kimco Select Investments - Kimco Select Investments, a New York general partnership ("Kimco Select"), was formed in 1997 to provide the Company, through its 90% ownership interest, the opportunity to make investments outside of its core neighborhood and community shopping center business. Although potential investments may be largely retail-focused, Kimco Select may invest in other asset categories. Kimco Select will focus on investments where the intrinsic value in the underlying assets may provide potentially superior returns relative to the inherent risk. These investments may be in the form of direct ownership of real estate, mortgage loans, public and private debt and equity securities that Kimco Select believes are undervalued, unoccupied properties, properties leased to weak or bankrupt tenants and other assets. Kimco Select is managed by David M. Samber, formerly President and Chief Operating Officer of the Company, who owns the remaining 10% ownership interest in Kimco Select. The Company has made an initial commitment of $35 million towards investments by Kimco Select and may increase its commitment as management deems appropriate. During January 1998, Kimco Select, through a partnership investment, acquired fee interests in three properties from a retailer in the Chicago, IL market comprising approximately 516,000 square feet of GLA for an aggregate purchase price of approximately $23.7 million. These properties include approximately 70,000 square feet of showroom space and adjoining warehouses of approximately 100,000 square feet at each location. Simultaneous with this transaction, the Company leased, to a national furniture retailer, the showroom portion of each property under individual long-term leases. The Company is currently planning the redevelopment of the warehouse portion of each property. During 1998, Kimco Select, through a partnership investment, acquired a leasehold position and expended approximately $2.4 million to construct a 50,000 square foot ambulatory care facility, which is anchored by Wellness Place, a regional health care provider, and contains complementary retail space. This property is located in Trexlertown, Pennsylvania. During 1997, Kimco Select through a partnership investment, acquired an interest in a multi-story building in Eastwick, PA. This 39,000 square foot property, and a 53,000 square foot property in Upper Darby, PA previously acquired, have been redeveloped as ambulatory care facilities, which are anchored by Mercy Health Corporation, a leading regional health care system and contain complementary retail space. During 1998, Kimco Select obtained mortgage financing of $9.0 million on these properties. This fixed-rate non-recourse mortgage bears interest at 7% per annum and matures in 2008. Through December 31, 1998, acquisition and redevelopment costs related to these two properties totaled approximately $13 million. 11 Kimco Select has also acquired (i) various first mortgage loan participations, (ii) certain public bonds and (iii) joint venture interests in two entities which own 3 office buildings in Miami, FL. The aggregate acquisition costs related to these investments was approximately $4.3 million. Other Transactions - During 1998, the Company invested approximately $19.0 million in a partnership which acquired and leased-back 11 automotive dealerships. The Company has a 50% interest in this partnership. In December 1998, the Company invested approximately $3.6 million in a partnership which acquired a shopping center property in Bronx, New York for approximately $34 million, including mortgage debt of approximately $27 million. The Company has a 50% interest in this partnership. In addition, the Company acquired a first mortgage on a shopping center in Manhasset, New York for approximately $21 million and has entered into a contract to acquire fee title to this property. Financings - Unsecured Debt. During 1998, the Company issued an aggregate principal amount of $290 million of unsecured notes under its MTN program. These unsecured notes are comprised of (i) $100 million seven-year fixed-rate notes bearing interest at 6.73% per annum and maturing in June 2005, (ii) $30 million eight-year fixed-rate notes bearing interest at 6.93% per annum and maturing in July 2006, (iii) $60 million two-year floating-rate notes bearing interest at Libor plus .15% per annum and maturing in August 2000 and (iv) $100 million ten-year Remarketed Reset notes bearing interest initially at LIBOR plus .30% and maturing in August 2008. The Company has entered into interest rate swap agreements which have effectively fixed the interest rate on the $60 million floating-rate notes and $100 million Remarketed Reset notes at 5.91% per annum and 5.92% per annum, respectively. The net proceeds from these issuances were used to repay indebtedness and for the acquisition of neighborhood and community shopping centers. (See Note 7 of the Notes to Consolidated Financial Statements included in this annual report on Form 10-K.) Mortgage Financing. During November 1998, the Company obtained mortgage financing aggregating approximately $272.3 million on 20 of its properties. The mortgages are non-recourse, non-cross collateralized ten-year first mortgages, which bear interest at an average fixed rate of 6.585%. These properties were financed in anticipation of the commencement of the New Investment Vehicle (See Recent Developments-New Investment Vehicle). The net proceeds from these mortgages were used primarily for the acquisition of neighborhood and community shopping centers. Credit Facility. On August 21, 1998, the Company established a $215 million unsecured revolving credit facility (the "Credit Facility") with a group of banks. The Credit Facility is scheduled to expire in August 2001. Under the terms of the Credit Facility, funds may be borrowed for general corporate purposes, including (i) funding property acquisitions and (ii) development and redevelopment costs. Interest on borrowings under the Credit Facility accrues at a spread (currently .50%) to LIBOR, which fluctuates in accordance with change in the Company's senior debt ratings. This Credit Facility replaced the Company's (i) $100 million unsecured revolving credit facility and (ii) $150 million interim credit facility. Equity. During 1998, the Company completed 16 public stock offerings issuing an aggregate 7.6 million shares of common stock at prices ranging from $36.0625 to $39.6875 per share. The net proceeds from these sales of common stock, totaling approximately $278.3 million (after related transaction costs of approximately $11.5 million), have been used primarily for the acquisition of neighborhood and community shopping centers and the redemption of the Class E Preferred Stock issued in connection with the Merger. (See Notes 2 and 3 of the Notes to Consolidated Financial Statements included in this annual report on Form 10-K.) 12 New Investment Vehicle In view of recent market conditions, the Company has decided to explore the creation of a new entity that would invest in real estate that it believes would be more appropriately financed through greater leverage than the Company traditionally uses. These properties would include, but not be limited to, fully developed properties with strong, stable cash flows from credit-worthy retailers with long-term leases that have limited near-term potential for growth through redevelopment or re-tenanting. The Company has preliminarily established from our existing portfolio an initial portfolio of properties with an estimated net equity value of approximately $110 million for this entity. The Company has reached an agreement in principle with an institutional investor to participate in this new investment vehicle. The investors' initial capital commitment will equal the equity value of the initial portfolio to be contributed by the Company. The agreement in principle is subject to completion and final approval by the Company and the investor. KC Holdings, Inc. To facilitate the Company's November 1991 IPO, forty-six shopping center properties and certain other assets, together with indebtedness related thereto, were transferred to subsidiaries of KC Holdings, Inc. ("KC Holdings") a newly formed corporation that is owned by the stockholders of the Company prior to the IPO. The Company, although having no ownership interest in KC Holdings or its subsidiary companies, was granted ten-year, fixed-price options to reacquire the real estate assets owned by KC Holdings' subsidiaries, subject to any liabilities outstanding with respect to such assets at the time of an option exercise. As of December 31, 1998, KC Holdings' subsidiaries had conveyed fourteen shopping center properties back to the Company and had disposed of ten additional centers in transactions with third parties. The members of the Company's Board of Directors who are not also shareholders of KC Holdings unanimously approved the purchase of each of the fourteen shopping centers that have been reacquired by the Company from KC Holdings. (See Notes 10 and 14 of the Notes to Consolidated Financial Statements included in this annual report on Form 10-K.) The Company manages 18 of KC Holdings' 22 shopping center properties pursuant to a management agreement. KC Holdings' other four shopping center properties are managed by unaffiliated joint venture partners. Acquisition Option - The Company holds 10-year acquisition options which expire in November 2001 to reacquire interests in the 22 shopping center properties owned by KC Holdings' subsidiaries. The option exercise prices are fixed and payable in shares of the Company's common stock or, in the event payment in the form of common stock could jeopardize the Company's status as a REIT, an equivalent value in cash. If the Company exercises its options to acquire all the remaining shopping center properties, the maximum aggregate amount payable to KC Holdings would be approximately $11.1 million, or approximately 280,000 shares of the Company's common stock (assuming shares valued at the closing price on the NYSE of $39.69 per share as of December 31, 1998). The Company would acquire the properties subject to any existing mortgage indebtedness and other liabilities on the properties. The acquisition options enable the Company to obtain any appreciation in the value of these properties over the option exercise prices, while eliminating the Company's interim exposure to leverage and operating risks. The option exercise prices for the shopping center properties are generally equal to 10% of KC Holdings' share of the mortgage debt which was outstanding on the properties at the date of the IPO. If, however, the market value of the Company's common stock at the time an option is exercised is less than $13.33 per share (the IPO price), then the option exercise price will decline proportionately (subject to maximum reduction of 50%). The 22 shopping center properties subject to the acquisition options are held in 8 subsidiaries of KC Holdings. Thirteen of these properties are subject to a single lease and/or a single cross-collateralized mortgage and are therefore held by a single subsidiary. Four of the properties, which are owned in two separate joint ventures and managed by unaffiliated joint venture partners, are held by two additional subsidiaries, and the remaining five shopping center properties are each held by separate subsidiaries. The Company may exercise its acquisition options separately with respect to each subsidiary. The acquisition options may be exercised by either (i) a majority of the Company's directors who are not also stockholders of KC Holdings, provided that the pro forma annualized net cash flows of the properties to be acquired exceed the dividend yield on the shares issued to exercise each option, or (ii) a majority of the Company's stockholders who are not also stockholders of KC Holdings. 13 KC Holdings' subsidiaries may sell any of the properties subject to the acquisition options to any third party unaffiliated with KC Holdings or its stockholders, provided that KC Holdings provides the Company with a 30-day right of first refusal notice with regard to such sale. KC Holdings may cause such a selling subsidiary to distribute any sale proceeds to KC Holdings or its stockholders, provided that the option exercise price with respect to such subsidiary is reduced by the amount that is distributed, and further provided that no amount may be distributed so as to cause the option exercise price for any subsidiary to be reduced to less than $1. Each of KC Holdings' subsidiaries may pay dividends to KC Holdings to the extent of net operating cash flow. In addition, any KC Holdings subsidiary may make distributions to KC Holdings in excess of net operating cash flow, provided that the option exercise price with respect to such subsidiary is reduced by the amount of such distribution, and further provided that no amount may be distributed so as to cause the option exercise price for any subsidiary to be reduced to less than $1. KC Holdings may increase the indebtedness in its subsidiaries for the purpose of improving, maintaining, refinancing or operating the related shopping center properties. Such indebtedness may include borrowings from the stockholders of KC Holdings. In the event of a complete casualty or a condemnation of a property held by any of KC Holdings' subsidiaries, the acquisition option will terminate with respect to such property and the option shall continue to be effective with respect to any other properties held by such subsidiary. Each of KC Holdings' subsidiaries has agreed with the Company that it will engage in no activities other than in connection with the ownership, maintenance and improvement of the properties that it owns and only to the extent that the Company could engage in such activities without receiving or earning non-qualifying income (in excess of certain limits) under the REIT provisions of the Code or without otherwise impairing the Company's status as a REIT. In addition, KC Holdings has covenanted not to engage in any other real estate activity. The Company has agreed not to make loans to KC Holdings or its subsidiaries. Subsequent Events Property Acquisitions / Disposition - During January and February 1999, the Company acquired five neighborhood and community shopping center properties comprising approximately .7 million square feet of GLA for approximately $79.0 million, including the assumption of $8.5 million of mortgage debt encumbering one of the properties. These properties are primarily anchored by supermarket or discount department store tenants, including Kmart Corporation, Kroger and TJ Maxx. The Company disposed of a property in Morrisville, PA during February 1999. Cash proceeds from the disposition totaling $1.6 million approximated the property's net book value. Financings - During February 1999, the Company issued $130 million 6-7/8% fixed-rate Senior Notes due 2009. Interest on the notes is payable semi-annually in arrears. The notes were sold at 99.85% of par value. Net proceeds from this issuance, totaling approximately $128.9 million, after related transaction costs of approximately $.9 million, were used, in part, to repay $100 floating-rate senior notes that matured during February 1999 and for general corporate purposes. Exchange Listings The Company's common stock, Class A Depositary Shares, Class B Depositary Shares, Class C Depositary Shares and Class D Depositary Shares are traded on the NYSE under the trading symbols "KIM", "KIMprA", "KIMprB", "KIMprC" and "KIMprD" respectively. 14 Item 2. Properties Real Estate Portfolio As of January 1, 1999 the Company's real estate portfolio was comprised of approximately 56.7 million square feet of GLA in 365 neighborhood and community shopping center properties, two regional malls, 61 retail store leases, three parcels of undeveloped land, one distribution center, one stand-alone retail warehouse and three projects under development, located in 40 states. Neighborhood and community shopping centers comprise the primary focus of the Company's current portfolio, representing approximately 98% of the Company's total shopping center GLA. As of January 1, 1999, approximately 91% of the Company's neighborhood and community shopping center space was leased, and the average annualized base rent per leased square foot of the neighborhood and community shopping center portfolio was $7.97. The Company's neighborhood and community shopping center properties, generally owned and operated through subsidiaries or joint ventures, had an average size of approximately 135,000 square feet as of January 1, 1999. The Company retains its shopping centers for long-term investment and consequently pursues a program of regular physical maintenance together with major renovations and refurbishing to preserve and increase the value of its properties. These projects usually include renovating existing facades, installing uniform signage, resurfacing parking lots and enhancing parking lot lighting. During 1998, the Company capitalized approximately $6.1 million in connection with these property improvements. The Company's neighborhood and community shopping centers are usually "anchored" by a national or regional discount department store, supermarket or drugstore. As one of the original participants in the growth of the shopping center industry and one of the nation's largest owners and operators of shopping centers, the Company has established close relationships with a large number of major national and regional retailers. National and regional companies that are tenants in the Company's shopping center properties include Kmart Corporation, Kohl's, The Home Depot, WalMart, TJX Companies, Toys/Kids R' Us, Shopko, Ames, A & P and Costco. A substantial portion of the Company's income consists of rent received under long-term leases. Most of the leases provide for the payment of fixed base rentals monthly in advance and for the payment by tenants of an allocable share of the real estate taxes, insurance, utilities and common area maintenance expenses incurred in operating the shopping centers. Although a majority of the leases require the Company to make roof and structural repairs as needed, a number of tenant leases place that responsibility on the tenant, and the Company's standard small store lease provides for roof repairs to be reimbursed by the tenant as part of common area maintenance. The Company's management places a strong emphasis on sound construction and safety at its properties. Approximately 1,600 of the Company's 4,100 leases also contain provisions requiring the payment of additional rent calculated as a percentage of tenants' gross sales above predetermined thresholds. Percentage Rents accounted for approximately 2% of the Company's revenues from rental property for the year ended December 31, 1998. Minimum base rental revenues and operating expense reimbursements accounted for approximately 98% of the Company's total revenues from rental property for the year ended December 31, 1998. The Company's management believes that the average base rent per square foot for many of the Company's existing leases is generally lower than the prevailing market-rate base rents in the geographic regions where the Company operates, reflecting the potential for future growth. 15 The Company has been able to capitalize on the below market-rate leases in its existing shopping center portfolio to obtain increases in rental revenues through the renewal of leases or strategic re-tenanting of space. From January 1, 1998 to December 31, 1998, excluding the effect of (i) 1998 acquisitions and (ii) the acquisition of Price REIT, the Company increased the average base rent per leased square foot on its portfolio of neighborhood and community shopping centers from $6.31 to $7.00, an increase of $.69 per square foot, which was attributable to (i) general leasing activity within the existing portfolio and (ii) the re-leasing of the Venture locations in connection with the acquisition of 94 leasehold positions (See Recent Developments Venture Stores, Inc. Properties Acquisitions). The effect of 1998 acquisitions, including the acquisition of Price REIT which had an average rent per square foot of $10.19 at the time of the acquisition, increased the overall rent per leased square foot of the shopping center portfolio by $.97, thus bringing the average rent per leased square foot to $7.97 as of December 31, 1998. The average annual base rent per leased square foot for new leases executed in 1998 was $9.30. The Company seeks to reduce its operating and leasing risks through geographic and tenant diversity. No single neighborhood and community shopping center accounted for more than 1.0% of the Company's total shopping center GLA or more than 1.5% of total annualized base rental revenues as of December 31, 1998. The Company's five largest tenants include Kmart Corporation, The Home Depot, Kohl's, Toys/Kids R' Us and TJX Companies, which represent approximately 13.7%, 3.0%, 2.5%, 1.8% and 1.5%, respectively, of the annualized base rental revenues at December 31, 1998. The Company maintains an active leasing and capital improvement program that, combined with the high quality of the locations, has made, in management's opinion, the Company's properties attractive to tenants. The Company's management believes its experience in the real estate industry and its relationships with numerous national and regional tenants gives it an advantage in an industry where ownership is fragmented among a large number of property owners. Retail Store Leases In addition to our neighborhood and community shopping centers, as of January 1, 1999, we had interests in retail store leases totaling approximately 5.5 million square feet of anchor stores in 61 neighborhood and community shopping centers located in 24 states. As of January 1, 1999, approximately 93% of the space in these anchor stores had been sublet to retailers that lease the stores under net lease agreements providing for average annualized base rental payments to us of $4.14 per square foot. Our average annualized base rental payments under our retail store leases to the land owners of such subleased stores is approximately $2.75 per square foot. The average remaining primary term of our retail store leases (and similarly the remaining primary terms of our sublease agreements with the tenants currently leasing such space) is approximately 4 years, excluding options to renew the leases for terms which generally range from 5 to 25 years. Ground-Leased Properties The Company has 54 shopping center properties that are subject to long-term ground leases where a third party owns and has leased the underlying land to the Company (or an affiliated joint venture) to construct and/or operate a shopping center. The Company or the joint venture pays rent for the use of the land and generally is responsible for all costs and expenses associated with the building and improvements. At the end of these long-term leases, unless extended, the land together with all improvements revert to the land owner. Undeveloped Land The Company owns certain unimproved land tracts that it intends to develop as new shopping centers (See Recent Developments - Property Developments and Redevelopments) and owns parcels of land adjacent to certain of its existing shopping centers that are held for possible expansion. At times, should circumstances warrant, the Company may develop or dispose of these parcels. The table on pages 17 to 24 sets forth more specific information with respect to each of the Company's shopping center properties as of December 31, 1998. Item 3. Legal Proceedings The Company is not presently involved in any litigation nor to its knowledge is any litigation threatened against the Company or its subsidiaries that, in management's opinion, would result in any material adverse effect on the Company's ownership, management or operation of its properties, or which is not covered by the Company's liability insurance. Item 4. Submission of Matters to a Vote of Security Holders None. 16 PROPERTY CHART
YEAR OWNERSHIP DEVELOPED INTEREST/ LAND AREA OR ACQUIRED (EXPIRATION)(2) (ACRES) ----------- --------------- ------- ARIZONA GLENDALE 1998 FEE 40.50 GLENDALE 1998 FEE/JOINT VENTURE 16.52 MESA 1998 FEE 19.83 NORTH PHOENIX 1998 FEE 17.00 PHOENIX (3) 1996 FEE 13.40 PHOENIX 1998 FEE 26.60 PHOENIX 1997 FEE 17.50 TEMPE (5) 1998 FEE/JOINT VENTURE 20.00 TEMPE 1998 FEE/JOINT VENTURE 21.10 CALIFORNIA ALHAMBRA 1998 FEE 18.40 LA MIRADA 1998 FEE 31.20 ANAHEIM 1995 FEE 1.04 SANTA ANA 1998 FEE 12.00 CORONA 1998 FEE 58.27 CARMICHAEL 1998 FEE 18.50 CHULA VISTA 1998 FEE 31.30 SANTEE 1998 FEE 11.01 OXNARD 1998 FEE 14.40 COLORADO AURORA 1998 FEE 13.81 AURORA 1998 FEE 9.92 AURORA 1998 FEE 13.90 ENGLEWOOD 1998 FEE 6.48 DENVER 1998 FEE 1.45 COLORADO SPRINGS 1998 FEE 10.74 LAKEWOOD 1998 FEE 7.55 CONNECTICUT FARMINGTON 1998 FEE 16.90 HAMDEN 1997 FEE/JOINT VENTURE 7.42 NORTH HAVEN 1998 FEE 31.70 WATERBURY 1993 FEE 13.10 DELAWARE ELSMERE 1979 GROUND LEASE(2076) 17.14 FLORIDA MELBOURNE 1968 GROUND LEASE(2071) 11.53 MELBOURNE 1994 FEE 13.84 WEST MELBOURNE 1998 FEE 13.23 CORAL SPRINGS 1994 FEE 5.90 CORAL SPRINGS 1997 FEE 9.80 LAUDERDALE LAKES 1968 FEE/JOINT VENTURE 10.04 LAUDERHILL 1978 FEE 15.50 MARGATE 1993 FEE 34.07 PLANTATION 1974 FEE/JOINT VENTURE 4.59 POMPANO BEACH 1968 FEE/JOINT VENTURE 6.55 HOMESTEAD 1972 FEE/JOINT VENTURE 21.00 MIAMI 1968 FEE 8.23 MIAMI 1998 FEE/JOINT VENTURE 13.98 MIAMI (3) 1985 FEE 15.92 MIAMI 1986 FEE 7.78 SOUTH MIAMI 1995 FEE 5.44 TAMPA 1997 FEE 16.34 LEESBURG 1969 GROUND LEASE(2017) 1.25 MOUNT DORA 1997 FEE 12.44 BRADENTON 1968 FEE/JOINT VENTURE 6.20 BRADENTON 1998 FEE 19.63 LEASABLE PERCENT MAJOR LEASE AREA LEASED (LEASE EXPIRATION/ (SQ. FT) (1) OPTION EXPIRATION) -------- --- ------------------ ARIZONA GLENDALE 337,107 100% COSTCO(2011/2046), HOMEBASE(2008/2028), LEVITZ FURNITURE(2012/2032) GLENDALE 124,325 100% SEARS(2001/2016), MICHAELS(2003/2018), FABRI CENTER(2002/2017) MESA 135,692 97% ROSS STORES(2000/2005), HARKINS THEATRE(2005/2025), OUR HOME(2005/2015) NORTH PHOENIX 228,769 100% BURLINGTON COAT FACTORY(2013/2023), COMPUTER CITY(2004/2019), MICHAELS(2007/2022) PHOENIX (3) 190,575 67% HOME DEPOT(1999/2020), AUTOZONE(2003/2008) PHOENIX 334,597 97% COSTCO(2006/2041), HOMEBASE(2009/2029) PHOENIX 124,052 96% SAFEWAY(2009/2039), WALGREENS(2029) TEMPE (5) -- -- TEMPE 384,812 100% HOMEBASE(2010/2025), SPORTS AUTHORITY(2009/2024) CALIFORNIA ALHAMBRA 200,634 77% COSTCO(2006/2041), FABRI CENTER(2004/2019) LA MIRADA 288,471 97% TOYS R US(2012/2032), LA FITNESS INTERNATIONAL(2012/2022) ANAHEIM 15,396 100% SANTA ANA 134,400 100% HOME DEPOT(2015/2035) CORONA 486,958 98% COSTCO(2007/2042), HOME DEPOT(2010/2030), LEVITZ FURNITURE(2009/2029) CARMICHAEL 214,914 94% HOME DEPOT(2003/2023), SPORTS AUTHORITY(2009/2024) CHULA VISTA 371,023 100% COSTCO(2006/2041), HOMEBASE(2008/2028), LEVITZ FURNITURE(2010/2030) SANTEE 97,451 94% OFFICE DEPOT(2006/2021), ROSS STORES(2004/2024), MICHAELS(2003/2018) OXNARD 171,581 100% TARGET(2003/2013), FOOD 4 LESS(2003/2008) COLORADO AURORA 145,466 91% TJ MAXX(2002/2012), GRANTREE FURNITURE(2003), CLASSIC TREASURES(2000/2004) AURORA 44,170 95% BLOCKBUSTER(2003) AURORA 111,085 91% COOMERS(2001/2006), CROWN LIQOUR(2005/2010) ENGLEWOOD 80,330 100% PHAR MOR(2004/2019), OLD COUNTRY BUFFET(2009/2019) DENVER 18,405 100% PAYLESS DRUGS(2002/2017) COLORADO SPRINGS 107,798 96% CUB FOODS(2004/2034) LAKEWOOD 83,304 99% SAFEWAY STORES(2002/2032) CONNECTICUT FARMINGTON 184,981 99% SPORTS AUTHORITY(2018/2063), LINENS & THINGS(2016/2036), BORDERS BOOKS(2018/2063) HAMDEN 341,502 100% BRADLEES(2004/2014), STEINBACH(2002/2012), BOB'S(2016/2036) NORTH HAVEN 331,919 100% HOME DEPOT(2009/2029), COSTCO(2006/2041) WATERBURY 136,153 100% BRADLEES(2002/2007), STOP & SHOP(2013/2043) DELAWARE ELSMERE 111,600 100% SCHOTTENSTEIN(2008/2038) FLORIDA MELBOURNE 168,797 58% FABRI CENTER(2006/2016), WALGREENS(2045) MELBOURNE 131,851 76% WINN DIXIE(2002/2027), ECKERD(2002/2022) WEST MELBOURNE 148,003 96% SERVICE MERCHANDISE(2005/2035), KROGER(2004/2034), MARSHALLS(2000/2010) CORAL SPRINGS 46,497 100% LINENS N THINGS(2012/2027), PIER 1 IMPORTS(2001/2011) CORAL SPRINGS 83,500 98% TJ MAXX(2001/2016), BLOCKBUSTER(2006/2026) LAUDERDALE LAKES 112,476 99% THRIFT SHOPS(2002/2012), FAMILY DOLLAR(2002/2017) LAUDERHILL 179,726 91% BABIES R US(2004/2014), PARTY CITY(2007/2017) MARGATE 256,030 95% PUBLIX(2008/2028), OFFICE DEPOT(2000/2020) PLANTATION 60,414 100% WHOLE FOODS(2009/2019) POMPANO BEACH 63,838 100% HOMESTEAD 160,819 93% PUBLIX(2014/2034), OFFICEMAX(2013/2028), ECKERD(2002/2012) MIAMI 104,968 100% KMART(2009/2029), WALGREENS(1999) MIAMI 74,973 98% BABIES R US(2006/2021) MIAMI (3) 83,275 100% PUBLIX(2019/2039), WALGREENS(2058) MIAMI 81,780 100% PUBLIX(2009/2029), WALGREENS(2018) SOUTH MIAMI 60,804 93% KIDS R US(2016/2021), PARTY CITY(2007/2017) TAMPA 109,408 100% STAPLES(2003/2018), ROSS STORES(2002/2022) LEESBURG 13,468 89% DISCOUNT AUTO PARTS(1999/2004) MOUNT DORA 118,150 100% KMART(2013/2058), PET SUPERMARKET(2003/2013) BRADENTON 24,700 96% DISCOUNT VIDEO(2002/2007) BRADENTON 162,997 96% PUBLIX(2012/2032), TJ MAXX(2003/2018), FABRI CENTER(2009/2024)
17 PROPERTY CHART
YEAR OWNERSHIP DEVELOPED INTEREST/ LAND AREA OR ACQUIRED (EXPIRATION)(2) (ACRES) ----------- --------------- ------- OCALA 1997 FEE 27.17 STUART 1994 FEE 20.67 EAST ORLANDO 1971 FEE 11.63 LAKE BARTON 1968 FEE 4.79 ORLANDO 1968 FEE/JOINT VENTURE 10.00 ORLANDO 1968 GROUND LEASE(2047)/JOINT VENTURE 7.75 ORLANDO 1994 FEE 28.00 ORLANDO 1996 FEE 11.70 ALAMONTE SPRINGS 1995 FEE 5.58 KISSIMMEE 1996 FEE 18.42 BOCA RATON 1967 FEE 9.85 RIVIERA BEACH 1968 GROUND LEASE(2066)/JOINT VENTURE 5.06 WEST PALM BEACH 1967 FEE/JOINT VENTURE 7.57 WEST PALM BEACH 1995 FEE 7.93 NEW PORT RICHEY 1972 FEE 0.99 LARGO 1968 FEE 11.98 LARGO 1992 FEE 29.44 LARGO 1993 FEE 6.62 ST. PETERSBURG 1968 GROUND LEASE(2084)/JOINT VENTURE 9.01 WINTER HAVEN 1973 FEE/JOINT VENTURE 13.90 PALATKA 1970 FEE 8.90 SARASOTA 1970 FEE 10.00 SARASOTA 1989 FEE 11.98 FERN PARK 1968 FEE 12.00 ORLANDO 1998 FEE/JOINT VENTURE 19.40 SANFORD 1989 FEE 40.90 FT. PIERCE 1970 FEE/JOINT VENTURE 14.83 TALLAHASSEE 1998 FEE 12.79 PORT RICHEY 1998 FEE 15.20 MIAMI 1998 FEE/JOINT VENTURE 4.02 MIAMI 1998 FEE/JOINT VENTURE 0.26 GEORGIA SAVANNAH 1993 FEE 22.22 MACON 1969 FEE 12.30 SAVANNAH 1995 FEE 9.50 FOREST PARK 1969 FEE 14.21 ATLANTA 1988 FEE 19.48 GAINESVILLE 1970 FEE/JOINT VENTURE 12.60 AUGUSTA 1995 FEE 11.32 IOWA WATERLOO 1996 FEE 8.97 DAVENPORT 1997 GROUND LEASE(2028) 9.10 DUBUQUE 1997 GROUND LEASE(2019) 8.39 CLIVE 1996 FEE 8.80 DES MOINES 1996 FEE 9.56 ILLINOIS CHAMPAIGN 1998 FEE 9.04 ADDISON 1998 FEE 16.37 ARLINGTON HEIGHTS 1998 FEE 19.20 BRIDGEVIEW 1998 FEE 6.81 CALUMET CITY 1997 FEE 16.98 CHICAGO 1997 GROUND LEASE(2020) 13.42 CHICAGO 1997 GROUND LEASE(2040) 17.48 CHICAGO 1997 FEE 6.04 CHICAGO 1998 FEE 6.41 CHICAGO 1998 FEE 9.47 COUNTRYSIDE 1997 GROUND LEASE(2053) 27.67 CRESTWOOD 1997 GROUND LEASE(2051) 36.75 FOREST PARK 1997 GROUND LEASE(2021) 9.29 MATTESON 1997 FEE 17.01 LEASABLE PERCENT MAJOR LEASE AREA LEASED (LEASE EXPIRATION/ (SQ. FT) (1) OPTION EXPIRATION) -------- --- ------------------ OCALA 254,937 97% KMART(2001/2021), SERVICE MERCHANDISE(2007/2032) STUART 170,291 100% SERVICE MERCHANDISE(2010/2070), MARSHALLS(2005/2020) EAST ORLANDO 124,798 100% SPORTS AUTHORITY(2000/2020), OFFICE DEPOT(2005/2025) LAKE BARTON 2,800 100% ORLANDO 114,434 100% BALLYS HEALTH(2008/2018), HSN REALTY(2000/2009) ORLANDO 103,480 100% DORIN DISTRIBUTORS(2002/2007) ORLANDO 230,704 93% COSTCO(2006/2026), SPORTS AUTHORITY(2011/2031) ORLANDO 117,644 86% ROSS STORES(2003/2028), BIG LOTS(2004/2009), OFFICE MAX(2014/2034) ALAMONTE SPRINGS 94,193 100% ROOMS TO GO(2001), THOMASVILLE HOME(2001/2006) KISSIMMEE 130,983 97% KASH N KARRY(2006/2036), OFFICEMAX(2012/2027), FABRI CENTER(2001/2016) BOCA RATON 73,549 98% WINN DIXIE(2008/2033) RIVIERA BEACH 46,390 98% GULFSTREAM GOODWILL(2005/2008), FURNITURE KINGDOM(2009/2014), BOATHOUSE DISCOUNT(2002/2007) WEST PALM BEACH 74,326 99% WINN DIXIE(2010/2030) WEST PALM BEACH 80,845 99% BABIES R US(2006/2021) NEW PORT RICHEY 9,000 -- LARGO 149,472 98% WALMART(2007/2027), ECKERD(1999/2004) LARGO 215,916 96% PUBLIX(2009/2029), OFFICE DEPOT(1999/2019) LARGO 56,630 90% ST. PETERSBURG 119,179 76% KASH N KARRY(2017/2037), TJ MAXX(2001/2011) WINTER HAVEN 88,400 60% BIG LOTS(2000/2010), FABRI CENTER(2006/2016) PALATKA 72,216 87% SAVE A LOT(2003/2013), BIG LOTS(1999/2009) SARASOTA 103,085 100% TJ MAXX(2001/2016), OFFICEMAX(2009/2024), FRANKS NURSERY(2012/2032) SARASOTA 109,930 92% WINN DIXIE(1999) FERN PARK 131,894 99% BED BATH AND BEYOND(2002/2012), BOOKS-A-MILLION(2006/2016), OFFICEMAX(2008/2023) ORLANDO 271,095 98% UPTONS(2009/2029), GENERAL CINEMA(2005/2025), ROSS STORES(2001/2021) SANFORD 301,801 94% WALMART(2005/2035), ROSS STORES(2005/2025), PUBLIX(2005/2025) FT. PIERCE 210,460 89% KMART(2001/2016), WINN DIXIE(2002/2027), FABRI CENTER(2000/2010) TALLAHASSEE 105,901 98% STEINMART(2003/2008), BEN FRANKLIN(2007/2022) PORT RICHEY 103,294 100% CIRCUIT CITY(2011/2021), STAPLES(2006/2011) MIAMI 233,039 74% MIAMI 138,380 76% GEORGIA SAVANNAH 187,071 97% PHAR-MOR(1999/2004), TJ MAXX(2005/2015), MARSHALLS(2007/2022) MACON 127,260 78% HEILIG-MEYERS(2007/2017) SAVANNAH 88,480 100% MEDIA PLAY(2006/2021), PIGGLY WIGGLY(1999/2004), REVCO(2000) FOREST PARK 100,452 91% ATLANTA 165,314 100% GEORGIA SHOW(2005) GAINESVILLE 142,288 99% CONSOLIDATED STORES(2002), OFFICE DEPOT(2004/2020) AUGUSTA 119,930 94% PHAR-MOR(1999/2007), TJ MAXX(2004/2014), GOLDS GYM(2004/2009) IOWA WATERLOO 96,000 100% KMART(2021/2051) DAVENPORT 91,035 100% KMART(2024/2028) DUBUQUE 82,979 100% SHOPKO(2018/2019) CLIVE 90,000 100% KMART(2021/2051) DES MOINES 111,847 100% HOME DEPOT(2019/2064) ILLINOIS CHAMPAIGN 102,615 100% K'S MERCHANDISE MART(2014/2034) ADDISON 115,710 100% KMART(2024/2054) ARLINGTON HEIGHTS 81,370 100% KMART(2024/2054) BRIDGEVIEW 88,069 -- CALUMET CITY 197,386 95% KMART(2024/2054), MARSHALLS(2003/2008), BEST BUY(2012/2032) CHICAGO 109,441 100% KMART(2020) CHICAGO 104,264 100% GOLDBLATT'S(2005/2025) CHICAGO 87,563 100% KMART(2024/2054) CHICAGO 83,380 100% KMART(2024/2054) CHICAGO 117,450 98% KMART(2024/2054) COUNTRYSIDE 117,456 100% KMART(2024/2053) CRESTWOOD 79,903 100% KMART(2024/2051) FOREST PARK 98,371 100% KMART(2021) MATTESON 165,623 98% KMART(2024/2054), MARSHALLS(2005/2010)
