Kimco Realty
Annual Report 2012

Plain-text annual report

K i m c o R e a l t y • 2 0 1 2 A n n u a l R e p o r t R E A L T Y 3333 New Hyde Park Road New Hyde Park, NY 11042 Tel: 516-869-9000 blog.kimcorealty.com / kimcorealty.com R E A L T Y R E A L T Y 2012 Annual Repor t 247947KIM_Cvr_R1.indd 1 R E A L T Y 3/12/13 1:42 PM Corporate Directory Board of Directors R E A L T Y Milton Cooper Executive Chairman Philip E. Coviello (1)(2)(3) Partner * Richard G. Dooley (1)(2)(3v) Lead Independent Director Kimco Realty Corporation Latham & Watkins LLP Executive Vice President & Chief Investment Officer * Massachusetts Mutual Life Insurance Company Joe Grills (1)(2v)(3) Chief Investment Officer * IBM Retirement Fund David B. Henry Vice Chairman, President & Chief Executive Officer Kimco Realty Corporation F. Patrick Hughes (1v)(2)(3) President Hughes & Associates LLC Frank Lourenso Executive Vice President JPMorgan Chase & Co. Colombe M. Nicholas (2)(3) Richard Saltzman (2)(3) Consultant President Financo Global Consulting Colony Capital LLC * Retired (1) Audit Committee (2) Executive Compensation Committee (3) Nominating and Corporate Governance Committee v Chairman R E A L T Y Executive Management Milton Cooper Executive Chairman Corporate Management David F. Bujnicki Vice President, Investor Relations & Corporate Communications David B. Henry Vice Chairman, President & Chief Executive Officer Michael V. Pappagallo Executive Vice President & Chief Operating Officer Glenn G. Cohen Executive Vice President, Chief Financial Officer & Treasurer Adam M. Cohen Vice President, Tax Raymond Edwards Vice President, Retailer Services Fredrick Kurz Vice President Leah Landro Vice President, & General Manager, Human Resources Risk Management Scott G. Onufrey Senior Vice President, Acquisitions & Investment Management Bruce Rubenstein Senior Vice President, General Counsel & Secretary Thomas R. Taddeo Vice President, Paul Westbrook Vice President, Chief Information Officer Chief Accounting Officer U.S. Regional Management Conor Flynn President, Western Region Robert Nadler President, Central Region Paul D. Puma President, Wilbur “Tom” Simmons III President, Florida/Southeast Region Mid-Atlantic/Northeast Region L ETTER FROM THE CHA IRMA N 2 2012 O PERATING REVIEW FORM 10-K 14 21 SHAREHOLDER INFO RMAT ION 119 CORPORATE DIRECTORy IBC A BOUT THE COMPANy Kimco Realty Corporation (NYSE: KIM) is a real estate investment trust (REIT) headquartered in New Hyde Park, N.Y., that owns and operates North America’s largest portfolio of neighborhood and community shopping centers. As of December 31, 2012, the company owned interests in 896 shopping centers comprising 131 million square feet of leasable space across 44 U.S. states, Puerto Rico, Canada, Mexico and South America. International Management Michael Melson Managing Director, Latin America Kelly Smith Managing Director, Canada 247947_KIM_Cvr_R3.indd 2 3/12/13 11:28 PM F O C U S E D F O C U S E D From our first shopping center in Miami in 1958, to our nearly 900 shopping centers across North America today, growth has always been a part of Kimco’s DNA. It still is. But as we enter the next chapter in our history, our path to growth is becoming even more focused – on top markets, quality and value, serving retailers and, as always, on results. We’re paying close attention to what really matters, with one goal in mind: to be the best neighborhood and community shopping center company in North America. We will achieve that goal by staying FOCUS ED. .. ON TOP MARKETS ........... .. ... 6 ON QUALITY AN D VALU E .... 8 ON RETAILERS ........... .. ......... 10 ON RESULTS .......... .. .. ........... 12 247947Kimco_NARR_2012_R2.indd 1 3/19/13 6:34 PM CH AIRMAN’S LETT ER Dear Fellow Shareholders and Associates: When Marty Kimmel and I developed our first shopping center in 1958, our primary focus was on the cash flow that could be generated from tenant leases; this would amortize the mortgage loan and provide our investors with stable and predictable cash distributions. The investment thesis was simple: Construct a building where a retailer wanted to serve its customers and lease it at a rate that would pay the investors a safe and reasonable return over the life of the lease. We could earn money while we slept. During the ’70s and ’80s, we shifted to acquiring properties with the same characteristics – low rent relative to the anchor tenant’s sales, strong locations in densely populated markets and a steady cash flow providing distributions to the investors. In 1991, when we completed our initial public offering, we provided investors access to ownership of shopping centers in a new public vehicle for the first time in a very long time. Our shareholders enjoyed a safe and growing dividend and growth in cash flow from retail real estate, along with a vehicle to opportunistically capitalize on the needs of distressed, real-estate rich retailers. Fast forward to Kimco’s Investor Day in September 2010 when, after the worst recession since the Great Depression, we made a commitment to our shareholders to simplify our strategy and once again focus on recurring cash flow from high-quality shopping centers. We are making excellent progress fulfilling that commitment. To put our transformation in perspective, in 2008 our non-retail investment balance was $1.1 billion. After the impending sale of the InTown Suites extended-stay portfolio, that balance is expected to be below $300 million. Since our Investor Day, we’ve also shed shopping centers that didn’t fit our criteria, generating proceeds to Kimco of more than $500 million. We have used these proceeds, together with those generated from our non-retail dispositions, to reduce debt and acquire higher-quality shopping centers in well-located areas. The table on the next page illustrates our trans- formation. Today, the demand for space for our type of retail property continues to improve. Absorptions are forecast to outpace completions of new construction for the foreseeable future. Despite prevailing economic uncertainties, planned store openings are at a multiyear high. Our tenants are generally strong credits, including discounters, off-price retailers, drugstores, super- markets and warehouse clubs, supplying everyday 2 247947Kimco_NARR_2012_R2.indd 2 3/19/13 6:34 PM Our Quality Trade-Up: U.S. Shopping Center Acquisitions & Dispositions Number of properties Gross Price (000’s) Gross Leaseable Area in square feet (000’s)* Occupancy* Average Base Rent per square foot* Estimated Population† Household Density per square mile† Median Household Income† Average Household Income† * Represents Kimco’s pro-rata interest † Within a three-mile radius Since Investor Day 2010 (as of 12/31/12) Acquired Sites 59 Disposed Sites 108 $1,290,868 $825,250 6,459 95.8% $13.92 91,621 1,273 $74,390 $88,935 8,527 85.4% $8.75 76,329 1,064 $58,458 $65,328 Variance -45.4% 56.4% -24.3% 10.4% 59.1% 20.0% 19.6% 27.3% 36.1% necessities. Many of our leases were entered into decades ago, and contain very low contract rents. Very few public companies have entered into leases 40 years ago; these legacy contract rents are obviously below market, and they form a basis for future rental growth as the leases expire. A recent illustration of this was a 41-year-old lease with a major retailer that provided us with annual rental revenues of $315,000. When the lease expired in the first quarter of 2012, we entered into a new ground lease with a credit tenant for over six times that rent. There are more such leases in our portfolio, which should result in additional rental growth as the leases expire. Like other retail property owners, we are still navigating through some headwinds. Many consumers are feeling the impact from the end of the payroll tax holiday, and gasoline prices are up. And yet some major economic indicators are pointing in the right direction. The unemployment rate, while still too high, is slowly improving, and home prices continue to recover. Interest rates remain low. We remain focused on leasing our space to smart retailers who will benefit from better economic conditions in the years ahead. 247947Kimco_NARR_2012_R2.indd 3 3 3/19/13 6:34 PM Having evolved from that first shopping center many years ago, there are three aspects of Kimco’s business that distinguish us today. 1. We have a very large operating platform – 896 shopping centers with approximately 8,400 tenants – that enables us to service the needs of major national and regional retailers. Having this breadth of locations provides us with access to most, if not all, of the retailers that are experiencing the most rapid growth today. Among our peers, we are the largest landlord to Costco, TJX Companies (T.J. Maxx, Marshalls, etc.), Royal Ahold (Stop & Shop, Giant, etc.) and others. Home Depot and Walmart, two of the most creditworthy companies in America today, are among our largest tenants. Given our scale, we are afforded a seat at the table when a retailer is looking to expand or open a new store. In the retail real estate industry, size matters. 2. We are a manager and owner in joint ventures that hold approximately $10 billion of retail real estate. This platform has enabled us to acquire interests in numerous high-quality properties and to generate high returns on our shareholders’ equity due to our management role. Recently, an added benefit of this business has been the opportunity to increase our investment in select assets when some of our partners have expressed a desire to monetize their investments or modify their investment allocations. Since our Investor Day in 2010, we have disposed of 55 joint venture properties that were not strategic to our portfolio and acquired 10 properties from partners in which we had a minority interest stake and a management role. For example, during the year, we acquired Towson Marketplace in Towson, Maryland. This is a wonderful shopping center anchored by both Target and Walmart, with a full-line Weis Market on site. This property should provide stable and growing cash flows to our shareholders for many years to come. Another recent example is Santee Trolley Square in Santee, California, where we increased our ownership from 45 percent to 100 percent. This 98-percent-occupied, 311,000-square-foot shopping center is anchored by several prominent national retailers such as T.J. Maxx, PetSmart, Party City, Bed Bath & Beyond, 24 Hour Fitness and Old Navy, and shadow-anchored by Target. 3. We have a long-term track record of capturing retail- related opportunities. Our history is illuminated by profitable transactions with Venture Stores, Gold Circle, Hechinger’s, Montgomery Ward, Service Merchandise, Kmart, Ames, Albertsons, Woolworth, Frank’s Nursery, Strawbridge & Clothier, Strauss Discount Auto, Penn Traffic, Save Mart and Shopko. While committed to our stable and growing base of recurring income, Kimco has always had an opportunistic culture, which is the “plus” in our “Income Plus” strategy. Our track record of generating profits from transactions with retailers that are real-estate rich has proven time and again that if you are fast with your footwork, 4 247947Kimco_NARR_2012_R2.indd 4 3/19/13 6:34 PM and well-known, reliable and trusted in the retail industry, you can generate outsized returns for your shareholders. Our most recent example of an opportunistic investment is our participation in a consortium to restructure Supervalu. This is the same group we partnered with in the Albertsons transaction, which made Kimco shareholders five times their initial investment – and we still maintain a valuable position in this investment. Kimco will continue to provide real estate advisory services to the new Supervalu venture. In closing, please permit me to express a few thoughts about today’s retail real estate market prices. The prices of high-quality shopping centers today appear “expensive” compared with long-term historical averages for market cap rates, which are the initial unleveraged yields available to property buyers. However, let’s dig a little deeper. When compared with the risk-free interest rate available on the 10-year U.S. Treasury note, investment yields available on quality retail real estate may be at historically attractive levels. Let me explain. The interest rate on 10-year Treasuries was, as of this writing, approximately two percent. Treasury Inflation-Protected Securities (TIPS) for the same duration show negative yields. An argument can be made that real estate returns should be compared with TIPS, because the residual value of real estate often increases in value with inflation, in some ways similar to the increasing yield on a TIPS bond. Clearly, by these measures, quality real estate bearing cap rates in the 5 to 6 percent range looks attractively priced. A similar conclusion might be reached if one compares real estate cap rates with yields presently available on investment-grade corporate bonds. All this considered, I’ll put my money in shopping centers at today’s cap rates any day. Our goal at Kimco is to continue to be the premier owner of retail properties in North America; this should enable us to deliver safe and growing cash flows from our investment portfolio, as well as increasing distributions to our shareholders. In addition, we seek to continue generating profits and create value from our retail-related opportunistic activities. In other words, “Income Plus.” We continue to work very hard to achieve these objectives. I want to thank all of our associates for the wonderful job they are doing executing our business plan; I’m quite proud of their achievements on behalf of Kimco shareholders and stakeholders. I am very excited by the future opportunities I see ahead. It’s indeed a great time to own high-quality, income-producing retail real estate and I’m as proud as ever of our position in the industry. Milton Cooper Executive Chairman 247947Kimco_NARR_2012_R3.indd 5 5 3/19/13 10:16 PM We’re focusing our business on key U.S. markets, where population, income and growth prospects are highest. F O C U S E D F O C U S E D on Top Markets Kimco’s strategy is to be where the consumers are. We’re rebalancing our portfolio so the vast majority of our shopping centers are in the most densely populated, highest-income areas of the U.S. – the places retailers value most. By deepening our presence in top markets, we’ll improve our overall asset values, gain operating efficiencies, and increase occupancy and income – factors that produce greater wealth for our investors. Wilton Campus Shops in Wilton, Conn., is a prime example of our quality trade-up. Acquired last year, the center is 97 percent occupied, commands rent of $30 per square foot, and is located in Connecticut’s affluent Gold Coast, an area which has an average household income of $241,000. In comparison, the properties we sold since Investor Day 2010 were, on average, 85 percent occupied, had rent of $8.75 per square foot, and average household income of $65,000. Early in 2013, Kimco acquired Wilton Executive Campus and Shoppes, a mixed-use center adjacent to Wilton Campus Shops, securing full ownership of the entire Wilton River Park development. The median household income in our target markets is 14 percent higher than the U.S. average. 