18 PROPERTY CHART
YEAR OWNERSHIP DEVELOPED INTEREST/ LAND AREA OR ACQUIRED (EXPIRATION)(2) (ACRES) ----------- --------------- ------- MELROSE PARK 1998 FEE 6.75 MT.PROSPECT 1997 FEE 16.80 NILES 1997 GROUND LEASE(2022) 10.18 NORRIDGE 1997 GROUND LEASE(2042) 11.69 OAK LAWN 1997 FEE 15.43 ORLAND PARK 1998 FEE 18.83 ORLAND PARK (3) 1998 FEE/JOINT VENTURE 7.76 SCHAUMBURG (3) 1998 FEE/JOINT VENTURE 7.30 SCHAUMBURG 1997 GROUND LEASE(2015) 10.91 SKOKIE (3) 1997 GROUND LEASE(2003) 10.66 STREAMWOOD 1998 FEE 5.61 DOWNERS GROVE 1997 FEE 12.04 DOWNERS GROVE 1998 FEE/JOINT VENTURE 7.19 NAPERVILLE 1997 FEE 9.00 OAKBROOK TERRACE 1997 FEE 16.90 WOODRIDGE 1998 FEE 13.10 ADDISON 1968 GROUND LEASE(2066) 7.99 CARBONDALE 1997 GROUND LEASE(2052) 8.05 BRADLEY 1996 FEE 5.35 AURORA 1998 FEE 17.89 ELGIN 1972 FEE 18.69 ELGIN 1998 FEE 9.00 GENEVA 1996 FEE 8.18 MUNDELIEN 1998 FEE 7.62 WAUKEGAN 1998 FEE 6.82 OTTAWA 1970 FEE 9.00 ALTON 1998 FEE 21.22 CRYSTAL LAKE 1998 FEE 6.13 BLOOMINGTON 1972 FEE 16.09 PEORIA 1997 GROUND LEASE(2031) 20.45 SPRINGFIELD 1998 GROUND LEASE(2028) 6.66 MOLINE 1998 GROUND LEASE(2003) 9.25 ROCKFORD 1998 GROUND LEASE(2030) 9.00 BELLEVILLE 1998 GROUND LEASE(2057) 20.34 FAIRVIEW HEIGHTS 1998 GROUND LEASE(2050) 19.05 CRESTHILL 1997 GROUND LEASE(2039) 9.03 INDIANA GRIFFITH 1997 GROUND LEASE(2054) 10.57 MERRILLVILLE 1997 GROUND LEASE(2015) 12.67 E. WASHINGTON 1997 FEE 9.56 EAGLEDALE 1967 FEE 11.92 FELBRAM 1970 FEE 4.13 GREENWOOD 1970 FEE 25.68 INDIANAPOLIS 1998 FEE/JOINT VENTURE 17.42 INDIANAPOLIS 1986 FEE 20.60 MISHAWAKA 1998 FEE 7.47 SOUTH BEND 1998 FEE 1.82 LAFAYETTE 1971 FEE 12.37 LAFAYETTE 1997 FEE 24.34 LAFAYETTE 1998 FEE 43.16 EVANSVILLE 1986 FEE 14.20 EVANSVILLE 1986 FEE 11.50 KANSAS OVERLAND PARK 1998 FEE 14.48 ROELAND PARK 1997 GROUND LEASE(2024) 12.70 WICHITA 1998 FEE 13.50 WICHITA 1996 FEE 6.50 KANSAS CITY 1998 FEE 19.63 WICHITA 1996 FEE 8.06 LEASABLE PERCENT MAJOR LEASE AREA LEASED (LEASE EXPIRATION/ (SQ. FT) (1) OPTION EXPIRATION) -------- --- ------------------ MELROSE PARK 88,218 -- MT.PROSPECT 165,603 87% KMART(2024/2054), PAYLESS(2000/2005) NILES 101,775 100% KMART(2022), PAYLESS(1999/2009) NORRIDGE 116,914 100% KMART(2024/2042) OAK LAWN 164,040 87% KMART(2024/2054), CHUCK E CHEESE(2002/2007) ORLAND PARK 116,011 4% ORLAND PARK (3) 166,000 49% HEILIG-MEYERS(2008/2018) SCHAUMBURG (3) 167,690 51% HEILIG-MEYERS(2008/2018) SCHAUMBURG 104,910 100% KMART(2015) SKOKIE (3) 108,423 2% STREAMWOOD 81,000 -- DOWNERS GROVE 141,906 100% TJ MAXX(2009/2024), BEST BUY(2015/2030) DOWNERS GROVE 182,624 48% HEILIG-MEYERS(2008/2018) NAPERVILLE 102,615 100% KMART(2024/2054) OAKBROOK TERRACE 169,034 100% KMART(2024/2054), LINENS N THINGS(2006) WOODRIDGE 149,411 98% GENERAL CINEMA(2006/2021), MICHIGAN SPORT(2001/2011), MONTGOMERY WARD(2004/2009) ADDISON 93,289 100% SCHOTTENSTEIN STORES(2001/2016) CARBONDALE 80,535 100% K'S MERCHANDISE MART(2012/2052) BRADLEY 80,535 100% CARSON PIERRIE SCOTT(2014/2034) AURORA 90,189 100% KMART(2024/2054) ELGIN 183,439 99% MENARD(2001/2006), EAGLE FOOD(2000) ELGIN 102,585 100% KMART(2024/2054) GENEVA 104,000 100% KMART(2024/2054) MUNDELIEN 90,630 100% KMART(2024/2054) WAUKEGAN 90,555 100% MEGA MARTS(2009/2029) OTTAWA 60,000 100% SCHOTTENSTEIN STORES(2001/2011) ALTON 124,466 100% GRANDPAS(2003/2023) CRYSTAL LAKE 81,365 72% HOBBY LOBBY(2009/2019) BLOOMINGTON 175,530 100% SCHNUCK MARKETS(2004/2024), TOYS R US(2015/2045), BARNES & NOBLE(2005/2015) PEORIA 158,407 83% KMART(2024/2031) SPRINGFIELD 115,526 100% KMART(2024/2028) MOLINE 105,977 100% SHOPKO(2003) ROCKFORD 102,971 100% SHOPKO(2018/2030) BELLEVILLE 81,730 100% KMART(2024/2054) FAIRVIEW HEIGHTS 163,911 100% KMART(2024/2050), OFFICEMAX(2015/2025) CRESTHILL 90,313 -- INDIANA GRIFFITH 114,860 100% KMART(2024/2054) MERRILLVILLE 101,887 100% KMART(2015) E. WASHINGTON 89,042 -- EAGLEDALE 75,000 95% DAVIS WHOLESALE(2003/2012) FELBRAM 27,400 91% SAVE A LOT(2001/2016), BLOCKBUSTER(2004/2009) GREENWOOD 157,160 100% BABIES R US(2006/2021), TJ MAXX(2004/2010) INDIANAPOLIS 166,104 55% KROGER(2000/2020), CVS(2004/2024) INDIANAPOLIS 178,610 89% TARGET(2009/2029), FABRI CENTER(1999) MISHAWAKA 82,100 100% K'S MERCHANDISE MART(2013/2023) SOUTH BEND 81,668 -- LAFAYETTE 90,500 100% MENARD(TJX)(2001/2006) LAFAYETTE 176,940 98% TARGET(2000/2024), FABRI CENTER(2010/2011) LAFAYETTE 190,377 84% PETSMART(2012/2032), STAPLES(2011/2026), MICHAELS(2006/2026) EVANSVILLE 193,472 96% SHOPKO(2018/2038), OFFICEMAX(2012/2027), MICHAELS(2004/2019) EVANSVILLE 149,182 90% SHOPKO(2018/2038), BUEHLER FOODS(2003/2013) KANSAS OVERLAND PARK 168,953 100% HOME DEPOT(2005/2050) ROELAND PARK 127,401 100% KMART(2024), PRICE CHOPPER(2004/2009) WICHITA 133,800 100% BEST BUY(2010/2025), TJ MAXX(2004/2019), MICHAELS(2005/2025) WICHITA 97,992 100% SHOPKO(2018/2038) KANSAS CITY 164,332 100% K MART(2024/2054), PRICE CHOPPER(2002/2017) WICHITA 96,319 100% SHOPKO(2018/2038)
19 PROPERTY CHART
YEAR OWNERSHIP DEVELOPED INTEREST/ LAND AREA OR ACQUIRED (EXPIRATION)(2) (ACRES) ----------- --------------- ------- KENTUCKY BELLEVUE 1976 FEE 6.04 PADUCAH 1998 GROUND LEASE(2039) 1.96 LEXINGTON 1993 FEE 35.82 LOUISIANA LAFAYETTE 1997 FEE 21.94 BATON ROUGE 1997 FEE 18.58 BATON ROUGE 1983 FEE/JOINT VENTURE 7.00 MARYLAND WHITE MARSH 1998 FEE 25.30 LAUREL 1964 FEE 18.00 LAUREL 1972 FEE 8.06 HAGERSTOWN 1973 FEE 10.48 MASSACHUSETTS GREAT BARRINGTON 1994 FEE 14.14 LEOMINSTER 1975 FEE 57.00 MICHIGAN WALKER 1993 FEE 41.78 MUSKEGON 1985 FEE 12.20 CLARKSTON 1996 FEE 20.00 CLAWSON 1993 FEE 13.47 FARMINGTON 1993 FEE 2.78 GRAND HAVEN 1976 FEE 7.55 LIVONIA 1968 FEE 4.53 TAYLOR 1993 FEE 13.00 MINNESOTA MINNETONKA 1998 FEE 12.10 MISSOURI SPRINGFIELD 1998 GROUND LEASE(2087) 18.50 SPRINGFIELD 1994 FEE 41.50 ST. JOSEPH 1998 FEE 10.22 CAPE GIRARDEAU 1997 GROUND LEASE(2060) 6.99 ST. LOUIS 1972 FEE 13.11 KANSAS CITY 1997 FEE 15.64 INDEPENDENCE 1998 FEE 21.03 KANSAS CITY 1997 FEE 17.84 JOPLIN 1998 FEE 9.45 ST.PETERS 1997 FEE 14.77 BRIDGETON 1997 GROUND LEASE(2040) 27.29 CREVE COEUR 1998 FEE 12.23 ELLISVILLE 1970 FEE 18.37 HAZELWOOD 1970 FEE 15.00 JENNINGS 1971 FEE 8.20 KIRKWOOD 1998 GROUND LEASE(2069) 19.75 LEMAY 1974 FEE 3.09 MANCHESTER 1998 FEE 9.55 ST.LOUIS 1997 GROUND LEASE(2025) 19.66 ST.LOUIS 1997 GROUND LEASE(2035) 37.71 ST.LOUIS 1997 GROUND LEASE(2040) 16.33 ST.LOUIS 1997 FEE 17.51 ST.LOUIS 1998 FEE 17.54 ST. CHARLES (5) 1998 FEE 36.87 JOPLIN 1998 FEE 12.51 NEW HAMPSHIRE SALEM (3) 1994 FEE 39.80 LEASABLE PERCENT MAJOR LEASE AREA LEASED (LEASE EXPIRATION/ (SQ. FT) (1) OPTION EXPIRATION) -------- --- ------------------ KENTUCKY BELLEVUE 53,695 100% KROGER(2005/2035) PADUCAH 85,229 100% SHOPKO(2018/2038) LEXINGTON 258,644 99% BEST BUY(2009/2024), BED BATH & BEYOND(2013/2038), TOYS R US(2013/2038) LOUISIANA LAFAYETTE 150,936 99% STEIN MART(2005/2020), T.J. MAXX(2003/2018), OFFICEMAX(2012/2027) BATON ROUGE 262,256 90% STEIN MART(2006/2016), US OFFICE PRODUCTS(2002/2007), MARSHALLS(2001/2016) BATON ROUGE 190,000 100% MERCANTILE STORES(2011/2031) MARYLAND WHITE MARSH 209,831 100% COSTCO(2011/2046), SPORTS AUTHORITY(2011/2021), PETSMART(2010/2030) LAUREL 73,542 90% FOOD A RAMA(1999/2009), FACTORY CARD OUTLET(2005/2015), OLD COUNTRY BUFFET(2009/2019) LAUREL 81,550 100% AMES(2007/2017) HAGERSTOWN 115,718 98% AMES(2007/2017) MASSACHUSETTS GREAT BARRINGTON 134,817 94% KMART(2001/2016), PRICE CHOPPER(2016/2036) LEOMINSTER 595,760 93% SEARS(2003/2033), JC PENNEY(2009/2034), BRADLEES(2009/2024) MICHIGAN WALKER 284,143 98% KMART(2016/2051), KOHLS(2017/2037), OFFICEMAX(2013/2033) MUSKEGON 72,235 89% PLUMB(2002/2022), FABRI CENTER(2002/2012) CLARKSTON 156,864 99% A&P(2015/2045), FRANKS NURSERY(2011/2031) CLAWSON 177,797 100% A&P(2006/2016), FRANKS NURSERY(2016), STAPLES(2011/2026) FARMINGTON 97,038 100% A&P(2001), DAMMAN HARDWARE(2002) GRAND HAVEN 87,430 96% FAMILY FARE(2006/2026), QUALITY MATTRESS(2008) LIVONIA 44,185 97% DAMMAN HARDWARE(2004/2014) TAYLOR 121,364 100% KOHLS(2011/2031), DRUG EMPORIUM(2000/2020) MINNESOTA MINNETONKA 120,220 98% TOYS R US(2016/2031), GOLFSMITH(2008/2018), OFFICE MAX(2001/2011) MISSOURI SPRINGFIELD 163,530 94% KMART(2024/2054), OFFICE DEPOT(2000/2010) SPRINGFIELD 271,552 93% BEST BUY(2011/2026), JC PENNEY(2005/2015), TJ MAXX(2006/2021) ST. JOSEPH 90,630 -- CAPE GIRARDEAU 80,803 100% SHOPKO(2018/2038) ST. LOUIS 163,821 81% K MART(1999/2019), WALGREENS(2006) KANSAS CITY 147,989 100% KMART(2024/2054), PRICE CHOPPER(2001/2006) INDEPENDENCE 159,847 83% KMART(2024/2054) KANSAS CITY 161,538 100% HOME DEPOT(2005/2050) JOPLIN 80,524 100% SHOPKO(2018/2038) ST.PETERS 167,087 97% KMART(2024/2054), OFFICE DEPOT(2004/2009) BRIDGETON 101,592 100% KOHLS(2010/2020) CREVE COEUR 113,781 82% KOHLS(2018/2038) ELLISVILLE 118,080 100% SHOP N SAVE(2005/2015) HAZELWOOD 149,230 88% KMART(2000/2020), WALGREENS(2006) JENNINGS 155,095 18% WALGREENS(2056) KIRKWOOD 167,562 97% KMART(2024/2054), HANCOCK FABRICS(2007/2017) LEMAY 73,281 100% SHOP N SAVE(2003/2008), ODD LOTS(1999), DOLLAR GENERAL(2003/2008) MANCHESTER 89,305 100% KOHLS(2018/2038) ST.LOUIS 162,901 93% KMART(2023/2024) ST.LOUIS 164,191 98% KMART(2024/2035), OFFICE DEPOT(1999/2009) ST.LOUIS 116,222 100% KMART(2024/2040) ST.LOUIS 165,809 80% KMART(2024/2054) ST.LOUIS 157,913 22% OFFICE DEPOT(1999/2009) ST. CHARLES (5) -- -- JOPLIN 147,142 96% HASTINGS BOOKS(2004/2014), HOBBY LOBBY(2008/2013), OFFICEMAX(2010/2025) NEW HAMPSHIRE SALEM (3) 332,951 93% BRADLEES(2003/2013), SHAWS SUPERMARKET(2008/2038), BOB'S(2011/2021)
20 PROPERTY CHART
YEAR OWNERSHIP DEVELOPED INTEREST/ LAND AREA OR ACQUIRED (EXPIRATION)(2) (ACRES) ----------- --------------- ------- NEW JERSEY RIDGEWOOD 1994 FEE 2.71 CINNAMINSON 1996 FEE 13.67 CHERRY HILL 1985 FEE/JOINT VENTURE 18.58 CHERRY HILL 1996 GROUND LEASE(2035) 15.20 WESTMONT 1994 FEE 17.39 NORTH BRUNSWICK 1994 FEE 38.12 PISCATAWAY 1998 FEE 9.60 BRIDGEWATER (4) 1998 FEE 74.74 PLAINFIELD 1998 FEE 16.23 FRANKLIN 1998 FEE 14.90 NEW MEXICO ALBUQUERQUE 1998 FEE 4.70 ALBUQUERQUE 1998 FEE 26.00 ALBUQUERQUE 1998 FEE 4.77 NEW YORK POUGHKEEPSIE 1972 FEE 20.03 HENRIETTA 1988 FEE 14.90 IRONDEQUOIT 1988 FEE 12.80 WEST GATES 1993 FEE 8.55 CARLE PLACE 1993 FEE 8.34 PLAINVIEW 1969 FEE 6.98 SYOSSET 1967 FEE 2.49 STATEN ISLAND 1989 FEE 16.70 STATEN ISLAND 1997 FEE 7.00 NANUET 1984 FEE 6.00 BRIDGEHAMPTON 1973 FEE 30.20 CENTEREACH 1993 FEE/JOINT VENTURE 40.68 COMMACK 1998 GROUND LEASE(2085)/JOINT VENTURE 35.70 COPIAGUE 1998 FEE 15.40 HAMPTON BAYS 1989 FEE 8.17 BRONX 1998 FEE/JOINT VENTURE 11.00 YONKERS 1995 FEE 4.13 NORTH CAROLINA DURHAM 1996 FEE 13.24 WINSTON-SALEM 1969 FEE 13.15 GASTONIA 1989 FEE 24.85 GREENSBORO 1998 FEE 4.40 CHARLOTTE 1968 FEE 13.50 CHARLOTTE 1993 FEE 13.96 CHARLOTTE 1986 GROUND LEASE(2048) 14.33 CARY 1998 FEE 10.90 RALEIGH 1993 FEE 35.94 OHIO LIMA 1986 FEE 18.13 SPRINGFIELD 1988 FEE 14.32 CLEVELAND 1975 GROUND LEASE(2035) 9.42 COLUMBUS 1998 FEE 12.13 COLUMBUS 1988 FEE 12.40 COLUMBUS 1988 FEE 13.70 COLUMBUS 1988 FEE 17.90 COLUMBUS 1988 FEE 12.40 UPPER ARLINGTON 1969 FEE 13.28 WESTERVILLE 1988/1993 FEE 25.40 WHITEHALL COLUMBUS 1967 FEE 13.80 BEAVERCREEK (3) 1986 FEE 18.19 CAMBRIDGE 1973 FEE 13.08 CINCINATTI 1988 FEE 11.60 LEASABLE PERCENT MAJOR LEASE AREA LEASED (LEASE EXPIRATION/ (SQ. FT) (1) OPTION EXPIRATION) -------- --- ------------------ NEW JERSEY RIDGEWOOD 24,280 100% WHOLE FOODS(2013/2024) CINNAMINSON 121,084 78% AMES(2019/2034) CHERRY HILL 121,673 75% GIANT FOOD(2016/2036) CHERRY HILL 129,809 100% KOHLS(2016/2035), SEARS(2003/2013) WESTMONT 195,824 68% A&P(2017/2081), SUPER FITNESS(2009) NORTH BRUNSWICK 409,879 100% WALMART(2018/2058), BURLINGTON COAT FACTORY(2008/2013) PISCATAWAY 97,348 96% FOODARAMA(2014/2024) BRIDGEWATER (4) -- -- PLAINFIELD 136,939 100% A&P(2018/2058), SEARS HARDWARE(2008/2018) FRANKLIN 138,364 100% GIANT(2010/2020), LIFESTYLES FITNESS(2006/2016) NEW MEXICO ALBUQUERQUE 37,735 100% SEARS(2006/2021) ALBUQUERQUE 180,512 99% MOVIES WEST(2011/2021), ROSS STORES(2001/2021) ALBUQUERQUE 59,723 95% PAGE ONE(2003/2013), WALGREENS(2027) NEW YORK POUGHKEEPSIE 180,064 86% EDWARDS(2002/2012) HENRIETTA 123,000 15% STAPLES(2010/2022) IRONDEQUOIT 105,000 -- WEST GATES 185,153 39% TOPS(2004/2024) CARLE PLACE 132,318 91% HARROWS(2000), STAPLES(2010/2025), JUST FOR FEET(2011/2026) PLAINVIEW 88,206 91% WALDBAUMS(2017/2037) SYOSSET 32,124 16% STATEN ISLAND 210,990 100% K MART(2001/2011), PATHMARK(2001/2021) STATEN ISLAND 98,247 96% WALDBAUMS(2001/2031), CVS(2000/2015) NANUET 70,829 77% RKO CENTURY THEATRES(2000/2010) BRIDGEHAMPTON 287,632 99% KING KULLEN(2015/2035), TJ MAXX(2007/2017) CENTEREACH 371,028 90% WALMART(2015/2044), KING KULLEN(2003/2034), MODELL'S SPORTING GOODS(2009/2019) COMMACK 265,409 100% KING KULLEN(2017/2047), SPORTS AUTHORITY(2017/2037), TOYS R US(2023/2043) COPIAGUE 163,999 100% HOME DEPOT(2011/2056), BALLY TOTAL FITNESS(2008/2019) HAMPTON BAYS 70,990 100% STERNS(2005/2025), GENOVESE(2001/2016) BRONX 225,821 96% A&P(2011), NATIONAL AMUSEMENTS(2011) YONKERS 43,560 100% BIG V SUPERMARKET(2008/2028) NORTH CAROLINA DURHAM 116,169 82% TJ MAXX(2003/2013) WINSTON-SALEM 137,929 74% KROGER(2016/2041), SPORTSMAN'S SUPPLY(2008) GASTONIA 235,607 96% SERVICE MERCHANDISE(2003), TOYS R US(2015/2045), WINN DIXIE(2002) GREENSBORO 41,387 100% STAPLES(2011/2031) CHARLOTTE 110,300 94% MEDIA PLAY(2004/2019), TJX(2001/2016) CHARLOTTE 135,269 100% BI-LO(2009/2029), MICHAELS(2003/2013), PARTY CITY(2004/2014) CHARLOTTE 227,883 95% TOYS R US(2012/2042), DRUG EMPORIUM(2005/2015), OFFICEMAX(2009/2024) CARY 102,787 100% LOWES FOOD(2017/2037), ECKERD(2007/2017) RALEIGH 374,395 98% BEST BUY(2005/2020), PHAR-MOR(2010/2025), MARSHALLS(2004/2014) OHIO LIMA 194,130 99% RAYS SUPERMARKET(2011/2026), THE PHARM(2004/2024) SPRINGFIELD 131,628 100% KMART(2010/2029), KROGER(2001/2007) CLEVELAND 82,411 75% ALDIS(2003/2023) COLUMBUS 113,184 95% BORDERS BOOKS(2018/2038), ZANY BRAINY(2007/2017) COLUMBUS 191,089 100% KOHLS(2011/2031), KIDS R US(2015/2040) COLUMBUS 140,993 100% KOHLS(2011/2031), STAPLES(2000/2010) COLUMBUS 129,008 100% KOHLS(2011/2031) COLUMBUS 135,650 100% KOHLS(2011/2031), CIRCUIT CITY(2019/2039) UPPER ARLINGTON 153,733 89% TJ MAXX(2001/2006) WESTERVILLE 242,124 100% KOHLS(2016/2036), OFFICEMAX(2002/2012) WHITEHALL COLUMBUS 112,813 15% BEAVERCREEK (3) 127,318 71% KROGER(2018/2048) CAMBRIDGE 95,955 99% QUALITY STORES(TJX)(2000/2018), KROGER(1999/2014) CINCINATTI 139,985 67% CIRCUIT CITY(2008/2031), BIG LOTS(2004/2009), OFFICE DEPOT(2004/2024)
21 PROPERTY CHART
YEAR OWNERSHIP DEVELOPED INTEREST/ LAND AREA OR ACQUIRED (EXPIRATION)(2) (ACRES) ----------- --------------- ------- CINCINNATI 1988 FEE 29.20 SHARONVILLE 1977 GROUND LEASE(2076)/JOINT VENTURE 14.99 MENTOR 1987 FEE 20.59 MENTOR 1988 FEE 25.00 WICKLIFFE 1995 FEE 10.00 ELYRIA 1988 FEE 8.30 BRUNSWICK 1975 FEE 20.00 CENTERVILLE 1988 FEE 15.20 DAYTON 1969 GROUND LEASE(2043) 22.82 DAYTON 1984 FEE 32.01 DAYTON 1988 FEE 16.86 KETTERING 1988 FEE 11.21 SPRINGBORO PIKE 1985 FEE 12.96 CANTON 1993 FEE 7.88 CANTON 1972 FEE 19.60 MASSILLON 1988 GROUND LEASE(2001) 13.09 AKRON 1975 FEE 6.91 BARBERTON 1972 FEE 9.97 OKLAHOMA OKLAHOMA CITY 1997 FEE 9.64 MIDWEST CITY 1998 FEE 9.70 OKLAHOMA CITY 1998 FEE 19.80 OKLAHOMA CITY (6) 1997 GROUND LEASE(2019) 7.36 TULSA 1996 FEE 8.79 PENNSYLVANIA GETTYSBURG 1986 FEE 2.25 DUQUESNE 1993 FEE 8.77 PENN HILLS 1986 GROUND LEASE(2027) 31.06 WEST MIFFLIN 1974 FEE 24.62 WEST MIFFLIN 1986 FEE 8.33 FEASTERVILLE 1996 FEE 4.60 MORRISVILLE (6) 1996 FEE 14.38 RICHBORO (3) 1986 FEE 14.47 WARRINGTON 1996 FEE 8.28 EXTON 1996 FEE 9.78 UPPER ALLEN 1986 FEE 6.00 HARRISBURG 1972 FEE/JOINT VENTURE 17.00 MIDDLETOWN 1973 FEE 21.86 MIDDLETOWN 1986 FEE 4.66 HAVERTOWN 1996 FEE 9.01 SPRINGFIELD 1983 FEE 19.66 UPPER DARBY 1996 FEE/JOINT VENTURE 16.34 ERIE 1968 FEE 0.57 WHITEHALL 1996 GROUND LEASE(2081) 6.00 CENTER SQUARE 1996 FEE 17.72 E STROUDSBURG 1973 FEE 15.33 EAGLEVILLE 1973 FEE 15.20 LANDSDALE 1996 GROUND LEASE(2037) 1.39 NORRISTOWN 1984 FEE 12.52 PHILADELPHIA 1997 FEE 3.40 PHILADELPHIA 1983 FEE/JOINT VENTURE 8.12 PHILADELPHIA 1995 FEE/JOINT VENTURE 22.55 PHILADELPHIA 1996 FEE 6.30 PHILADELPHIA 1996 GROUND LEASE(2035) 6.82 TREXLERTOWN 1998 GROUND LEASE(2048)/JOINT VENTURE 1.18 NEW KENSINGTON 1986 FEE 12.53 YORK 1986 FEE 8.00 YORK 1986 FEE 13.65 YORK 1986 FEE 3.32 LEASABLE PERCENT MAJOR LEASE AREA LEASED (LEASE EXPIRATION/ (SQ. FT) (1) OPTION EXPIRATION) -------- --- ------------------ CINCINNATI 321,537 100% HECHINGERS(2013/2033), SERVICE MERCHANDISE(2002/2012), TOYS R US(2016/2046) SHARONVILLE 130,715 100% KMART(2004/2054), KROGER(2003/2028) MENTOR 103,911 100% AMES(2020/2045) MENTOR 271,914 98% RINI SUPERMARKET(2019/2029),BURLINGTON COAT FACTORY(2014),FABRI CENTER(2009/2019) WICKLIFFE 128,180 100% GABRIEL BROS(2008/2023), CONSOLIDATED STORES(2000) ELYRIA 103,400 100% KMART(2010/2029) BRUNSWICK 168,523 96% KMART(2000/2050), RINI SUPERMARKET(2001/2031) CENTERVILLE 115,378 65% WACCAMAW(2006/2021), LASER QUEST(2007/2017) DAYTON 163,131 54% BEST BUY(2004/2024), FABRI CENTER(2002/2012) DAYTON 215,891 87% VICTORIA'S SECRET(2004/2019), FABRI CENTER(2006/2016), KROGER (2012/2038) DAYTON 141,616 90% SCHOTTENSTEIN STORES(2010/2020), CIRCUIT CITY(2018/2038) KETTERING 123,148 94% SCHOTTENSTEIN STORES(2010/2015) SPRINGBORO PIKE 99,147 100% OFFICEMAX(2002/2022), HANCOCK FABRICS(2007/2017) CANTON 63,712 72% CINEMARK(1999) CANTON 161,569 80% TJ MAXX(2007/2017) MASSILLON 102,632 100% AMES(2001) AKRON 56,975 78% GIANT EAGLE(1999/2024), DOLLAR GENERAL(2002) BARBERTON 119,975 100% GIANT EAGLE(2007/2012) OKLAHOMA OKLAHOMA CITY 96,481 100% KMART(2024/2054) MIDWEST CITY 99,118 98% KMART(2024/2054) OKLAHOMA CITY 233,797 93% HOME DEPOT(2014/2044), BEST BUY(2007/2022) OKLAHOMA CITY (6) 73,600 -- TULSA 96,100 100% KMART(2021/2051) PENNSYLVANIA GETTYSBURG 30,706 100% GIANT FOOD(2000/2010) DUQUESNE 69,733 100% PENN HILLS 110,517 100% AMES(2017/2026) WEST MIFFLIN 194,393 97% AMES(2004/2034), GIANT EAGLE(2014/2039) WEST MIFFLIN 84,279 100% AMES(2007/2032) FEASTERVILLE 86,575 100% VALUE CITY(2011/2026) MORRISVILLE (6) 117,524 2% RICHBORO (3) 109,721 100% SUPER FRESH(2018/2058) WARRINGTON 82,338 -- EXTON 85,184 100% KOHLS(2016/2036) UPPER ALLEN 59,470 97% GIANT FOOD(2010/2030) HARRISBURG 175,917 100% AMES(2002/2032), MEDIA PLAY(2011/2026), SUPERPETZ(2002/2022) MIDDLETOWN 140,481 57% ELECTRONIC INSTITUTE(1999) MIDDLETOWN 35,747 81% US POSTAL SERVICE(2016/2026), FAMILY DOLLAR(2003/2008) HAVERTOWN 80,938 100% KOHLS(2016/2036) SPRINGFIELD 218,907 98% VALUE CITY(2013/2043), STAPLES(2008), JO ANN FABRICS(2006/2016) UPPER DARBY 52,657 63% MERCY HEALTH(2012/2022) ERIE 2,196 -- WHITEHALL 84,524 100% KOHLS(2016/2036) CENTER SQUARE 116,055 100% KOHLS(2016/2036), SEARS(2002/2007) E STROUDSBURG 168,218 100% KMART(2002/2022), WEIS MARKETS(2002/2012) EAGLEVILLE 165,385 99% K MART(2004/2019), GENUARDI SUPERMARKET(2011/2025) LANDSDALE 71,760 100% KOHLS(2012) NORRISTOWN 134,860 100% GIANT FOOD(2017/2037), STAPLES(2008/2023), FABRI CENTER(2002/2012) PHILADELPHIA 38,753 90% MERCY HEALTH(2012/2022) PHILADELPHIA 214,970 100% JC PENNEY(2012/2037), TOYS R US(2002/2052) PHILADELPHIA 274,330 96% PET FOOD GIANT(2006/2016), PEP BOYS(2004/2014) PHILADELPHIA 82,345 100% KOHLS(2016/2036) PHILADELPHIA 133,309 100% KMART(2010/2035) TREXLERTOWN 50,000 63% WELLNESS PLACE(2008/2023) NEW KENSINGTON 106,624 100% GIANT EAGLE(2006/2026) YORK 61,979 100% SUPERPETZ(2004/2009), DISCOVERY ZONE(2005/2015) YORK 53,011 100% GIANT FOOD(2006/2026) YORK 35,500 100% GIANT FOOD(2002/2017), RITE AID(2002/2012)
22 7 PROPERTY CHART
YEAR OWNERSHIP DEVELOPED INTEREST/ LAND AREA OR ACQUIRED (EXPIRATION)(2) (ACRES) ----------- --------------- ------- RHODE ISLAND CRANSTON 1998 FEE 11.02 SOUTH CAROLINA AIKEN 1989 FEE 16.63 CHARLESTON 1978 FEE 17.60 NORTH CHARLESTON 1997 FEE 21.07 CHARLESTON 1995 FEE 17.15 FLORENCE 1997 FEE 21.00 GREENVILLE 1997 FEE 20.35 TENNESSEE NASHVILLE 1998 FEE 10.20 CHATTANOOGA 1973 GROUND LEASE(2073) 7.63 GOODLETTSVILLE 1998 FEE 16.93 MEMPHIS 1998 FEE 14.71 MADISON 1978 GROUND LEASE(2039) 14.49 TEXAS PLANO 1996 FEE 9.03 DALLAS 1969 FEE/JOINT VENTURE 75.00 DALLAS 1998 FEE 6.80 DUNCANVILLE 1996 FEE 6.80 GARLAND 1998 FEE 6.30 GARLAND 1996 FEE 2.89 GARLAND 1996 FEE 8.83 MESQUITE 1974 FEE 9.03 MESQUITE 1998 FEE 15.00 RICHARDSON 1998 FEE 11.70 LEWISVILLE 1998 FEE 11.20 LEWISVILLE 1998 FEE 3.80 BAYTOWN 1996 FEE 8.68 HOUSTON 1973 FEE 4.25 HOUSTON 1998 FEE 40.00 HOUSTON (4) 1998 FEE/JOINT VENTURE 46.50 HOUSTON 1997 FEE 8.04 HOUSTON 1996 FEE 8.75 HOUSTON 1997 FEE 8.17 WEST OAKS 1996 FEE 8.18 LUBBOCK 1998 FEE 9.58 CORSICANA 1997 FEE 10.25 AUSTIN 1998 FEE 15.10 AMARILLO 1997 FEE 9.30 ARLINGTON 1997 GROUND LEASE(2043) 8.00 ARLINGTON 1996 FEE 8.04 FT. WORTH 1996 FEE 12.59 NORTH RICHLAND HILLS(5) 1997 FEE 9.17 LEWISVILLE 1998 FEE 3.80 CEDAR HILL (4) 1998 FEE 23.25 AUSTIN 1998 FEE 18.20 UTAH OGDEN 1967 FEE 11.36 VIRGINIA FAIRFAX 1998 FEE 37.00 RICHMOND 1995 FEE 11.47 MANASSAS 1997 FEE 13.50 WOODBRIDGE 1973 GROUND LEASE(2072)/JOINT VENTURE 19.63 WOODBRIDGE 1998 FEE 54.00 WASHINGTON BELLINGHAM 1998 FEE 20.00 LEASABLE PERCENT MAJOR LEASE AREA LEASED (LEASE EXPIRATION/ (SQ. FT) (1) OPTION EXPIRATION) -------- --- ------------------ RHODE ISLAND CRANSTON 129,907 100.0% BOB'S(2003/2028), MARSHALLS(2001/2021) SOUTH CAROLINA AIKEN 132,345 69% WALMART(2002/2032) CHARLESTON 166,855 84% STEIN MART(2001/2016) NORTH CHARLESTON 204,662 96% PHAR-MOR(2000/2010), TJ MAXX(2003/2008) CHARLESTON 186,096 93% TJ MAXX (1999/2004), OFFICE DEPOT(2001/2016), BARNES & NOBLE(2014/2029) FLORENCE 113,922 100% HAMRICK'S(2001/2011), STAPLES(2010/2035), ATHLETE'S FOOT(2007/2017) GREENVILLE 148,612 100% PHAR-MOR(2005/2020), BABIES R US(2002/2022) TENNESSEE NASHVILLE 109,012 100% MARSHALLS(2000/2005), OFFICEMAX(2004/2019), OLD COUNTRY BUFFET(2006/2017) CHATTANOOGA 44,288 66% GOODLETTSVILLE 171,236 99% UPTONS DEPARTMENT STORE(2006/2016), STEIN MART(2003/2013), FACTORY CARD(2008/2018) MEMPHIS 167,283 98% TOYS R US(2017/2042), OFFICEMAX(2008/2028), JUST FOR FEET(2015/2025) MADISON 182,256 100% OLD TIME POTTERY(2001/2006), HOLLYWOOD ENTERTAINMENT(2008/2014) TEXAS PLANO 97,260 100% HOME DEPOT(2024/2054) DALLAS 566,826 54% MONTGOMERY WARD(2000/2015) DALLAS 83,867 90% ROSS STORES(2007/2017), OFFICEMAX(2009/2024) DUNCANVILLE 96,500 100% KMART(2021/2051) GARLAND 62,000 100% OFFICE DEPOT(2001/2021), DRUG EMPORIUM(2006), BLOCKBUSTER(2001/2021) GARLAND 41,364 100% KROGER(2000/2025) GARLAND 103,600 100% KMART(2021/2051) MESQUITE 79,550 100% KROGER(2012/2037) MESQUITE 209,580 100% BEST BUY(2009/2024), SEARS(2001/2026), PETSMART(2007/2027) RICHARDSON 115,579 100% OFFICEMAX(2011/2026), BALLY TOTAL FITNESS(2009/2019) LEWISVILLE 74,890 98% BALLY'S(2007/2022), TALBOT'S(2007/2017) LEWISVILLE 124,104 100% HOMEPLACE(2012/2027), BABIES R US(2009/2027) BAYTOWN 103,800 54% HOBBY LOBBY(2008/2018) HOUSTON 45,494 100% KROGER(2002/2012) HOUSTON 426,097 100% KMART (2012/2032), BED BATH & BEYOND(2009/2019) HOUSTON (4) 3,500 100% HOUSTON 113,831 90% HEB GROCERY(2007/2027), PALAIS ROYAL(2007/2022), CATO(2004/2009) HOUSTON 106,000 100% KMART(2021/2051) HOUSTON 106,295 100% HOME DEPOT(2024/2054) WEST OAKS 96,500 100% KMART(2021/2051) LUBBOCK 108,326 100% PETSMART(2015/2040), OFFICEMAX(2009/2029), BARNES & NOBLE(2010/2025) CORSICANA 350,000 -- AUSTIN 153,325 96% HEB GROCERY(2006/2026) AMARILLO 342,859 96% BUILDERS SQUARE(2019/2064), KMART(2024/2054), CIRCUIT CITY(2010/2035) ARLINGTON 96,127 100% HOBBY LOBBY(2008/2018) ARLINGTON 97,000 100% KMART(2021/2051) FT. WORTH 106,000 100% KMART(2021/2051) NORTH RICHLAND HILLS(5) -- -- LEWISVILLE 93,668 100% DRUG EMPORIUM(2013/2028), DESIGNER SHOE(2008/2028) CEDAR HILL (4) -- -- AUSTIN 192,010 99% CIRCUIT CITY(2017/2037), BABIES R US(2012/2027) UTAH OGDEN 121,449 99% KMART(2002) VIRGINIA FAIRFAX 323,262 100% HOME DEPOT(2013/2033), COSTCO(2011/2046), SPORTS AUTHORITY(2003/2013) RICHMOND 121,550 100% BURLINGTON COAT FACTORY(2006/2035) MANASSAS 117,525 87% SUPERFRESH(2006/2026) WOODBRIDGE 186,142 66% AMES(2000/2020), ALDI'S(2023) WOODBRIDGE 481,740 97% LOWE'S(2012/2032), SHOPPERS FOOD WAREHOUSE(2009/2044), BEST BUY(2010/2025) WASHINGTON BELLINGHAM 174,547 100% FEDERATED(2012/2022), TJ MAXX(2001/2011)
23 PROPERTY CHART
YEAR OWNERSHIP DEVELOPED INTEREST/ LAND AREA OR ACQUIRED (EXPIRATION)(2) (ACRES) ----------- --------------- ------- WISC0NSIN RACINE 1988 FEE 14.20 WEST VIRGINIA MARTINSBURG 1986 FEE 6.04 CHARLES TOWN 1985 FEE 22.00 -------- TOTAL 375 PROPERTY INTERESTS 5,506.57 ======== ACQUISITIONS SUBSEQUENT TO DECEMBER 31,1998 ARIZONA CHANDLER (4) 1999 FEE 16.50 CALIFORNIA TEMECULA 1999 FEE 40.00 SAN RAMON 1999 FEE 5.30 ILLINOIS DOWNERS GROVE 1999 FEE 24.76 TEXAS HOUSTON 1999 FEE 5.59 SAN ANTONIO (4) 1999 FEE 170.00 WEST VIRGINIA SOUTH CHARLESTON 1999 FEE 14.75 DISPOSITIONS SUBSEQUENT TO DECEMBER 31, 1998 OKLAHOMA OKLAHOMA CITY 1997 GROUND LEASE(2019) (7.36) (73,600) PENNSYLVANIA MORRISVILLE 1996 FEE (14.38) (117,524) 5,761.73 51,804,112 -------- ------------- RETAIL STORE LEASES (7) 1995/97 LEASEHOLD 5,419,977 ------------- GRAND TOTAL 440 PROPERTY INTERESTS 57,224,089 ------------- LEASABLE AREA (SQ. FT) -------- WISC0NSIN RACINE 158,930 82% PIGGLY WIGGLY(1999/2010), CONSOLIDATED STORES(2000/2005), HEILIG-MEYERS(2007/2017) WEST VIRGINIA MARTINSBURG 43,212 100% GIANT FOOD(2010/2030), CVS(2003/2009) CHARLES TOWN 201,208 98% WALMART(2017/2047), STAPLES(2008/2018) ---------- ---- TOTAL 375 PROPERTY INT 51,195,757 90% ========== ==== ACQUISITIONS SUBSEQUENT TO DECEMBER 31, 1998 ARIZONA CHANDLER (4) -- -- CALIFORNIA TEMECULA 339,966 98% K MART(2017/2032), FOOD 4 LESS(2010/2030), TJ MAXX(2000/2010) SAN RAMON 42,066 100% SUPER CROWN BOOKS(2004/2014) ILLINOIS DOWNERS GROVE 144,670 92% DOMINICK'S(2004/2019), WALGREENS(2007/2022) TEXAS HOUSTON 84,188 100% OFFICE DEPOT(2002/2012), METROPOLITAN FURNITURE(2013/2023), JUST FOR FEET(2013/2023) SAN ANTONIO (4) -- WEST VIRGINIA SOUTH CHARLESTON 188,589 98% KROGER(2008/2038), TJ MAXX(2006/2022) DISPOSITIONS SUBSEQUENT TO DECEMBER 31, 1998 OKLAHOMA OKLAHOMA CITY (73,600) PENNSYLVANIA MORRISVILLE (117,524) 51,804,112 ----------- RETAIL STORE LEASES(7) 5,419,977 93% VARIOUS ---------- GRAND TOTAL 440 PROPERTY INTERESTS 57,224,089 =========-
(1) PERCENT LEASED INFORMATION AS OF DECEMBER 31, 1998 OR DATE OF ACQUISITION IF ACQUIRED SUBSEQUENT TO DECEMBER 31, 1998. (2) THE TERM "JOINT VENTURE" INDICATES THAT THE COMPANY OWNS THE PROPERTY IN CONJUNCTION WITH ONE OR MORE JOINT VENTURE PARTNERS. THE DATE INDICATED IS THE EXPIRATION DATE OF ANY GROUND LEASE AFTER GIVING AFFECT TO ALL RENEWAL PERIODS. (3) DENOTES REDEVELOPMENT PROJECT (4) DENOTES GROUND-UP DEVELOPMENT PROJECT (5) DENOTES UNDEVELOPED LAND (6) SOLD OR TERMINATED SUBSEQUENT TO DECEMBER 31, 1998 (7) THE COMPANY HOLDS INTEREST IN VARIOUS RETAIL STORE LEASES RELATED TO THE ANCHOR STORE PREMISES IN NEIGHBORHOOD AND COMMUNITY SHOPPING CENTERS. 24 Executive Officers of the Registrant The following table sets forth information with respect to the ten executive officers of the Company as of March 1, 1999. Name Age Position Since Milton Cooper 70 Chairman of the Board of 1991 Directors and Chief Executive Officer Michael J. Flynn 63 Vice Chairman of the 1996 Board of Directors and President and Chief 1997 Operating Officer Joseph K. Kornwasser 51 Director and 1998 Senior Executive Vice President Glenn G. Cohen 35 Treasurer 1997 Joseph V. Denis 47 Vice President - 1993 Construction Jerald Friedman 54 Executive Vice President 1998 Bruce M. Kauderer 52 Vice President - Legal 1995 General Counsel and 1997 Secretary Lawrence Kronenberg 42 Vice President 1998 Michael V. Pappagallo 40 Vice President - 1997 Chief Financial Officer Alex Weiss 41 Vice President - 1988 Management Information Systems Michael J. Flynn has been President and Chief Operating Officer since January 2, 1997, Vice Chairman of the Board of Directors since January 2, 1996 and a Director of the Company since December 1, 1991. Mr. Flynn was Chairman of the Board and President of Slattery Associates, Inc. for more than five years prior to joining the Company. Joseph K. Kornwasser has been a Director and Senior Executive Vice President of the Company since June 1998. Mr. Kornwasser was President, Chief Executive Officer and a director of Price REIT from August 1993 to June 1998. From 1984 until 1994, Mr. Kornwasser was Managing General Partner of Kornwasser and Friedman Shopping Center Properties, a commercial real estate development company. Glenn G. Cohen has been Treasurer of the Company since June 1997. Mr. Cohen served as Director of Accounting and Taxation of the Company from June 1995 to June 1997. Prior to joining the Company in June 1995, Mr. Cohen served as Chief Operating Officer and Chief Financial Officer for U.S. Balloon Manufacturing Co., Inc. from August 1993 to June 1995. Joseph V. Denis has been a Vice President of the Company since October 1993. Mr. Denis was President and Chief Operating Officer of Konover Construction Company, and previously held various positions with such company as a project and construction manager, for more than five years prior to joining the Company in June 1993. Jerald Friedman has been Executive Vice President of the Company since June 1998. Mr. Friedman was Senior Executive Vice President and Chief Operating Officer of Price REIT from January 1, 1997 to June 1998. From 1994 through 1996, Mr. Friedman was the Chairman and Chief Executive Officer of K & F Development Company, an affiliate of Price REIT. From 1984 until 1994, Mr. Friedman was a General Partner of Kornwasser and Friedman Shopping Center Properties, a commercial real estate development company. 25 Bruce M. Kauderer has been a Vice President of the Company since June 1995 and since December 15, 1997, General Counsel and Secretary of the Company. Mr. Kauderer was a founder of and partner with Kauderer & Pack P.C. from 1992 to June 1995 and a Partner with Fink Weinberger, P.C. for more than five years prior to 1992. Lawrence Kronenberg has been a Vice President of the Company since June 1998. Mr. Kronenberg had served as Executive Vice President, Finance of Price REIT from January 1,1997 to June 1998. From 1993 through 1996, Mr. Kronenberg served as Executive Vice President and Chief Financial Officer of K & F Development Company, an affiliate of Price REIT. Michael V. Pappagallo has been a Vice President and Chief Financial Officer of the Company since May 27, 1997. Mr. Pappagallo was Chief Financial Officer of GE Capital's Commercial Real Estate Financial and Services business from September 1994 to May 1997 and held various other positions within GE Capital for more than five years prior to joining the Company. The executive officers of the Company serve in their respective capacities for approximate one-year terms and are subject to re-election by the Board of Directors, generally at the time of the Annual Meeting of the Board of Directors following the Annual Meeting of Stockholders. 26 PART II Item 5. Market for the Registrant's Common Equity and Related Shareholder Matters Market Information The following table sets forth the common stock offerings completed by the Company during the three year period ended December 31, 1998. The Company's common stock was sold for cash at the following offering prices per share. Offering Date Offering Price(s) February 1996 $26.50 September 1997 $35.50 April 1998 (4 Offerings) $36.0625, $36.025, $36.25 and $36.625, respectively May 1998 $38.4375 July 1998 (3 Offerings) $38.2575, $38.56 and $39.4375, respectively September 1998 $38.75 November 1998 (4 offerings) $39.00, $39.00, $39.6875 and $39.6875, respectively December 1998 (3 offerings) $38.25 for each offering The table below sets forth, for the quarterly periods indicated, the high and low sales prices per share reported on the NYSE Composite Tape for the Company's common stock. The Company's common stock is traded under the trading symbol "KIM ". Stock Price Period High Low 1997: First Quarter $34.63 $31.75 Second Quarter $33.38 $30.25 Third Quarter $36.19 $31.75 Fourth Quarter $35.50 $30.50 1998: First Quarter $35.94 $33.44 Second Quarter $41.00 $34.88 Third Quarter $41.63 $34.75 Fourth Quarter $40.25 $33.75 Holders The approximate number of holders of record of the Company's common stock, par value $.01 per share, was 1,552 as of March 1, 1999. Dividends Since the IPO, the Company has paid regular quarterly dividends to its stockholders. Quarterly dividends at the rate of $.43 per share were declared and paid on December 2, 1996 and January 15, 1997, March 17, 1997 and April 15, 1997, June 16, 1997 and July 15, 1997 and September 15, 1997 and October 15, 1997, respectively. Quarterly dividends at the increased rate of $.48 per share were declared and paid on December 1, 1997 and January 15, 1998 and March 16, 1998 and April 15, 1998, respectively. On May 21, 1998 and June 22, 1998 the Company declared a dividend of $.42 per share and $.06 per share, respectively. These dividends were paid on July 2, 1998 and July 15, 1998, respectively. The dividends for this quarter were paid in two installments in order to provide Kimco shareholders the full $.48 per share dividend as well as provide the Price REIT shareholders a pro-rated dividend for the period following the effective date of the Merger. The Company declared and paid a dividend of $.48 per share on September 15, 1998 and October 15, 1998, respectively. In addition, the Company declared and paid a special $.05 per share dividend on October 29, 1998 and December 1, 1998, respectively. Also on October 29, 1998, the Company declared its dividend payable during the first quarter of 1999 at the increased rate of $.57 per share payable January 15, 1999 to shareholders of record January 4, 1999. This $.57 per share dividend, if annualized, would equal $2.28 per share or an annual yield of approximately 5.9% based on the closing price of $38.75 of the Company's common stock on the NYSE as of March 1, 1999. 27 The Company has determined that 100% of the dividends paid during 1998 and 1997 totaling $1.97 and $1.72 per share, respectively, represented ordinary dividend income to its stockholders. While the Company intends to continue paying regular quarterly dividends, future dividend declarations will be at the discretion of the Board of Directors and will depend on the actual cash flow of the Company, its financial condition, capital requirements, the annual distribution requirements under the REIT provisions of the Code and such other factors as the Board of Directors deems relevant. The actual cash flow available to pay dividends will be affected by a number of factors, including the revenues received from rental properties, the operating expenses of the Company, the interest expense on its borrowings, the ability of lessees to meet their obligations to the Company and any unanticipated capital expenditures. In addition to its common stock offerings, the Company has capitalized the growth in its business through the issuance of unsecured fixed and floating-rate medium-term notes, underwritten bonds, mortgage debt, convertible preferred stock and perpetual preferred stock. Borrowings under the Company's revolving credit facility have also been an interim source of funds to both finance the purchase of properties and meet any short-term working capital requirements. The various instruments governing the Company's issuance of its unsecured public debt, bank debt, mortgage debt and preferred stock impose certain restrictions on the Company with regard to dividends, voting, liquidation and other preferential rights available to the holders of such instruments. See "Management's Discussion and Analysis of Financial Condition and Results of Operations" and Notes 7 and 12 of the Notes to Consolidated Financial Statements included in this annual report on Form 10-K. The Company does not believe that the preferential rights available to the holders of its Class A, Class B, Class C and Class D Preferred Stock, the financial covenants contained in its public bond Indenture, as amended, or its revolving credit agreement will have any adverse impact on the Company's ability to pay dividends in the normal course to its common stockholders or to distribute amounts necessary to maintain its qualification as a REIT. The Company maintains a dividend reinvestment program pursuant to which common and preferred stockholders may elect to automatically reinvest their dividends to purchase shares of the Company's common stock. The Company may, from time to time, either (i) repurchase shares of its common stock in the open market, or (ii) issue new shares of its common stock, for the purpose of fulfilling its obligations under this dividend reinvestment program. Item 6. Selected Financial Data The following table sets forth selected, historical consolidated financial data for the Company and should be read in conjunction with the Consolidated Financial Statements of the Company and Notes thereto included in this annual report on Form 10-K. The Company believes that the book value of its real estate assets, which reflects the historical costs of such real estate assets less accumulated depreciation, is not indicative of the current market value of its properties. Historical operating results are not necessarily indicative of future operating performance. 28
Year Ended December 31, ------------------------------------------------------------------------ 1998 1997 1996 1995 1994 ---- ---- ---- ---- ---- (in thousands, except per share data) Operating Data: Revenues from rental property (1) $ 338,798 $ 198,929 $ 168,144 $ 143,132 $ 125,272 Depreciation and amortization $ 51,348 $ 30,053 $ 27,067 $ 26,188 $ 23,478 Income before extraordinary items $ 127,166(3) $ 85,836(3) $ 73,827(3) $ 51,922 $ 41,071 Income per common share, before extraordinary items: Basic $ 2.05(3) $ 1.80(3) $ 1.61(3) $ 1.33 $ 1.17 Diluted $ 2.02(3) $ 1.78(3) $ 1.59(3) $ 1.32 $ 1.16 Interest expense $ 64,912 $ 31,745 $ 27,019 $ 25,585 $ 20,483 Weighted average number of shares of common stock outstanding: Basic 50,071 37,388 35,906 33,388 30,072 Diluted 50,641 37,850 36,219 33,633 30,264 Cash dividends per common share $ 1.97 $ 1.72 $ 1.56 $ 1.44 $ 1.33 December 31, ------------------------------------------------------------------------ 1998 1997 1996 1995 1994 ---- ---- ---- ---- ---- Balance Sheet Data: Real estate, before accumulated depreciation $3,023,902(4) $1,404,196(4) $1,072,056(4) $932,390(4) $796,611 Total assets $3,051,178 $1,343,890 $1,023,033 $884,242 $736,709 Total debt $1,289,561 $531,614 $364,655 $389,223 $372,999 Other data: Year ended December 31, ------------------------------------------------------------------------ 1998 1997 1996 1995 1994 ---- ---- ---- ---- ---- Funds from Operations (2): Net Income $122,266 $85,836 $73,827 $51,922 $40,247 Depreciation and amortization 51,348 30,053 27,067 26,188 23,478 (Gain) loss on sales of properties and early repayment of mortgage debt 3,999 (244) (802) (370) 824 Preferred stock dividends (24,654) (18,438) (16,134) (7,631) (5,812 Other 788 976 1,148 2,019 901 ---------- ---------- --------- --------- --------- Funds from Operations $153,747 $98,183 $85,106 $72,128 $59,638 ========== ========== ========= ========= ========= Cash flow provided by operations $158,706 $125,108 $101,892 $74,233 $62,933 Cash flow used for investing activities ($630,229) ($280,823) ($144,027) ($127,261) ($142,183 Cash flow provided by financing activities $484,465 $149,269 $63,395 $58,248 $37,047
(1) Does not include revenues from rental property relating to unconsolidated joint ventures or revenues relating to the investment in retail store leases. (2) Most industry analysts and equity REITs, including the Company, generally consider funds from operations ("FFO") to be an appropriate supplemental measure of the performance of an equity REIT. In March 1995, the National Association of Real Estate Investment Trusts ("NAREIT") modified the definition of FFO, among other things, to eliminate adding back amortization of deferred financing costs and depreciation of non-real estate items to net income when computing FFO. The Company adopted this new method as of January 1, 1996. FFO is defined as net income applicable to common shares before depreciation and amortization, extraordinary items, gains or losses on sales of real estate, plus FFO of unconsolidated joint ventures determined on a consistent basis. FFO does not represent cash generated from operating activities in accordance with generally accepted accounting principles and therefore should not be considered an alternative for net income as a measure of results of operations, or for cash flows from operations calculated in accordance with generally accepted accounting principles as a measure of liquidity. In addition, the comparability of the Company's FFO with the FFO reported by other REITs may be affected by the differences that may exist regarding certain accounting policies relating to expenditures for repairs and other recurring items. (3) Includes $.9 million or $0.02 per share in 1998, $.2 million or $0.01 per share in 1997 and $.8 million or $0.02 per share in 1996 relating to non-recurring gains from the disposition of shopping center properties in each year. (4) Does not include the Company's investment in retail store leases. 29 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations The following discussion should be read in conjunction with the Consolidated Financial Statements and Notes thereto included in this annual report on Form 10-K. Historical results and percentage relationships set forth in the Consolidated Statements of Income contained in the Consolidated Financial Statements, including trends which might appear, should not be taken as indicative of future operations. Results of Operations Comparison 1998 to 1997 Revenues from rental property increased approximately $139.9 million, or 70.3% to $338.8 million for the year ended December 31, 1998, as compared with $198.9 million for the year ended December 31, 1997. This increase resulted primarily from the combined effect of (i) the acquisition of 62 shopping center properties and 3 retail properties during 1998 providing revenues from rental property of $35.5 million,(ii) the full year impact related to the 63 property interests acquired in 1997 providing incremental revenues of $42.1 million, (iii) the acquisition of the Price REIT as of June 19, 1998 (the "Price REIT Acquisition") providing revenues of $52.9 million and (iv) new leasing, re-tenanting and completion of certain property redevelopments within the portfolio providing improved rental rates. Rental property expenses, including depreciation and amortization, increased approximately $92.3 million, or 80.1%, to $207.5 million for the year ended December 31, 1998, as compared with $115.2 million for the preceding calendar year. The rental property expense components of rent, real estate taxes and depreciation and amortization increased $7.7 million, $19.1 million and $21.3 million, respectively, for the year ended December 31, 1998 as compared to the preceding year. These rental property expense increases are primarily due to the 62 shopping center properties and 3 retail properties acquired during 1998, the Price REIT Acquisition and the incremental costs related to the 63 property interests acquired during 1997. Interest expense increased approximately $33.2 million between the respective periods reflecting higher average outstanding borrowings during calendar year 1998 resulting from (i) the issuance of an aggregate $290 million unsecured medium-term notes during 1998, (ii) the assumption of approximately $49.2 million of mortgage debt in connection with the acquisition of certain property interests during 1998, as compared to the preceding year, (iii) the aggregate of $281.3 million of mortgage financing obtained in 1998 in connection with 22 property interests and (iv) the assumption of approximately $250 million of unsecured debt and $60 million of mortgage debt in connection with the Price REIT Acquisition. These increased borrowings were offset, in part, by the July 1998 repayment of $50 million medium-term notes which matured and the repayment of approximately $79.2 million of mortgage debt during 1998. The Company has interests in various retail store leases relating to the anchor store premises in neighborhood and community shopping centers. These premises have been substantially sublet to retailers which lease the stores pursuant to net lease agreements. Income from the investment in retail store leases during the years ended December 31, 1998 and 1997 was $3.7 million and $3.6 million, respectively. General and administrative expenses increased approximately $6.9 million to $18.6 million for the year ended December 31, 1998, as compared to $11.7 million for the preceding calendar year. The increase during 1998 is due primarily to an increase in senior management and staff levels and other personnel costs in connection with the growth of the Company, including approximately $3.0 million attributable to the Price REIT Acquisition. During 1998, the Company disposed of a property in Pinellas Park, FL. Cash proceeds from the disposition totaling $2.3 million, together with an additional $7.1 million cash investment, were used to acquire an exchange shopping center property located in Cranston, RI. Additionally, during December 1998, the Company disposed of a vacant distribution center and adjacent facility located in O'Fallon, Missouri, which were acquired as part of the Venture transactions, for $10 million, which amount approximated their net book value. During 1998, the Company prepaid certain mortgage loans resulting in extraordinary charges of approximately $4.9 million, or on a per-basic share and diluted share basis, $.10 and $.09, respectively, representing the premiums paid and other costs written-off in connection with the early satisfaction of these mortgage loans. 30 Net income for the year ended December 31, 1998 of approximately $122.3 million represented a substantial improvement of approximately $36.5 million, as compared with net income of approximately $85.8 million for the preceding calendar year. After adjusting for the gains on the sale of shopping center properties during both periods and the extraordinary loss during 1998, net income for 1998 increased by $40.7 million, or $.24 per basic share, compared to 1997. This substantially improved performance was primarily attributable to the Company's strong property acquisition program, the Price REIT Acquisition and internal growth from redevelopments, re-tenanting of the Venture portfolio and increased leasing activity which strengthened operating profitability. Results of Operations Comparison of 1997 to 1996 Revenues from rental property increased approximately $30.8 million, or 18.3% to $198.9 million for the year ended December 31, 1997, as compared with $168.1 million for the year ended December 31, 1996. This increase resulted primarily from the combined effect of (i) the acquisition of 63 property interests during 1997 providing revenues from rental property of $20.1 million, (ii) the full year impact related to the 39 property interests acquired in 1996 and (iii) new leasing and re-tenanting within the portfolio at improved rental rates providing an increase in the overall occupancy level from 87% at December 31, 1996 to 90% at December 31, 1997. Rental property expenses, including depreciation and amortization, increased approximately $18.2 million, or 18.8%, to $115.2 million for the year ended December 31, 1997, as compared with $97.0 million for the preceding calendar year. Rent, real estate taxes and depreciation and amortization charges contributed significantly to this net increase in rental property expenses (increasing $3.5 million, $6.5 million and $3.0 million, respectively, for the year ended December 31, 1997 as compared to the preceding year) primarily due to the 63 property interests acquired during 1997 and the 39 property interests acquired during 1996. Interest expense increased approximately $4.7 million between the respective periods reflecting higher average outstanding borrowings during calendar year 1997 resulting from (i) the issuance of an aggregate $100 million unsecured medium-term notes during 1997 and (ii) the assumption of approximately $73.2 million of mortgage debt in connection with the acquisition of certain property interests during 1997, as compared to the preceding year. The Company has interests in various retail store leases relating to the anchor store premises in neighborhood and community shopping centers. These premises have been substantially sublet to retailers which lease the stores pursuant to net lease agreements. Income from the investment in retail store leases during the years ended December 31, 1997 and 1996 was $3.6 million in each year. General and administrative expenses increased approximately $1.3 million to $11.6 million for the year ended December 31, 1997, as compared to $10.3 million for the preceding calendar year. This increase is primarily attributable to increased senior management and staff levels during 1997 and 1996. During 1997, the Company disposed of a property in Troy, OH. Cash proceeds from the disposition totaling $1.6 million, together with an additional $8.3 million cash investment, were used to acquire an exchange shopping center property located in Ocala, FL. Net income for the year ended December 31, 1997 of approximately $85.8 million represented an improvement of approximately $12.0 million, as compared with net income of approximately $73.8 million for the preceding calendar year. After adjusting for the gains on the sale of shopping center properties during both periods, net income for 1997 increased by $12.6 million, or $.20 per basic share, compared to 1996. This substantially improved performance was primarily attributable to property acquisitions and redevelopments and increased leasing activity which strengthened operating profitability. Liquidity and Capital Resources Since the completion of the Company's IPO in 1991, the Company has utilized the public debt and equity markets as its principal source of capital. Since the IPO, the Company has completed additional offerings of its public unsecured debt and equity, raising in the aggregate over $1.9 billion for the purposes of repaying indebtedness, acquiring interests in neighborhood and community shopping centers and for expanding and improving properties in the portfolio. 31 During August 1998, the Company established a $215 million, unsecured revolving credit facility, which is scheduled to expire in August 2001. This credit facility, which replaced both the Company's $100 million unsecured revolving credit facility and $150 million interim credit facility, has made available funds to both finance the purchase of properties and meet any short-term working capital requirements. As of December 31, 1998 there were no borrowings outstanding under the Company's revolving credit facility. The Company has also implemented a $200 million MTN program pursuant to which it may from time to time offer for sale its senior unsecured debt for any general corporate purposes, including (i) funding specific liquidity requirements in its business, including property acquisitions, development and redevelopment costs and (ii) managing the Company's debt maturities. (See Note 7 of the Notes to Consolidated Financial Statements included in this annual report on Form 10-K.) In addition to the public equity and debt markets as capital sources, the Company may, from time to time, obtain mortgage financing on selected properties. As of December 31, 1998, the Company had over 300 unencumbered property interests in its portfolio. During 1998, the Company filed a shelf registration on Form S-3 for up to $750 million of debt securities, preferred stock, depositary shares, common stock and common stock warrants. As of March 1, 1999, the Company had approximately $493.2 million available for issuance under this shelf registration statement. In connection with its intention to continue to qualify as a REIT for Federal income tax purposes, the Company expects to continue paying regular dividends to its stockholders. These dividends will be paid from operating cash flows which are expected to increase due to property acquisitions and growth in rental revenues in the existing portfolio and from other sources. Since cash used to pay dividends reduces amounts available for capital investment, the Company generally intends to maintain a conservative dividend payout ratio, reserving such amounts as it considers necessary for the expansion and renovation of shopping centers in its portfolio, debt reduction, the acquisition of interests in new properties as suitable opportunities arise, and such other factors as the Board of Directors considers appropriate. Cash dividends paid increased to $113.9 million in 1998, compared to $82.6 million in 1997 and $69.8 million in 1996. The Company's dividend payout ratio, based on funds from operations on a per-basic common share basis, for 1998, 1997 and 1996 was approximately 64.2%, 65.4% and 65.8%, respectively. Although the Company receives substantially all of its rental payments on a monthly basis, it generally intends to continue paying dividends quarterly. Amounts accumulated in advance of each quarterly distribution will be invested by the Company in short-term money market or other suitable instruments. The Company anticipates its capital commitment toward ground-up development and redevelopment projects during 1999 will be approximately $150 million. It is management's intention that the Company continually have access to the capital resources necessary to expand and develop its business. Accordingly, the Company may seek to obtain funds through additional equity offerings, unsecured debt financings and/or mortgage financings in a manner consistent with its intention to operate with a conservative debt capitalization policy. The Company anticipates that cash flows from operations will continue to provide adequate capital to fund its operating and administrative expenses, regular debt service obligations and all dividend payments in accordance with REIT requirements in both the short-term and long-term. In addition, the Company anticipates that cash on hand, borrowings under its revolving credit facility, issuance of equity and public debt, as well as other debt and equity alternatives, will provide the necessary capital required by the Company. Cash flows from operations as reported in the Consolidated Statements of Cash Flows increased to $158.7 million for 1998 from $125.1 million for 1997 and $101.9 million for 1996. 32 Effects of Inflation Many of the Company's leases contain provisions designed to mitigate the adverse impact of inflation. Such provisions include clauses enabling the Company to receive Percentage Rents, which generally increase as prices rise, and/or escalation clauses, which generally increase rental rates during the terms of the leases. Such escalation clauses include increases in the consumer price index or similar inflation indices. In addition, many of the Company's leases are for terms of less than 10 years, which permits the Company to seek to increase rents upon renewal to market rates. Most of the Company's leases require the tenant to pay an allocable share of operating expenses, including common area maintenance costs, real estate taxes and insurance, thereby reducing the Company's exposure to increases in costs and operating expenses resulting from inflation. The Company periodically evaluates its exposure to short-term interest rates and will, from time to time, enter into interest rate protection agreements which mitigate, but do not eliminate, the effect of changes in interest rates on its floating-rate debt. Year 2000 Issue Like most corporations, the Company depends upon its business and technical information systems in operating its business. Many computer systems process dates using two digits to identify the year, and some systems are unable to properly process dates beginning with the year 2000. This problem is commonly referred to as the "Year 2000" issue. The Company has completed the assessment phase of its systems as to Year 2000 compliance and functionality. The Company has substantially completed the identification and review of computer hardware and software suppliers and is currently verifying the Year 2000 compliance of third-party suppliers, vendors and service providers that the Company has deemed important to the ongoing operations of the business. The Company has substantially completed the modification of its software applications and is in the final phase of testing. The Company anticipates our systems, including hardware and software, will be Year 2000 compliant by the end of the second quarter of 1999. The total costs to date related to the Year 2000 issue have been immaterial to our operations. These costs have been expensed as incurred and consist primarily of internal staff costs and other related expenses. We do not believe that the remaining costs expected to be incurred in addressing the Year 2000 issue will have a material adverse effect on our financial conditions or results of operation. Based upon the substantial progress made to date, the Company does not anticipate delays in finalizing internal Year 2000 compliance issues. However, the Company cannot guarantee that our third party vendors, partners or others will be Year 2000 compliant. If the Company or such third party vendors, partners and others encounter problems in addressing the Year 2000 issue, our ability to operate our properties and to bill and collect our revenues in a timely manner could be materially adversely affected. The Company is currently addressing the development of a contingency plan in the event that our systems or the systems of third party vendors, partners or others fail to resolve the Year 2000 issue. New Accounting Pronouncements During 1998, the Company adopted the provisions of Financial Accounting Standards No. 130 - "Reporting Comprehensive Income" ("SFAS 130") which established standards for reporting and displaying comprehensive income and its components and the provisions of Financial Accounting Standards No. 131 - "Disclosures about Segments of an Enterprise and Related Information"("SFAS 131") which established standards for reporting information about operating segments. The provisions of SFAS 130 and SFAS 131 had no impact on the consolidated financial statements of the Company. In 1998, the Financial Accounting Standards Board issued Financial Accounting Standards No. 133 - "Accounting for Derivative Instruments and Hedging Activities" ("SFAS 133"), which is effective for years beginning after June 15, 1999. The management of the Company believes that the implementation of SFAS 133 will not have a material impact on the Company's consolidated financial statements. In addition, during 1998, the Accounting Standards Executive Committee of the American Institute of Certified Public Accountants issued Statement of Position 98-5, "Reporting on the Costs of Start-Up Activities" ("SOP 98-5") and Statement of Position 98-1 "Accounting for the Costs of Computer Software Developed or Obtained for Internal Use" ("SOP 98-1"), each of which is effective for fiscal years beginning after December 15, 1998. SOP 98-5 requires that certain costs incurred in connection with start-up activities be expensed. SOP 98-1 provides guidance on whether the costs of computer software developed or obtained for internal use should be capitalized or expensed. The management of the Company believes that, when adopted, SOP 98-5 and SOP 98-1 will not have a material impact on the Company's consolidated financial statements. 33 Item 7A. Quantitative and Qualitative Disclosures About Market Risk As of December 31, 1998, the Company had approximately $279.1 million of floating-rate debt outstanding. The interest rate risk on $260 million of such debt has been mitigated through the use of interest rate swap agreements (the "Swaps") with major financial institutions. The Company is exposed to credit risk in the event of non-performance by the counter-parties to the Swaps. The Company believes it mitigates its credit risk by entering into these Swaps with major financial institutions. The Company believes the interest rate risk represented by the remaining $19.1 million of floating-rate debt is not material in relation to the total debt outstanding of the Company or its market capitalization. The Company has not, and does not plan to, enter into any derivative financial instruments for trading or speculative purposes. As of December 31, 1998, the Company had no other material exposure to market risk. Item 8. Financial Statements and Supplementary Data The response to this Item 8 is included as a separate section of this annual report on Form 10-K. Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure None. 34 PART III Item 10. Directors and Executive Officers of the Registrant Incorporated herein by reference to the Company's definitive proxy statement to be filed with respect to its Annual Meeting of Stockholders expected to be held on May 20, 1999. Information with respect to the Executive Officers of the Registrant follows Part I, Item 4 of this annual report on Form 10-K. Item 11. Executive Compensation Incorporated herein by reference to the Company's definitive proxy statement to be filed with respect to its Annual Meeting of Stockholders expected to be held on May 20, 1999. Item 12. Security Ownership of Certain Beneficial Owners and Management Incorporated herein by reference to the Company's definitive proxy statement to be filed with respect to its Annual Meeting of Stockholders expected to be held on May 20, 1999. Item 13. Certain Relationships and Related Transactions Incorporated herein by reference to the Company's definitive proxy statement to be filed with respect to its Annual Meeting of Stockholders expected to be held on May 20, 1999. 35 PART IV Item 14. Exhibits, Financial Statements, Schedules and Reports on Form 8-K (a) 1. Financial Statements - Form 10-K The following consolidated financial information Report is included as a separate section of this annual Page report on Form 10-K. -------- Report of Independent Accountants 42 Consolidated Financial Statements Consolidated Balance Sheets as of December 31, 1998 and 1997 43 Consolidated Statements of Income for the years ended December 31, 1998, 1997 and 1996 44 Consolidated Statements of Stockholders' Equity for the years ended December 31, 1998, 1997 and 1996 45 Consolidated Statements of Cash Flows for the years ended December 31, 1998, 1997 and 1996 46 Notes to Consolidated Financial Statements 47 2. Financial Statement Schedules - Schedule II - Valuation and Qualifying Accounts 64 Schedule III - Real Estate and Accumulated Depreciation 65 All other schedules are omitted since the required information is not present or is not present in amounts sufficient to require submission of the schedule. 3. Exhibits The exhibits listed on the accompanying Index to Exhibits are filed as part of this report. 37 (b) Reports on Form 8-K A current report on Form 8-K was filed on November 10, 1998 to disclose (i) the Remarketing Agreement, dated as of August 11, 1998 between the Company and a Financial institution; (ii) the Company's new $215 million unsecured credit facility, (iii) the Underwriting and Terms Agreement dated July 9, 1998 between the Company and an underwriter and (iv) the Underwriting and Terms Agreement dated November 4, 1998 between the Company and an underwriter. A current report on Form 8-K was filed on November 17, 1998 to disclose (i) the Underwriting and Terms Agreement dated November 12, 1998 between the Company and an underwriter and (ii) the Underwriting and Terms Agreement dated November 12, 1998 between the Company and an underwriter. A current report on Form 8-K was filed on December 4, 1998 to disclose certain historical financial information for certain properties acquired during September and October 1998 and pro forma financial information for (i) all shopping centers acquired during the ten months ended October 1998 and (ii) the Merger. 36 INDEX TO EXHIBITS Form 10-K Exhibits Page 2.1 -- Form of Plan of Reorganization of Kimco Realty Corporation [Incorporated by reference to Exhibit 2.1 to the Company's Registration Statement on Form S-11 No. 33-42588]. 2.2 -- Agreement and Plan of Merger, dated as of January 13, 1998, among Kimco Realty Corporation, REIT Sub, Inc. and The Price REIT, Inc. (the "Merger Agreement"). [Incorporated by reference to Exhibit 99.2 to the Company's Current Report on Form 8-K filed January 21, 1998]. 2.3 -- First Amendment to the Merger Agreement, dated as of March 5, 1998, among Kimco Realty Corporation, REIT Sub, Inc. and The Price REIT, Inc. [Incorporated by reference to the Company's Exhibit 99.1 of the Company's Current Report on Form 8-K filed January 21, 1998.] 2.4 -- Second Amendment to the Merger Agreement, dated as of May 14, 1998, among Kimco Realty Corporation, REIT Sub, Inc. and The Price REIT, Inc. [Incorporated by reference to the Company's and The Price REIT, Inc.'s Joint Proxy Statement/Prospectus on Form S-4 No. 333-52667]. 3.1 -- Articles of Amendment and Restatement of the Company, dated August 4, 1994 [Incorporated by reference to Exhibit 3.1 to the Company's Annual Report on Form 10-K for the year ended December 31, 1994]. 3.2 -- By-laws of the Company, as amended dated August 4, 1994. 3.3 -- Articles Supplementary relating to the 8 1/2% Class B Cumulative Redeemable Preferred Stock, par value $1.00 per share, of the Company, dated July 25, 1995. Incorporated by reference to Exhibit 3.3 to the Company's Annual Report on Form 10-K for the year ended December 31, 1995 (file #1-10899) (the "1995 Form 10-K")]. 3.4 -- Articles Supplementary relating to the 8 3/8% Class C Cumulative Redeemable Preferred Stock, par value $1.00 per share, of the Company, dated April 9, 1996 [Incorporated by reference to Exhibit 3.4 to the Company's Annual Report on Form 10-K for the year ended December 31, 1996]. 3.5 -- Articles Supplementary relating to the 7 1/2% Class D Cumulative Convertible Preferred Stock, par value $1.00 per share, of the Company, dated May 14, 1998 [Incorporated by reference to the Company's and The Price REIT, Inc.'s Joint Proxy/Prospectus on Form S-4 No. 333-52667]. 4.1 -- Agreement of the Company pursuant to Item 601(b)(4)(iii)(A) of Regulation S-K [Incorporated by reference to Exhibit 4.1 to Amendment No. 3 to the Company's Registration Statement on Form S-11 No. 33-42588]. 4.2 -- Certificate of Designations [Incorporated by reference to Exhibit 4(d) to Amendment No. 1 to the Registration Statement on Form S-3 dated September 10, 1993 (the "Registration Statement", Commission File No. 33-67552)]. 37 INDEX TO EXHIBITS (continued) Form 10-K Page Exhibits 4.3 -- Indenture dated September 1, 1993 between Kimco Realty Corporation and IBJ Schroder Bank and Trust Company [Incorporated by reference to Exhibit 4(a) to the Registration Statement]. 4.4 -- First Supplemental Indenture, dated as of August 4, 1994. [Incorporated by reference to Exhibit 4.6 to the 1995 Form 10-K.] 4.5 -- Second Supplemental Indenture, dated as of April 7, 1995 [Incorporated by reference to Exhibit 4(a) to the Company's Current Report on Form 8-K dated April 7, 1995 (the "April 1995 8-K")]. 4.6 -- Form of Medium-Term Note (Fixed Rate) [Incorporated by reference to Exhibit 4(b) to the April 1995 8-K]. 4.7 -- Form of Medium-Term Note (Floating Rate) [Incorporated by reference to Exhibit 4(c) to the April 1995 8-K]. 4.8 -- Form of Remarketed Reset Note [Incorporated by reference to Exhibit 4(j) to the Company's Current Report on Form 8-K dated March 26, 1999]. 10.1 -- Form of Acquisition Option Agreement between the Company and the subsidiary named therein [Incorporated by reference to Exhibit 10.1 to Amendment No. 3 to the Company's Registration Statement on Form S-11 No. 33-42588]. 10.2 -- Management Agreement between the Company and KC Holdings, Inc. [Incorporated by reference to Exhibit 10.2 to the Company's Registration Statement on Form S-11 No. 33-47915]. 