6 Airport Plaza, Farmingdale, New York Houston, Houston, Houston, Texas Woodbridge Shopping Center, Houston, Texas Texas Center, Woodbridge Shopping Center, Center, Houston, Shopping Shopping Center, La Verne Towne Center, Los Angeles, California 247947Kimco_NARR_2012_R3.indd 6 3/19/13 10:16 PM “Wilton is growing but still has a small-town feel, and this shopping center is central to keeping us a tight-knit community. With each trip to the Wilton Campus Shops, we have a chance to bump into neighbors and friends. I was pleased Kimco acquired the center, because I know they will continue to add to the high-quality shopping experience enjoyed by those of us who are proud to call Wilton home.” Jane Melani, local shopper, Wilton Campus Shops 247947Kimco_NARR_2012_R2.indd 7 7 3/19/13 6:34 PM “I’m thrilled the 45-year-old Wilde Lake Village Center is being reinvented for the next 45 years. Kimco’s new, environmentally friendly design, created with extensive input from the community, remains true to the original vision James Rouse had for Columbia, my home town. Wilde Lake residents should be excited about this project, and with the Downtown Columbia plan coming to life, the future of this community could not be brighter.” Ken Ulman, County Executive, Howard County, Maryland 8 247947Kimco_NARR_2012_R2.indd 8 3/19/13 6:34 PM We’re focused on increasing the value of our centers – for consumers, communities and the company alike. F O C U S E D F O C U S E D on Quality and Value Our redevelopment projects bring new life to outmoded shopping centers in strong locations. Whenever we rebuild, expand, or reconfigure space to attract highly coveted national retailers, we create quality and value – in the form of increased economic activity, jobs, and tax revenues for communities; more attractive shopping environments and greater choice for consumers; and stronger returns for Kimco shareholders. Even the environment benefits: using energy-efficient design and sustainable materials, our revamped centers are greener than ever before. With a 33 percent vacancy rate, Kimco saw an opportunity to revitalize the Wilde Lake Village Center in Columbia, Md., and once again make it a hub of community life in this affluent suburb of Baltimore. The $45 million project, which includes a $17 million investment by Kimco, will open up the center’s courtyard area and add new retail, office and residential space. Expected to be completed in 2014, the project is being built to LEED certification, with a new storm water management system and energy-efficient lighting and HVAC systems. 230 We expect to We expect to invest $400 million in redevelopment projects over the in redevelopment next few years. next few years. 247947Kimco_NARR_2012_R2.indd 9 9 3/19/13 6:34 PM F O C U S E D on Retailers F O C U S E D Kimco and its retail partners enjoy some of the longest and strongest relationships in the industry – each built on trust, dependability and service. Retailers count on Kimco for our national scale and local expertise, but they also appreciate how we’re always thinking beyond the box, offering programs like KEYS, which provides training and incentives to help entrepreneurs launch retail businesses. In return, our loyal tenants provide a steady, reliable source of income, and the opportunity, when conditions change, to participate in restructurings and retailer-owned asset sales that create mutual value. Rudy Gonzales got the idea for his new business, Build-It Workshops, after watching his two young daughters play with blocks at San Diego’s New Children’s Museum. With help from Kimco’s KEYS program, Rudy received the training and incentives he needed to turn that idea into reality. Now, Build-It Workshops, located in Kimco’s North County Plaza shopping center in Carlsbad, Calif., offers children and their parents a creative play outlet fueled by a sense of fun and imagination. Rudy hopes to open other locations in the future, but no matter how far he goes, he will always appreciate the head start he got from Kimco to get his initial idea off the ground. During 2012, 90 percent of tenants coming up for renewal or with options decided to remain with Kimco. 10 Mesa Riverview, Mesa, Arizona Columbia Crossing, Columbia, Maryland Preston Forest Village, Dallas, Texas 7 247947Kimco_NARR_2012_R3.indd 10 3/19/13 10:16 PM We’re focused on providing more services and greater opportunity for retailers – the kind of support that builds long-term relationships. “I’ll always be grateful to Kimco for the encouragement and support they gave me to start my own business. The advice and training I received through the KEYS program were invaluable, and on top of that, Kimco is providing me with a year of free rent and other incentives. I can’t think of a better way to get my business off to a strong start. Thank you again, Kimco. You really helped make Build-It Workshops possible.” Rudy Gonzales, owner, Build-It Workshops 11 3/19/13 6:35 PM 247947Kimco_NARR_2012_R2.indd 11 T O TA L R E T U R N P E R F O R M A N C E Since IPO Full-Year 2012 23.9% 13.0% 11.6% 10.0% 8.7% 18.1% 16.0% 10.2% KIM NAREIT DJIA S&P500 KIM NAREIT DJIA S&P500 $100,000 invested at IPO would be worth $1.3 million at December 31, 2012 Kimco outperformed major indices for the 12 months ended December 31, 2012 Source: NAREIT, Bloomberg since Investor Day 2010 59% increase in average rent per square foot (bought vs. sold properties) $2.1 billion of capital refinanced in 2012 10.5% increase in cash dividend $13.2 billion of enterprise value 94% occupancy rate, highest since 2008 27.8% spread on new U.S. leases 170 basis-point increase in small-shop occupancy in 2012 11 consecutive quarters of same-site NOI growth 12 Santee Trolley Square, San Diego, California Since its 1991 IPO, Kimco has returned an average of 13 percent a year to its shareholders, outpacing the returns of the broader REIT sector and leading market indices. 247947Kimco_NARR_2012_R2.indd 12 3/19/13 6:35 PM F O C U S E D on Results F O C U S E D Kimco follows an “Income Plus” strategy, making sure our portfolio of stable shopping centers delivers the consistent, reliable income stream our investors expect, while offering an upside “plus” from opportunistic retail investments. It takes effort and creativity to make that model work. Kimco employees focus everyday on generating maximum cash flow from our shopping centers by keeping space filled, rents paid and operating expenses down, while finding new sources of revenue through value-added services and ancillary income programs. It also takes connections and intelligent risk-taking to capitalize on new opportunities, such as our participation, announced earlier this year, in a buyout of five leading supermarket chains with nearly 900 stores from Supervalu. In the end, it all adds up to a record of market-beating returns that is the envy of our industry… and the pride of our employees. 247947Kimco_NARR_2012_R2.indd 13 13 3/19/13 6:35 PM 2012 OPERATING REVIEW In many ways, 2012 was a banner year for Kimco. We delivered outstanding results, while improving the quality, value and growth potential of our shopping center portfolio. Dea r Fellow S ha reh ol ders and As s o ci ates: In many ways, 2012 was a banner year for Kimco. Focused on both the present and the future, we delivered outstanding financial and operating results, while strengthening our balance sheet and making significant strides toward improving the quality, value and growth potential of our shopping center portfolio for the long term. Our reported funds from operations (FFO) as adjusted came in at $514.2 million, or $1.26 per diluted share, up 5 percent from $489.8 million, or $1.20 per diluted share, in 2011. For this solid performance, shareholders were rewarded with a total return of nearly 24 percent, continuing a long history of sector- and market-beating returns enjoyed by Kimco investors (see chart on page 12). Dividends, of course, make up a significant portion of Kimco’s total return. In October, the Board approved a 10.5 percent increase in our quarterly dividend, to an annualized rate of $0.84 per common share, reflecting our strong results and confidence in our future growth prospects. FU N DA MENTAL S L O OKING UP We have good reason to be confident in the future. While economic uncertainty persists, the leading indicators in our industry continue to trend upward. Demand for quality retail space is steadily increasing, with store openings hitting multiyear highs as retailers expand their store counts, population and consumer spending continue to rise, unemployment eases, and the housing recovery, fueled by low interest rates, gains momentum. Yet available supply remains tight, with virtually no new development on the drawing boards. That translates into accelerating growth in effective rents and occupancy rates. Kimco is well positioned to capitalize on these trends. The quality of our shopping center portfolio is strong and improving, our national platform is geographically diverse and increasingly focused on top markets, and our credit- worthy tenant base is very stable, generating reliable and growing cash flows. Vital Signs Show Strength and Stability Our 2012 operating metrics, what we call our vital signs, provide further evidence of our strength and stability. Same-site net operating income (NOI) in our combined portfolio has grown now for 11 consecutive quarters – a terrific winning streak. In the fourth quarter, it rose 3.4 percent – the highest quarterly increase since the end of 2007. In all, our same-site NOI grew 2.3 percent in 2012, including a negative 60 basis-point impact from currency changes. Much of the improvement in our NOI came from a rise in effective rents, but was also helped by efforts to reduce operating expenses, improve occupancy and retain tenants, 14 247947Kimco_NARR_2012_R2.indd 14 3/19/13 6:35 PM Stable, Growing Cash Flows Come From… Geographically Diverse Rental Income MSA* 1-5 20.5% MSA 6-10 12.3% MSA 11-30 23.2% Puerto Rico 3.3% Canada 10.4% Latin America 6.8% All Other 23.5% *Metropolitan Statistical Area Location California Florida New York Texas Pennsylvania New Jersey All Other U.S. Puerto Rico Subtotal U.S. Latin America Canada Subtotal International Total Shopping Centers Number of Properties Square Feet (in millions) Annualized Base Rent 109 77 60 52 45 28 381 7 759 71 66 137 896 18.7 10.7 6.4 8.0 5.0 4.3 50.9 2.2 106.2 12.7 12.4 25.1 131.3 13.1% 8.8% 8.0% 4.9% 4.7% 4.1% 35.9% 3.3% 82.8% 6.8% 10.4% 17.2% 100.0% recover lost rents, and generate new revenue streams from services and ancillary income programs. Our growing occupancy levels tell the tale of strong retailer demand for quality space, while also reflecting the success of our portfolio recycling program. For the year, occupancy in our combined portfolio was 93.8 percent, up 70 basis points from 2011. In the U.S., the level was 93.9 percent, an increase of 80 basis points. Occupancy in our U.S. anchor space (over 10,000 square feet) climbed 50 basis points, to 96.9 percent, fueled by increased demand from national and regional chains. Meanwhile, our small-shop occupancy jumped 170 basis points, to 84.2 percent – a strong indicator of the improving health of the economy. During 2012, the company signed 2,678 new leases, renewals and options for a total of 10 million square feet – a 25 percent increase in pro-rata square footage over the previous year. Available space from bankruptcies such as Room Store, Syms and A&P, or end-of-term vacancies from such retailers as Kmart, were absorbed very quickly at higher rents, underscoring the value of those spaces. Overall, our leasing spreads – the difference between old and new rents on the same space – continue to widen, another sign of strong demand. In the U.S., the spread was 9.8 percent. Rents on new leases were 27.8 percent higher; on renewals and options, they rose 4.5 percent. Progress in Canada and Mexico Our portfolio in Canada continues to enjoy high occupancy, at 97 percent, amid strong demand. High- quality space is at a premium, with more and more U.S. retailers seeking to expand into Canada. In 2013, the big expansion story is Target. In what promises to be a real transformational move for Canadian retailing, Target plans to open 125 stores in Canada, including one in our Shoppers World Danforth center in Toronto this spring, the first of nine the retailer will open in our joint-venture properties over the next two years. In 2012, we strengthened our presence in Canada by acquiring shopping centers in Ottawa and Edmonton. We also increased our ownership in one shopping center and converted our preferred equity interest into a pari- passu joint venture in another, both in British Columbia. The quality of our portfolio is strong and improving, our national platform is geographically diverse and focused on top markets, and our tenant base is stable, generating reliable and growing cash flows. 15 Davidson Commons, Charlotte, North Carolina 247947Kimco_NARR_2012_R2.indd 15 3/19/13 6:35 PM Our portfolio will be concentrated in key territories, areas with the strongest demographics, limited retail per capita, high barriers to entry, and the greatest population density. We’re also pleased with our progress in Mexico, where occupancy rose to nearly 90 percent in our fully operational centers, reaching the target we established last year. In all, Mexico contributed more than $57 million to our NOI last year, up 16 percent before currency impacts. Demand for quality space in Mexico is on the rise, with the economy expected to grow nearly 4 percent in 2013. Many major U.S. retailers have their sights set on Mexico, including Petco, American Eagle and Old Navy, among others. Mexico’s real estate capital market is suddenly very vibrant as well, thanks to recent offerings from several Mexican REITs. With the flow of investment money into real estate driving property values higher, we will look to monetize certain assets to optimize our portfolio composition. At the end of 2012, we also made a decision to sell, over time, our South America portfolio – two projects in Brazil, two in Peru, and 11 in Chile. Even though GDP growth rates are projected to remain strong in these markets, we don’t have the scale or the efficient tax structure to continue expanding in South America. Instead, we’ll take our profits and reinvest the proceeds to help fund our U.S. growth strategy. OUR MODEL: INCOME PLUS Since our Investor Day in September 2010, we have been focused on executing against four strategic imperatives: active portfolio management, value creation through redevelopment and re-tenanting, opportunistic retail investments, and maintaining a strong balance sheet. These activities all contribute to our “Income Plus” model. The “income” comes from a continuously improving portfolio of stable shopping centers that generates reliable and growing cash flows. The “plus” comes from the opportunistic investments we’re able to make because of our strong financial position and longstanding relationships with major retailers and investment partners. Added together, they produce outstanding results for our shareholders. Active Portfolio Management Thirty months ago, we decided to get back to basics, concentrating on our core competency of owning and operating stable, high-quality neighborhood and community shopping centers. It’s how we got our start in 1958, and what we know best. After a painstaking review process, we decided to sell those shopping centers that were outside our core operating markets, didn’t fit our desired asset profile, or had limited In the last two and a half years, we have made tremendous progress have made tremendous progress for for greater for greater our rebalancing our portfolio our portfolio rebalancing our portfolio for greater growth and value. growth and value. 16 City Heights, San Diego, California 247947Kimco_NARR_2012_R2.indd 16 3/19/13 6:35 PM Stable, Growing Cash Flows Come From… A Diverse Mix of Creditworthy Tenants Only 14 tenants above 1% of Annualized Base Rent (ABR) 2.9% 3.0% 2.6% 1.4% 1.5% 1.5% 2.0% 1.6% 1.7% 1.1% 1.2% 1.2% 1.2% 1.2% (% of total ABR) Dollar Tree Michael’s Safeway Ross Dress for Less Costco PetSmart Best Buy Kohl’s Ahold Bed Bath & Beyond Sears/ Kmart Walmart TJX Companies Home Depot opportunity for growth or repositioning. In addition, we decided to exit substantially all of our non-retail investments. In the last two and a half years, we have made tremendous progress rebalancing our portfolio for greater growth and value. Last year alone, we sold 68 properties in the U.S., more than double the pace of the previous year, while purchasing 24 higher-quality shopping centers. In all, we have sold 108 U.S. retail properties since September 2010, for gross proceeds of $825 million, while buying 59 higher-quality properties for a gross price of $1.3 billion. The measure of success: our newly acquired centers have occupancy of 96 percent, average base rent of $13.92 a square foot, and average household income of $89,000. Those we sold: occupancy of 85 percent, rent of $8.75, and income of $65,000. Despite the progress we’ve made, we’re not finished yet. We’re now looking to optimize our remaining portfolio by refining and deepening our presence in top U.S. markets. Going forward, our portfolio will be concentrated in key markets, encompassing the top Metropolitan Statistical Areas (MSAs) of the U.S., areas that have the strongest demographics, limited retail per capita, high barriers to entry, and the greatest population density. Our plan is to acquire larger, higher-value retail properties in these key territories, funding our investments through an active portfolio recycling program, both within and outside these markets. At the same time, we’ll keep an eye on a handful of areas in other parts of the country that we think have the highest future growth potential. In the end, we want to have a national platform that allows us to take advantage of scale and operating efficiencies, that enables us to serve as a top landlord to most national retailers, and that is broad enough to maintain the spread of financial risk, while having enough depth to capture new opportunities. This is our core investment proposition. That model leaves little room for non-retail assets. After we complete the impending sale of our InTown Suites portfolio, our non-retail holdings are expected to comprise only 2.5 percent of our asset base, down from 10 percent at the peak. Value Creation through Redevelopment and Re-tenanting Acquiring high-quality properties in top markets is one avenue to growth. Another way we’re adding value for the long term is to redevelop, re-tenant and expand the strongly situated shopping centers we already have. Mountain Island, Charlotte, North Carolina Santee Trolley Square, San Diego, California 17 247947Kimco_NARR_2012_R2.indd 17 3/19/13 6:35 PM Suburban Square, Philadelphia, Pennsylvania Hampton Bays Plaza, Hampton Bays, New York Our relationships with major retailers and investment partners, coupled with our strong balance sheet, put us in a great position to make opportunistic retail investments. After spending more than $40 million on redevelopment in 2012, we’re ramping up our activity and targeting nearly $400 million in spending over the next few years. In Staten Island, N.Y., we’re redeveloping our Richmond shopping center, converting an empty box formerly occupied by Kmart into a new, higher-income space for Target. Similarly, in Pompano, Fla., we’re taking a former Kmart location and turning it into new space for Whole Foods and The Sports Authority, at higher rents. These are just two examples of how we’re benefiting from turnover in leases signed more than 20 years ago at what are now below-market rents. We still have more than 1,000 such leases in our portfolio, so there’s plenty of upside remaining to be captured. Opportunistic Retail Investments Our longstanding relationships with major retailers and investment partners, coupled with our strong balance sheet, put us in great position to make opportunistic retail investments that add value to our portfolio. A recent example is our participation in an investment consortium that is buying five grocery banners – Albertsons, Acme, Jewel-Osco, Shaw’s and Star Market – encompassing 877 stores, from Supervalu Inc. Kimco was part of the original consortium that purchased more than 600 stores from Albertsons in 2006. As with our initial investment, we expect this latest transaction will result in a substantial return on our investment of up to $76.5 million, adding to our long history of success with retailer-owned real estate opportunities. Joint ventures provide Kimco with another attractive source of acquisitions as our partners look to monetize their investments and we seek to simplify our ownership Wilton Campus Shops, Wilton, Connecticut 18 247947Kimco_NARR_2012_R2.indd 18 3/19/13 6:35 PM Cash Flows: A Shift Back to Retail... EBITDA Composition 83% Shopping Centers 96% Shopping Centers 100% Shopping Centers 17% Non-retail Investments 4% Non-retail Investments All EBITDA contributions generated from retail shopping center flows. 2008 2012 2014 structure. We currently have about $10 billion of assets in such partnerships. During the year, Kimco acquired from joint-venture partners full interests in seven U.S. shopping centers. Most recently, we acquired our partner’s 55 percent ownership interest in the Santee Trolley Square shopping center in the affluent San Diego market. We’ll also look to increase our ownership in other joint ventures. For example, we recently increased our interest in the Kimco Income Fund I from 14.6 percent to 29.8 percent, and reached preliminary agreement with a new institutional investor to raise our stake from 18 percent to 33 percent in an existing institutional joint venture. Maintaining a Strong Balance Sheet During 2012, we took every opportunity to maintain and strengthen our healthy balance sheet and our liquidity position by accessing lower-cost money in the capital markets. In all, we issued $800 million of perpetual preferred stock, at a blended coupon of 5.78 percent, and redeemed $635 million of such debt with a blended coupon of 7.45 percent. We also paid off approximately $199 million in senior unsecured notes with a coupon of 6.0 percent. Although we reported one-time non-cash charges of approximately $22 million, or $0.05 per diluted share, as a result of these transactions, we will benefit by approximately $13 million a year, or $0.03 per diluted share, in real cash savings and reduced fixed charges year after year. Our immediate liquidity position remains very strong, at more than $1.4 billion, and over the course of the year, we improved our net-debt-to-recurring EBITDA ratio to 5.7 times, a level better than the 6 times to which we had committed at our 2010 Investor Day. ACCELERATING OUR PROGRESS IN 20 13 In 2013, we expect the pace of our activities will accelerate in response to improving market conditions and new opportunities. We have four main strategic objectives to guide us, but only one real focus: to maximize the value we create for Kimco shareholders, partners and associates. Here is how we see the year shaping up: • Portfolio Recycling – We will continue to recycle our portfolio for quality and growth, selling 60-75 retail properties that no longer meet our criteria, while re- investing the proceeds to acquire higher-value shopping centers that deepen and refine our presence in our key U.S. territories. In addition, we will substantially complete the sale of our non-retail assets, take initial steps to monetize our South American portfolio and select assets in Mexico, and continue to invest in redevelopment projects that improve the value of our U.S. portfolio. • Shopping Center Performance – We’re focused, as always, on extracting maximum value and cash flow from our shopping centers by increasing occupancy levels and rents, lowering costs and finding new revenue streams. We closed out 2012 with a streak of 11 consecutive quarters of same-site net operating income growth and we intend to keep that streak going in 2013. We also expect to increase our combined portfolio occupancy. • Financial Strength – We will continue to maintain a healthy balance sheet and employ a conservative capital structure to achieve our business objectives. Our ongoing target for consolidated net-debt-to-recurring- EBITDA ratio is between 5.5 and 6.0 times, with a fixed-charge coverage ratio of at least 2.5 times. 