10.3 -- Amended and Restated Stock Option Plan [Incorporated by reference to Exhibit 10.3 to the 1995 Form 10-K.] *10.4 -- Employment Agreement between Kimco Realty Corporation and Michael J. Flynn, dated November 1, 1998. 10.5 -- Restricted Equity Agreement, Non-Qualified and Incentive Stock Option Agreement, and Price Condition Non-Qualified and Incentive Stock Option Agreement between Kimco Realty Corporation and Michael J. Flynn, each dated November 1, 1995 [Incorporated by reference to Exhibit 10.5 to the 1995 Form 10-K]. 10.6 -- Employment Agreement between Kimco Realty Corporation and Michael V. Pappagallo, dated April 30, 1997 [Incor- porated by Reference to Exhibit 10.7 to the Company's Annual Report on Form 10-K for the year ended December 31, 1997]. 10.7 -- Employment Agreement between Kimco Realty Corporation and Joseph K. Kornwasser, dated January 13, 1998 [Incorporated by Reference to Exhibit 10.9 to the Company's and the Price REIT, Inc.'s Joint Proxy Statement/Prospectus on Form S-4 No. 333-52667]. 38 INDEX TO EXHIBITS (continued) Form 10-K Page 10.8 -- Employment Agreement between Kimco Realty Corporation and Jerald Friedman, dated January 13, 1998 [Incorporated by Reference to Exhibit 10.10 to the Company's and the Price REIT, Inc.'s Joint Proxy Statement/Prospectus on Form S-4 No. 333-52667]. 10.9 -- Credit Agreement among Kimco Realty Corporation, The Several Banks, financial institutions and other entities from Time to Time Parties Hereto, Chase Manhattan Bank and The First National Bank of Chicago, as Co-Managers and Chase Manhattan Bank, as Administrative Agent, dated as of August 11, 1998. [Incorporated by reference to Exhibit 4(b) to the Company's Current Report of Form 8-K filed November 10, 1998]. 10.10 -- Amended and Restated Stock Option Plan [Incorporated by reference to the Company's and The Price REIT, Inc.'s Joint Proxy/Prospectus on Form S-4 No. 333-52667]. *12.1 -- Computation of Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends. 77 *12.2 -- Computation of Ratio of Funds from Operations to Combined Fixed Charges and Preferred Stock Dividends. 78 *21.1 -- Subsidiaries of the Company 79 *23.1 -- Consent of PricewaterhouseCoopers LLP 87 - -------------------------------------------------------- * Filed herewith. 39 SIGNATURES Pursuant to the requirements of Section 13 or 15 (d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. KIMCO REALTY CORPORATION (Registrant) By: /s/ Milton Cooper ---------------------------- Milton Cooper Chief Executive Officer Dated: March 26, 1999 Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated. Signature Title Date /s/ Martin S. Kimmel Chairman (Emeritus) of March 26, 1999 --------------------------- the Board of Directors Martin S. Kimmel /s/ Milton Cooper Chairman of the Board March 26, 1999 --------------------------- of Directors and Chief Milton Cooper Executive Officer /s/ Michael J. Flynn Vice Chairman of the March 26, 1999 --------------------------- Board of Directors, Michael J. Flynn President and Chief Operating Officer /s/ Joseph K. Kornwasser Director and Senior March 26, 1999 ---------------------------- Joseph K. Kornwasser Executive Vice President /s/ Richard G. Dooley Director March 26, 1999 --------------------------- Richard G. Dooley /s/ Joe Grills Director March 26, 1999 --------------------------- Joe Grills /s/ Frank Lourenso Director March 26, 1999 --------------------------- Frank Lourenso /s/ Michael V. Pappagallo Chief Financial Officer March 26, 1999 --------------------------- Michael V. Pappagallo /s/ Glenn G. Cohen Treasurer March 26, 1999 --------------------------- Glenn G. Cohen /s/ Ruth Mitteldorf Director of Accounting March 26, 1999 --------------------------- and Taxation Ruth Mitteldorf 40 ANNUAL REPORT ON FORM 10-K ITEM 8, ITEM 14 (a) (1) and (2) INDEX TO FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES ------- FORM 10-K Page No. KIMCO REALTY CORPORATION AND SUBSIDIARIES Report of Independent Accountants 42 Consolidated Financial Statements and Financial Statement Schedules: Consolidated Balance Sheets as of December 31, 1998 and 1997 43 Consolidated Statements of Income for the years ended December 31, 1998, 1997 and 1996 44 Consolidated Statements of Stockholders' Equity for the years ended December 31, 1998, 1997 and 1996 45 Consolidated Statements of Cash Flows for the years ended December 31, 1998, 1997 and 1996 46 Notes to Consolidated Financial Statements 47 Financial Statement Schedules: II. Valuation and Qualifying Accounts 64 III. Real Estate and Accumulated Depreciation 65 41 REPORT OF INDEPENDENT ACCOUNTANTS To the Board of Directors and Stockholders of Kimco Realty Corporation: In our opinion, the consolidated financial statements listed in the accompanying index present fairly, in all material respects, the financial position of Kimco Realty Corporation and Subsidiaries at December 31, 1998 and 1997, and the consolidated results of their operations and their cash flows for each of the three years in the period ended December 31, 1998, in conformity with generally accepted accounting principles. In addition, in our opinion, the financial statement schedules listed in the accompanying index present fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial statements. These financial statements and financial statement schedules are the responsibility of the Company's management; our responsibility is to express an opinion on these financial statements and financial statement schedules based on our audits. We conducted our audits of these statements in accordance with generally accepted auditing standards which 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 the opinion expressed above. /S/ PRICEWATERHOUSECOOPERS LLP New York, New York February 26, 1999 42 KIMCO REALTY CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS -----------------
December 31, December 31, 1998 1997 -------------------- --------------------- ASSETS: Real Estate Rental property Land $ 528,549,456 $ 212,019,596 Buildings and improvements 2,494,004,820 1,190,828,854 -------------------- --------------------- 3,022,554,276 1,402,848,450 Less, accumulated depreciation and amortization 255,949,923 207,408,091 -------------------- --------------------- 2,766,604,353 1,195,440,359 Undeveloped land 1,347,709 1,347,709 -------------------- --------------------- Real estate, net 2,767,952,062 1,196,788,068 Investment in retail store leases 15,171,978 15,938,041 Investments and advances in real estate joint ventures 64,263,252 9,794,142 Cash and cash equivalents 43,920,544 30,978,178 Accounts and notes receivable 31,820,940 16,203,454 Deferred charges and prepaid expenses 34,030,574 21,260,041 Other assets 94,019,071 52,928,200 -------------------- --------------------- $ 3,051,178,421 $ 1,343,890,124 ==================== ===================== LIABILITIES & STOCKHOLDERS' EQUITY: Notes payable $ 855,250,000 $ 410,250,000 Mortgages payable 434,310,884 121,363,908 Accounts payable and accrued expenses 66,179,347 34,288,409 Dividends payable 39,444,195 22,545,806 Other liabilities 58,019,873 7,590,856 -------------------- --------------------- 1,453,204,299 596,038,979 -------------------- --------------------- Minority interests in partnerships 12,955,270 4,531,934 -------------------- --------------------- Commitments and contingencies Stockholders' equity Preferred Stock, $1.00 par value, authorized 3,470,000 and 5,000,000 shares, respectively Class A Preferred Stock, $1.00 par value, authorized 345,000 shares Issued and outstanding 300,000 shares 300,000 300,000 Aggregate liquidation preference $75,000,000 Class B Preferred Stock, $1.00 par value, authorized 230,000 shares Issued and outstanding 200,000 shares 200,000 200,000 Aggregate liquidation preference $50,000,000 Class C Preferred Stock, $1.00 par value, authorized 460,000 shares Issued and outstanding 400,000 shares 400,000 400,000 Aggregate liquidation preference $100,000,000 Class D Convertible Preferred Stock, $1.00 par value, authorized 700,000 shares Issued and outstanding 429,159 shares Aggregate liquidation preference $107,289,750 429,159 - Common stock, $.01 par value, authorized 100,000,000 shares Issued and outstanding 60,133,704 and 40,394,805 shares, respectively 601,337 403,948 Paid-in capital 1,707,271,637 857,658,054 Cumulative distributions in excess of net income (124,183,281) (115,642,791) -------------------- --------------------- 1,585,018,852 743,319,211 -------------------- --------------------- $ 3,051,178,421 $ 1,343,890,124 ==================== =====================
The accompanying notes are an integral part of these consolidated financial statements. 43 KIMCO REALTY CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME ----------------
Year Ended December 31, ----------------------------------------------------------------------- 1998 1997 1996 ------------------ ------------------- ------------------- Revenues from rental property $ 338,797,629 $ 198,929,403 $ 168,144,419 ------------------ ------------------- ------------------- Rental property expenses: Rent 12,568,259 4,873,200 1,417,263 Real estate taxes 45,472,470 26,345,685 19,815,808 Interest 64,911,743 31,744,762 27,019,283 Operating and maintenance 33,246,001 22,194,628 21,659,620 Depreciation and amortization 51,347,612 30,052,714 27,066,709 ------------------ ------------------- ------------------- 207,546,085 115,210,989 96,978,683 ------------------ ------------------- ------------------- Income from rental property 131,251,544 83,718,414 71,165,736 Income from investment in retail store leases 3,702,854 3,571,946 3,631,845 ------------------ ------------------- ------------------- 134,954,398 87,290,360 74,797,581 Management fee income 3,645,674 3,276,152 3,447,577 General and administrative expenses (18,582,817) (11,651,341) (10,333,924) Equity in income (losses) of real estate joint ventures, net 3,106,214 1,116,988 820,083 Minority interests in income of partnerships, net (1,275,360) (463,522) (470,441) Other income, net 4,416,973 6,023,813 4,764,062 ------------------ ------------------- ------------------- Income before gain on sale of shopping center property and extraordinary items 126,265,082 85,592,450 73,024,938 Gain on sale of shopping center 901,249 243,995 801,955 ------------------ ------------------- ------------------- Income before extraordinary items 127,166,331 85,836,445 73,826,893 Extraordinary items (4,900,361) - - ------------------ ------------------- ------------------- Net income $ 122,265,970 $ 85,836,445 $ 73,826,893 ================== =================== =================== Net income applicable to common shares $ 97,612,123 $ 67,398,745 $ 57,692,418 ================== =================== =================== Per common share Income before extraordinary items Basic $2.05 $1.80 $1.61 ====== ====== ===== Diluted $2.02 $1.78 $1.59 ====== ====== ===== Net Income Basic $1.95 $1.80 $1.61 ====== ====== ===== Diluted $1.93 $1.78 $1.59 ====== ====== =====
The accompanying notes are an integral part of these consolidated financial statements. 44 KIMCO REALTY CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY For the Years Ended December 31, 1998, 1997 and 1996 ------------------------------
Preferred Stock Common Stock ---------------------------------- ---------------------------- Issued Amount Issued Amount ------------------ -------------- -------------- ------------ Balance, December 31, 1995 500,000 $ 500,000 33,731,348 $ 337,313 Net income Dividends ($1.60 per common share; $1.9375, $2.125 and $1.59943 per Class A, Class B and Class C Depositary Share, respectively) Issuance of preferred stock 400,000 400,000 Issuance of common stock 2,320,125 23,201 Exercise of common stock options 163,582 1,637 ------------------ -------------- -------------- ------------ Balance, December 31, 1996 900,000 900,000 36,215,055 362,151 Net income Dividends ($1.77 per common share; $1.9375, $2.125 and $2.0938 per Class A, Class B and Class C Depositary Share, respectively) Issuance of common stock 4,000,000 40,000 Exercise of common stock options 179,750 1,797 ------------------ -------------- -------------- ------------ Balance, December 31, 1997 900,000 900,000 40,394,805 403,948 Net income Dividends ($2.06 per common share; $1.9375, $2.125, $2.0938, $1.0729 and $2.9609 per Class A, Class B, Class C, Class D and Class E Depositary Share, respectively) Issuance of preferred stock 494,159 494,159 Issuance of common stock 19,588,133 195,881 Exercise of common stock options 150,766 1,508 Redemption of preferred stock (65,000) (65,000) ------------------ -------------- -------------- ------------ Balance, December 31, 1998 1,329,159 $ 1,329,159 60,133,704 $ 601,337 ================== ============== ============== ============
Cumulative Distributions Total Paid-in in Excess Stockholders' Capital of Net Income Equity ----------------- ------------------ ------------------ Balance, December 31, 1995 $ 562,311,822 $ (114,665,183) $ 448,483,952 Net income 73,826,893 73,826,893 Dividends ($1.60 per common share; $1.9375, $2.125 and $1.59943 per Class A, Class B and Class C Depositary Share, respectively) (74,254,848) (74,254,848) Issuance of preferred stock 96,037,337 96,437,337 Issuance of common stock 58,087,001 58,110,202 Exercise of common stock options 3,165,796 3,167,433 ----------------- ------------------ ------------------ Balance, December 31, 1996 719,601,956 (115,093,138) 605,770,969 Net income 85,836,445 85,836,445 Dividends ($1.77 per common share; $1.9375, $2.125 and $2.0938 per Class A, Class B and Class C Depositary Share, respectively) (86,386,098) (86,386,098) Issuance of common stock 134,293,408 134,333,408 Exercise of common stock options 3,762,690 3,764,487 ----------------- ------------------ ------------------ Balance, December 31, 1997 857,658,054 (115,642,791) 743,319,211 Net income 122,265,970 122,265,970 Dividends ($2.06 per common share; $1.9375, $2.125, $2.0938, $1.0729 and $2.9609 per Class A, Class B, Class C, Class D and Class E Depositary Share, respectively) (130,806,460) (130,806,460) Issuance of preferred stock 171,795,591 172,289,750 Issuance of common stock 739,590,562 739,786,443 Exercise of common stock options 3,162,430 3,163,938 Redemption of preferred stock (64,935,000) (65,000,000) ----------------- ------------------ ------------------ Balance, December 31, 1998 $ 1,707,271,637 $ (124,183,281) $ 1,585,018,852 ================= ================== ==================
The accompanying notes are an integral part of these consolidated financial statements. 45 KIMCO REALTY CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS -------------------------
Year Ended December 31, ------------------------------------------ 1998 1997 -------------------- ------------------- Cash flow from operating activities: Net income $ 122,265,970 $ 85,836,445 Adjustments for noncash items - Depreciation and amortization 51,347,612 30,052,714 Extraordinary items 4,900,361 - Gain on sale of shopping center (901,249) (243,995) Minority interests in income of partnerships, net 1,275,360 463,522 Equity in income of real estate joint ventures, net (3,106,214) (1,116,988) Change in accounts and notes receivable (11,422,086) (2,217,316) Change in accounts payable and accrued expenses (6,607,964) 12,304,523 Change in other operating assets and liabilities 954,079 28,736 -------------------- ------------------- Net cash flow provided by operations 158,705,869 125,107,641 -------------------- ------------------- Cash flow from investing activities: Acquisition of and improvements to real estate (583,979,056) (261,225,536) Acquisition of real estate through joint venture investment (23,313,994) (4,625,068) Investment in marketable securities (7,088,793) (11,138,247) Advances to affiliated companies - (14,036,000) Investment in mortgage loans receivable (27,698,415) - Repayment of mortgage loans receivable 1,456,200 - Construction advances to real estate joint ventures (1,904,464) - Reimbursement of advances to real estate joint ventures - 8,651,653 Proceeds from sale of shopping center 12,300,000 1,550,000 -------------------- ------------------- Net cash flow used for investing activities (630,228,522) (280,823,198) -------------------- ------------------- Cash flow from financing activities: Principal payments on debt, excluding normal amortization of rental property debt (84,056,229) (4,650,000) Principal payments on rental property debt, net (4,402,896) (1,618,255) Proceeds from mortgage financing 281,275,000 - Mortgage financing origination costs (7,323,495) - Proceeds from issuance of medium-term notes 290,000,000 100,000,000 Repayment of medium term notes (50,000,000) - Borrowings under revolving credit facilities 220,000,000 - Repayment of borrowings under revolving credit facilities (265,000,000) - Dividends paid (113,908,071) (82,561,111) Proceeds from issuance of stock 282,880,710 138,097,895 Redemption of preferred stock (65,000,000) - -------------------- ------------------- Net cash flow provided by financing activities 484,465,019 149,268,529 -------------------- ------------------- Increase(decrease) in cash and cash equivalents 12,942,366 (6,447,028) Cash and cash equivalents, beginning of year 30,978,178 37,425,206 -------------------- ------------------- Cash and cash equivalents, end of year $ 43,920,544 $ 30,978,178 ==================== =================== Supplemental schedule of noncash investing/financing activity: Acquisition of real estate interests by issuance of common stock and/or assumption of debt $ 1,005,712,554 $ 73,227,224 ==================== =================== Declaration of dividends paid in succeeding year $ 39,444,195 $ 22,545,806 ==================== ===================
Year Ended December 31, ------------------ 1996 ------------------ Cash flow from operating activities: Net income $ 73,826,893 Adjustments for noncash items - Depreciation and amortization 27,066,709 Extraordinary items - Gain on sale of shopping center (801,955) Minority interests in income of partnerships, net 470,441 Equity in income of real estate joint ventures, net (820,083) Change in accounts and notes receivable 2,626,760 Change in accounts payable and accrued expenses 2,730,442 Change in other operating assets and liabilities (3,207,396) ------------------ Net cash flow provided by operations 101,891,811 ------------------ Cash flow from investing activities: Acquisition of and improvements to real estate (140,916,684) Acquisition of real estate through joint venture investment - Investment in marketable securities (4,935,008) Advances to affiliated companies - Investment in mortgage loans receivable - Repayment of mortgage loans receivable - Construction advances to real estate joint ventures - Reimbursement of advances to real estate joint ventures - Proceeds from sale of shopping center 1,825,000 ------------------ Net cash flow used for investing activities (144,026,692) ------------------ Cash flow from financing activities: Principal payments on debt, excluding normal amortization of rental property debt (8,299,980) Principal payments on rental property debt, net (1,267,816) Proceeds from mortgage financing - Mortgage financing origination costs - Proceeds from issuance of medium-term notes - Repayment of medium term notes - Borrowings under revolving credit facilities - Repayment of borrowings under revolving credit facilities (15,000,000) Dividends paid (69,751,755) Proceeds from issuance of stock 157,714,972 Redemption of preferred stock - ------------------ Net cash flow provided by financing activities 63,395,421 ------------------ Increase(decrease) in cash and cash equivalents 21,260,540 Cash and cash equivalents, beginning of year 16,164,666 ------------------ Cash and cash equivalents, end of year $ 37,425,206 ================== Supplemental schedule of noncash investing/financing activity: Acquisition of real estate interests by issuance of common stock and/or assumption of debt $ - ================== Declaration of dividends paid in succeeding year $ 18,720,819 ==================
The accompanying notes are an integral part of these consolidated financial statements. 46 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. Summary of Significant Accounting Policies: Business Kimco Realty Corporation (the "Company" or "Kimco"), its subsidiaries, affiliates and related real estate joint ventures are engaged principally in the operation of neighborhood and community shopping centers which are anchored generally by discount department stores, supermarkets or drugstores. Additionally, the Company provides management services for shopping centers owned by affiliated entities and various real estate joint ventures. The Company seeks to reduce its operating and leasing risks through diversification achieved by the geographic distribution of its properties, avoiding dependence on any single property, and a large tenant base. At December 31, 1998, the Company's single largest neighborhood and community shopping center accounted for only 1.5% of the Company's annualized base rental revenues and only 1.0% of the Company's total shopping center gross leasable area ("GLA"). At December 31, 1998, the Company's five largest tenants include Kmart Corporation, The Home Depot, Kohl's, Toys/Kids R' Us and TJX Companies, which represented approximately 13.7%, 3.0%, 2.5%, 1.8% and 1.5%, respectively, of the Company's annualized base rental revenues. Principles of Consolidation and Estimates The accompanying Consolidated Financial Statements include the accounts of the Company, its subsidiaries, all of which are wholly-owned, and all majority-owned partnerships. All significant intercompany balances and transactions have been eliminated in consolidation. Generally accepted accounting principles require the Company's management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses during a reporting period. Actual results may differ from such estimates. The most significant assumptions and estimates relate to depreciable lives, valuation of real estate and the recoverability of trade accounts receivable. Real Estate Realestate assets are stated at cost, less accumulated depreciation and amortization. If there is an event or a change in circumstances that indicates that the basis of the Company's property may not be recoverable, the Company will assess any impairment in value by making a comparison of (i) the current and projected operating cash flows (undiscounted and without interest charges) of the property over its remaining useful life and (ii) the net carrying amount of the property. If the current and projected operating cash flows (undiscounted and without interest charges) are less than the carrying value of its property, the carrying value would be written down to an amount to reflect the fair value of the property. Depreciation and amortization are provided on the straight-line method over the estimated useful lives of the assets, as follows: Buildings 15 to 39 years Fixtures and leasehold improvements Terms of leases or useful lives, whichever is shorter 47 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued Expenditures for maintenance and repairs are charged to operations as incurred. Significant renovations are capitalized. Investments in Real Estate Joint Ventures Investments in real estate joint ventures are accounted for on the equity method. Deferred Leasing and Financing Costs Costs incurred in obtaining tenant leases and long-term financing, included in deferred charges and prepaid expenses in the accompanying Consolidated Balance Sheets, are amortized over the terms of the related leases or debt agreements, as applicable. Revenue Recognition Minimum revenues from rental property are recognized on a straight-line basis over the terms of the related leases. Income Taxes The Company and its subsidiaries file a consolidated Federal income tax return. The Company has made an election to qualify, and believes it is operating so as to qualify, as a Real Estate Investment Trust (a "REIT") for Federal income tax purposes. Accordingly, the Company generally will not be subject to Federal income tax, provided that distributions to its stockholders equal at least the amount of its REIT taxable income as defined under the Code. Per Share Data In 1997 the Financial Accounting Standards Board issued Financial Accounting Standards No. 128 "Earnings Per Share". Statement 128 replaced the presentation of primary and fully diluted earnings per share ("EPS") pursuant to Accounting Principles Board Opinion No. 15 with the presentation of basic and diluted EPS. Basic EPS excludes dilution and is computed by dividing net income available to common shareholders by the weighted average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common shares were exercised or converted into common shares and then shared in the earnings of the Company. The following table sets forth the reconciliation between basic and diluted weighted average number of shares outstanding for each period:
1998 1997 1996 ----------- ---------- ---------- Basic EPS - weighted average number of common shares outstanding 50,071,425 37,387,984 35,906,029 Effect of dilutive securities - Stock options 569,113 462,076 312,993 =========== ========== ========== Diluted EPS - weighted average number of common shares 50,640,538 37,850,060 36,219,022 =========== ========== ==========
48 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued The effect of the conversion of the Class D Preferred Stock (as defined in Note 3) would have an anti-dilutive effect upon the calculation of net income per common share. Accordingly, the impact of such conversion has not been included in the determination of diluted net income per common share. New Accounting Pronouncements During 1998, the Company adopted the provisions of Financial Accounting Standards No. 130 - "Reporting Comprehensive Income" ("SFAS 130") which established standards for reporting and displaying comprehensive income and its components and the provisions of Financial Accounting Standards No. 131 - "Disclosures about Segments of an Enterprise and Related Information"("SFAS 131") which established standards for reporting information about operating segments. The provisions of SFAS 130 and SFAS 131 had no impact on the accompanying Consolidated Financial Statements. In 1998 the Financial Accounting Standards Board issued Financial Accounting Standards No. 133 "Accounting for Derivative Instruments and Hedging Activities" ("SFAS 133"), which is effective for years beginning after June 15, 1999. The management of the Company believes that the implementation of SFAS 133 will not have a material impact on the Company's consolidated financial statements. In addition, during 1998, the Accounting Standards Executive Committee of the American Institute of Certified Public Accountants issued Statement of Position 98-5, "Reporting on the Costs of Start-Up Activities" ("SOP 98-5"), and Statement of Position 98-1, "Accounting for the Costs of Computer Software Developed or Obtained for Internal Use" ("SOP 98-1"), each of which is effective for fiscal years beginning after December 15, 1998. SOP 98-5 requires that certain costs incurred in connection with start-up activities be expensed. SOP 98-1 provides guidance on whether the costs of computer software developed or obtained for internal use should be capitalized or expensed. The management of the Company believes that, when adopted, SOP 98-5 and SOP 98-1 will not have a material impact on the Company's consolidated financial statements. 2. Property Acquisitions: Shopping Centers- During the years 1998, 1997 and 1996 certain subsidiaries of the Company acquired real estate interests, in separate transactions, in various shopping center properties at aggregate costs of approximately $303 million, $146 million and $39 million, respectively. Venture Stores, Inc. Properties Transactions- During January 1996, certain subsidiaries of the Company entered into two sale-leaseback transactions with Venture Stores, Inc. ("Venture") pursuant to which it acquired fee title to 16 retail properties located in Texas, Iowa, Oklahoma, Illinois and Kansas for a purchase price of $40 million. Simultaneously, the Company executed two long-term unitary net leases with Venture covering the 16 locations. During July 1997, the Company consented to the modification of these two unitary net lease agreements whereby the Company entered into two unitary net lease 49 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued agreements with another retailer on 9 of the locations and a new unitary lease with Venture on the remaining 7 locations. In August 1997, certain subsidiaries of the Company acquired certain real estate assets from Venture consisting of interests in 49 fee and leasehold properties totaling approximately 5.9 million square feet of leasable area located in seven states. The aggregate price was approximately $130 million, consisting of $70.5 million in cash and the assumption of approximately $59.5 million of existing mortgage debt on certain of these properties. Simultaneously with this transaction, the Company entered into a long-term unitary net lease with Venture covering all premises occupied by Venture on these properties. As a result of this transaction, Venture was the primary or sole tenant at 60 of the Company's locations as of December 31, 1997. In January 1998, Venture filed for protection under Chapter 11 of the United States Bankruptcy Code. On April 27, 1998, Venture announced it would discontinue its retail operations and that it had reached an agreement to sell its leasehold position at 89 locations to the Company, including 56 properties pursuant to two unitary leases already in place with the Company, 30 properties pursuant to a master lease with Metropolitan Life Insurance Company ("Metropolitan Life") and three properties leased by Venture from others. The purchase price for the leasehold positions was $95.0 million, less certain closing adjustments, but is subject to upward adjustment based on the Company's success in re-tenanting the properties over a two-year period. On July 17, 1998, the Company purchased the leasehold positions with an initial cash payment to Venture of approximately $50 million. Simultaneous with this transaction, the Company leased 46 of these locations to Kmart Corporation. The Company also reached an agreement with Metropolitan Life to purchase the 30 fee and leasehold positions which were leased by Metropolitan Life to Venture, for an aggregate purchase price of $167.5 million. This transaction was completed on July 1, 1998. During August 1998, the Company acquired from Venture five additional leasehold positions, including two leases already in place with the Company, for an aggregate purchase price of approximately $2.2 million. Simultaneous with this transaction, the Company leased these five locations, along with five other former Venture locations, to another national retailer. As of December 31, 1998, the Company has leased substantially all of the vacant space at 76 locations and sold 2 of the locations acquired in the above transactions (See Recent Developments - Property Dispositions). The Company is currently negotiating with other major retailers concerning the re-tenanting of the remaining locations. Retail Property Acquisitions- During January 1998, the Company, through a partnership interest, acquired fee interest in three properties from a retailer in the Chicago, IL market comprising approximately 516,000 square feet of GLA for a aggregate purchase price of approximately $23.7 million. These properties include approximately 70,000 square feet of showroom space and adjoining warehouses of approximately 100,000 square feet at each location. Simultaneous with this transaction, the Company leased, to a national furniture retailer, the showroom portion of each property under individual long-term leases. The Company is currently planning the redevelopment of the warehouse portion of each property. 50 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued During August 1996, certain subsidiaries of the Company acquired interests in 16 retail properties, including 2 properties to which the Company and its affiliates already held fee title, for $21.8 million in cash. These property interests were acquired from a retailer which had elected to discontinue operation of its discount department store division. These acquisitions have been funded principally through the application of proceeds from the Company's public unsecured debt and equity offerings and proceeds from mortgage financings. (See Notes 7, 8 and 12.) Other Acquisitions- During December 1998, the Company acquired a first mortgage on a shopping center in Manhasset, New York for approximately $21 million and has entered into a contract to acquire fee title to this property. 