247947Kimco_NARR_2012_R2.indd 19 19 3/19/13 6:35 PM Kimco helps protect the environment through sustainability initiatives like utility and waste management, lighting and irrigation efficiency, rooftop solar-power production, and low-impact materials and design – efforts that also reduce operating costs and create new revenue streams. Edgewater Commons, Edgewater, New Jersey FO C US ED ON VA LUE The true value of retail real estate comes from people. The people who finance, build and maintain shopping centers; the people who realize retail success in them, and the people who shop, enjoy dining and entertainment, or find a sense of community in them. Behind them all, are the people of Kimco – the men and women who are focused every day on creating value for retailers, consumers, investors and communities alike. And they do a great job of it. They work closely with retailers of all sizes to understand their business plans and help them find the right real estate to maximize their performance. They give entrepreneurs and first-time business owners a helping hand through programs like KEYS, which offers training and incentives to start new businesses, and FastTRACK Franchise, which connects aspiring and experienced franchise owners with pre-approved locations. They create, renew and maintain attractive shopping environments that enhance the consumer experience, improve property values, and keep shoppers coming back for more. They help protect the environment through sustainability initiatives like utility and waste management, lighting and irrigation efficiency, rooftop solar-power production, and low-impact materials and design – efforts that also reduce operating costs and create new revenue streams. They improve our internal efficiency with technology, creating lease management and integrated financial planning systems; business intelligence tools, and mobile property management applications. In the end, as they focus on creating value for those around them, the people of Kimco create value for themselves, building careers and a company with almost unlimited potential and opportunity. We thank all Kimco associates for their many contributions to our success in 2012, and look forward to what their energy, creativity, drive and determination will mean to us in the years ahead. David B. Henry Vice Chairman, President & Chief Executive Officer Michael V. Pappagallo Executive Vice President & Chief Operating Officer Glenn G. Cohen Executive Vice President, Chief Financial Officer & Treasurer 20 247947Kimco_NARR_2012_R2.indd 20 3/19/13 6:35 PM PM S 2945 RGB CMYK R E A L T Y R E A L T Y 10-K R E A L T Y 247947_Kimco pg21_pg122_R1.indd 1 21 R E A L T Y 3/20/13 3:07 PM UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2012 OR For the transition period from __________ to __________ Commission file number 1-10899 Kimco Realty Corporation (Exact name of registrant as specified in its charter) Maryland (State or other jurisdiction of incorporation or organization) 13-2744380 (I.R.S. Employer Identification No.) 3333 New Hyde Park Road, New Hyde Park, NY 11042-0020 (Address of principal executive offices) (Zip Code) (516) 869-9000 (Registrant’s telephone number, including area code) Securities registered pursuant to Section 12(b) of the Act: Common Stock, par value $.01 per share. Title of each class Depositary Shares, each representing one-hundredth of a share of 6.90% Class H Cumulative Redeemable Preferred Stock, par value $1.00 per share. Depositary Shares, each representing one-thousandth of a share of 6.00% Class I Cumulative Redeemable Preferred Stock, par value $1.00 per share. Depositary Shares, each representing one-thousandth of a share of 5.50% Class J Cumulative Redeemable Preferred Stock, par value $1.00 per share. Depositary Shares, each representing one-thousandth of a share of 5.625% Class K Cumulative Redeemable Preferred Stock, par value $1.00 per share. Name of each exchange on which registered New York Stock Exchange New York Stock Exchange New York Stock Exchange New York Stock Exchange New York Stock Exchange Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes  No  Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes  No  Securities registered pursuant to section 12(g) of the Act: None Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes  No  Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes  No  Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) 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.  Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer,” “accelerated filer" and “smaller reporting company” in Rule 12b-2 of the Exchange Act. Large accelerated filer Non-accelerated filer (Do not check if a smaller reporting company.)   Accelerated filer Smaller reporting company   Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes  No  The aggregate market value of the voting and non-voting common equity held by non-affiliates of the registrant was approximately $7.4 billion based upon the closing price on the New York Stock Exchange for such equity on June 30, 2012. Indicate the number of shares outstanding of each of the registrant's classes of common stock, as of the latest practicable date. (APPLICABLE ONLY TO CORPORATE REGISTRANTS) 407,883,635 shares as of February 14, 2013. 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 April 30, 2013. Index to Exhibits begins on page 37. TABLE OF CONTENTS Item No. PART I 1. Business ................................................................................................................................................................................................................. 1A. Risk Factors .......................................................................................................................................................................................................... 1B. Unresolved Staff Comments ...................................................................................................................................................................... 2. 3. 4. Properties ............................................................................................................................................................................................................. Legal Proceedings ............................................................................................................................................................................................ Mine Safety Disclosures ................................................................................................................................................................................ PART II 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities ...................................................................................................................................... 6. 7. Selected Financial Data ................................................................................................................................................................................. Management’s Discussion and Analysis of Financial Condition and Results of Operations .................................... 7A. Quantitative and Qualitative Disclosures About Market Risk ................................................................................................. 8. 9. Financial Statements and Supplementary Data................................................................................................................................ Changes in and Disagreements With Accountants on Accounting and Financial Disclosure ................................ 9A. Controls and Procedures ............................................................................................................................................................................. 9B. Other Information ........................................................................................................................................................................................... PART III 10. Directors, Executive Officers and Corporate Governance....................................................................................................... 11. Executive Compensation ............................................................................................................................................................................. 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters ...................................................................................................................................................... 13. Certain Relationships and Related Transactions, and Director Independence .............................................................. 14. Principal Accounting Fees and Services ............................................................................................................................................... PART IV Form 10-K Report Page 2 4 10 10 11 11 11 14 15 33 34 34 34 35 35 35 35 35 35 15. Exhibits, Financial Statement Schedules ............................................................................................................................................... 36 1 FORWARD-LOOKING STATEMENTS This annual report on Form 10-K (“Form 10-K”), together with other statements and information publicly disseminated by Kimco Realty Corporation (the “Company”) 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 includes this statement for purposes of complying with the safe harbor provisions. Forward-looking statements, which are based on certain assumptions and describe the Company’s 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 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 adverse economic and local real estate conditions, (ii) the inability of major tenants to continue paying their rent obligations due to bankruptcy, insolvency or a general downturn in their business, (iii) financing risks, such as the inability to obtain equity, debt or other sources of financing or refinancing on terms favorable to the Company, (iv) the Company’s ability to raise capital by selling its assets, (v) changes in governmental laws and regulations, (vi) the level and volatility of interest rates and foreign currency exchange rates, (vii) risks related to our international operations, (viii) the availability of suitable acquisition and disposition opportunities, (ix) valuation and risks related to our joint venture and preferred equity investments, (x) valuation of marketable securities and other investments, (xi) increases in operating costs, (xii) changes in the dividend policy for the Company’s common stock, (xiii) the reduction in the Company’s income in the event of multiple lease terminations by tenants or a failure by multiple tenants to occupy their premises in a shopping center, (xiv) impairment charges and (xv) unanticipated changes in the Company’s intention or ability to prepay certain debt prior to maturity and/or hold certain securities until maturity and the risks and uncertainties identified under Item 1A, “Risk Factors” and elsewhere in this Form 10-K and in the Company’s other filings with the SEC. Accordingly, there is no assurance that the Company’s expectations will be realized. Item 1. Business Background PART I Kimco Realty Corporation, a Maryland corporation, is one of the nation's largest owners and operators of neighborhood and community shopping centers. The terms "Kimco," the "Company," "we," "our" and "us" each refer to Kimco Realty Corporation and our subsidiaries, unless the context indicates otherwise. The Company is a self-administered real estate investment trust ("REIT") and has owned and operated neighborhood and community shopping centers for more than 50 years. The Company has not engaged, nor does it expect to retain, any REIT advisors in connection with the operation of its properties. As of December 31, 2012, the Company had interests in 896 shopping center properties (the “Combined Shopping Center Portfolio”), aggregating 131.3 million square feet of gross leasable area (“GLA”), and 829 other property interests, primarily through the Company’s preferred equity investments, other real estate investments and non-retail properties, totaling 26.6 million square feet of GLA, for a grand total of 1,725 properties aggregating 157.9 million square feet of GLA, located in 44 states, Puerto Rico, Canada, Mexico, Chile, Brazil and Peru. The Company’s ownership interests in real estate consist of its consolidated portfolio and portfolios where the Company owns an economic interest, such as properties in the Company’s investment real estate management programs, where the Company partners with institutional investors and also retains management. The Company believes its portfolio of neighborhood and community shopping center properties is the largest (measured by GLA) currently held by any publicly traded REIT. 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. 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 and supported by the Company’s regional offices. As of December 31, 2012, a total of 635 persons are employed by the Company. The Company’s Web site is located at http://www.kimcorealty.com. The information contained on our Web site does not constitute part of this Form 10-K. On the Company’s Web site you can obtain, free of charge, a copy of our Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act of 1934, as amended, as soon as reasonably practicable, after we file such material electronically with, or furnish it to, the Securities and Exchange Commission (the "SEC"). The public may read and copy any materials we file with the SEC at the SEC's Public Reference Room at 100 F Street, NE, Washington, DC 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC also maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC at http://www.sec.gov. 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, commencing with its taxable year which began January 1, 2 1992, elected to qualify as a REIT in accordance with Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (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. In 1994, the Company reorganized as a Maryland corporation. In March 2006, the Company was added to the S & P 500 Index, an index containing the stock of 500 Large Cap companies, most of which are U.S. corporations. The Company's common stock, Class H Depositary Shares, Class I Depositary Shares, Class J Depositary Shares and Class K Depositary Shares are traded on the New York Stock Exchange (“NYSE”) under the trading symbols “KIM”, “KIMprH”, “KIMprI”, “KIMprJ” and “KIMprK”, respectively. The Company’s initial growth resulted primarily from ground-up development and the construction of shopping centers. Subsequently, the Company revised its growth strategy to focus on the acquisition of existing shopping centers and continued its expansion across the nation. The Company implemented its investment real estate management format through the establishment of various institutional joint venture programs, in which the Company has noncontrolling interests. The Company earns management fees, acquisition fees, disposition fees and promoted interests based on value creation. The Company continued its geographic expansion with investments in Canada, Mexico, Chile, Brazil and Peru. The Company’s revenues and equity in income from its foreign investments in U.S. dollar equivalents and their respective local currencies are as follows (in millions): 2012 2011 2010 Revenues (consolidated in USD): Mexico ....................................................................................................................................... $ Brazil ............................................................................................................................................ $ Peru ............................................................................................................................................. $ Chile ............................................................................................................................................ $ 47.3 3.8 0.4 7.4 $ $ $ $ Revenues (consolidated): Mexico (Mexican Pesos “MXN”) ............................................................................... Brazil (Brazillian Real) ......................................................................................................... Peru (Peruvian Nuevo Sol) ............................................................................................. Chile (Chilean Pesos “CLP”) .......................................................................................... Equity in income (unconsolidated joint ventures, including preferred equity investments in USD): Canada ....................................................................................................................................... $ Mexico ....................................................................................................................................... $ Chile ............................................................................................................................................ $ Equity in income (unconsolidated joint ventures, including preferred equity investments in local currencies): Canada (Canadian dollars) .............................................................................................. Mexico (MXN) ...................................................................................................................... Chile (CLP) .............................................................................................................................. 46.3 $ 3.8 $ 0.4 $ 0.3 $ 570.2 6.3 1.1 144.7 626.5 7.2 1.1 3,648.0 45.4 15.0 0.4 $ $ $ 21.3 $ 11.9 $ 0.9 $ 44.4 152.8 194.2 19.7 123.5 411.2 35.4 3.3 0.4 0.1 455.8 5.9 1.0 62.8 26.5 12.0 0.1 27.3 99.0 32.0 The Company, through its taxable REIT subsidiaries (“TRS”), as permitted by the Tax Relief Extension Act of 1999, has been engaged in various retail real estate related opportunities, including (i) ground-up development of neighborhood and community shopping centers and the subsequent sale thereof upon completion, (ii) retail real estate management and disposition services, which primarily focused on leasing and disposition strategies for real estate property interests of both healthy and distressed retailers and (iii) acting as an agent or principal in connection with tax-deferred exchange transactions. The Company may consider other investments through its TRS should suitable opportunities arise. In addition, the Company has capitalized on its established expertise in retail real estate by establishing other ventures in which the Company owns a smaller equity interest and provides management, leasing and operational support for those properties. The Company has also provided preferred equity capital in the past to real estate entrepreneurs and, from time to time, provides real estate capital and management services to both healthy and distressed retailers. The Company has also made selective investments in secondary market opportunities where a security or other investment is, in management’s judgment, priced below the value of the underlying assets, however these investments are subject to volatility within the equity and debt markets. Operating and Investment Strategy The Company’s vision is to be the premier owner and operator of shopping centers with its core business operations focusing on owning and operating neighborhood and community shopping centers through investments in North America. This vision has entailed a shift away from non-retail assets that the Company currently holds. These investments include non-retail preferred equity investments, marketable securities, mortgages on non-retail properties and several urban mixed-use properties. The Company has been actively selling its non-retail assets and investments. As of December 31, 2012, these investments had a book value of $398.4 million, which represents 3 less than 3.5% of the Company’s total assets, before depreciation. In addition, the Company has an active capital recycling program of selling retail assets deemed non-strategic. The Company also has an institutional management business with domestic and foreign institutional partners for the purpose of investing in neighborhood and community shopping centers. The Company's investment objective is to increase cash flow, current income and, consequently, the value of its existing portfolio of properties and to seek continued growth through (i) the retail re-tenanting, renovation and expansion of its existing centers and (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 in geographic regions in which the Company presently operates. The Company may 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 are typically anchored by a discount department store, a supermarket or a 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/or other indebtedness. Financing or other indebtedness may be incurred simultaneously or subsequently in connection with such investments. Any such financing or indebtedness would 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. 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. As of December 31, 2012, no single neighborhood and community shopping center accounted for more than 1.7% of the Company's annualized base rental revenues, including the proportionate share of base rental revenues from properties in which the Company has less than a 100% economic interest, or more than 1.2% of the Company’s total shopping center GLA. At December 31, 2012, the Company’s five largest tenants were The Home Depot, TJX Companies, Wal-Mart, Sears Holdings and Bed Bath & Beyond, which represented 3.0%, 2.9%, 2.6%, 2.0% and 1.7%, respectively, of the Company’s annualized base rental revenues, including the proportionate share of base rental revenues from properties in which the Company has less than a 100% economic interest. 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 regional and local commercial developers, real estate companies, financial institutions and other investors who compete with the Company for the acquisition of properties and other investment opportunities and in seeking tenants who will lease space in the Company’s properties. Item 1A. Risk Factors We are subject to certain business and legal risks including, but not limited to, the following: Loss of our tax status as a real estate investment trust could have significant adverse consequences to us and the value of our securities. We have elected to be taxed as a REIT for federal income tax purposes under the Code. We believe that we have operated so as to qualify as a REIT under the Code and that our current organization and method of operation comply with the rules and regulations promulgated under the Code to enable us to continue to qualify as a REIT. However, there can be no assurance that we have qualified or will continue to qualify as a REIT for federal income tax purposes. Qualification as a REIT involves the application of highly technical and complex Code provisions, for which there are only limited judicial and administrative interpretations. The determination of various factual matters and circumstances not entirely within our control may affect our ability to qualify as a REIT. New legislation, regulations, administrative interpretations or court decisions could significantly change the tax laws with respect to qualification as a REIT, the federal income tax consequences of such qualification or the desirability of an investment in a REIT relative to other investments. In order to qualify as a REIT, we must satisfy a number of requirements, including requirements regarding the composition of our assets and a requirement that at least 95% of our gross income in any year be derived from qualifying sources, such as “rents from real property.” Also, we must make distributions to stockholders aggregating annually at least 90% of our REIT taxable income, excluding net capital gains. Furthermore, we own a direct or indirect interest in certain subsidiary REITs which elected to be taxed as REITs for federal income tax purposes under the Code. Provided that each subsidiary REIT qualifies as a REIT, our interest in such subsidiary REIT will be treated as a qualifying real estate asset for purposes of the REIT asset tests. To qualify as a REIT, the subsidiary REIT must independently satisfy all of the REIT qualification requirements. The failure of a subsidiary REIT to qualify as a REIT could have an adverse effect on our ability to comply with the REIT income and asset tests, and thus our ability to qualify as a REIT. 4 If we lose our REIT status, we will face serious tax consequences that will substantially reduce the funds available to pay dividends to stockholders for each of the years involved because:  we would not be allowed a deduction for distributions to stockholders in computing our taxable income and we would be subject to federal income tax at regular corporate rates;  we could be subject to the federal alternative minimum tax and possibly increased state and local taxes;  unless we were entitled to relief under statutory provisions, we could not elect to be subject to tax as a REIT for four taxable years following the year during which we were disqualified; and  we would not be required to make distributions to stockholders. As a result of all these factors, our failure to qualify as a REIT could also impair our ability to expand our business or raise capital and materially adversely affect the value of our securities. To maintain our REIT status, we may be forced to borrow funds on a short-term basis during unfavorable market conditions. To qualify as a REIT, we generally must distribute to our stockholders at least 90% of our REIT taxable income each year, excluding capital gains, and we will be subject to regular corporate income taxes to the extent that we distribute less than 100% of our net taxable income each year. In addition, we will be subject to a 4% nondeductible excise tax on the amount, if any, by which distributions paid by us in any calendar year are less than the sum of 85% of our ordinary income, 95% of our capital gain net income and 100% of our undistributed income from prior years. While we have historically satisfied these distribution requirements by making cash distributions to our stockholders, a REIT is permitted to satisfy these requirements by making distributions of cash or other property, including, in limited