3. Price REIT Merger: On January 13, 1998, the Company, REIT Sub, Inc., a Maryland corporation and a wholly owned subsidiary of the Company ("Merger Sub") and The Price REIT, Inc., a Maryland corporation, ("Price REIT"), signed a definitive Agreement and Plan of Merger dated January 13, 1998, as amended March 5, 1998 and May 14, 1998, (the "Merger Agreement"). On June 19, 1998, upon approval by the shareholders of the Company and the shareholders of Price REIT, Price REIT was merged into Merger Sub, whereupon the separate existence of Price REIT ceased (the "Merger"). For financial reporting purposes, the Merger was accounted for using the purchase method of accounting. Prior to the Merger, Price REIT was a self-administered and self-managed equity REIT that was primarily focused on the acquisition, development, management and redevelopment of large community shopping center properties concentrated in the western part of the United States . In connection with the Merger, the Company acquired interests in 43 properties, consisting of 39 retail community centers, one stand-alone retail warehouse, one project under development and two undeveloped land parcels, located in 17 states containing approximately 8.0 million square feet of GLA. The overall occupancy rate of the retail community centers was 98%. In connection with the Merger, holders of Price REIT common stock received one share of Kimco common stock and 0.36 shares of Kimco Class D Depositary Shares (the "Class D Depositary Shares"), each Class D Depositary Share representing a one-tenth fractional interest in a new issue of Kimco 7.5% Cumulative Convertible Preferred Stock, par value $1.00 per share (the "Class D Preferred Stock"), for each share of Price REIT common stock. On June 19, 1998, the Company issued 11,921,992 shares of its common stock and 429,159 shares of Class D Preferred Stock (represented by 4,291,590 Class D Depositary Shares) in connection with the Merger. Additionally, in connection with the Merger, the Company issued 65,000 shares of a new issue of Kimco Class E Floating Rate Cumulative Preferred Stock, par value $1.00 per share ((the "Class E Preferred Stock"), represented by 650,000 Class E Depositary Shares, (the "Class E Depositary Shares")), each Class E Depositary Share representing a one-tenth fractional interest in the Class E Preferred Stock. The Class E Preferred Stock was redeemable at the option of the Company for 150 days after its issuance at a price equal to the liquidation preference of $1,000 per share plus accrued and unpaid 51 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued dividends. The Company exercised its option in November 1998 to redeem all of the Class E Preferred Stock for $65.065 million representing the liquidation preference of $65 million and approximately $65,000 of accrued dividends (See Note 12). The total Merger consideration was approximately $960 million, including the assumption of approximately $310 million of debt. Management has allocated the purchase price based on the fair value of assets and liabilities assumed. Such allocations are based on preliminary estimates, and are subject to revision. 4. Investment in Retail Store Leases: The Company has interests in various retail store leases relating to the anchor store premises in neighborhood and community shopping centers. These premises have been substantially sublet to retailers which lease the stores pursuant to net lease agreements. Income from the investment in these retail store leases during the years ended December 31, 1998 and 1997 was approximately $3.7 million and $3.6 million, respectively. These amounts represent sublease revenues during the years ended December 31, 1998 and 1997 of approximately $20.2 million and $20.9 million, respectively, less related expenses of $14.9 million and $15.2 million, respectively, and an amount, which in management's estimate, reasonably provides for the recovery of the investment over a period representing the expected remaining term of the retail store leases. The Company's future minimum revenues under the terms of all noncancellable tenant subleases and future minimum obligations through the remaining terms of its retail store leases, assuming no new or renegotiated leases are executed for such premises, for future years are as follows (in millions of dollars): 1999, $18.3 and $13.7; 2000, $17.1 and $12.5; 2001, $13.9 and $10.1; 2002, $10.3 and $7.3; 2003, $7.0 and $4.5 and thereafter, $8.7 and $1.7, respectively. 5. Investments and Advances in Real Estate Joint Ventures: The Company and its subsidiaries have investments in and advances to various real estate joint ventures. These joint ventures are engaged primarily in the operation of shopping centers which are either owned or held under long-term operating leases. During 1998, in connection with the Merger, the Company acquired two additional joint venture interests. The Company also invested approximately $19.0 million in a partnership which has acquired and leased-back 11 automotive dealerships and invested approximately $3.6 million in a partnership which acquired a shopping center for approximately $34 million, including mortgage debt of approximately $27 million. The Company has a 50% interest in each of these partnerships. 52 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued Summarized financial information for the recurring operations of these real estate joint ventures is as follows (in millions of dollars): December 31, -------------------------- 1998 1997 ----------- ---------- Assets: Real estate, net $168.2 $58.3 Other assets 20.3 7.8 ----------- ---------- $188.5 $66.1 =========== ========== Liabilities and Partners' Capital/(Deficit): Mortgages payable $104.3 $63.5 Other liabilities 24.7 19.7 Partners' Capital/(Deficit) 59.5 (17.1) ----------- ---------- $188.5 $66.1 =========== ========== Year Ended December 31, ----------------------------- 1998 1997 1996 ------- ------ -------- Revenues from rental property $26.8 $14.8 $11.2 Operating expenses (9.7) (3.6) (2.9) Mortgage interest (6.2) (3.1) (2.5) Depreciation and amortization (2.9) (2.2) (2.2) Other, net .1 (1.8) (1.3) ------ ----- ----- Net income $8.1 $4.1 $2.3 ====== ====== ==== Other liabilities in the accompanying Consolidated Balance Sheets include accounts with certain real estate joint ventures totaling approximately $5.0 million and $5.1 million at December 31, 1998 and 1997, respectively. The Company and its subsidiaries have varying equity interests in these real estate joint ventures which may differ from their proportionate share of net income or loss recognized in accordance with generally accepted accounting principles. 6. Cash and Cash Equivalents: Cashand cash equivalents (demand deposits in banks, commercial paper and certificates of deposit with original maturities of three months or less) includes tenants' security deposits, escrowed funds and other restricted deposits approximating $.1 million and $10.1 million at December 31, 1998 and 1997, respectively. Cashand cash equivalent balances may, at a limited number of banks and financial institutions, exceed insurable amounts. The Company believes it mitigates its risks by investing in or through major financial institutions. Recoverability of investments is dependent upon the performance of the issuers. 53 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued 7. Notes Payable: The Company has implemented a $200 million unsecured medium-term notes ("MTN") program pursuant to which it may, from time to time, offer for sale its senior unsecured debt for any general corporate purposes, including (i) funding specific liquidity requirements in its business, including property acquisition, development and redevelopment costs, and (ii) managing the Company's debt maturities. During June and July 1998, the Company issued an aggregate $130 million of fixed-rate unsecured medium-term notes under its MTN program (the "June and July MTNS"). The June and July MTNs mature in June 2005 and July 2006, respectively, and bear interest at 6.73% and 6.93% per annum, respectively. Interest on these notes is payable semi-annual in arrears. As of December 31, 1998, a total principal amount of $290.25 million, including the June and July MTNs, in fixed-rate senior unsecured MTNs had been issued under the MTN program primarily for the acquisition of neighborhood and community shopping centers and the expansion and improvement of properties in the Company's portfolio. These fixed-rate notes had maturities ranging from seven to twelve years at the time of issuance and bear interest at rates ranging from 6.70% to 7.91%. Interest on these fixed-rate senior unsecured notes is payable semi-annually in arrears. During August 1998, the Company issued $60 million of floating-rate MTNs which mature in August 2000 and bear interest at LIBOR plus .15% per annum. The interest rate resets quarterly and is payable quarterly in arrears. Concurrent with the issuance of these MTN's, the Company entered into an interest rate swap agreement for the term of these MTNs, which effectively fixed the interest rate at 5.91% per annum. The proceeds from this MTN issuance were used to prepay certain mortgage loans with a principal amount of approximately $57 million bearing interest at 10.54% per annum plus prepayment premiums of approximately $4.9 million (See Note 9). Additionally during August 1998, the Company issued $100 million of remarketed reset notes under its MTN program. The remarketed reset notes mature in August 2008 and bear interest initially at a floating rate of LIBOR plus .30% per annum. After an initial period of one year, the interest rate spread applicable to each subsequent period will be determined pursuant to a remarketing agreement between the Company and a financial institution. The interest rate resets quarterly and is payable quarterly in arrears. Concurrent with this issuance, the Company entered into an interest rate swap agreement which effectively fixed the interest rate at 5.92% per annum during the initial one-year period. The proceeds from the MTN issuance were used, in part, to repay $50 million MTNs that matured in July 1998. In connection with the Price REIT Merger, the Company assumed $205 million of fixed-rate unsecured senior notes consisting of: (i) $50 million which mature in June 2004 and bear interest at 7.125%, (ii) $55 million which mature November 2006 and bear interest at 7.5% and (iii) $100 million which mature November 2000 and bear interest at 7.25% (collectively, "the Price REIT Notes"). Interest is payable on the Price REIT Notes semi-annually in arrears. 54 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued As of December 31, 1998, the Company had outstanding $100 million in floating rate senior notes due 1999 bearing interest at LIBOR plus .50%. Interest on these floating-rate, senior unsecured notes resets quarterly and is payable quarterly in arrears. During 1998, the Company entered into an interest rate swap agreement which effectively fixed the interest rate at 6.165% per annum for the remaining term of these notes (See Note 18). As of December 31, 1998, the Company had $100 million in 6.5% fixed-rate unsecured Senior Notes due 2003. Interest on these senior unsecured notes is paid semi-annually in arrears. The scheduled maturities of all unsecured senior notes payable as of December 31, 1998, are approximately as follows (in millions of dollars): 1999, $100.0; 2000, $160.0; 2003, $100.0 and thereafter, $495.25. In accordance with the terms of the Indenture, as amended, pursuant to which the Company's senior, unsecured notes have been issued, the Company is (a) subject to maintaining certain maximum leverage ratios on both unsecured senior corporate and secured debt, minimum debt service coverage ratios and minimum equity levels, and (b) restricted from paying dividends in amounts that exceed by more than $26 million the funds from operations, as defined, generated through the end of the calendar quarter most recently completed prior to the declaration of such dividend; however, this dividend limitation does not apply to any distributions necessary to maintain the Company's qualification as a REIT providing the Company is in compliance with its total leverage limitations. The Company maintains a $215 million, unsecured revolving credit agreement with a group of banks. Borrowings under this facility are available for general corporate purposes, including the funding of property acquisitions, development and redevelopment costs. Interest on borrowings accrues at a spread (currently .50%) to LIBOR or money-market rates, as applicable, which fluctuates in accordance with changes in the Company's senior debt ratings. A fee approximating .20% per annum is payable on that portion of the facility which remains unused. Pursuant to the terms of the agreement, the Company, among other things, is (a) subject to maintaining certain maximum leverage ratios on both unsecured senior corporate and secured debt, a minimum debt service coverage ratio and minimum unencumbered asset and equity levels, and (b) restricted from paying dividends in amounts that exceed 90% of funds from operations, as defined, plus 10% of the Company's stockholders' equity determined in accordance with generally accepted accounting principles. There were no borrowings outstanding under this facility at December 31, 1998. This revolving credit facility is scheduled to expire in August 2001. 8. Mortgages Payable: During 1998, the Company obtained mortgage financing aggregating approximately $272.3 million on 20 of its properties. These mortgages are non-recourse, non-cross collateralized, ten-year fixed-rate first mortgages, bearing interest at a weighted average rate of 6.585% per annum over the term of the loans. The proceeds from the mortgages were used primarily for the acquisition of neighborhood and community shopping centers. In addition, the Company, through an affiliated entity, obtained mortgage financing of approximately $9 million on two other properties. These ten-year fixed-rate mortgages bear interest at 7% per annum for the term of the loans. 55 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued Mortgages payable, collateralized by certain shopping center properties and related tenants' leases, are generally due in monthly installments of principal and/or interest which mature at various dates through 2023. Interest rates range from approximately 6.57% to 10.5% (weighted average interest rate of 7.27% as of December 31, 1998). The scheduled maturities of all mortgages payable as of December 31, 1998, are approximately as follows (in millions of dollars): 1999, $28.8; 2000, $16.5; 2001, $4.8; 2002, $8.0; 2003, $6.0 and thereafter, $370.2. Three of the Company's properties are encumbered by approximately $13.5 million in floating-rate, tax-exempt mortgage bond financing. The rates on the bonds are reset annually, at which time bondholders have the right to require the Company to repurchase the bonds. The Company has engaged a remarketing agent for the purpose of offering for resale those bonds that are tendered to the Company. All bonds tendered for redemption in the past have been remarketed and the Company has arrangements, including letters of credit, with banks to both collateralize the principal amount and accrued interest on such bonds and to fund any repurchase obligations. 9. Extraordinary Items: During 1998, the Company prepaid certain mortgage loans resulting in extraordinary charges of approximately $4.9 million, or, on a per-basic share and diluted share basis, $.10 and $.09, respectively, representing the premiums paid and other costs written-off in connection with the early satisfaction of these mortgage loans. 10. KC Holdings, Inc.: To facilitate the Company's November 1991 initial public stock offering(the "IPO"), forty-six shopping center properties and certain other assets, together with indebtedness related thereto, were transferred to subsidiaries of KC Holdings, Inc. ("KC Holdings"), a newly-formed corporation that is owned by the stockholders of the Company prior to the IPO. The Company continues to manage eighteen of these shopping center properties and was granted ten-year, fixed-price options to reacquire the real estate assets owned by KC Holdings' subsidiaries, subject to any liabilities outstanding with respect to such assets at the time of an option exercise. As of December 31, 1998, KC Holdings' subsidiaries had conveyed 14 shopping centers back to the Company and had disposed of ten additional centers in transactions with third parties. The members of the Company's Board of Directors who are not also shareholders of KC Holdings unanimously approved the purchase of each of the 14 shopping centers that have been reacquired by the Company from KC Holdings. Selected financial information for the twenty-two property interests owned by KC Holdings' subsidiaries as of and for the year ended December 31, 1998, is as follows: Real estate, net of accumulated depreciation and amortization, $54.7 million; Notes and mortgages payable, $58.8 million; Revenues from rental property, $11.7 million; Income from rental operations, $.3 million, after depreciation and amortization deductions of $2.1 million; Income adjustment for real estate joint ventures, net, $.6 million. 56 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued 11. Fair Value Disclosure of Financial Instruments: All financial instruments of the Company are reflected in the accompanying Consolidated Balance Sheets at amounts which, in management's estimation based upon an interpretation of available market information and valuation methodologies (including discounted cash flow analyses with regard to fixed rate debt) considered appropriate, reasonably approximate their fair values. Such fair value estimates are not necessarily indicative of the amounts that would be realized upon disposition of the Company's financial instruments. 12. Preferred and Common Stock Issuances: During April and May 1998, the Company completed the sale of an aggregate 3,039,507 shares of common stock in five separate transactions consisting of (i) a primary public stock offering of 460,000 shares of common stock priced at $36.0625 per share, and (ii) four direct placements of 415,945 shares, 546,075 shares, 837,000 shares and 780,487 shares of common stock priced at $36.0625, $36.625, $36.25 and $38.4375 per share, respectively. The shares of common stock sold in the direct placements were deposited in separate unit investment trusts. The net proceeds from these offerings totaled approximately $106.0 million, after related transaction costs of approximately $5.9 million. During July 1998, the Company completed the sale of an aggregate 1,315,498 shares of common stock in three separate transactions consisting of (i) a primary public stock offering of 510,000 shares of common stock priced at $39.4375 per share and (ii) two direct placements of 375,000 and 430,498 shares of common stock priced at $38.2575 and $38.56 per share, respectively. The net proceeds from these offerings totaled approximately $49.9 million, after related transaction costs of approximately $1.2 million. During September 1998, the Company completed the sale of an aggregate 750,000 shares of common stock priced at $38.75 per share in a primary public stock offering. In addition, during October 1998, the Company sold an additional 112,500 shares of common stock pursuant to an election by the underwriter to exercise, in full, their over-allotment option. The net proceeds from these sales of common stock totaled approximately $31.6 million, after related transaction costs of approximately $1.8 million. During November 1998, the Company completed the sale of an aggregate 1,395,000 shares of common stock in four separate transactions consisting of primary public stock offerings of 650,000 shares, 170,000 shares, 475,000 shares and 100,000 shares of common stock priced at $39.6875, $39.6875, $39.00 and $39.00 per share, respectively. The net proceeds from these sales of common stock totaled approximately $52.4 million after related transaction costs of approximately $2.5 million. During December 1998, the Company completed the sale of an aggregate 1,005,800 shares of common stock in three direct placements. The transactions were each priced at $38.25 per share and provided net proceeds to the Company of approximately $38.4 million, after related transaction costs of approximately $.1 million. On September 30, 1997, the Company completed a primary public stock offering of 4,000,000 shares of common stock at $35.50 per share. The net proceeds from this sale of common stock totaled approximately $134.5 million, after related transaction costs of approximately $7.5 million. 57 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued The net proceeds from these common stock offerings have been used for general corporate purposes, including the acquisition of neighborhood and community shopping centers, the expansion and improvement of certain properties in the Company's portfolio, and the redemption of the Class E Preferred Stock issued in connection with the Merger. During June 1998, in connection with the Merger, the Company issued 4,291,590 Class D Depositary Shares (each such depositary share representing a one-tenth fractional interest in the Class D Preferred Stock) and 650,000 Class E Depositary Shares (each depositary share representing a one-tenth fractional interest in the Class E Preferred Stock). During November 1998, the Company exercised its option to redeem all of the Class E Preferred Stock (represented by the Class E Depositary Shares). (See Note 3.) Dividends on the Class D Depositary Shares are cumulative and payable at the rate per depositary share equal to the greater of (i) 7.5% per annum based upon a $25 per share initial value or $1.875 per share or (ii) the cash dividend on the shares of the Company's common stock into which a Class D Depositary Share is convertible plus $0.0275 per quarter. The Class D Depositary Shares are convertible into the Company's common stock at a conversion price of $40.25 per share of common stock at any time by the holder and may be redeemed by the Company at the conversion price in shares of the Company's common stock at any time after June 19, 2001 if, for any 20 trading days within any period of 30 consecutive trading days, including the last day of such period, the average closing price per share of the Company's common stock exceeds 120% of the conversion price or $48.30 per share, subject to certain adjustments. The dividend rate on the Class E Preferred Stock (represented by the Class E Depositary Shares) was equal to LIBOR plus 2% per annum, adjusted quarterly, and had an initial dividend rate of 7.68% per annum. The Class D Preferred Stock (represented by the Class D Depositary Shares outstanding) ranks pari passu with the Company's 7-3/4% Class A Cumulative Redeemable Preferred Stock, 8-1/2% Class B Cumulative Redeemable Preferred Stock and the 8-3/8% Class C Cumulative Redeemable Preferred Stock as to voting rights, priority for receiving dividends and liquidation preferences as set forth below. At December 31, 1998, the Company has outstanding 3,000,000 Depositary Shares (the "Class A Depositary Shares"), each such Class A Depositary Share representing a one-tenth fractional interest of a share of the Company's 7-3/4% Class A Cumulative Redeemable Preferred Stock, par value $1.00 per share(the "Class A Preferred Stock"), 2,000,000 Depositary Shares (the "Class B Depositary Shares"), each such Class B Depositary Share representing a one-tenth fractional interest of a share of the Company's 8-1/2% Class B Cumulative Redeemable Preferred Stock, par value $1.00 per share (the "Class B Preferred Stock"), 4,000,000 Depositary Shares ("the Class C Depositary Shares"), each such Class C Depositary Share representing a one-tenth fractional interest of a share of the Company's 8-3/8% Class C Cumulative Redeemable Preferred Stock, par value $1.00 per share (the "Class C Preferred Stock"). 58 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued Dividends on the Class A Depositary Shares are cumulative and payable quarterly in arrears at the rate of 7-3/4% per annum based on the $25 per share initial offering price, or $1.9375 per depositary share. The Class A Depositary Shares are redeemable, in whole or in part, for cash on or after September 23, 1998 at the option of the Company, at a redemption price of $25 per depositary share, plus any accrued and unpaid dividends thereon. The Class A Depositary Shares are not convertible or exchangeable for any other property or securities of the Company. The Class A Preferred Stock (represented by the Class A Depositary Shares outstanding) ranks pari passu with the Company's Class B Preferred Stock, Class C Preferred Stock and Class D Preferred Stock as to voting rights, priority for receiving dividends and liquidation preferences as set forth below. Dividends on the Class B Depositary Shares are cumulative and payable quarterly in arrears at the rate of 8-1/2% per annum based on the $25 per share initial offering price, or $2.125 per depositary share. The Class B Depositary Shares are redeemable, in whole or in part, for cash on or after July 15, 2000 at the option of the Company at a redemption price of $25 per depositary share, plus any accrued and unpaid dividends thereon. The redemption price of the Class B Preferred Stock may be paid solely from the sale proceeds of other capital stock of the Company, which may include other classes or series of preferred stock. The Class B Depositary Shares are not convertible or exchangeable for any other property or securities of the Company. The Class B Preferred Stock (represented by the Class B Depositary Shares outstanding) ranks pari passu with the Company's Class A Preferred Stock, Class C Preferred Stock and Class D Preferred Stock as to voting rights, priority for receiving dividends and liquidation preferences as set forth below. Dividends on the Class C Depositary Shares are cumulative and payable quarterly in arrears at the rate of 8-3/8% per annum based on the $25 per share initial offering price, or $2.0938 per depositary share. The Class C Depositary Shares are redeemable, in whole or in part, for cash on or after April 15, 2001 at the option of the Company at a redemption price of $25 per depositary share, plus any accrued and unpaid dividends thereon. The redemption price of the Class C Preferred Stock may be paid solely from the sale proceeds of other capital stock of the Company, which may include other classes or series of preferred stock. The Class C Depositary Shares are not convertible or exchangeable for any other property or securities of the Company. The Class C Preferred Stock (represented by the Class C Depositary Shares outstanding) ranks pari passu with the Company's Class A Preferred Stock, Class B Preferred Stock and Class D Preferred Stock as to voting rights, priority for receiving dividends and liquidation preferences as set forth below. Voting Rights - As to any matter on which the Class A Preferred Stock, Class B Preferred Stock, Class C Preferred Stock and Class D Preferred Stock (collectively, the "Preferred Stock") may vote, including any action by written consent, each share of Preferred Stock shall be entitled to 10 votes, each of which 10 votes may be directed separately by the holder thereof. With respect to each share of Preferred Stock, the holder thereof may designate up to 10 proxies, with each such proxy having the right to vote a whole number of votes (totaling 10 votes per share of Preferred Stock). As a result, each Class A, each Class B, each Class C and each Class D Depositary Share is entitled to one vote. 59 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued Liquidation Rights - In the event of any liquidation, dissolution or winding up of the affairs of the Company, the Preferred Stock holders are entitled to be paid, out of the assets of the Company legally available for distribution to its stockholders, a liquidation preference of $250.00 per share ($25 per Class A, Class B, Class C and Class D Depositary Share, respectively), plus an amount equal to any accrued and unpaid dividends to the date of payment, before any distribution of assets is made to holders of the Company's common stock or any other capital stock that ranks junior to the Preferred Stock as to liquidation rights. 13. Dispositions of Real Estate: During January 1998, the Company disposed of a property in Pinellas Park, Florida. Proceeds from the disposition totaling approximately $2.3 million, together with an additional $7.1 million cash investment, were used to acquire an exchange shopping center property located in Cranston, Rhode Island. During December 1998, the Company disposed of a vacant distribution center and adjacent facility located in O'Fallon, Missouri, which were acquired as part of the Venture transactions, for $10 million, which amount approximated their net book value. 14. Transactions with Related Parties: The Company provides management services for shopping centers owned principally by affiliated entities and various real estate joint ventures in which certain stockholders of the Company have economic interests. Such services are performed pursuant to management agreements which provide for fees based upon a percentage of gross revenues from the properties and other direct costs incurred in connection with management of the centers. The Consolidated Statements of Income include management fee income from KC Holdings of approximately $.6 million during each of the three years ending December 31, 1998, 1997, and 1996. Reference is made to Notes 5 and 10 for additional information regarding transactions with related parties. 15. Commitments and Contingencies: The Company and its subsidiaries are engaged in the operation of shopping centers which are either owned or held under long-term leases which expire at various dates through 2076. The Company and its subsidiaries, in turn, lease premises in these centers to tenants pursuant to lease agreements which provide for terms ranging generally from 5 to 25 years and for annual minimum rentals plus incremental rents based on operating expense levels and tenants' sales volumes. Annual minimum rentals plus incremental rents based on operating expense levels comprised approximately 98%, 98% and 97% of total revenues from rental property for the years ended December 31, 1998, 1997 and 1996, respectively. The future minimum revenues from rental property under the terms of all noncancellable tenant leases, assuming no new or renegotiated leases are executed for such premises, for future years are approximately as follows (in millions of dollars): 1999, $337.1; 2000, $319.2; 2001, $297.3; 2002, $276.1; 2003, $253.5 and thereafter, $2,321.6. 60 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued Minimum rental payments under the terms of all noncancellable operating leases pertaining to its shopping center portfolio for future years are approximately as follows (in millions of dollars): 1999, $13.5; 2000, $12.9; 2001, $11.6; 2002, $10.7; 2003, $9.6 and thereafter $169.1. 16. Incentive Plans: The Company maintains a stock option plan (the "Plan") pursuant to which a maximum 6,000,000 shares of the Company's common stock may be issued for qualified and non-qualified options. Options granted under the Plan generally vest ratably over a three-year term, expire ten years from the date of grant and are exercisable at the market price on the date of grant, unless otherwise determined by the Board in its sole discretion. In addition, the Plan provides for the granting of certain options to each of the Company's non-employee directors (the "Independent Directors") and permits such Independent Directors to elect to receive deferred stock awards in lieu of directors' fees. Information with respect to stock options under the Plan for the years ended December 31, 1998, 1997 and 1996 is as follows:
Weighted Average ---------------- Exercise Price -------------- Shares Per Share --------- --------- Options outstanding, December 31, 1995 1,452,228 $21.44 Exercised (163,582) $19.36 Granted 315,500 $28.32 --------- Options outstanding, December 31, 1996 1,604,146 $23.01 Exercised (179,750) $20.94 Granted 470,700 $31.72 --------- Options outstanding, December 31, 1997 1,895,096 $25.37 Exercised (150,766) $20.99 Granted 1,023,500 $37.32 --------- Options outstanding, December 31, 1998 2,767,830 $30.03 ========= Options exercisable - December 31, 1996 954,175 $20.84 ======= ====== December 31, 1997 1,126,093 $22.39 ========= ====== December 31, 1998 1,326,224 $24.13 ========= ======
The exercise prices for options outstanding as of December 31, 1998 range from $13.33 to $39.94 per share. The weighted average remaining contractual life for options outstanding as of December 31, 1998 was approximately 7.8 years. Options to purchase 2,316,420, 329,673 and 800,373 shares of the Company's common stock were available for issuance under the Plan at December 31, 1998, 1997 and 1996 respectively. The Company has elected to adopt the disclosure-only provisions of Statement of Financial Accounting Standards No. 123 "Accounting for Stock-Based Compensation". Accordingly, no compensation cost has been recognized with regard to options granted under the Plan in the accompanying Consolidated Statements of Income. If stock-based compensation costs had been recognized based on the estimated fair values at the dates of grant for options awarded during 1998, 1997 and 1996 net income and net income per common share for these calendar years would have been reduced by approximately $1.4 million or $.03 per basic share, $.7 million, or $.02 per basic share and $.4 million, or $.01 per basic share, respectively. 61 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued These pro forma adjustments to net income and net income per basic common share assume fair values of each option grant estimated using the Black-Scholes option pricing formula. The more significant assumptions underlying the determination of such fair values for options grantedduring 1998, 1997 and 1996 include: (i) weighted average risk-free interest rates of 5.07%, 6.18% and 6.24%, respectively; (ii) weighted average expected option lives of 5.6 years, 8.2 years and 7.25 years, respectively; (iii) an expected volatility of 15.76%, 15.65% and 15.79%, respectively, and (iv) an expected dividend yield of 6.40%, 6.44% and 6.82%, respectively. The per share weighted average fair value at the dates of grant for options awarded during 1998, 1997 and 1996 was $2.86, $3.02 and $2.50, respectively. The Company maintains a 401(k) retirement plan covering substantially all officers and employees which permits participants to defer up to a maximum 10% of their eligible compensation. This deferred compensation, together with Company matching contributions which generally equal employee deferrals up to a maximum of 5%, is fully vested and funded as of December 31, 1998. Company contributions to the plan totaled less than $.3 million for each of the years ended December 31, 1998, 1997 and 1996. 17. Supplemental Financial Information: The following represents the results of operations, expressed in thousands except per share amounts, for each quarter during years 1998 and 1997.
1998 (Unaudited) -------------------------------------------------------------------- Mar. 31 June 30 Sept. 30 Dec. 31 ------- ------- -------- ------- Revenues from rental property $63,112 $69,341 $98,085 $108,260 Income before extraordinary items $25,484 $27,530 $36,107 $38,046 Net income $25,484 $27,530 $31,255 $37,997 Per common Share: Income before extraordinary items: Basic $.52 $.51 $.50 $.53 Diluted $.51 $.50 $.49 $.52 Net income: Basic $.52 $.51 $.41 $.53 Diluted $.51 $.50 $.41 $.52 1997 (Unaudited) ------------------------------------------------------------------ Mar. 31 June 30 Sept. 30 Dec. 31 ------- ------- -------- ------- Revenues from rental property $45,195 $45,276 $50,823 $57,635 Net income $20,604 $21,045 $20,641 $23,546 Net income, per common share: Basic $.44 $.45 $.44 $.47 Diluted $.44 $.45 $.43 $.46
62 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued Interest paid during years 1998, 1997 and 1996 approximated $60.7 million, $29.9 million and $26.9 million, respectively. Accounts and notes receivable in the accompanying Consolidated Balance Sheets are net of estimated unrecoverable amounts of approximately $3.2 million and $1.8 million, respectively, at December 31, 1998 and 1997. 18. Subsequent Events: Property Acquisitions / Dispositions In January and February 1999, the Company acquired five neighborhood and community shopping center properties comprising approximately .7 million square feet of GLA in four states for an aggregate price of approximately $79.0 million, including the assumption of $8.5 million of mortgage debt encumbering one of the properties. During February 1999, the Company disposed of a property in Morrisville, Pennsylvania. Cash proceeds from the disposition totaling $1.6 million approximated its net book value. Financings During February 1999, the Company issued $130 million of 6-7/8% fixed-rate Senior Notes due 2009. Interest on the notes is payable semi-annually in arrears. The notes were sold at 99.85% of par value. Net proceeds from the issuance totaling approximately $128.9 million, after related transaction costs of approximately $.9 million, were used, in part, to repay $100 million floating-rate senior notes that matured during February 1999 and for general corporate purposes. 19. Pro Forma Financial Information (Unaudited): As discussed in Notes 2, 3 and 13, the Company and certain of its subsidiaries acquired and disposed of interests in shopping center properties during 1998. The pro forma financial information set forth below is based upon the Company's historical Consolidated Statements of Income for the years ended December 31, 1998 and 1997, adjusted to give effect to these transactions as of January 1, 1997. The pro forma financial information is presented for informational purposes only and may not be indicative of what actual results of operations would have been had the transactions occurred on January 1, 1997, nor does it purport to represent the results of operations for future periods. (Amounts presented in millions of dollars, except per share figures.) Years ended December 31, 1998 1997 ---- ---- Revenues from rental property $410.0 $349.4 Income before extraordinary items $149.1 $139.8 Net income $144.2 $139.8 Per common Share: Income before extraordinary items: Basic $2.13 $2.20 Diluted $2.11 $2.18 Net income: Basic $2.04 $2.20 Diluted $2.02 $2.18 63 KIMCO REALTY CORPORATION AND SUBSIDIARIES VALUATION AND QUALIFYING ACCOUNTS For Years Ended December 31, 1998, 1997 and 1996
Balance at Charged to Beginning of Charged to valuation Balance at end Period expenses accounts Deductions of period ----------------- --------------- ------------------ ---------------- ----------------- Year Ended December 31, 1998 Allowance for uncollectable accounts $1,800,000 $2,050,000 $ 1,300,000 $ 2,000,000 $ 3,150,000 =============== ============= ============== =========== ============= Year Ended December 31, 1997 Allowance for uncollectable accounts $1,350,000 $910,000 $ -- $ 460,000 $ 1,800,000 =============== ============= ============== =========== ============ Year Ended December 31, 1996 Allowance for uncollectable accounts $1,350,000 $955,000 $ -- $ 955,000 $ 1,350,000 =============== ============= ============== ============ ============
64 KIMCO REALTY CORPORATION AND SUBSIDARIES REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1998 SCHEDULE III
INITIAL COST TOTAL COST BUILDING AND SUBSEQUENT BUILDINGS AND PROPERTIES LAND IMPROVEMENTS TO ACQUISITION LAND IMPROVEMENTS ---------- ---- ------------ -------------- ---- ------------ BOCA RATON $573,875 $2,295,501 $867,261 $573,875 $3,162,762 WHITEHALL 432,652 770,159 183,153 432,652 953,312 OGDEN 213,818 855,275 465,600 213,818 1,320,875 ORLANDO 923,956 3,646,904 1,828,967 1,172,119 5,227,708 PLAINVIEW 263,693 584,031 9,470,272 263,693 10,054,303 POMPANO BEACH 97,169 874,442 1,215,842 97,169 2,090,284 LIVONIA 178,785 925,818 630,242 178,785 1,556,060 LAUDERDALE LAKES 342,420 2,416,645 2,137,057 342,420 4,553,702 FERN PARK 225,000 902,000 2,351,777 225,000 3,253,777 ADDISON 0 753,343 1,100,049 0 1,853,392 LARGO 293,686 792,119 1,239,676 293,686 2,031,795 WINSTON-SALEM 540,667 719,655 3,706,733 540,667 4,426,388 MELBOURNE 0 1,754,000 2,272,584 0 4,026,584 ST. PETERSBURG 0 917,360 681,718 0 1,599,078 GROVE GATE 365,893 1,049,172 1,048,494 365,893 2,097,666 UPPER ARLINGTON 504,256 2,198,476 6,672,770 1,255,544 8,119,958 SHILOH SPRING RD. 0 1,735,836 2,290,519 0 4,026,355 FELBRAM 72,971 302,579 401,599 72,971 704,178 LEESBURG 0 171,636 97,728 0 269,364 FOREST PARK 141,200 564,800 64,990 141,200 629,790 LARGO EAST BAY 2,832,296 11,329,185 779,937 2,832,296 12,109,122 LEXINGTON 1,675,031 6,848,209 4,849,819 1,675,031 11,698,028 CLAWSON 1,624,771 6,578,142 2,119,979 1,624,771 8,698,121 CHARLOTTE 919,251 3,570,981 906,378 919,251 4,477,359 LAFAYETTE 230,402 1,305,943 65,497 230,402 1,371,440 FARMINGTON 1,098,426 4,525,723 1,259,066 1,098,426 5,784,789 WEST MIFFLIN 475,815 1,903,231 646,514 475,815 2,549,745 BRADENTON 125,000 299,253 323,963 125,000 623,216 GREENWOOD 423,371 1,883,421 1,243,942 423,371 3,127,363 GRAVOIS 1,032,416 4,455,514 872,488 1,032,416 5,328,002 JENNINGS 257,782 1,031,128 1,233,616 257,782 2,264,744 DALLAS 1,299,632 5,168,727 5,373,565 1,299,632 10,542,292 TUTTLE BEE SARASOTA 254,961 828,465 1,607,783 254,961 2,436,248 LAUREL 349,562 1,398,250 668,130 349,562 2,066,380 LAUREL 274,580 1,100,968 - 274,580 1,100,968 EAST ORLANDO 491,676 1,440,000 2,526,528 1,007,882 3,450,322 OTTAWA 137,775 784,269 303,414 137,775 1,087,683 BLOOMINGTON 805,521 2,222,353 2,579,854 805,521 4,802,207 RALEIGH 5,208,885 20,885,792 1,631,675 5,208,885 22,517,467 CANTON HILLS 500,980 2,020,274 1,038,157 500,980 3,058,431 SAVANNAH 2,052,270 8,232,978 327,564 2,052,270 8,560,542 MACON 262,700 1,487,860 1,481,094 349,326 2,882,328 CANTON 792,985 1,459,031 4,509,866 792,985 5,968,897 CHARLOTTE 1,783,400 7,139,131 15,209 1,783,400 7,154,340 PALATKA 130,844 556,658 897,013 130,844 1,453,671 EAST STROUDSBURG 1,050,000 2,372,628 671,982 1,050,000 3,044,610 POUGHKEEPSIE 876,548 4,695,659 1,227,104 876,548 5,922,763 BARBERTON 505,590 1,948,135 119,615 505,590 2,067,750 HAGERSTOWN 541,389 2,165,555 967,899 541,389 3,133,454 ELGIN 842,555 2,108,674 1,368,285 842,555 3,476,959 GRAND HAVEN 356,800 1,532,689 1,190,674 356,800 2,723,363 HOUSTON 275,000 507,588 191,639 275,000 699,227 WICKLIFFE 610,991 2,471,965 1,353,159 610,991 3,825,124 LEOMINSTER 3,732,508 6,754,092 29,319,716 4,933,640 34,872,676 LAUDERHILL 1,002,733 2,602,415 9,135,669 1,774,443 10,966,374 CAMBRIDGE 0 1,848,195 809,892 473,060 2,185,027 OLMSTED 167,337 2,815,856 930,580 167,337 3,746,436 LEMAY 125,879 503,510 159,725 125,879 663,235 AKRON WATERLOO 437,277 1,912,222 209,678 437,277 2,121,900 BRUNSWICK 771,765 6,058,560 289,996 771,765 6,348,556 WEST MIFFLIN HILLS 654,366 3,199,729 6,864,887 654,366 10,064,616 CHARLESTON 770,000 3,132,092 4,110,219 770,000 7,242,311 MESQUITE 520,340 2,081,356 528,652 520,340 2,610,008 BELLEVUE 405,217 1,743,573 101,153 405,217 1,844,726 ELSMERE 0 3,185,642 - 0 3,185,642 MADISON 0 4,133,904 2,296,477 0 6,430,381 SPRINGFIELD 919,998 4,981,589 2,493,557 919,998 7,475,146 CHERRY HILL 2,417,583 6,364,094 920,457 2,417,583 7,284,551 NANUET 798,932 2,361,900 1,473,214 798,932 3,835,114 OAKCREEK 1,245,870 4,339,637 3,970,635 1,245,870 8,310,272 NORRISTOWN 686,134 2,664,535 3,199,738 774,084 5,776,323 SPRINGBORO PIKE 1,854,527 2,572,518 2,493,276 1,854,527 5,065,794 LIMA 770,121 3,080,479 561,651 770,121 3,642,130 CHARLES TOWN 602,000 3,725,871 11,060,667 602,000 14,786,538 MUSKEGON 391,500 958,500 742,640 391,500 1,701,140 NORTH MIAMI 732,914 4,080,460 6,730,334 732,914 10,810,794 NEW KENSINGTON 521,945 2,548,322 725,212 521,945 3,273,534 PENN HILLS 0 1,737,289 - 0 1,737,289 BEAVERCREEK 635,228 3,024,722 2,495,349 635,228 5,520,071 TOTAL TOTAL COST, DATE OF ACCUMULATED NET OF ACCUMULATED CONSTRUCTION(C) PROPERTIES TOTAL DEPRECIATION DEPRECIATION ENCUMBRANCES ACQUISITION(A) ---------- ----- ------------ ------------ ------------ -------------- BOCA RATON $3,736,637 $524,324 $3,212,313 $0 1992(A) WHITEHALL 1,385,964 721,571 664,393 0 1967(C) OGDEN 1,534,693 729,293 805,400 0 1967(C) ORLANDO 6,399,827 549,479 5,850,348 0 1995(A) PLAINVIEW 10,317,996 1,648,265 8,669,731 0 1969(C) POMPANO BEACH 2,187,453 1,012,476 1,174,977 0 1968(C) LIVONIA 1,734,845 413,201 1,321,644 0 1968(C) LAUDERDALE LAKES 4,896,122 2,902,912 1,993,210 0 1968(C) FERN PARK 3,478,777 1,021,217 2,457,560 0 1968(C) ADDISON 1,853,392 922,995 930,397 0 1968(C) LARGO 2,325,481 1,356,804 968,677 0 1968(C) WINSTON-SALEM 4,967,055 1,090,999 3,876,056 0 1969(C) MELBOURNE 4,026,584 1,561,828 2,464,756 0 1968(C) ST. PETERSBURG 1,599,078 586,422 1,012,656 0 1968(C) GROVE GATE 2,463,559 1,102,222 1,361,337 0 1968(C) UPPER ARLINGTON 9,375,502 3,604,914 5,770,588 0 1969(C) SHILOH SPRING RD. 4,026,355 2,402,928 1,623,427 0 1969(C) FELBRAM 777,149 422,238 354,911 0 1970(C) LEESBURG 269,364 188,212 81,152 0 1969(C) FOREST PARK 770,990 409,622 361,368 0 1969(C) LARGO EAST BAY 14,941,418 2,170,309 12,771,109 0 1992(A) LEXINGTON 13,373,059 1,326,058 12,047,001 0 1993(A) CLAWSON 10,322,892 958,962 9,363,930 0 1993(A) CHARLOTTE 5,396,610 395,225 5,001,385 0 1995(A) LAFAYETTE 1,601,842 845,683 756,159 0 1971(C) FARMINGTON 6,883,215 660,684 6,222,531 0 1993(A) WEST MIFFLIN 3,025,560 259,919 2,765,641 0 1993(A) BRADENTON 748,216 315,462 432,754 0 1968(C) GREENWOOD 3,550,734 1,295,979 2,254,755 0 1970(C) GRAVOIS 6,360,418 3,093,463 3,266,955 0 1972(C) JENNINGS 2,522,526 215,500 2,307,026 0 1971(C) DALLAS 11,841,924 8,092,560 3,749,364 0 1969(C) TUTTLE BEE SARASOTA 2,691,209 1,175,101 1,516,108 0 1970(C) LAUREL 2,415,942 277,286 2,138,656 0 1995(A) LAUREL 1,375,548 696,756 678,792 0 1972(C) EAST ORLANDO 4,458,204 1,368,689 3,089,515 0 1971(C) OTTAWA 1,225,458 896,848 328,610 0 1970(C) BLOOMINGTON 5,607,728 1,469,381 4,138,347 0 1972(C) RALEIGH 27,726,352 2,534,757 25,191,595 0 1993(A) CANTON HILLS 3,559,411 284,778 3,274,633 0 1993(A) SAVANNAH 10,612,812 1,161,503 9,451,309 0 1993(A) MACON 3,231,654 1,199,305 2,032,349 0 1969(C) CANTON 6,761,882 2,266,925 4,494,957 0 1972(C) CHARLOTTE 8,937,740 976,317 7,961,423 0 1993(A) PALATKA 1,584,515 713,623 870,892 0 1970(C) EAST STROUDSBURG 4,094,610 1,583,494 2,511,116 0 1973(C) POUGHKEEPSIE 6,799,311 3,115,895 3,683,416 0 1972(C) BARBERTON 2,573,340 1,310,903 1,262,437 0 1972(C) HAGERSTOWN 3,674,843 1,487,124 2,187,719 0 1973(C) ELGIN 4,319,514 1,390,732 2,928,782 0 1972(C) GRAND HAVEN 3,080,163 1,050,581 2,029,582 0 1976(C) HOUSTON 974,227 545,978 428,249 0 1973(C) WICKLIFFE 4,436,115 259,333 4,176,782 0 1995(A) LEOMINSTER 39,806,316 9,776,598 30,029,718 0 1975(A) LAUDERHILL 12,740,817 0 12,740,817 0 1974(C) CAMBRIDGE 2,658,087 1,251,987 1,406,100 0 1973(C) OLMSTED 3,913,773 2,497,307 1,416,466 0 1973(C) LEMAY 789,114 374,877 414,237 0 1974(C) AKRON WATERLOO 2,559,177 1,400,147 1,159,030 0 1975(C) BRUNSWICK 7,120,321 4,211,211 2,909,110 0 1975(C) WEST MIFFLIN HILLS 10,718,982 3,718,331 7,000,651 0 1973(C) CHARLESTON 8,012,311 1,375,015 6,637,296 0 1978(C) MESQUITE 3,130,348 218,973 2,911,375 0 1995(A) BELLEVUE 2,249,943 1,333,232 916,711 0 1976(A) ELSMERE 3,185,642 2,013,324 1,172,318 0 1979(C) MADISON 6,430,381 3,221,945 3,208,436 0 1978(C) SPRINGFIELD 8,395,144 4,021,619 4,373,525 3,425,000 1983(A) CHERRY HILL 9,702,134 2,801,007 6,901,127 4,755,000 1985(C) NANUET 4,634,046 1,417,325 3,216,721 0 1984(A) OAKCREEK 9,556,142 2,820,041 6,736,101 4,920,000 1984(A) NORRISTOWN 6,550,407 2,545,149 4,005,258 0 1984(A) SPRINGBORO PIKE 6,920,321 2,053,539 4,866,782 0 1985(C) LIMA 4,412,251 334,533 4,077,718 0 1995(A) CHARLES TOWN 15,388,538 3,414,981 11,973,557 0 1985(A) MUSKEGON 2,092,640 935,640 1,157,000 0 1985(A) NORTH MIAMI 11,543,708 3,294,593 8,249,115 0 1985(A) NEW KENSINGTON 3,795,479 2,003,958 1,791,521 0 1986(A) PENN HILLS 1,737,289 1,108,553 628,736 0 1986(A) BEAVERCREEK 6,155,299 2,411,890 3,743,409 0 1986(A)
65
INITIAL COST TOTAL COST BUILDING AND SUBSEQUENT BUILDINGS AND PROPERTIES LAND IMPROVEMENT TO ACQUISITION LAND IMPROVEMENTS ---------- ---- ----------- -------------- ---- ------------ HAMPTON BAYS 1,495,105 5,979,320 41,919 1,495,105 6,021,239 BRIDGEHAMPTON 1,811,752 3,107,232 21,778,249 1,811,752 24,885,481 EASTERN BLVD. 412,016 1,876,962 169,942 412,016 2,046,904 E. PROSPECT ST. 604,826 2,755,314 265,370 604,826 3,020,684 W. MARKET ST. 188,562 1,158,307 - 188,562 1,158,307 MIDDLETOWN 207,283 1,174,603 447,331 207,283 1,621,934 UPPER ALLEN 445,743 1,782,972 165,450 445,743 1,948,422 GETTYSBURG 74,626 671,630 101,519 74,626 773,149 MARTINSBURG 242,634 1,273,828 628,937 242,634 1,902,765 SOUTH EAST SARASOTA 1,283,400 5,133,544 1,133,522 1,440,264 6,110,202 AIKEN 980,808 3,923,234 43,200 980,808 3,966,434 TYVOLA RD. 0 4,736,345 1,494,281 0 6,230,626 RACINE 1,403,082 5,612,330 1,171,905 1,403,082 6,784,235 WEST MIFFLIN 1,468,341 0 - 1,468,341 0 INDIANAPOLIS 447,600 3,607,193 1,898,487 447,600 5,505,680 RICHBORO 788,761 3,155,044 9,871,704 976,439 12,839,070 MILLER ROAD 1,138,082 4,552,327 1,425,775 1,138,082 5,978,102 SANFORD 3,406,565 13,648,041 1,377,997 3,406,565 15,026,038 CARLE PLACE 1,183,290 4,903,642 10,409,825 1,314,540 15,182,217 PLAZA EAST 1,236,149 4,944,597 2,071,416 1,236,149 7,016,013 PLAZA WEST 808,435 3,210,187 575,057 808,435 3,785,244 MENTOR 503,981 2,455,926 390,515 503,981 2,846,441 MORSE RD. 835,386 2,097,600 2,587,666 835,386 4,685,266 HAMILTON RD. 856,178 2,195,520 3,404,322 856,178 5,599,842 OLENTANGY RIVER RD. 764,517 1,833,600 2,197,502 764,517 4,031,102 SALEM AVE. 665,314 347,818 5,043,518 665,314 5,391,336 KETTERING 1,190,496 4,761,984 635,571 1,190,496 5,397,555 W. BROAD ST. 982,464 3,929,856 2,968,565 982,464 6,898,421 ELYRIA 781,728 3,126,912 52,741 781,728 3,179,653 RIDGE ROAD 1,285,213 4,712,358 516,953 1,285,213 5,229,311 SPRINGFIELD 842,976 3,371,904 168,204 842,976 3,540,108 MENTOR ERIE CMNS. 2,234,474 9,648,000 3,896,201 2,234,474 13,544,201 SPRINGDALE 3,205,653 14,619,732 4,661,221 3,205,653 19,280,953 WESTERVILLE 1,050,431 4,201,616 7,386,243 1,050,431 11,587,859 IRONDEQUOIT 1,234,250 8,190,181 - 1,234,250 8,190,181 WEST GATES 1,784,718 9,721,970 92,117 1,784,718 9,814,087 HENRIETTA 1,075,358 6,635,486 37,146 1,075,358 6,672,632 JONESBORO RD. &I-285 468,118 1,872,473 53,114 468,118 1,925,587 HAYDEN PLAZA NORTH 2,015,726 4,126,509 - 2,015,726 4,126,509 ALHAMBRA, COSTCO 4,995,639 19,982,557 - 4,995,639 19,982,557 CORDATA CENTER 4,971,910 19,898,194 - 4,971,910 19,898,194 MADISON PLAZA 5,758,998 23,045,565 - 5,758,998 23,045,565 CHULA VISTA, COSTCO 6,321,931 25,342,024 - 6,321,931 25,342,024 COPIAGUE, HOME DEPOT 3,888,574 15,614,297 - 3,888,574 15,614,297 CORONA HILLS, COSTCO 12,838,907 51,355,628 - 12,838,907 51,355,628 FAIRFAX, COSTCO 9,417,281 37,685,925 - 9,417,281 37,685,925 WEST FARM SHOPPING CENTER 5,166,190 20,819,671 - 5,166,190 20,819,671 GLENDALE, COSTCO 7,546,028 30,345,319 - 7,546,028 30,345,319 WENDOVER RIDGE 1,330,398 5,329,161 - 1,330,398 5,329,161 LA MIRADA THEATRE CENTER 8,639,473 34,597,403 - 8,639,473 34,597,403 RIDGEDALE FESTIVAL CENTER 2,992,609 11,976,725 - 2,992,609 11,976,725 METRO SQUARE 4,006,994 16,056,181 - 4,006,994 16,056,181 N. HAVEN, HOME DEPOT 7,291,995 29,186,370 - 7,291,995 29,186,370 CENNTENIAL PLAZA 4,575,336 18,327,650 - 4,575,336 18,327,650 TARGET PLAZA 2,555,741 10,217,921 - 2,555,741 10,217,921 PHOENIX, COSTCO 5,253,547 21,014,187 - 5,253,547 21,014,187 PISCATAWAY TOWN CENTER 3,765,878 15,087,330 - 3,765,878 15,087,330 SANTA ANA, HOME DEPOT 4,385,539 17,542,156 - 4,385,539 17,542,156 WHITE MARSH, COSTCO 3,334,491 13,337,966 - 3,334,491 13,337,966 WICHITA WEST GATE CENTER 2,688,432 10,767,765 - 2,688,432 10,767,765 SMOKETOWN 12,547,302 50,880,531 - 12,547,302 50,880,531 WOODGROVE FESTIVAL 4,929,633 20,372,625 - 4,929,633 20,372,625 ARBORETUM, CROSSING 6,598,084 26,437,313 - 6,598,084 26,437,313 CITY PLACE, DALLAS TX 2,092,425 8,474,500 - 2,092,425 8,474,500 BROADMOOR VILLAGE 1,235,311 4,947,069 - 1,235,311 4,947,069 CENTER AT BAYBROOK 6,555,737 26,222,950 - 6,555,737 26,222,950 SHOP AT VISTA RIDGE 3,257,199 13,029,416 - 3,257,199 13,029,416 VISTA RIDGE PLAZA 2,926,495 11,716,483 - 2,926,495 11,716,483 MESQUITE TOWN CENTER 3,544,652 14,230,819 - 3,544,652 14,230,819 RICHARDSON PLAZA 2,333,541 9,373,422 - 2,333,541 9,373,422 BRIDEWATER NJ 30,601,991 6,276,285 - 30,601,991 6,276,285 RENAISSANCE CENTER 9,104,379 36,540,873 - 9,104,379 36,540,873 KING KULLEN PLAZA 5,968,082 23,243,404 - 5,968,082 23,243,404 MARKET PLACE AT RIVERGATE 2,301,239 9,259,517 - 2,301,239 9,259,517 SYCAMORE PLAZA 1,382,500 5,532,900 - 1,382,500 5,532,900 PLAZA PASEO DEL-NORTE 4,480,702 17,968,171 - 4,480,702 17,968,171 FRANKLIN TOWNE CENTER 4,787,144 19,170,180 - 4,787,144 19,170,180 RIVERGATE, TN 3,038,561 12,157,408 - 3,038,561 12,157,408 CENTER OF THE HILLS, TX 2,923,585 11,706,145 - 2,923,585 11,706,145 VISTA RIDGE PHASE II 2,276,575 9,106,300 - 2,276,575 9,106,300 JUAN TABO, ALBUQUERQUE 1,141,200 4,566,817 - 1,141,200 4,566,817 TROLLEY STATION 3,303,682 13,218,740 - 3,303,682 13,218,740 OAK PARK COMMONS 4,705,024 18,889,681 - 4,705,024 18,889,681 NORTH WEST SQUARE 3,015,796 12,078,732 - 3,015,796 12,078,732 ST. CHARLES-UNDEVELOPED LAND, MO 2,040,517 0 - 2,040,517 0 TOTAL TOTAL COST, DATE OF ACCUMULATED NET OF ACCUMULATED CONSTRUCTION(C) PROPERTIES TOTAL DEPRECIATION DEPRECIATION ENCUMBRANCES ACQUISITION(A) ---------- ------------ ------------ ------------ ------------ ------------- HAMPTON BAYS 7,516,344 1,747,882 5,768,462 0 1989(A) BRIDGEHAMPTON 26,697,233 5,505,819 21,191,414 0 1972(C) EASTERN BLVD. 2,458,920 1,256,131 1,202,789 0 1987(A) E. PROSPECT ST. 3,625,510 1,876,647 1,748,863 0 1986(A) W. MARKET ST. 1,346,869 767,106 579,763 0 1986(A) MIDDLETOWN 1,829,217 785,704 1,043,513 0 1986(A) UPPER ALLEN 2,394,165 1,232,313 1,161,852 0 1986(A) GETTYSBURG 847,775 511,168 336,607 0 1986(A) MARTINSBURG 2,145,399 1,121,994 1,023,405 0 1986(A) SOUTH EAST SARASOTA 7,550,466 1,553,870 5,996,596 0 1989(A) AIKEN 4,947,242 1,170,910 3,776,332 0 1989(A) TYVOLA RD. 6,230,626 3,023,676 3,206,950 0 1986(A) RACINE 8,187,317 1,870,017 6,317,300 0 1988(A) WEST MIFFLIN 1,468,341 0 1,468,341 0 1986(A) INDIANAPOLIS 5,953,280 2,545,993 3,407,287 0 1986(A) RICHBORO 13,815,509 2,958,322 10,857,187 0 1986(A) MILLER ROAD 7,116,184 3,137,528 3,978,656 0 1986(A) SANFORD 18,432,603 4,162,958 14,269,645 0 1989(A) CARLE PLACE 16,496,757 563,546 15,933,211 0 1993(A) PLAZA EAST 8,252,162 399,204 7,852,958 0 1995(A) PLAZA WEST 4,593,679 186,597 4,407,082 0 1995(A) MENTOR 3,350,422 1,029,258 2,321,164 0 1987(A) MORSE RD. 5,520,652 1,309,102 4,211,550 0 1988(A) HAMILTON RD. 6,456,020 1,478,879 4,977,141 0 1988(A) OLENTANGY RIVER RD. 4,795,619 1,375,471 3,420,148 0 1988(A) SALEM AVE. 6,056,650 1,183,395 4,873,255 3,596,557 1988(A) KETTERING 6,588,051 1,592,028 4,996,023 3,407,265 1988(A) W. BROAD ST. 7,880,885 1,655,134 6,225,751 3,785,850 1988(A) ELYRIA 3,961,381 1,014,445 2,946,936 0 1988(A) RIDGE ROAD 6,514,524 1,025,898 5,488,626 0 1992(A) SPRINGFIELD 4,383,084 1,110,539 3,272,545 3,975,142 1988(A) MENTOR ERIE CMNS. 15,778,675 2,826,092 12,952,583 4,164,435 1988(A) SPRINGDALE 22,486,606 3,680,284 18,806,322 0 1992(A) WESTERVILLE 12,638,290 1,994,429 10,643,861 0 1988(A) IRONDEQUOIT 9,424,431 1,436,250 7,988,181 0 1993(A) WEST GATES 11,598,805 1,264,300 10,334,505 0 1993(A) HENRIETTA 7,747,990 1,136,257 6,611,733 0 1993(A) JONESBORO RD. &I-285 2,393,705 549,661 1,844,044 0 1988(A) HAYDEN PLAZA NORTH 6,142,235 42,003 6,100,232 0 1998(A) ALHAMBRA, COSTCO 24,978,196 269,890 24,708,306 0 1998(A) CORDATA CENTER 24,870,104 268,608 24,601,496 15,036,657 1998(A) MADISON PLAZA 28,804,563 311,130 28,493,433 0 1998(A) CHULA VISTA, COSTCO 31,663,955 341,544 31,322,411 0 1998(A) COPIAGUE, HOME DEPOT 19,502,871 210,081 19,292,790 13,413,098 1998(A) CORONA HILLS, COSTCO 64,194,535 693,644 63,500,891 0 1998(A) FAIRFAX, COSTCO 47,103,206 508,770 46,594,436 31,959,140 1998(A) WEST FARM SHOPPING CENTER 25,985,861 279,104 25,706,757 14,403,144 1998(A) GLENDALE, COSTCO 37,891,347 407,676 37,483,671 24,728,057 1998(A) WENDOVER RIDGE 6,659,559 71,875 6,587,684 4,046,409 1998(A) LA MIRADA THEATRE CENTER 43,236,876 466,749 42,770,127 0 1998(A) RIDGEDALE FESTIVAL CENTER 14,969,334 161,676 14,807,658 9,150,000 1998(A) METRO SQUARE 20,063,175 216,478 19,846,697 0 1998(A) N. HAVEN, HOME DEPOT 36,478,365 393,951 36,084,414 0 1998(A) CENNTENIAL PLAZA 22,902,986 247,184 22,655,802 11,195,536 1998(A) TARGET PLAZA 12,773,662 138,075 12,635,587 7,850,000 1998(A) PHOENIX, COSTCO 26,267,734 283,824 25,983,910 0 1998(A) PISCATAWAY TOWN CENTER 18,853,208 203,451 18,649,757 11,018,424 1998(A) SANTA ANA, HOME DEPOT 21,927,695 236,929 21,690,766 0 1998(A) WHITE MARSH, COSTCO 16,672,457 180,147 16,492,310 0 1998(A) WICHITA WEST GATE CENTER 13,456,197 145,242 13,310,955 7,850,000 1998(A) SMOKETOWN 63,427,833 677,871 62,749,962 40,963,579 1998(A) WOODGROVE FESTIVAL 25,302,258 266,324 25,035,934 0 1998(A) ARBORETUM, CROSSING 33,035,397 346,345 32,689,052 19,932,313 1998(A) CITY PLACE, DALLAS TX 10,566,925 113,319 10,453,606 5,750,000 1998(A) BROADMOOR VILLAGE 6,182,380 66,463 6,115,917 3,396,986 1998(A) CENTER AT BAYBROOK 32,778,687 354,174 32,424,513 0 1998(A) SHOP AT VISTA RIDGE 16,286,615 175,971 16,110,644 7,000,000 1998(A) VISTA RIDGE PLAZA 14,642,978 158,207 14,484,771 6,000,000 1998(A) MESQUITE TOWN CENTER 17,775,471 191,500 17,583,971 0 1998(A) RICHARDSON PLAZA 11,706,963 126,070 11,580,893 6,793,971 1998(A) BRIDEWATER NJ 36,878,276 0 36,878,276 0 1998(A) RENAISSANCE CENTER 45,645,252 404,384 45,240,868 0 1998(A) KING KULLEN PLAZA 29,211,486 323,077 28,888,409 0 1998(A) MARKET PLACE AT RIVERGATE 11,560,756 121,873 11,438,883 0 1998(A) SYCAMORE PLAZA 6,915,400 74,690 6,840,710 1,848,249 1998(A) PLAZA PASEO DEL-NORTE 22,448,873 242,071 22,206,802 7,950,008 1998(A) FRANKLIN TOWNE CENTER 23,957,324 258,627 23,698,697 12,762,265 1998(A) RIVERGATE, TN 15,195,969 129,853 15,066,116 0 1998(A) CENTER OF THE HILLS, TX 14,629,730 125,157 14,504,573 0 1998(A) VISTA RIDGE PHASE II 11,382,875 38,883 11,343,992 6,000,000 1998(A) JUAN TABO, ALBUQUERQUE 5,708,017 48,769 5,659,248 0 1998(A) TROLLEY STATION 16,522,422 84,711 16,437,711 11,691,202 1998(A) OAK PARK COMMONS 23,594,705 120,642 23,474,063 19,237,500 1998(A) NORTH WEST SQUARE 15,094,528 77,328 15,017,200 0 1998(A) ST. CHARLES-UNDEVELOPED LAND, MO 2,040,517 0 2,040,517 0 1998(A)
66