circumstances, its own stock. Assuming we continue to satisfy these distributions requirements with cash, we may need to borrow funds to meet the REIT distribution requirements even if the then prevailing market conditions are not favorable for these borrowings. These borrowing needs could result from differences in timing between the actual receipt of cash and inclusion of income for federal income tax purposes, or the effect of non-deductible capital expenditures, the creation of reserves or required debt or amortization payments. Adverse global market and economic conditions may impede our ability to generate sufficient income and maintain our properties. The economic performance and value of our properties is subject to all of the risks associated with owning and operating real estate, including:              changes in the national, regional and local economic climate; local conditions, including an oversupply of, or a reduction in demand for, space in properties like those that we own; trends toward smaller store sizes as retailers reduce inventory and new prototypes; increasing use by customers of e-commerce and online store sites; the attractiveness of our properties to tenants; the ability of tenants to pay rent, particularly anchor tenants with leases in multiple locations; tenants who may declare bankruptcy and/or close stores; competition from other available properties to attract and retain tenants; changes in market rental rates; the need to periodically pay for costs to repair, renovate and re-let space; changes in operating costs, including costs for maintenance, insurance and real estate taxes; the fact that the expenses of owning and operating properties are not necessarily reduced when circumstances such as market factors and competition cause a reduction in income from the properties; and changes in laws and governmental regulations, including those governing usage, zoning, the environment and taxes. Competition may limit our ability to purchase new properties or generate sufficient income from tenants and may decrease the occupancy and rental rates for our properties. Our properties consist primarily of community and neighborhood shopping centers and other retail properties. Our performance therefore, is generally linked to economic conditions in the market for retail space. In the future, the market for retail space could be adversely affected by:  weakness in the national, regional and local economies;  the adverse financial condition of some large retailing companies; 5 the impact of internet sales on the demand for retail space;   ongoing consolidation in the retail sector; and  the excess amount of retail space in a number of markets. In addition, numerous commercial developers and real estate companies compete with us in seeking tenants for our existing properties and properties for acquisition. New regional malls, open-air lifestyle centers, or other retail shopping centers with more convenient locations or better rents may attract tenants or cause them to seek more favorable lease terms at or prior to renewal. Retailers at our properties may face increasing competition from other retailers, e-commerce, outlet malls, discount shopping clubs, catalog companies, direct mail, telemarketing or home shopping networks, all of which could (i) reduce rents payable to us; (ii) reduce our ability to attract and retain tenants at our properties; or (iii) lead to increased vacancy rates at our properties. We may fail to anticipate the effects of changes in consumer buying practices, particularly of growing online sales and the resulting retailing practices and space needs of our tenants or a general downturn in our tenants’ businesses, which may cause tenants to close stores or default in payment of rent. Our performance depends on our ability to collect rent from tenants, our tenants’ financial condition and our tenants maintaining leases for our properties. At any time our tenants, particularly small local stores, may experience a downturn in their business that may significantly weaken their financial condition. As a result, our tenants may delay a number of lease commencements, decline to extend or renew leases upon expiration, fail to make rental payments when due, close stores or declare bankruptcy. Any of these actions could result in the termination of tenants’ leases and the loss of rental income attributable to these tenants’ leases. In the event of a default by a tenant, we may experience delays and costs in enforcing our rights as landlord under the terms of the leases. In addition, multiple lease terminations by tenants or a failure by multiple tenants to occupy their premises in a shopping center could result in lease terminations or significant reductions in rent by other tenants in the same shopping centers under the terms of some leases. In that event, we may be unable to re-lease the vacated space at attractive rents or at all, and our rental payments from our continuing tenants could significantly decrease. The occurrence of any of the situations described above, particularly if it involves a substantial tenant with leases in multiple locations, could have a material adverse effect on our financial condition, results of operations and cash flows. A tenant that files for bankruptcy protection may not continue to pay us rent. A bankruptcy filing by, or relating to, one of our tenants or a lease guarantor would bar all efforts by us to collect pre-bankruptcy debts from the tenant or the lease guarantor, or their property, unless the bankruptcy court permits us to do so. A tenant or lease guarantor bankruptcy could delay our efforts to collect past due balances under the relevant leases and could ultimately preclude collection of these sums. If a lease is rejected by a tenant in bankruptcy, we would have only a general unsecured claim for damages. As a result, it is likely that we would recover substantially less than the full value of any unsecured claims we hold, if at all. We may be unable to sell our real estate property investments when appropriate or on terms favorable to us. Real estate property investments are illiquid and generally cannot be disposed of quickly. In addition, the federal tax code restricts a REIT’s ability to dispose of properties that are not applicable to other types of real estate companies. Therefore, we may not be able to vary our portfolio in response to economic or other conditions promptly or on terms favorable to us within a time frame that we would need. We may acquire or develop properties or acquire other real estate related companies and this may create risks. We may acquire or develop properties or acquire other real estate related companies when we believe that an acquisition or development is consistent with our business strategies. We may not succeed in consummating desired acquisitions or in completing developments on time or within budget. When we do pursue a project or acquisition, we may not succeed in leasing newly developed or acquired properties at rents sufficient to cover the costs of acquisition or development and operations. Difficulties in integrating acquisitions may prove costly or time-consuming and could divert management’s attention from other activities. Acquisitions or developments in new markets or industries where we do not have the same level of market knowledge may result in poorer than anticipated performance. We may also abandon acquisition or development opportunities that management has begun pursuing and consequently fail to recover expenses already incurred and will have devoted management’s time to a matter not consummated. Furthermore, our acquisitions of new properties or companies will expose us to the liabilities of those properties or companies, some of which we may not be aware of at the time of the acquisition. In addition, development of our existing properties presents similar risks. Newly acquired or re-developed properties may have characteristics or deficiencies currently unknown to us that affect their value or revenue potential. It is also possible that the operating performance of these properties may decline under our management. As we acquire additional properties, we will be subject to risks associated with managing new properties, including lease-up and tenant retention. In addition, our ability to manage our growth effectively will require us to successfully integrate our new acquisitions into our existing management structure. We may not succeed with this integration or effectively manage additional properties, particularly in secondary markets. Also, newly acquired properties may not perform as expected. 6 We face competition in pursuing acquisition or development opportunities that could increase our costs. We face competition in the acquisition, development, operation and sale of real property from others engaged in real estate investment that could increase our costs associated with purchasing and maintaining assets. Some of these competitors may have greater financial resources than we do. This could result in competition for the acquisition of properties for tenants who lease or consider leasing space in our existing and subsequently acquired properties and for other real estate investment opportunities. We do not have exclusive control over our joint venture and preferred equity investments, such that we are unable to ensure that our objectives will be pursued. We have invested in some properties as a co-venturer or partner, instead of owning directly. In these investments, we do not have exclusive control over the development, financing, leasing, management and other aspects of these investments. As a result, the co- venturer or partner might have interests or goals that are inconsistent with ours, take action contrary to our interests or otherwise impede our objectives. These investments involve risks and uncertainties. The co-venturer or partner may fail to provide capital or fulfill its obligations, which may result in certain liabilities to us for guarantees and other commitments, conflicts arising between us and our partners and the difficulty of managing and resolving such conflicts, and the difficulty of managing or otherwise monitoring such business arrangements. The co-venturer or partner also might become insolvent or bankrupt, which may result in significant losses to us. Although our joint venture arrangements may allow us to share risks with our joint-venture partners, these arrangements may also decrease our ability to manage risk. Joint ventures implicate additional risks, such as:  potentially inferior financial capacity, diverging business goals and strategies and the need for our venture partner’s continued cooperation;  our inability to take actions with respect to the joint venture activities that we believe are favorable to us if our joint venture partner does not agree;  our inability to control the legal entity that has title to the real estate associated with the joint venture;  our lenders may not be easily able to sell our joint venture assets and investments or may view them less favorably as collateral, which could negatively affect our liquidity and capital resources;  our joint venture partners can take actions that we may not be able to anticipate or prevent, which could result in negative impacts on our debt and equity; and  our joint venture partners’ business decisions or other actions or omissions may result in harm to our reputation or adversely affect the value of our investments. Our joint venture and preferred equity investments generally own real estate properties for which the economic performance and value is subject to all the risks associated with owning and operating real estate as described above. We intend to sell many of our non-retail and non-strategic assets over the next several years and may not be able to recover our investments, which may result in significant losses to us. There can be no assurance that we will be able to recover the current carrying amount of all of our non-retail and/or non-strategic properties and investments and those of our unconsolidated joint ventures in the future. Our failure to do so would require us to recognize impairment charges for the period in which we reached that conclusion, which could materially and adversely affect our business, financial condition, operating results and cash flows. We have significant international operations, which may be affected by economic, political and other risks associated with international operations, and this could adversely affect our business. The risks we face in international business operations include, but are not limited to: currency risks, including currency fluctuations; unexpected changes in legislative and regulatory requirements; potential adverse tax burdens; burdens of complying with different accounting and permitting standards, labor laws and a wide variety of foreign laws;      obstacles to the repatriation of earnings and cash;  regional, national and local political uncertainty;  economic slowdown and/or downturn in foreign markets;  difficulties in staffing and managing international operations;  difficulty in administering and enforcing corporate policies, which may be different than the normal business practices of local cultures; and reduced protection for intellectual property in some countries.  