INITIAL COST TOTAL COST BUILDING AND SUBSEQUENT BUILDINGS AND PROPERTIES LAND IMPROVEMENT TO ACQUISITION LAND IMPROVEMENTS ---------- ---- ----------- -------------- ---- ------------- STATEN ISLAND 2,280,000 9,027,951 3,994,089 2,280,000 13,022,040 GASTONIA 2,467,696 9,870,785 364,222 2,467,696 10,235,007 MARGATE 2,948,530 11,754,120 1,184,077 2,948,530 12,938,197 CENTEREACH 1,182,650 4,735,779 16,410,087 1,417,098 20,911,418 WALKER 3,682,478 14,730,060 1,336,811 3,682,478 16,066,871 TAYLOR 1,451,397 5,806,263 59,406 1,451,397 5,865,669 WATERBURY 2,253,078 9,017,012 59,581 2,253,078 9,076,593 GREAT BARRINGTON 642,170 2,547,830 6,902,051 1,427,963 8,664,088 KISSIMMEE 1,328,536 5,296,652 1,515,262 1,328,536 6,811,914 WESTMONT 601,655 2,404,604 7,624,551 601,655 10,029,155 RIDGEWOOD 450,000 2,106,566 28,802 450,000 2,135,368 MELBOURNE 715,844 2,878,374 317,408 715,844 3,195,782 NORTH BRUNSWICK 3,204,978 12,819,912 12,506,129 3,204,978 25,326,041 SAND LAKE 3,092,706 12,370,824 723,708 3,092,706 13,094,532 STUART 2,109,677 8,415,323 291,562 2,109,677 8,706,885 ROCKINGHAM 2,660,915 10,643,660 7,923,134 2,660,915 18,566,794 CORAL SPRINGS 710,000 2,842,907 3,128,997 710,000 5,971,904 SPRINGFIELD 2,745,595 10,985,778 3,277,294 2,904,022 14,104,645 CHARLESTON 1,744,430 6,986,094 2,229,760 1,744,430 9,215,854 SAVANNAH 652,255 2,616,522 34,536 652,255 2,651,058 WEST PALM BEACH 550,896 2,298,964 339,979 550,896 2,638,943 SOUTH MIAMI 1,280,440 5,133,825 1,963,737 1,280,440 7,097,562 AUGUSTA 1,482,564 5,928,122 17,855 1,482,564 5,945,977 ALTAMONTE SPRINGS 770,893 3,083,574 - 770,893 3,083,574 KENT 2,261,530 0 - 2,261,530 0 ORLANDO 560,800 2,268,112 1,736,041 580,030 3,984,923 DURHAM 1,882,800 7,551,576 414,253 1,882,800 7,965,829 GARLAND 210,286 845,845 - 210,286 845,845 MARLTON PIKE 0 4,318,534 - 0 4,318,534 CAMDEN 0 1,000,570 79,366 0 1,079,936 CINNAMINSON 657,140 2,628,559 241,085 657,140 2,869,644 FLORENCE 1,465,661 6,011,013 - 1,465,661 6,011,013 PHOENIX 2,450,341 9,802,046 - 2,450,341 9,802,046 MORRISVILLE 627,864 2,511,457 (240,683) 627,864 2,270,774 CENTER SQUARE 731,888 2,927,551 - 731,888 2,927,551 PHILADELPHIA 731,888 2,927,551 - 731,888 2,927,551 FEASTERVILLE 520,521 2,082,083 29,197 520,521 2,111,280 WARRINGTON 268,194 1,072,774 116,629 268,194 1,189,403 WHITEHALL 0 5,195,577 9,231 0 5,204,808 HARRIS COUNTY 1,843,000 7,372,420 275,774 2,003,260 7,487,934 HAVERTOWN 731,888 2,927,551 - 731,888 2,927,551 EXTON 731,888 2,927,551 - 731,888 2,927,551 GALLERY, PHILADELPHIA PA 0 0 258,931 0 258,931 EASTWICK 889,001 2,762,888 2,386,166 889,001 5,149,054 UPPER DARBY 231,821 927,286 3,049,951 285,828 3,923,230 TAMPA 2,820,000 11,283,189 673,624 2,820,000 11,956,813 OCALA 1,980,000 7,927,484 443,713 1,980,000 8,371,197 BATON ROUGE 3,125,527 12,503,083 403,823 3,125,527 12,906,906 WHITE LAKE 2,300,050 9,249,607 1,085,937 2,300,050 10,335,544 THE SHOPS AT WEST MELBOURNE 2,200,000 8,829,541 - 2,200,000 8,829,541 LAFAYETTE 2,115,000 8,508,218 355,572 2,115,000 8,863,790 LAFAYETTE 812,810 3,252,269 707,178 812,810 3,959,447 MANASSAS 1,788,750 7,162,661 25,357 1,788,750 7,188,018 CORAL SPRINGS 1,649,000 6,626,301 15,385 1,649,000 6,641,686 STATEN ISLAND 2,940,000 11,811,964 32,904 2,940,000 11,844,868 GREENVILLE 2,209,812 8,850,864 - 2,209,812 8,850,864 MT. DORA 1,011,000 4,062,890 - 1,011,000 4,062,890 SOUTH PLAINES PLAZA, TX 1,890,000 7,577,145 - 1,890,000 7,577,145 KIMCO MESA 679, INC. AZ 2,915,000 11,686,291 - 2,915,000 11,686,291 DENVER WEST 38TH STREET 161,167 646,983 - 161,167 646,983 VILLAGE ON THE PARK 2,194,463 8,885,987 - 2,194,463 8,885,987 ENGLEWOOD PHAR MOR 805,837 3,232,650 - 805,837 3,232,650 HERITAGE WEST 1,526,576 6,124,074 - 1,526,576 6,124,074 AURORA QUINCY 1,148,317 4,608,249 - 1,148,317 4,608,249 SPRING CREEK COLORADO 1,423,260 5,718,813 - 1,423,260 5,718,813 AURORA EAST BANK 1,500,568 6,180,103 - 1,500,568 6,180,103 MARSHALL PLAZA, CRANSTON RI 1,886,600 7,575,302 - 1,886,600 7,575,302 N. CHARLESTON 2,965,748 11,895,294 18,105 2,965,748 11,913,399 KIMCO CARY 696, INC. 2,180,000 8,756,865 - 2,180,000 8,756,865 KIMCO LAFAYETTE MARKET PLACE 3,788,000 15,162,095 - 3,788,000 15,162,095 BAYSHORE GARDENS, BRADENTON FL 2,901,000 11,738,955 - 2,901,000 11,738,955 SANTEE TOWN CENTER 2,252,812 9,012,256 - 2,252,812 9,012,256 NORTH POINT SHOPPING CENTER 1,935,380 7,800,746 - 1,935,380 7,800,746 CEDAR HILL CROSSING 4,091,048 0 - 4,091,048 0 VILLAGE COMMONS SHOPPING CENTER 2,192,331 8,774,158 - 2,192,331 8,774,158 THE PIERS SHOPPING CENTER 1,990,000 7,964,165 - 1,990,000 7,964,165 MOLINE SHOPPING CENTER. IL 0 1,301,194 - 0 1,301,194 PADUCAH MALL, KY 0 1,047,281 - 0 1,047,281 PLAZA AT ROCKFORD, IL 0 83,158 - 0 83,158 SPRINGFIELD, MACARTHUR 0 131,091 - 0 131,091 RICHMOND 670,500 2,751,375 - 670,500 2,751,375 YONKERS 871,977 3,487,909 - 871,977 3,487,909 ALTON, BELTLINE HWY 329,532 1,987,981 - 329,532 1,987,981 KRIKWOOD 0 9,704,005 - 0 9,704,005 ST. LOUIS, CHRISTY BLVD. 809,087 4,430,514 - 809,087 4,430,514 TOTAL TOTAL COST, DATE OF ACCUMULATED NET OF ACCUMULATED CONSTRUCTION(C) PROPERTIES TOTAL DEPRECIATION DEPRECIATION ENCUMBRANCES ACQUISITION(A) ---------- ------------ ------------ ------------ ------------ ------------- STATEN ISLAND 15,302,040 3,197,108 12,104,932 4,801,996 1989(A) GASTONIA 12,702,703 2,235,299 10,467,404 0 1989(A) MARGATE 15,886,727 1,664,562 14,222,165 0 1993(A) CENTEREACH 22,328,516 1,955,029 20,373,487 0 1993(A) WALKER 19,749,349 1,921,548 17,827,801 0 1993(A) TAYLOR 7,317,066 769,258 6,547,808 0 1993(A) WATERBURY 11,329,671 1,200,883 10,128,788 5,506,288 1993(A) GREAT BARRINGTON 10,092,051 373,437 9,718,614 0 1994(A) KISSIMMEE 8,140,450 417,446 7,723,004 0 1996(A) WESTMONT 10,630,810 474,370 10,156,440 0 1994(A) RIDGEWOOD 2,585,368 271,080 2,314,288 0 1993(A) MELBOURNE 3,911,626 359,457 3,552,169 0 1994(A) NORTH BRUNSWICK 28,531,019 1,759,892 26,771,127 0 1994(A) SAND LAKE 16,187,238 1,518,846 14,668,392 0 1994(A) STUART 10,816,562 967,236 9,849,326 0 1994(A) ROCKINGHAM 21,227,709 1,407,003 19,820,706 0 1994(A) CORAL SPRINGS 6,681,904 371,935 6,309,969 0 1994(A) SPRINGFIELD 17,008,667 1,167,148 15,841,519 0 1994(A) CHARLESTON 10,960,284 608,320 10,351,964 0 1995(A) SAVANNAH 3,303,313 223,600 3,079,713 0 1995(A) WEST PALM BEACH 3,189,839 172,424 3,017,415 0 1995(A) SOUTH MIAMI 8,378,002 524,598 7,853,404 0 1995(A) AUGUSTA 7,428,541 463,655 6,964,886 0 1995(A) ALTAMONTE SPRINGS 3,854,467 237,198 3,617,269 0 1995(A) KENT 2,261,530 0 2,261,530 0 1995(A) ORLANDO 4,564,953 156,538 4,408,415 0 1996(A) DURHAM 9,848,629 532,865 9,315,764 0 1996(A) GARLAND 1,056,131 57,564 998,567 0 1996(A) MARLTON PIKE 4,318,534 258,374 4,060,160 0 1996(A) CAMDEN 1,079,936 0 1,079,936 0 1996(A) CINNAMINSON 3,526,784 11,159 3,515,625 0 1996(A) FLORENCE 7,476,674 195,235 7,281,439 0 1997(A) PHOENIX 12,252,387 293,202 11,959,185 8,024,229 1997(A) MORRISVILLE 2,898,638 0 2,898,638 0 1996(A) CENTER SQUARE 3,659,439 175,153 3,484,286 0 1996(A) PHILADELPHIA 3,659,439 175,153 3,484,286 0 1996(A) FEASTERVILLE 2,631,801 106,774 2,525,027 0 1996(A) WARRINGTON 1,457,597 0 1,457,597 0 1996(A) WHITEHALL 5,204,808 310,847 4,893,961 0 1996(A) HARRIS COUNTY 9,491,194 283,986 9,207,208 0 1997(A) HAVERTOWN 3,659,439 175,153 3,484,286 0 1996(A) EXTON 3,659,439 175,153 3,484,286 0 1996(A) GALLERY, PHILADELPHIA PA 258,931 538 258,393 0 1996(A) EASTWICK 6,038,055 175,515 6,038,055 5,040,000 1997(A) UPPER DARBY 4,209,058 140,145 4,209,058 3,960,000 1996(A) TAMPA 14,776,813 516,910 14,259,903 0 1997(A) OCALA 10,351,197 321,646 10,029,551 0 1997(A) BATON ROUGE 16,032,433 481,208 15,551,225 0 1997(A) WHITE LAKE 12,635,594 578,589 12,057,005 0 1996(A) THE SHOPS AT WEST MELBOURNE 11,029,541 188,075 10,841,466 0 1998(A) LAFAYETTE 10,978,790 256,457 10,722,333 0 1997(A) LAFAYETTE 4,772,257 163,795 4,608,462 0 1997(A) MANASSAS 8,976,768 206,486 8,770,282 0 1997(A) CORAL SPRINGS 8,290,686 183,611 8,107,075 0 1997(A) STATEN ISLAND 14,784,868 302,868 14,482,000 5,500,881 1997(A) GREENVILLE 11,060,676 212,526 10,848,150 0 1997(A) MT. DORA 5,073,890 112,892 4,960,998 0 1997(A) SOUTH PLAINES PLAZA, TX 9,467,145 145,413 9,321,732 6,453,600 1998(A) KIMCO MESA 679, INC. AZ 14,601,291 224,424 14,376,867 9,859,797 1998(A) DENVER WEST 38TH STREET 808,150 15,189 792,961 0 1998(A) VILLAGE ON THE PARK 11,080,450 94,090 10,986,360 0 1998(A) ENGLEWOOD PHAR MOR 4,038,487 34,547 4,003,940 1,386,104 1998(A) HERITAGE WEST 7,650,650 65,420 7,585,230 0 1998(A) AURORA QUINCY 5,756,566 49,248 5,707,318 2,766,910 1998(A) SPRING CREEK COLORADO 7,142,073 134,190 7,007,883 0 1998(A) AURORA EAST BANK 7,680,671 141,355 7,539,316 0 1998(A) MARSHALL PLAZA, CRANSTON RI 9,461,902 161,569 9,300,333 0 1998(A) N. CHARLESTON 14,879,147 152,672 14,726,475 0 1997(A) KIMCO CARY 696, INC. 10,936,865 149,221 10,787,644 0 1998(A) KIMCO LAFAYETTE MARKET PLACE 18,950,095 226,636 18,723,459 0 1998(A) BAYSHORE GARDENS, BRADENTON FL 14,639,955 174,758 14,465,197 0 1998(A) SANTEE TOWN CENTER 11,265,068 0 11,265,068 0 1998(A) NORTH POINT SHOPPING CENTER 9,736,126 16,566 9,719,560 0 1998(A) CEDAR HILL CROSSING 4,091,048 0 4,091,048 0 1998(A) VILLAGE COMMONS SHOPPING CENTER 10,966,489 0 10,966,489 0 1998(A) THE PIERS SHOPPING CENTER 9,954,165 0 9,954,165 0 1998(A) MOLINE SHOPPING CENTER. IL 1,301,194 10,488 1,290,706 0 1998(A) PADUCAH MALL, KY 1,047,281 9,719 1,037,562 0 1998(A) PLAZA AT ROCKFORD, IL 83,158 711 82,447 0 1998(A) SPRINGFIELD, MACARTHUR 131,091 1,069 130,022 0 1998(A) RICHMOND 3,421,875 69,749 3,352,126 0 1995(A) YONKERS 4,359,886 315,159 4,044,727 0 1998(A) ALTON, BELTLINE HWY 2,317,513 390,452 1,927,061 0 1998(A) KRIKWOOD 9,704,005 103,257 9,600,748 0 1998(A) ST. LOUIS, CHRISTY BLVD. 5,239,601 43,782 5,195,819 0 1998(A)
67
INITIAL COST TOTAL COST BUILDING AND SUBSEQUENT BUILDINGS AND PROPERTIES LAND IMPROVEMENT TO ACQUISITION LAND IMPROVEMENTS ---------- ---- ----------- -------------- ---- ------------- OVERLAND PARK, MELCALF 1,183,911 6,335,308 1,995 1,185,906 6,335,308 INDEPENDENCE, NOLAND DR. 1,728,367 8,951,101 2,933 1,731,300 8,951,101 KANSAS CITY, STATE AVE. 1,692,301 8,763,689 2,872 1,695,173 8,763,689 BELLEVILLE, WESTFIELD PLAZA 0 5,372,253 - 0 5,372,253 ORLAND PARK, S. HARLEM 476,972 2,764,775 - 476,972 2,764,775 TULSA 500,950 2,002,508 - 500,950 2,002,508 WATERLOO 500,525 2,002,101 - 500,525 2,002,101 CLIVE 500,525 2,002,101 - 500,525 2,002,101 DES MOINES 500,525 2,559,019 - 500,525 2,559,019 E. WICHITA 500,414 6,449,627 - 500,414 6,449,627 W. WICHITA 500,414 6,394,959 - 500,414 6,394,959 PLANO 500,414 2,830,835 - 500,414 2,830,835 WEST OAKS 500,422 2,001,687 - 500,422 2,001,687 ARLINGTON 500,414 2,001,656 - 500,414 2,001,656 DUNCANVILLE 500,414 2,001,656 - 500,414 2,001,656 GARLAND 500,414 2,001,656 - 500,414 2,001,656 HOUSTON 500,422 2,001,687 - 500,422 2,001,687 GENEVA 500,422 12,917,712 - 500,422 12,917,712 BAYTOWN 500,422 2,431,651 - 500,422 2,431,651 FT. WORTH 500,414 2,426,533 - 500,414 2,426,533 BRADLEY 500,422 2,001,687 - 500,422 2,001,687 N. RICHLAND HILLS 1,000,000 0 65,837 1,065,837 0 CORSICANA 989,061 3,990,595 - 989,061 3,990,595 OVERLAND 0 4,928,677 120,104 0 5,048,781 CREVE COEUR, WOODCREST/OLIVE 1,044,598 5,475,623 1,773 1,046,371 5,475,623 ST. LOUIS 0 5,756,736 156,042 0 5,912,778 PEORIA 0 5,081,290 - 0 5,081,290 KANSAS CITY 574,777 2,971,191 - 574,777 2,971,191 ST. LOUIS 0 2,766,644 - 0 2,766,644 OAK LAWN 1,530,111 8,776,631 - 1,530,111 8,776,631 CALUMET CITY 1,479,217 8,815,760 - 1,479,217 8,815,760 OAKBROOK TERRACE 1,610,958 9,155,177 - 1,610,958 9,155,177 MATTERSON 950,515 6,292,319 - 950,515 6,292,319 MT. PROSPECT 1,017,345 6,572,176 - 1,017,345 6,572,176 ST. PETERS 1,182,194 7,423,459 - 1,182,194 7,423,459 CHICAGO, S. PULASKI RD. 1,611,612 8,252,282 2,707 1,614,319 8,252,282 KANSAS CITY 775,025 5,046,021 - 775,025 5,046,021 ROELAND PARK 0 5,120,323 - 0 5,120,323 MAPLEWOOD 604,803 4,619,578 - 604,803 4,619,578 NORRIDGE 0 2,918,315 - 0 2,918,315 COUNTRYSIDE 0 4,770,671 - 0 4,770,671 DUBUQUE 0 2,152,476 - 0 2,152,476 CARBONDALE 0 500,000 - 0 500,000 MERRILLVILLE 0 1,965,694 45,601 0 2,011,295 CRYSTAL CITY, MI 0 234,378 - 0 234,378 GRIFFITH 0 2,495,820 (19,188) 0 2,476,632 DOWNER GROVE 811,778 4,322,956 - 811,778 4,322,956 CHICAGO 0 3,716,745 - 0 3,716,745 SKOKIE 0 2,276,360 - 0 2,276,360 SCHAUMBURG 0 2,576,673 - 0 2,576,673 CHICAGO 0 2,687,046 - 0 2,687,046 MIDWEST CITY 1,435,506 7,370,459 2,424 1,437,930 7,370,459 DAVENPORT 0 0 - 0 0 TULSA 0 0 131,399 0 131,399 ELGIN, AIRPORT RD. 2,728,647 12,624,998 - 2,728,647 12,624,998 FOREST PARK 0 2,335,884 - 0 2,335,884 NAPERVILLE 669,483 4,464,998 - 669,483 4,464,998 INDIANAPOLIS 0 0 - 0 0 NILES 0 2,217,231 134,809 0 2,352,040 ARLINGTON 0 2,285,377 - 0 2,285,377 JOLIET 0 0 - 0 0 SPRINGFIELD,GLENSTONE AVE. 0 608,793 - 0 608,793 CHAMPAIGN, NEIL ST. 230,519 1,285,460 - 230,519 1,285,460 SOUTH SHIELDS, OKLAHOMA 0 457,015 - 0 457,015 MANCHESTER, ANDERSON DR 1,417,725 6,709,421 2,220 1,419,945 6,709,421 CAPE GIRARDEAU 0 2,242,469 - 0 2,242,469 MUNDELIEN, S. LAKE 1,127,720 5,826,129 1,914 1,129,634 5,826,129 BRIDGETON 0 2,196,834 - 0 2,196,834 EDMOND 477,036 3,591,493 - 477,036 3,591,493 HOUSTON 406,513 1,939,253 - 406,513 1,939,253 CORPUS CHRISTI, TX 0 944,562 - 0 944,562 AMARILLO 4,666,000 28,644,596 - 4,666,000 28,644,596 ST. JOSEPH, N. BELT HWY 203,596 1,129,889 - 203,596 1,129,889 FAIRVIEW HTS, BELLVILLE RD. 0 11,866,880 - 0 11,866,880 SOUTH BEND, S. HIGH ST. 183,463 1,070,401 - 183,463 1,070,401 SHAWNEE, KANSAS 0 405,770 - 0 405,770 ELSTON 1,010,375 5,692,211 - 1,010,375 5,692,211 WAUKEGAN, BELVIDERE 203,427 1,161,847 345 203,772 1,161,847 S. CICERO 0 1,541,560 149,203 0 1,690,763 MELROSE 198,177 1,214,926 - 198,177 1,214,926 JOPLIN, N. RANGELINE 1,021,661 4,793,886 - 1,021,661 4,793,886 AURORA, N. LAKE 2,059,908 9,531,721 - 2,059,908 9,531,721 CRYSTAL LAKE, NW HWY 179,964 1,025,811 305 180,269 1,025,811 KRC PETERSON AVE 2,215,960 10,253,981 - 2,215,960 10,253,981 KRC BRIDGEVIEW 0 0 - 0 0 TOTAL TOTAL COST, DATE OF ACCUMULATED NET OF ACCUMULATED CONSTRUCTION(C) PROPERTIES TOTAL DEPRECIATION DEPRECIATION ENCUMBRANCES ACQUISITION(A) ---------- ------------ ------------ ------------ ------------ -------------- OVERLAND PARK, MELCALF 7,521,214 61,738 7,459,476 0 1998(A) INDEPENDENCE, NOLAND DR. 10,682,401 93,527 10,588,874 0 1998(A) KANSAS CITY, STATE AVE. 10,458,862 91,576 10,367,286 0 1998(A) BELLEVILLE, WESTFIELD PLAZA 5,372,253 57,373 5,314,880 0 1998(A) ORLAND PARK, S. HARLEM 3,241,747 25,810 3,215,937 0 1998(A) TULSA 2,503,458 149,870 2,353,588 0 1996(A) WATERLOO 2,502,626 149,730 2,352,896 0 1996(A) CLIVE 2,502,626 149,730 2,352,896 0 1996(A) DES MOINES 3,059,544 154,203 2,905,341 0 1996(A) E. WICHITA 6,950,041 194,085 6,755,956 5,175,000 1996(A) W. WICHITA 6,895,373 193,218 6,702,155 5,100,000 1996(A) PLANO 3,331,249 157,818 3,173,431 0 1996(A) WEST OAKS 2,502,109 149,695 2,352,414 0 1996(A) ARLINGTON 2,502,070 149,695 2,352,375 0 1996(A) DUNCANVILLE 2,502,070 149,695 2,352,375 0 1996(A) GARLAND 2,502,070 149,695 2,352,375 0 1996(A) HOUSTON 2,502,109 149,695 2,352,414 0 1996(A) GENEVA 13,418,134 257,634 13,160,500 0 1996(A) BAYTOWN 2,932,073 153,266 2,778,807 0 1996(A) FT. WORTH 2,926,947 149,695 2,777,252 0 1996(A) BRADLEY 2,502,109 153,849 2,348,260 0 1996(A) N. RICHLAND HILLS 1,065,837 0 1,065,837 0 1997(A) CORSICANA 4,979,656 218,804 4,760,852 0 1997(A) OVERLAND 5,048,781 168,501 4,880,280 0 1997(A) CREVE COEUR, WOODCREST/OLIVE 6,521,994 56,526 6,465,468 0 1998(A) ST. LOUIS 5,912,778 196,812 5,715,966 0 1997(A) PEORIA 5,081,290 117,601 4,963,689 0 1997(A) KANSAS CITY 3,545,968 85,187 3,460,781 0 1997(A) ST. LOUIS 2,766,644 82,033 2,684,611 0 1997(A) OAK LAWN 10,306,742 204,729 10,102,013 0 1997(A) CALUMET CITY 10,294,977 196,468 10,098,509 0 1997(A) OAKBROOK TERRACE 10,766,135 216,056 10,550,079 0 1997(A) MATTERSON 7,242,834 121,619 7,121,215 0 1997(A) MT. PROSPECT 7,589,521 131,044 7,458,477 0 1997(A) ST. PETERS 8,605,653 186,220 8,419,433 0 1997(A) CHICAGO, S. PULASKI RD. 9,866,601 82,447 9,784,154 0 1998(A) KANSAS CITY 5,821,046 124,091 5,696,955 0 1997(A) ROELAND PARK 5,120,323 156,304 4,964,019 0 1997(A) MAPLEWOOD 5,224,381 103,467 5,120,914 0 1997(A) NORRIDGE 2,918,315 87,537 2,830,778 0 1997(A) COUNTRYSIDE 4,770,671 108,525 4,662,146 0 1997(A) DUBUQUE 2,152,476 60,655 2,091,821 0 1997(A) CARBONDALE 500,000 0 500,000 0 1997(A) MERRILLVILLE 2,011,295 67,203 1,944,092 0 1997(A) CRYSTAL CITY, MI 234,378 1,703 232,675 0 1997(A) GRIFFITH 2,476,632 63,995 2,412,637 0 1997(A) DOWNER GROVE 5,134,734 114,349 5,020,385 0 1997(A) CHICAGO 3,716,745 94,289 3,622,456 0 1997(A) SKOKIE 2,276,360 70,780 2,205,580 0 1997(A) SCHAUMBURG 2,576,673 76,786 2,499,887 0 1997(A) CHICAGO 2,687,046 76,603 2,610,443 0 1997(A) MIDWEST CITY 8,808,389 92,762 8,715,627 0 1998(A) DAVENPORT 0 0 0 0 1997(A) TULSA 131,399 1,215 130,184 0 1997(A) ELGIN, AIRPORT RD. 15,353,645 133,399 15,220,246 0 1998(A) FOREST PARK 2,335,884 74,157 2,261,727 0 1997(A) NAPERVILLE 5,134,481 83,656 5,050,825 0 1997(A) INDIANAPOLIS 0 0 0 0 1997(A) NILES 2,352,040 75,803 2,276,237 0 1997(A) ARLINGTON 2,285,377 67,026 2,218,351 0 1997(A) JOLIET 0 0 0 0 1997(A) SPRINGFIELD,GLENSTONE AVE. 608,793 6,592 602,201 0 1998(A) CHAMPAIGN, NEIL ST. 1,515,979 12,474 1,503,505 0 1998(A) SOUTH SHIELDS, OKLAHOMA 457,015 3,696 453,319 0 1997(A) MANCHESTER, ANDERSON DR 8,129,366 70,108 8,059,258 6,300,000 1998(A) CAPE GIRARDEAU 2,242,469 60,036 2,182,433 0 1997(A) MUNDELIEN, S. LAKE 6,955,763 61,024 6,894,739 0 1998(A) BRIDGETON 2,196,834 70,442 2,126,392 0 1997(A) EDMOND 4,068,529 81,698 3,986,831 0 1997(A) HOUSTON 2,345,766 58,284 2,287,482 0 1997(A) CORPUS CHRISTI, TX 944,562 9,890 934,672 0 1997(A) AMARILLO 33,310,596 193,192 33,117,404 22,080,292 1997(A) ST. JOSEPH, N. BELT HWY 1,333,485 11,017 1,322,468 0 1998(A) FAIRVIEW HTS, BELLVILLE RD. 11,866,880 126,425 11,740,455 0 1998(A) SOUTH BEND, S. HIGH ST. 1,253,864 9,928 1,243,936 0 1998(A) SHAWNEE, KANSAS 405,770 2,946 402,824 0 1997(A) ELSTON 6,702,586 60,490 6,642,096 0 1997(A) WAUKEGAN, BELVIDERE 1,365,619 11,008 1,354,611 0 1998(A) S. CICERO 1,690,763 52,703 1,638,060 0 1997(A) MELROSE 1,413,103 10,724 1,402,379 0 1998(A) JOPLIN, N. RANGELINE 5,815,547 50,350 5,765,197 4,350,000 1998(A) AURORA, N. LAKE 11,591,629 100,709 11,490,920 0 1998(A) CRYSTAL LAKE, NW HWY 1,206,080 9,738 1,196,342 0 1998(A) KRC PETERSON AVE 12,469,941 108,342 12,361,599 0 1998(A) KRC BRIDGEVIEW 0 0 0 0 1998(A)
68
BUILDING AND SUBSEQUENT BUILDINGS AND PROPERTIES LAND IMPROVEMENT TO ACQUISITION LAND IMPROVEMENTS ---------- ---- ----------- -------------- ---- ------------ KRC MISHAWAKA 895 378,088 1,999,079 642 378,730 1,999,079 KRC ARLINGTON HEIGHT 1,983,517 9,178,272 - 1,983,517 9,178,272 KRC STREAMWOOD 181,962 1,057,740 - 181,962 1,057,740 ADDISON, IL 2,837,548 13,128,480 - 2,837,548 13,128,480 KIMCO SELECT 4,368,834 28,758,476 3,479,844 5,489,656 31,117,498 BALANCE OF PORTFOLIO 2,951,539 4,147,593 19,992,299 3,367,822 19,723,608 ------------------------------------------------------------------------------------- $522,250,000 $2,133,160,032 $368,491,953 $529,897,164 $2,494,004,820 ===================================================================================== TOTAL TOTAL COST, DATE OF ACCUMULATED NET OF ACCUMULATED CONSTRUCTION(C) PROPERTIES TOTAL DEPRECIATION DEPRECIATION ENCUMBRANCES ACQUISITION(A) ---------- ------------ ------------ ------------ ------------ -------------- KRC MISHAWAKA 895 2,377,809 20,460 2,357,349 0 1998(A) KRC ARLINGTON HEIGHT 11,161,789 96,974 11,064,815 0 1998(A) KRC STREAMWOOD 1,239,702 9,847 1,229,855 0 1998(A) ADDISON, IL 15,966,028 138,720 15,827,308 0 1998(A) KIMCO SELECT 36,607,154 587,947 35,703,547 6,000,000 VARIOUS BALANCE OF PORTFOLIO 23,091,430 11,668,821 11,422,609 0 VARIOUS ------------------------------------------------------------- $3,023,901,985 $255,949,923 $2,767,952,062 $434,310,884 =============================================================
Depreciation and amortization of the Company's investment in buildings and improvements reflected in the statements of income is calculated over the estimated useful lives of the assets as follows: Buildings.................... 15 to 39 years Improvements................. Terms of leases or useful lives, whichever is shorter The aggregate cost for Federal income tax purposes was approximately $2,730 million at December 31, 1998. The changes in total real estate assets for the years ended December 31, 1998, 1997 and 1996 are as follows:
1998 1997 1996 -------------------------------------------------------- Balance, beginning of period ...................... $ 1,404,196,159 $ 1,072,055,986 $ 932,390,261 Acquisitions .................................... 1,573,163,394 276,119,791 100,808,213 Improvements .................................... 58,298,913 61,144,440 40,108,471 Sales ........................................... (11,756,482) (5,124,058) (1,250,959) -------------------------------------------------------- Balance, end of period ............................ $ 3,023,901,985 $ 1,404,196,159 $ 1,072,055,986 ========================================================
The changes in accumulated depreciation for the years ended December 31, 1998, 1997 and 1996 are as follows:
1998 1997 1996 -------------------------------------------------------- Balance, beginning of period ...................... $ 207,408,091 $ 180,552,647 $ 156,131,718 Depreciation for year ........................... 48,934,560 28,371,587 24,963,191 Sales ........................................... (392,728) (1,516,143) (542,262) -------------------------------------------------------- Balance, end of period ............................ $ 255,949,923 $ 207,408,091 $ 180,552,647 ========================================================
69 EX-10.4 2 EMPLOYMENT AGREEMENT Exhibit 10.4 EMPLOYMENT AGREEMENT THIS AGREEMENT, dated November 1, 1998, is made by and between Kimco Realty Corporation (the "Company"), a Maryland corporation and Michael J. Flynn (the "Executive"). RECITALS: A. Executive has been employed by the Company as its Vice Chairman and President pursuant to an Employment Agreement dated November 1, 1995 which expires October 31, 1998 (the "Prior Agreement"). B. It is the desire of the Company and the Executive to continue their relationship on the terms set forth below. NOW, THEREFORE, in consideration of the foregoing and of the respective covenants and agreements set forth below the parties hereto agree as follows: 1. Certain Definitions. (a) "Base Salary" is defined in Section 5(a). (b) "Benefits" is defined in Section 5(d). (c) "Board" shall mean the Board of Directors of the Company. (d) "Bonus" is defined in Section 5(b). (e) "Cause": For purposes of this Agreement, the Company shall have "Cause" to terminate the Executive's employment hereunder upon (i) a finding by the Board that he has materially harmed the Company through a material act of dishonesty in the performance of his duties hereunder, (ii) his conviction of a felony, or (iii) his failure to perform his material duties under this Agreement (other than a failure due to disability) after written notice specifying the failure and a reasonable opportunity to cure (it being understood that if his failure to perform is not of a type requiring a single action to cure fully, that he may commence the cure promptly after such written notice and thereafter diligently prosecute such cure to completion). (f) "Disability" shall mean the absence of the Executive from the Executive's duties to the Company on a full-time basis for a total of 16 weeks during any 12 month period as a result of incapacity due to mental or physical illness which is determined to be total and permanent by a physician selected by the Company and acceptable to the Executive or the Executive's legal representative (such agreement as to acceptability not to be withheld unreasonably). (g) "Effective Date" shall mean November 1, 1998. (h) "Good Reason": The Executive shall have Good Reason to terminate his employment in the event of any material adverse change in his job titles, duties, responsibilities, perquisites granted hereunder, or authority without his consent. (i) "Prior Agreement" is defined in the Preamble hereto. (j) "Term of Employment" is defined in Section 2. 2. Employment. The Company shall continue to employ the Executive and the Executive shall continue to be employed by the Company, for the five year period commencing on the Effective Date (such period, subject to earlier termination pursuant to Section 6, the "Term of Employment"), in the position set forth in Section 3 and upon the other terms and conditions herein provided. The Term of Employment shall automatically be extended for successive one year periods until either party hereto gives notice of non-renewal to the other (pursuant to Section 13), no later than three months prior to the then applicable end of the Term of Employment. Notwithstanding the foregoing the Executive shall have the right to terminate the Term of Employment effective on or after the third anniversary of the Effective Date by giving notice thereof to the Company pursuant to Section 13. 3. Position. During the Term of Employment, the Executive shall serve as the Vice-Chairman and President of the Company. 4. Place of Performance. In connection with his employment during the Term of Employment, the Executive shall be based at the Company's principal executive offices currently located in New Hyde Park, New York. 5. Compensation and Related Matters. (a) Base Salary. During the Term of Employment the Executive shall receive a base salary ("Base Salary") at a rate of $650,000 per annum, payable monthly or more frequently in accordance with the Company's practice as applied to other senior executives. (b) Bonus. As additional compensation for services rendered during the Term of Employment the Executive shall be eligible to receive a bonus ("Bonus") in cash at such times and in such amounts, if any, as the Board in its sole discretion shall determine. (c) Equity Compensation. Executive shall be eligible to receive grants of common stock of the Company, or options with respect thereto, in such amounts, if any, and under such conditions as the Board, in its sole discretion, shall determine. (d) Benefits. During the Term of Employment, the Executive shall be entitled to participate in or receive benefits under any employee benefit plan or other arrangement made available by the Company to any of its senior employees (collectively "Benefits"), subject to and on a basis consistent with the terms, conditions and overall administration of such plan or arrangement, provided, however, that the Executive shall 2 be entitled to four weeks of paid vacation per annum during the Term of Employment, exclusive of Company holidays and that the Executive shall be entitled to take sick or personal days off in accordance with the Company's practice as applied to other senior executives. The Company shall also provide Executive with use of an automobile selected by Executive and shall pay fuel, oil and other vehicle necessities and maintenance and repairs cost and expenses for or to the automobile and shall provide a driver for the Executive's use of the automobile on Company business. (e) Expenses. The Company shall promptly reimburse the Executive for all reasonable travel and other business expenses incurred by the Executive in the performance of his duties to the Company hereunder. (f) No Waiver. The Executive shall also be entitled to such other benefits or terms of employment as are provided by law. 6. Termination. The Executive's employment hereunder may be terminated by the Company or the Executive, as applicable, without any breach of this Agreement only under the following circumstances: (a) Death. The Executive's employment hereunder shall terminate upon his death. (b) Disability. If the Company determines in good faith that the Disability of the Executive has occurred during the Term of Employment, the Company may give the Executive written notice in accordance with Section 13(b) of its intention to terminate the Executive's employment. In such event, the Executive's employment with the Company shall terminate effective on the 30th day after receipt of such notice by the Executive, provided that within the 30 days after such receipt, the Executive shall not have returned to full-time performance of his duties. The Executive shall continue to receive his Base Salary and Benefits until the date of termination. This subsection 6(b) shall not limit the entitlement of the Executive, his estate or beneficiaries to any disability or other benefits then available to the Executive under any disability insurance or other benefit plan or policy which is maintained by the Company for the Executive's benefit. (c) Cause. The Company may terminate the Executive's employment hereunder for Cause. (d) Good Reason. The Executive may terminate his employment for Good Reason. (e) Without Cause. The Company may terminate the Executive's employment hereunder without Cause upon 30 days notice. 