7 Each of these risks might impact our cash flow or impair our ability to borrow funds, which ultimately could adversely affect our business, financial condition, operating results and cash flows. In order to fully develop our international operations, we must overcome cultural and language barriers and assimilate different business practices. In addition, we are required to create compensation programs, employment policies and other administrative programs that comply with laws of multiple countries. We also must communicate and monitor standards and directives in our international locations. Our failure to successfully manage our geographically diverse operations could impair our ability to react quickly to changing business and market conditions and to enforce compliance with standards and procedures. Since a meaningful portion of our revenues are generated internationally, we must devote substantial resources to managing our international operations. Our future success will be influenced by our ability to anticipate and effectively manage these and other risks associated with our international operations. Any of these factors could, however, materially adversely affect our international operations and, consequently, our financial condition, results of operations and cash flows. We cannot predict the impact of laws and regulations affecting our international operations nor the potential that we may face regulatory sanctions. Our international operations include properties in Canada, Mexico, Chile, Brazil and Peru and are subject to a variety of United States and foreign laws and regulations, including the United States Foreign Corrupt Practices Act (“FCPA”). We have policies and procedures designed to promote compliance with the FCPA and other anti-corruption laws, but we cannot assure you that we will continue to be found to be operating in compliance with, or be able to detect violations of, any such laws or regulations. In addition, we cannot predict the nature, scope or effect of future regulatory requirements to which our international operations might be subject, the manner in which existing laws might be administered or interpreted, or the potential that we may face regulatory sanctions. We cannot assure you that our employees will adhere to our Code of Conduct or any other of our policies, applicable anti- corruption laws, including the FCPA, or other legal requirements. Failure to comply or violations of any applicable policies, anti-corruption laws, or other legal requirements may subject us to legal, regulatory or other sanctions, including criminal and civil penalties and other remedial measures. We have received a subpoena from the Enforcement Division of the SEC in connection with the SEC’s investigation, In the Matter of Wal-Mart Stores, Inc. (FW-3678), that the SEC Staff is currently conducting with respect to possible violations of the FCPA. See “Item 3. Legal Proceedings,” below. The U.S. Department of Justice and the SEC have a broad range of civil and criminal sanctions under the FCPA and other laws and regulations, which they may seek to impose against corporations and individuals in appropriate circumstances including, but not limited to, injunctive relief, disgorgement, fines, penalties and modifications to business practices and compliance programs. Any of these remedial measures, if applicable to us, could have a material adverse impact on our business, results of operations, financial condition and liquidity. We face risks relating to cybersecurity attacks, loss of confidential information and other business disruptions. Our business is at risk from and may be impacted by cybersecurity attacks, including attempts to gain unauthorized access to our confidential data and other electronic security breaches. Such cyber attacks can range from individual attempts to gain unauthorized access to our information technology systems to more sophisticated security threats. While we employ a number of measures to prevent, detect and mitigate these threats including password protection, backup servers and annual penetration testing, there is no guarantee such efforts will be successful in preventing a cyber attack. Cybersecurity incidents could compromise the confidential information of our tenants, employees and third party vendors and disrupt and effect the efficiency of our business operations. We may be unable to obtain financing through the debt and equities market, which would have a material adverse effect on our growth strategy, our results of operations and our financial condition. We cannot assure you that we will be able to access the capital and credit markets to obtain additional debt or equity financing or that we will be able to obtain financing on terms favorable to us. The inability to obtain financing on a timely basis could have negative effects on our business, such as:  we could have great difficulty acquiring or developing properties, which would materially adversely affect our business strategy;  our liquidity could be adversely affected;  we may be unable to repay or refinance our indebtedness;  we may need to make higher interest and principal payments or sell some of our assets on terms unfavorable to us to fund our indebtedness; or  we may need to issue additional capital stock, which could further dilute the ownership of our existing shareholders. Adverse changes in our credit ratings could impair our ability to obtain additional debt and equity financing on terms favorable to us, if at all, and could significantly reduce the market price of our publicly traded securities. 8 We are subject to financial covenants that may restrict our operating and acquisition activities. Our revolving credit facility and the indentures under which our senior unsecured debt is issued contain certain financial and operating covenants, including, among other things, certain coverage ratios and limitations on our ability to incur debt, make dividend payments, sell all or substantially all of our assets and engage in mergers and consolidations and certain acquisitions. These covenants may restrict our ability to pursue certain business initiatives or certain acquisition transactions that might otherwise be advantageous. In addition, failure to meet any of the financial covenants could cause an event of default under our revolving credit facility and the indentures and/or accelerate some or all of our indebtedness, which would have a material adverse effect on us. Changes in market conditions could adversely affect the market price of our publicly traded securities. As with other publicly traded securities, the market price of our publicly traded securities depends on various market conditions, which may change from time-to-time. Among the market conditions that may affect the market price of our publicly traded securities are the following:    the extent of institutional investor interest in us; the reputation of REITs generally and the reputation of REITs with portfolios similar to ours; the attractiveness of the securities of REITs in comparison to securities issued by other entities, including securities issued by other real estate companies;  our financial condition and performance;    the market’s perception of our growth potential and potential future cash dividends; an increase in market interest rates, which may lead prospective investors to demand a higher distribution rate in relation to the price paid for our shares; and general economic and financial market conditions. We may change the dividend policy for our common stock in the future. The decision to declare and pay dividends on our common stock in the future, as well as the timing, amount and composition of any such future dividends, will be at the sole discretion of our Board of Directors and will depend on our earnings, operating cash flows, liquidity, financial condition, capital requirements, contractual prohibitions or other limitations under our indebtedness including preferred stock, the annual distribution requirements under the REIT provisions of the Code, state law and such other factors as our Board of Directors deems relevant or are requirements under the Code or state or federal laws. Any change in our dividend policy could have a material adverse effect on the market price of our common stock. We may not be able to recover our investments in marketable securities or mortgage receivables, which may result in significant losses to us. Our investments in marketable securities are subject to specific risks relating to the particular issuer of the securities, including the financial condition and business outlook of the issuer, which may result in significant losses to us. Marketable securities are generally unsecured and may also be subordinated to other obligations of the issuer. As a result, investments in marketable securities are subject to risks of:      limited liquidity in the secondary trading market; substantial market price volatility, resulting from changes in prevailing interest rates; subordination to the prior claims of banks and other senior lenders to the issuer; the possibility that earnings of the issuer may be insufficient to meet its debt service and distribution obligations; and the declining creditworthiness and potential for insolvency of the issuer during periods of rising interest rates and economic downturn. These risks may adversely affect the value of outstanding marketable securities and the ability of the issuers to make distribution payments. In the event of a default by a borrower, it may be necessary for us to foreclose our mortgage or engage in costly negotiations. Delays in liquidating defaulted mortgage loans and repossessing and selling the underlying properties could reduce our investment returns. Furthermore, in the event of default, the actual value of the property securing the mortgage may decrease. A decline in real estate values will adversely affect the value of our loans and the value of the mortgages securing our loans. 9 Our mortgage receivables may be or become subordinated to mechanics' or materialmen's liens or property tax liens. In these instances we may need to protect a particular investment by making payments to maintain the current status of a prior lien or discharge it entirely. In these cases, the total amount we recover may be less than our total investment, resulting in a loss. In the event of a major loan default or several loan defaults resulting in losses, our investments in mortgage receivables would be materially and adversely affected. We may be subject to liability under environmental laws, ordinances and regulations. Under various federal, state, and local laws, ordinances and regulations, we may be considered an owner or operator of real property and may be responsible for paying for the disposal or treatment of hazardous or toxic substances released on or in our property, as well as certain other potential costs relating to hazardous or toxic substances (including governmental fines and injuries to persons and property). This liability may be imposed whether or not we knew about, or were responsible for, the presence of hazardous or toxic substances. Item 1B. Unresolved Staff Comments None Item 2. Properties Real Estate Portfolio. As of December 31, 2012, the Company had interests in 896 shopping center properties (the “Combined Shopping Center Portfolio”) aggregating 131.3 million square feet of gross leasable area (“GLA”) and 829 other property interests, primarily through the Company’s preferred equity investments, other real estate investments and non-retail properties, totaling 26.6 million square feet of GLA, for a grand total of 1,725 properties aggregating 157.9 million square feet of GLA, located in 44 states, Puerto Rico, Canada, Mexico and South America. The Company’s portfolio includes noncontrolling interests. Neighborhood and community shopping centers comprise the primary focus of the Company's current portfolio. As of December 31, 2012, the Company’s Combined Shopping Center Portfolio was 94.0% leased. The Company's neighborhood and community shopping center properties, which are generally owned and operated through subsidiaries or joint ventures, had an average size of 138,518 square feet as of December 31, 2012. The Company generally 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. This includes renovating existing facades, installing uniform signage, resurfacing parking lots and enhancing parking lot lighting. During 2012, the Company capitalized $7.8 million in connection with these property improvements and expensed to operations $25.4 million. 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. 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. Some of the major national and regional companies that are tenants in the Company's shopping center properties include The Home Depot, TJX Companies, Wal-Mart, Sears Holdings, Bed Bath & Beyond, Royal Ahold, Kohl’s, Best Buy, Petsmart 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 many 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. Minimum base rental revenues and operating expense reimbursements accounted for 97% and other revenues, including percentage rents, accounted for 3% of the Company's total revenues from rental property for the year ended December 31, 2012. The Company's management believes that the base rent per leased 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. 