3 (f) Notice of Termination. Any termination of the Executive's employment hereunder by the Company or the Executive (other than by reason of the Executive's death) shall be communicated by a notice of termination to the other parties hereto. For purposes of this Agreement, a "notice of termination" shall mean a written notice which (i) indicates the specific termination provision in the Agreement relied upon, (ii) sets forth in reasonable detail any facts and circumstances claimed to provide a basis for termination of the Executive's employment under the provision indicated and (iii) specifies the effective date of the termination. 7. Benefits upon Certain Terminations of Employment. (a) Termination upon Death or Disability. (i) If the Executive's employment shall terminate by reason of his death (pursuant to Section 6(a)) payment of one-half his Base Salary shall continue for the lesser of one year or the otherwise applicable termination of the Term of Employment to such payee as the Executive shall have designated on the signature page hereof. (Such payee may subsequently be changed by the Executive by written notice to the Company). (ii) If the Executive's employment shall terminate by reason of his death or Disability, any options with respect to the common stock of the Company then held by Executive which are not yet exercisable shall thereupon become exercisable and shall remain exercisable until expiration in accordance with the terms of such option. (b) Termination without Cause or for Good Reason: If the Executive's employment shall terminate without Cause (pursuant to Section 6(e)) or for Good Reason (pursuant to Section 6(d)), (i) the Company shall continue to pay the Executive his Base Salary and to make all necessary payments for and provide all Benefits to the Executive under this Agreement pursuant to Section 5(d) until the date of his termination, (ii) the Company shall pay the Executive a severance benefit equal to the greater of (A) the remaining Base Salary payments to which the Executive would be entitled for the remainder of the Term of Employment if such termination of employment had not occurred (and without regard to the Executive's right described in the last sentence of Section 2) or (B) one year's payment of Base Salary, and (iii) any options with respect to the common stock of the Company then held by Executive which are not yet exercisable shall thereupon become exercisable and shall remain exercisable until expiration in accordance with the terms of such option. 4 (c) Survival. The expiration or termination of the Term of Employment shall not impair the rights or obligations of any party hereto which shall have accrued hereunder prior to such expiration. (d) Mitigation of Damages. In the event of any termination of the Executive's employment by the Company, the Executive shall not be required to seek other employment to mitigate damages and any income earned by the Executive from other employment or self-employment shall be not be offset against any obligations of the Company to the Executive hereunder. 8. Consultancy. Upon termination of the Term of Employment pursuant to the notices described in the second or third sentences of Section 2, Executive and the Company shall thereupon enter into a consulting agreement which shall provide for compensation of $250,000 per annum, a term of three years and other customary terms and conditions. 9. Disputes. (a) Any dispute or controversy arising under, out of, in connection with or in relation to this Agreement shall, at the election and upon written demand of any party to this Agreement, be finally determined and settled by arbitration in New York, New York in accordance with the rules and procedures of the American Arbitration Association, and judgment upon the award may be entered in any court having jurisdiction thereof. (b) The prevailing party in any such proceeding shall be entitled to collect from the other party, all legal fees and expenses reasonably incurred in connection therewith. 10. Binding on Successors. This Agreement shall be binding upon and inure to the benefit of the Company, the Executive and their respective successors, assigns, personnel and legal representatives, executors, administrators, heirs, distributees, devisees, and legatees, as applicable. 11. Governing Law. This Agreement is being made and executed in and is intended to be performed in the State of New York, and shall be governed, construed, interpreted and enforced in accordance with the substantive laws of the State of New York. 12. Validity. The invalidity or unenforceability of any provision or provisions of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect. 13. Notices. Any notice, request, claim, demand, document and other communication hereunder to any party shall be effective upon receipt (or refusal of receipt) and shall be in writing and delivered personally or sent by telex, telecopy, or certified or registered mail, postage prepaid, as follows: 5 (a) If to the Company, addressed to its principal offices to the attention of the Chairman, at: 3333 New Hyde Park Rd. New Hyde Park, NY 11042 (b) If to the Executive, to him at the address set forth below under his signature; or at any other address as any party shall have specified by notice in writing to the other parties. 14. Counterparts. This Agreement may be executed in several counterparts, each of which shall be deemed to be an original, but all of which together will constitute one and the same Agreement. 15. Entire Agreement. The terms of this Agreement are intended by the parties to be the final expression of their agreement with respect to the employment of the Executive by the Company and may not be contradicted by evidence of any prior or contemporaneous agreement. The parties further intend that this Agreement shall constitute the complete and exclusive statement of its terms and that no extrinsic evidence whatsoever may be introduced in any judicial, administrative, or other legal proceeding to vary the terms of this Agreement. 16. Amendments; Waivers. This Agreement may not be modified, amended, or terminated except by an instrument in writing, signed by the Executive and a disinterested director of the Company. By an instrument in writing similarly executed, the Executive or the Company may waive compliance by the other party with any provision of this Agreement that such other party was or is obligated to comply with or perform, provided, however, that such waiver shall not operate as a waiver of, or estoppel with respect to, any other or subsequent failure. No failure to exercise and no delay in exercising any right, remedy, or power hereunder preclude any other or further exercise of any other right, remedy, or power provided herein or by law or in equity. 17. No Effect on Other Contractual Rights. Notwithstanding Section 6, the provisions of this Agreement, and any other payment provided for hereunder, shall not reduce any amounts otherwise payable to the Executive under any other agreement between the Executive and the Company, or in any way diminish the Executive's rights under any employee benefit plan, program or arrangement of the Company to which he may be entitled as an employee of the Company. 18. No Inconsistent Actions; Cooperation. (a) The parties hereto shall not voluntarily undertake or fail to undertake any action or course of action inconsistent with the provisions or essential intent of this Agreement. Furthermore, it is the intent of the parties hereto to act in a fair and reasonable manner with respect to the interpretation and application of the provisions of this Agreement. 6 (b) Each of the parties hereto shall cooperate and take such actions, and execute such other documents as may be reasonably requested by the other in order to carry out the provisions and purposes of this Agreement. 19. No Alienation of Benefits. To the extent permitted by law the benefits provided by this Agreement shall not be subject to garnishment, attachment or any other legal process by the creditors of the Executive, his beneficiary or his estate. IN WITNESS WHEREOF, the parties have executed this Agreement as of the date and year first above written. EXECUTIVE /s/ Michael J. Flynn ----------------------------- Michael J. Flynn 215 Old Church Road Greenwich, CT 06830 KIMCO REALTY CORPORATION, a Maryland corporation By: /s/ Milton Cooper ------------------------- Executive's payee pursuant to Section 7(a): Name: Anne J. Flynn Address: 215 Old Church Road Greenwich, CT 06830 7 EX-12.1 3 COMPUTATION OF RATIO OF EARNINGS Kimco Realty Corporation and Subsidiaries Computation of Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends For the Year Ended December 31, 1998 Income before extraordinary items $ 127,166,331 Add: Interest on indebtedness 63,547,946 Amortization of debt related expenses 1,680,197 Portion of rents representative of the interest factor 6,655,956 ------------- 199,050,430 Adjustment for equity share in partnerships (1,830,854) ------------- Income before extraordinary items, as adjusted $ 197,219,576 ============= Combined fixed charges and preferred stock dividends- Interest on indebtedness 64,723,874 Preferred stock dividends 24,653,847 Amortization of debt related expenses 1,564,883 Portion of rents representative of the interest factor 6,655,956 ------------- Combined fixed charges and preferred stock dividends 97,598,560 ============= Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends 2.0 ============= EX-12.2 4 COMPUTATION OF RATIO Kimco Realty Corporation and Subsidiaries Computation of Ratio of Funds from Operations to Combined Fixed Charges and Preferred Stock Dividends For the Year Ended December 31, 1998 Funds from Operations, Available to Common Stockholders $ 153,746,542 Add: Interest on indebtedness 63,547,946 Preferred stock dividends 24,653,847 Portion of rents representative of the interest factor 6,655,956 ------------- 248,604,291 Adjustment for equity share in partnerships (2,618,549) ------------- Funds from Operations, as adjusted $ 245,985,742 ============= Combined fixed charges and preferred stock dividends- Interest on indebtedness $ 64,723,874 Preferred stock dividends 24,653,847 Portion of rents representative of the interest factor 6,655,956 ------------- Combined fixed charges and preferred stock dividends $ 96,033,677 ============= Ratio of Funds from Operations to Combined Fixed Charges and Preferred Stock Dividends 2.6 =============
EX-21.1 5 LIST OF SUBSIDIARIES KIMCO REALTY CORPORATION AND SUBSIDIARIES 13-2744380 DECEMBER 31, 1998 ENTITY NAME FEI ---------------------------------------------------------------------- 1 KIMCO REALTY CORP. 13-2744380 2 44 PLAZA, INC. 13-2683791 3 AUK REALTY CORP. 11-2612680 4 BRENDA PROPERTIES, INC. 11-2727694 5 EAST END OPERATING CORP. 11-2498666 6 FOX HILL II, INC. 11-2671016 7 FOX HILL POUGHKEEPSIE, INC. 11-2727165 8 GC ACQUISITION CORP. 11-2928815 9 HARVEST OF NASHVILLE, INC. 11-2464767 10 HARVEST OF TEXAS, INC. 11-2330375 11 HARVEST PROPERTIES CORPORATION 11-2330376 12 KCH ACQUISITION, INC. 11-3238575 13 KIMCADE, INC. 34-1831497 14 KIMCAL CORPORATION 13-2587851 15 KIMCO 118 O/P, INC. 65-0471143 16 KIMCO 120 O/P, INC. 65-0471149 17 KIMCO 413B, INC. 34-1740528 18 KIMCO 420, INC. 34-1710200 19 KIMCO 632, INC. 58-2201467 20 KIMCO ACADIANA 670, INC. 72-1397863 21 KIMCO ALTAMONTE SPRINGS 636, INC. 65-0642321 22 KIMCO ANAHEIM, INC 93-1222235 23 KIMCO AUGUSTA 635, INC. 58-2214762 24 KIMCO AUSTIN 589, INC. 74-2891865 25 KIMCO AUTOVENTURE, INC. 52-2077426 26 KIMCO BATON ROUGE 666, INC. 62-2698758 27 KIMCO BLACKWOOD 644, INC. 23-3469041 28 KIMCO BOULDER 688, INC. 84-1444967 29 KIMCO BRADENTON 698, INC. 65-0807463 30 KIMCO BT CORP. 11-2465201 31 KIMCO BUCKS 651, INC. 23-2862081 32 KIMCO BUSTLETON 612, INC. 13-3867963 33 KIMCO CAMBRIDGE 242, INC. 31-1497725 34 KIMCO CANTON 182, INC. 34-1744056 35 KIMCO CARROLLWOOD 664,INC. 65-0737809 36 KIMCO CARY 696, INC. 62-1741256 37 KIMCO CASA PALOMA 592, INC. PENDING 38 KIMCO CEDAR HILL CROSSING 712, INC. 74-2903202 39 KIMCO CENTEREACH 605, INC. 11-3182994 40 KIMCO CHARLESTON 631, INC. 57-1030009 41 KIMCO CHARLOTTE 192, INC. 56-1831137 42 KIMCO CRYSTAL CITY 850, INC. 43-1807954 KIMCO REALTY CORPORATION AND SUBSIDIARIES 13-2744380 DECEMBER 31, 1998 ENTITY NAME FEI ---------------------------------------------------------------------- 43 KIMCO CINNAMINSON 645, INC. 22-3469045 44 KIMCO CLAWSON 143, INC. 38-3115543 45 KIMCO COLFAX 681, INC. 84-1444973 46 KIMCO COLUMBUS, INC. 13-6206133 47 KIMCO CONCOURSE, INC. 13-4043060 48 KIMCO CONSTRUCTION CORP. PENDING 49 KIMCO CORAL SPRINGS 623, INC. 65-0535840 50 KIMCO COTTMAN 294, INC. 23-2862072 51 KIMCO CRANSTON 691, INC. 06-1508094 52 KIMCO CROSS CREEK 607, INC. 38-3141736 53 KIMCO DAYTON, INC. PENDING 54 KIMCO DECATUR 797, INC. PENDING 55 KIMCO DELAWARE INC F/N/A Kimco Corporation 13-6115192 56 KIMCO DENVER 680, INC. 84-1444974 57 KIMCO DE SOTO 593, INC. PENDING 58 KIMCO DEV. OF WOOSTER, INC 11-2959598 59 KIMCO DEV. OF GASTONIA, INC. 11-2962621 60 KIMCO DEV. OF HAMPTON BAYS, INC. 11-2983330 61 KIMCO DEV. OF WATERLOO AKRON, INC. 11-2981359 62 KIMCO DEVELOPMENT OF BRADDOCK HILLS, INC. 11-2776505 63 KIMCO DEVELOPMENT OF GREENWOOD O/P, INC. 11-2981360 64 KIMCO DEVELOPMENT OF AIKEN, INC. 11-2978740 65 KIMCO DEVELOPMENT OF GIANTS, INC. 11-2792369 66 KIMCO DEVELOPMENT OF MUSKEGON, INC. 11-2757467 67 KIMCO DEVELOPMENT OF N. KENSINGTON, INC. 11-2776507 68 KIMCO DEVELOPMENT OF 31 SOUTH, INC. 11-2845541 69 KIMCO DEVELOPMENT OF KETTERING, INC. 11-2670996 70 KIMCO DEVELOPMENT OF MCINTOSH SARASOTA, INC. 11-2981378 71 KIMCO DEVELOPMENT OF MENTOR, INC. 11-3009184 72 KIMCO DEVELOPMENT OF SEMINOLE SANFORD, INC. 11-2847353 73 KIMCO DEVELOPMENT OF SPRINGBOR0 PIKE, INC. 11-2733483 74 KIMCO DEVELOPMENT OF TROY, INC. 11-2845542 75 KIMCO DEVELOPMENT OF TYVOLA, INC., 11-2805703 76 KIMCO DEVELOPMENT OF WOOSTER, INC. 11-2959598 77 KIMCO DOWNERS PARK 764, INC. 36-4274020 78 KIMCO DUBUQUE 847, INC. 39-1908742 79 KIMCO DURHAM 639, INC. 56-1968284 80 KIMCO EAGLEDALE, INC. 13-2587857 81 KIMCO EAST BANK 689, INC. 84-1444975 82 KIMCO ENFIELD 611, INC. 06-1386487 83 KIMCO ENGLEWOOD 683, INC. 84-1444966 84 KIMCO FARMINGTON 146, INC. 38-3115548 85 KIMCO FLORENCE 646, INC. 58-2346490 KIMCO REALTY CORPORATION AND SUBSIDIARIES 13-2744380 DECEMBER 31,1998 ENTITY NAME FEI ---------------------------------------------------------------------- 86 KIMCO FORUM 717, INC. PENDING 87 KIMCO FT. PIERCE 147, INC. 59-3272388 88 KIMCO GALLERY 660, INC. 23-2862071 89 KIMCO GARLAND 642, INC. 75-2650811 90 KIMCO GATES 149, INC. 13-3717461 91 KIMCO GREAT BARRINGTON 609, INC. 04-3239597 92 KIMCO GREEN ORCHARD 606, INC. 38-3141738 93 KIMCO GREENRIDGE 674, INC. 13-3974423 94 KIMCO GREENVILLE 676, INC 58-2361775 95 KIMCO HAYDEN PLAZA 640, INC. 86-0821811 96 KIMCO HAZLEWOOD, INC F/N/A Kimco of Missouri 13-2736629 97 KIMCO HOLMDELL 708, INC. 11-3470053 98 KIMCO JOPLIN 707, INC. 43-1837798 99 KIMCO JUAN TABO PLAZA 591, INC. 85-0455949 100 KIMCO KENT 637, INC. 13-3850824 101 KIMCO KISSIMMEE 613, INC. 65-0655663 102 KIMCO KML, INC. 23-2862080 103 KIMCO L.G. 709, INC. 11-3470054 104 KIMCO LAUREL, INC. 13-2731273 105 KIMCO LAFAYETTE 671, INC. 35-2001919 106 KIMCO LAFAYETTE MRKT PL 697, INC. 35-2056381 107 KIMCO LAKEWOOD 684, INC. 84-1445058 108 KIMCO LARGO 139, INC 65-0406401 109 KIMCO LARGO 196, INC. 65-0419586 110 KIMCO LEXINGTON 140, INC. 11-2845537 111 KIMCO LIVONIA, INC. 13-2587856 112 KIMCO LUBBOCK 687, INC. 75-2755893 113 KIMCO MANAGEMENT OF MARYLAND 52-1844127 114 KIMCO MANAGEMENT OF NEW JERSEY, INC. 11-3046314 115 KIMCO MANASSAS 672, INC. 54-1868158 116 KIMCO MAPLEWOOD 673, INC. 65-0785689 117 KIMCO MELBOURNE 616, INC. 65-0471154 118 KIMCO MERRILLVILLE 849, INC. 39-1908741 119 KIMCO MESA 679, INC. 86-0916546 120 KIMCO MIAMISBURG 714, INC. PENDING 121 KIMCO MISSOURI DEVELOPMENT CORP. 43-1837799 122 KIMCO MORRISVILLE 648, INC 23-2862079 123 KIMCO MOUNTAINSIDE PHOENIX 647, INC. 86-0892535 124 KIMOD MT. DORA 677, INC. 65-0797960 125 KIMCO N.W. SQUARE 597, INC. 34-1877388 126 KIMCO NO. BRUNSWICK 617, INC. 11-3204466 127 KIMCO NORTH RIVERS 692,INC. 57-1062095 128 KIMCO OCALA 665, INC. 58-2317767 KIMCO REALTY CORPORATION AND SUBSIDIARIES 13-2744380 DECEMBER 31, 1998 ENTITY NAME FEI ---------------------------------------------------------------------- 129 KIMCO OF SYOSSET, INC. 13-2660758 130 KIMCO OF CHERRY HILL, INC. 11-2641098 131 KIMCO OF GEORGIA, INC, 13-2697308 132 KIMCO OF HERMITAGE, INC. 11-2513375 133 KIMCO OF HICKORY HOLLOW, INC. 11-2464914 134 KIMCO OF HUNTINGTON, INC. 11-2516647 135 KIMCO OF ILLINOIS, INC. 13-2731271 136 KIMCO OF MILLERODE, INC. PENDING 137 KIMCO OF NANUET, INC. 11-2669924 138 KIMCO OF NEW ENGLAND, INC. 13-2731276 139 KIMCO OF NEW YORK, INC. 11-2845540 140 KIMCO OF NORTH CAROLINA, INC. 13-2660757 141 KIMCO OF NORTH MIAMI, INC. PENDING 142 KIMCO OF OAKVIEW, INC. 11-2727695 143 KIMCO OF OHIO, INC. 13-2587859 144 KIMCO OF PENNSYLVANIA, INC. 13-2731277 145 KIMCO OF RACINE, INC. 11-2928818 146 KIMCO OF SPRINGFIELD, INC. 11-2612681 147 KIMCO OF STUART 619, INC. 11-3205441 148 KIMCO OF TAMPA, INC. 11-2513372 149 KIMCO OF TENNESSEE, INC. 62-0813485 150 KIMCO OPPORTUNITY, INC. 11-3353009 151 KIMCO O.P., INC. PENDING 152 KIMCO ORLANDO 638, INC. 65-0667618 153 KIMCO PALMER PARK 654, INC. 23-2862077 154 KIMCO PEPPERTREE, INC. 65-0433600 155 KIMCO PHILMED, INC. 52-2016394 156 KIMCO PIERS 716, INC. 59-3551948 157 KIMCO PROPERTIES, INC. 13-2731270 158 KIMCO PROPS. NASHVILLE 11-2464762 159 KIMCO PT. WASHINGTON 675, INC. 11-3416853 160 KIMCO PURCHASING AGENCY CORPORATION 11-2966000 161 KIMCO QUINCY PLACE 685, INC. 84-1444963 162 KIMCO RALEIGH 177, INC. 56-1828155 163 KIMCO RALPH'S CORNER 659, INC. 23-2862075 164 KIMCO RICHMOND 800, INC. 52-1925248 165 KIMCO RIDGEWOOD 615, INC. 11-3183902 166 KIMCO RIVERGATE 588, INC. 62-1756376 167 KIMC0 RIVERWALK 595, INC. 55-0764132 168 KIMCO SACRAMENTO 788, INC. 68-0424487 169 KIMCO SAN RAMON 759, INC. 91-1949100 170 KIMCO SAND LAKE 618, INC. 65-0471136 171 KIMCO SANTEE 705, INC. 68-0424489 KIMCO REALTY CORPORATION AND SUBSIDIARIES 13-2744380 DECEMBER 31, 1998 ENTITY NAME FEI ---------------------------------------------------------------------- 172 KIMCO SARASOTA 378, INC. 65-0531169 173 KIMCO SAVANNAH 185, INC. 58-2055982 174 KIMCO SELECT TREXLER 663, INC. 23-2919887 175 KIMCO SHARONVILLE 276, INC. PENDING 176 KIMCO SHARPSTOWN 719, INC. PENDING 177 KIMCO SOUTHDALE 757, INC. 74-2846276 178 KIMCO SOUTH MIAMI 634,INC. 65-0559378 179 KIMCO SOUTH PARKER 682, INC. 84-1444970 180 KIMCO SOUTHINGTON 610, INC. 11-3193467 181 KIMCO SPRING CREEK 686, INC. 84-1444969 182 KIMCO SPRINGFIELD 625, INC. 43-1698931 183 KIMCO TALLAHASSEE 715, INC. 59-3551945 184 KIMCO TEMECULA 762, INC. 91-1949098 185 KIMCO TOWSON 621, INC. 22-3333299 186 KIMCO TROLLEY STATION 594, INC. 62-1759509 187 KIMCO UTAH, INC. 13-2659226 188 KIMCO VALLEY HI 687, INC. 84-1444972 189 KIMCO W MELBOURNE 668, INC. 58-2374863 190 KIMCO WARRINGTON 652, INC. 23-2862076 191 KIMCO WATERBURY 608, INC, 06-1382854 192 KIMCO WEST PALM BEACH 633, INC. 65-0642317 193 KIMCO WESTERVILLE 178, INC 34-1744144 194 KIMCO WESTMONT 614, INC. 38-3141736 195 KIMCO WHITE LAKE 667, INC. 38-3316919 196 KIMCO WM148, INC. 23-2725735 197 KIMCO WOODFOREST 655, INC. 75-2713979 198 KIMCO YONKERS 801, INC. 13-3851642 199 KIMCOAST OF WARREN, INC. 13-2683717 200 KIMZAY WINSTON - SALEM, INC. 13-2663113 201 KIMSWORTH OF ALABAMA, INC. 51-0368373 202 KIMSWORTH OF ARIZONA, INC. 51-0368375 203 KIMSWORTH OF ARKANSAS, INC. 51-0368374 204 KIMSWORTH OF COLORADO, INC. 51-0368377 205 KIMSWORTH OF FLORIDA, INC. 51-0368378 206 KIMSWORTH OF GEORGIA, INC. 51-0368380 207 KIMSWORTH OF ILLINOIS, INC. 51-0368382 208 KIMSWORTH OF INDIANA, INC. 51-0368383 209 KIMSWORTH OF IOWA, INC. 51-0368381 210 KIMSWQRTH OF KANSAS, INC. 51-0368385 211 KIMSWORTH OF LOUISIANNA, INC. 51-0368386 212 KIMSWORTH OF MARYLAND, INC. 51-0368387 213 KIMSWORTH OF MICHIGAN, INC. 51-0368389 214 KIMSWORTH OF MINNESOTA, INC. 51-0368389 KIMCO REALTY CORPORATION AND SUBSIDIARIES 13-2744380 DECEMBER 31, 1998 ENTITY NAME FEI ---------------------------------------------------------------------- 215 KIMSWORTH OF MISSISSIPPI, INC. 51-0368392 216 KIMSWORTH OF MISSOURI, INC. 51-0368391 217 KIMSWORTH OF MONTANA, INC. 51-0368393 218 KIMSWORTH OF NEBRASKA, INC. 51-0368394 219 KIMSWORTH OF NEW JERSEY, INC. 51-0368398 220 KIMSWORTH OF NEW MEXICO, INC. 51-0368399 221 KIMSWORTH OF OHIO, INC. 51-0368400 222 KIMSWORTH OF PENNSYLVANIA, INC. 51-0368401 223 KIMSWORTH PLAZO 768, INC. 74-2826813 224 KIMSWORTH OF S. CAROLINA, INC. 51-0368402 225 KIMSWORTH OF TEXAS, INC. 51-0368403 226 KIMSWORTH OF VIRGINIA, INC. 51-0368405 227 KIMSWORTH, INC. 51-0368319 228 KIMVEN CORPORATION 75-2630665 229 KIMZADD, INC. 11-3050459 230 KIMZAY BENTON HARBOR, INC. 11-2964477 231 KIMZAY BLOOMINGTON, INC. 13-2663111 232 KIMZAY CHARLOTTE, INC. 13-2603692 233 KIMZAY CORPORATION 13-2587863 234 KIMZAY FLORIDA, INC. 13-2587853 235 KIMZAY GEORGIA, INC. 13-2603693 236 KIMZAY GREENWOOD, INC. 13-2663112 237 KIMZAY ILLINOIS, INC. 13-2587858 238 KIMZAY MISSOURI CORPORATION 13-2636710 239 KIMZFERN, INC. 11-3035885 240 KIMZGATE, INC. 11-3035881 241 KIMZLAR, INC. 11-3050459 242 KIMZWOOD, INC. 11-3035886 243 KIR AMARILLO 879, INC. PENDING 244 KIR ARBORETUM CROSSING 564, INC. PENDING 245 KIR BELLINGHAM 542, INC. PENDING 246 KIR CITYPLACE MARKET 565, INC. PENDING 247 KIR COPIAGUE 545, INC. PENDING 248 KIR EAST WICHITA 814, INC. PENDING 249 KIR FAIRFAX 547, INC. PENDING 250 KIR GARLAND 566, INC. PENDING 251 KIR GLENDALE 549, INC. PENDING 252 KIR GREENSBORO 550, INC. 56-2108630 253 KIR JORLIN 889, INC. PENDING 254 KIR LEWISVILLE 568, INC. PENDING 255 KIR MANCHESTER 872, INC. PENDING 256 KIR MINNETONKA 552, INC. PENDING 257 KIR OAK PARK 596, INC. 22-3614608 KIMCO REALTY CORPORATION AND SUBSIDIARIES 13-2744380 DECEMBER 31, 1998 ENTITY NAME FEI ---------------------------------------------------------------------- 258 KIR OXNARD 556, INC. PENDING 259 KIR RICHARDSON 572, INC. PENDING 260 KIR SMOKETOWN STATION 562, INC. PENDING 261 KIR WEST WICHITA 815, INC. PENDING 262 KIR WESTGATE MARKET 561, INC. PENDING 263 KRC ACQUISITION CORP. 11-2993846 264 KRC ACQUISITION CORP. 11-2993846 265 KRC ALTON 802, INC. 37-1377797 266 KRC AMARILLO 879, INC. 75-2725430 267 KRC ARLINGTON 866, INC. 75-2725443 268 KRC ADDISON 898, INC. 36-4270002 269 KRC ARLINGTON HEIGHTS 896, INC. PENDING 270 KRC AURORA 890, INC. PENDING 271 KRC BELLEVILLE, INC. PENDING 272 KRC BRIDGETON 875, INC. 43-1792428 273 KRC BRIDGEVIEW 894, INC. PENDING 274 KRC CARBONDALE 848, INC. 36-4181898 275 KRC CHAMPAIGN 870, INC. PENDING 276 KRC CHRISTY 804, INC. 36-4251467 277 KRC CORPUS CHRISTI 878, INC. 75-2725431 278 KRC CRESTHILL 868, INC. 36-4181908 279 KRC CRESTWOOD 887, INC. 36-4181906 280 KRC CREVE COEUR 830, INC. 36-4251476 281 KRC CRYSTAL LAKE 891, INC. PENDING 282 KRC ELGIN 860, INC. PENDING 283 KRC FAIRVIEW HEIGHTS 881, INC. PENDING 284 KRC FOREST PARK 862, INC. 36-4181902 285 KRC INDEPENDENCE 806, INC. 36-4251469 286 KRC IRVING 867, INC. PENDING 287 KRC JOPLIN 889, INC. 36-4251490 288 KRC KIRKWOOD 803, INC. 36-4251464 289 KRC LEMAY 834, INC. 43-1792427 290 KRC MACARTHUR BLVD 799, INC. PENDING 291 KRC MANCHESTER 872, INC. 36-4251488 292 KRC MELROSE PARK 888, INC. PENDING 293 KRC MIDWEST CITY 857, INC. 73-1543453 294 KRC MISHAWAKA 895, INC. 35-2056382 295 KRC MOLINE 794, INC. PEN5ING 296 KRC MUNDELIEN 874, INC. PENDING 297 KRC N. KOSTNER 853, INC. 36-4181900 298 KRC N. ROCKWELL 882, INC. 73-1526425 299 KRC NILES 865, INC. 36-4191909 300 KRC NORRIDGE 845, INC. 36-4181905 KIMCO REALTY CORPORATION AND SUBSIDIARIES 13-2744380 DECEMBER 31, 1998 ENTITY NAME FEI ---------------------------------------------------------------------- 301 KRC O'FALLON DC 861, INC. 36-4251480 302 KRC ORLAND PARK 809, INC. PENDING 303 KRC OVERLAND PARK 805, INC 48-1202710 304 KRC PADUCAH 795, INC. PENDING 305 KRC PETERSON AVE 893, INC. PENDING 306 KRC PULASKI 841, INC. PENDING 307 KRC ROCKFORD 796, INC. PENDING 308 KRC S. SHIELDS 871, INC. 73-1526423 309 KRC SCHAUMBERG 855, INC. 36-4181901 310 KRC SHAWNEE 884, INC. 75-2725442 311 KRC SOUTHBEND 883, INC. PENDING 312 KRC SPRINGFIELD 869, INC. 43-1839496 313 KRC ST. CHARLES 798, INC. 36-4251491 314 KPC ST. JOSEPH 880, INC. 36-4251489 315 KRC TULSA 859, INC. 73-1526424 316 KRC WAUKEGAN 886, INC. PENDING 317 KRCV CORP 74-2846276 318 LAUREL 173, INC. 52-1948299 319 MANETTO HILLS ASSOCIATES, INC. 13-2604645 320 MILMAR REALTY CORP. 13-2671681 321 MOHEGAN CONSTRUCTION CORP. 13-2720238 322 MOHEGAN DEVELOPMENT CORP. 13-2720119 323 NORBER CORP. 11-2691272 324 PASSIVE INVESTORS, INC. 11-2723241 325 PERMELYNN CORPORATION 13-2660042 326 PERMELYNN OF BRIDGEHAMPTON, INC. 13-2690180 327 PERMELYNN OF GEORGIA, INC 13-2731264 328 PERMELYNN OF WESTCHESTER, INC. 13-2702562 329 REDEL CONSTRUCTION CORP. 13-3793428 330 RICH HILL, INC. 13-2731275 331 ROCKINGHAM 620, INC. 02-0471000 332 SAINT ANDREWS SHOPPING CENTER CORP OF CHARLESTON 11-2464767 333 SANNDREL OF HARRISBURG, INC. 13-2684422 334 SANNDREL OF PENNSYLVANIA, INC. 13-2700618 335 SANNDREL OF VIRGINIA, INC. 13-2700298 336 SANNDREL, INC. 13-2670120 337 THE PRICE R.E.I.T. INC, 11-3437944 338 VADBORN REALTY CORP. 11-2535543 339 WOODS0 CORP 11-2964256 EX-23.1 6 CONSENT OF PRICEWATERHOUSE COOPERS LLP CONSENT OF INDEPENDENT ACCOUNTANTS We consent to the incorporation by reference in the registration statements of Kimco Realty Corporation and Subsidiaries on Forms S-3 (File Nos. 333-61303 and 33-60050) and Form S-8 (File Nos. 333-61323 and 33-80729), of our report dated February 26, 1999, on our audits of the consolidated financial statements and financial statement schedules of Kimco Realty Corporation and Subsidiaries, as of December 31, 1998 and 1997, and for each of the three years in the period ended December 31, 1998, which report is included in this Annual Report of Form 10-K. /S/ PRICEWATERHOUSECOOPERS LLP New York, New York March 29, 1999 EX-27 7 ART. 5 FDS FOR ANNUAL 10-K
5 1 12-MOS DEC-31-1998 DEC-31-1998 43,920,544 26,005,350 34,970,940 3,150,000 0 0 3,023,901,985 255,949,923 3,051,178,421 0 1,289,560,884 0 1,329,159 601,337 1,583,088,356 3,051,178,421 338,797,629 338,797,629 91,286,730 91,286,730 0 0 64,911,743 127,166,331 0 127,166,331 0 4,900,361 0 122,265,970 1.95 1.93 Financial Data Schedule information has been extracted from the Registrant's Condensed Consolidated Balance Sheet (non-classified) as of December 31, 1998 and the Condensed Consolidated Statement of Income for the year then ended.
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