10 Approximately 15.4% of the Company's leases of consolidated properties also contain provisions requiring the payment of additional rent calculated as a percentage of tenants’ gross sales above predetermined thresholds. Percentage rents accounted for less than 1% of the Company's revenues from rental property for the year ended December 31, 2012. Additionally, a majority of the Company’s leases have provisions requiring contractual rent increases. The Company’s leases may also include escalation clauses, which provide for increases based upon changes in the consumer price index or similar inflation indices. As of December 31, 2012, the Company’s consolidated operating portfolio was 93.4% leased and was comprised of 58.9 million square feet of GLA, of which 55.1 million related to properties held in the U.S. and 3.8 million related to properties located in Latin America. For the period January 1, 2012 to December 31, 2012, the Company increased the average base rent per leased square foot, which includes the impact of tenant concessions, in its U.S. consolidated portfolio of neighborhood and community shopping centers from $11.48 to $12.18, an increase of $0.70. This increase primarily consists of (i) a $0.16 increase relating to acquisitions, as well as development properties placed into service, (ii) a $0.24 increase relating to new leases signed net of leases vacated and rent step-ups within the portfolio and (iii) a $0.30 increase relating to dispositions or the transfer of properties to various joint venture entities. For the period January 1, 2012 to December 31, 2012, the Company’s average base rent per leased square foot in its Mexican consolidated portfolio of neighborhood and community shopping centers decreased from $9.66 to $9.22, a decrease of $0.44. This decrease is primarily due to higher vacancy levels at certain development sites placed into service, which were included in occupancy in 2012, and new leases signed net of leases vacated and renewals within the portfolio. The Company has a total of 5,027 leases in the U.S. consolidated operating portfolio, of which 682 leases, comprising 3.7 million square feet of GLA, are scheduled to expire within the next 12 months, assuming available extension options are not exercised. These expiring leases have an average base rent per square foot of $13.99. The average rent per square foot on new U.S. leases signed during 2012 was $16.41. The Company will seek to obtain rents that are higher than these expiring leases, however, there are many variables and uncertainties which can significantly affect the leasing market at any time; as such, the Company cannot guarantee that future leases will continue to be signed for rents that are equal to or higher than current amounts. Ground-Leased Properties. The Company has interests in 47 consolidated shopping center properties and interests in 20 shopping center properties in unconsolidated joint ventures 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 landowner. More specific information with respect to each of the Company's property interests is set forth in Exhibit 99.1, which is incorporated herein by reference. 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 taken as a whole, or which is not covered by the Company's liability insurance. On January 28, 2013, the Company received a subpoena from the Enforcement Division of the SEC in connection with an investigation, In the Matter of Wal-Mart Stores, Inc. (FW-3678), that the SEC Staff is currently conducting with respect to possible violations of the Foreign Corrupt Practices Act. The Company is responding to the subpoena and intends to cooperate fully with the SEC in this matter. The Company has also been notified that the U.S. Department of Justice (“DOJ”) is conducting a parallel investigation, and the Company expects that it will cooperate with the DOJ investigation. At this point, we are unable to predict the duration, scope or result of the SEC or DOJ investigation. Item 4. Mine Safety Disclosures Not applicable PART II Item 5. Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information There were no common stock offerings completed by the Company during the three-year period ended December 31, 2012. 11 The table below sets forth, for the quarterly periods indicated, the high and low sales prices per share reported on the NYSE Composite Tape and declared dividends per share for the Company’s common stock. The Company’s common stock is traded on the NYSE under the trading symbol "KIM". Period High Low Dividends Stock Price 2011: First Quarter ........................................................................................... $ Second Quarter .................................................................................... $ Third Quarter ......................................................................................... $ Fourth Quarter ...................................................................................... $ 2012: First Quarter ........................................................................................... $ Second Quarter .................................................................................... $ Third Quarter ......................................................................................... $ Fourth Quarter ...................................................................................... $ 19.50 $ 19.80 $ 20.31 $ 17.93 $ 19.90 $ 19.96 $ 21.16 $ 20.95 $ 16.98 $ 17.01 $ 14.54 $ 13.55 $ 16.21 $ 17.16 $ 18.62 $ 18.11 $ 0.18 0.18 0.18 0.19(a) 0.19 0.19 0.19 0.21(b) (a) Paid on January 17, 2012, to stockholders of record on January 4, 2012. (b) Paid on January 15, 2013, to stockholders of record on January 2, 2013. Holders The number of holders of record of the Company's common stock, par value $0.01 per share, was 2,815 as of January 31, 2013. Dividends Since the IPO, the Company has paid regular quarterly cash dividends to its stockholders. While the Company intends to continue paying regular quarterly cash dividends, future dividend declarations will be paid at the discretion of the Board of Directors and will depend on the actual cash flows 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 Company’s Board of Directors will continue to evaluate the Company’s dividend policy on a quarterly basis as they monitor sources of capital and evaluate the impact of the economy on operating fundamentals. The Company is required by the Code to distribute at least 90% of its REIT taxable income. 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, the ability to refinance near-term debt maturities and any unanticipated capital expenditures. The Company has determined that the $0.76 dividend per common share paid during 2012 represented 72% ordinary income, a 23% return of capital and 5% capital gain to its stockholders. The $0.72 dividend per common share paid during 2011 represented 71% ordinary income and a 29% return of capital to its stockholders. 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 and construction loans, 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 other investments 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 Footnotes 13, 14 and 17 of the Notes to Consolidated Financial Statements included in this Form 10-K. The Company does not believe that the preferential rights available to the holders of its Class H Preferred Stock, Class I Preferred Stock, Class J Preferred Stock and Class K Preferred Stock, the financial covenants contained in its public bond indentures, as amended, or its revolving credit agreements will have an 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 and direct stock purchase plan (the "Plan") pursuant to which common and preferred stockholders and other interested investors may elect to automatically reinvest their dividends to purchase shares of the Company’s common stock or, through optional cash payments, purchase shares of the Company’s common stock. The Company may, from time-to-time, either (i) purchase 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 the Plan. Issuer Purchases of Equity Securities During the year ended December 31, 2012, the Company repurchased 1,635,823 shares in open-market transactions to offset new issuances of common shares in connection with the exercise of stock options. The Company expended $30.9 million to repurchase these shares, of which $22.6 million was provided to the Company from stock options exercised. 12 Period January 1, 2012 –-January 31, 2012 ................................. February 1, 2012 – February 29, 2012 .......................... March 1, 2012 – March 31, 2012 ..................................... April 1, 2012 – April 30, 2012 ........................................... May 1, 2012 - May 31, 2012 ............................................... June 1, 2012 - June 30, 2012 ............................................... July 1, 2012 - July 31, 2012 ................................................... August 1, 2012 - August 31, 2012 ................................... September 1, 2012 - December 31, 2012 .................. Total .................................................................................................. Total Number of Shares Purchased Average Price Paid per Share ($) 20,233 358,908 1,005,934 41,138 61,211 48,327 - 100,072 - 1,635,823 18.20 18.56 18.91 19.23 19.20 18.44 - 19.84 - 18.92 Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (in millions) - - - - - - - - - - $ - - - - - - - - - - Total Stockholder Return Performance The following performance chart compares, over the five years ended December 31, 2012, the cumulative total stockholder return on the Company’s common stock with the cumulative total return of the S&P 500 Index and the cumulative total return of the NAREIT Equity REIT Total Return Index (the "NAREIT Equity Index") prepared and published by the National Association of Real Estate Investment Trusts ("NAREIT"). Equity real estate investment trusts are defined as those which derive more than 75% of their income from equity investments in real estate assets. The NAREIT Equity Index includes all tax qualified equity real estate investment trusts listed on the New York Stock Exchange, American Stock Exchange or the NASDAQ National Market System. Stockholder return performance, presented quarterly for the five years ended December 31, 2012, is not necessarily indicative of future results. All stockholder return performance assumes the reinvestment of dividends. The information in this paragraph and the following performance chart are deemed to be furnished, not filed. 13 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 and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in this 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. 2012 Year ended December 31, (2) 2010 (in thousands, except per share information) 2009 2011 Operating Data: Revenues from rental property (1) ........................................... $ Interest expense (3) .......................................................................... $ Early extinguishment of debt charges....................................... $ Depreciation and amortization (3) ............................................ $ Gain on sale of development properties ............................... $ Total net gain on transfer or sale of operating properties (3) ................................................................................. $ Benefit for income taxes (4) ......................................................... $ Provision for income taxes (5) .................................................... $ Impairment charges (6) .................................................................... $ Income from continuing operations (7) .................................. $ Income/(loss) per common share, from continuing operations: 884,782 227,595 - 249,493 - $ $ $ $ $ 4,299 $ $ - $ 8,116 $ 37,111 $ 203,806 825,737 223,526 - 231,712 12,074 $ $ $ $ $ 108 $ $ - $ 21,330 $ 13,077 $ 147,430 786,940 $ 223,032 $ 10,811 $ 217,205 $ 2,080 $ 2,377 $ - $ 3,208 $ 32,661 $ 109,004 $ 703,348 205,490 - 209,055 5,751 $ $ $ $ $ 3,867 $ $ 16,400 $ - 135,688 $ (12,151) $ 2008 679,966 209,189 - 187,762 36,565 1,782 9,550 - 147,529 194,237 Basic ............................................................................................ $ Diluted ...................................................................................... $ 0.27 0.27 $ $ 0.22 0.21 $ $ 0.14 $ 0.14 $ (0.17) $ (0.17) $ 0.57 0.57 Weighted average number of shares of common stock: Basic ............................................................................................. Diluted ....................................................................................... Cash dividends declared per common share ....................... $ 405,997 406,689 0.78 $ 406,530 407,669 0.73 $ 405,827 406,201 0.66 $ 350,077 350,077 0.72 $ 257,811 258,843 1.68 2012 2011 December 31, 2010 (in thousands) 2009 2008 Balance Sheet Data: $ Real estate, before accumulated depreciation .................... $ 8,947,287 $ Total assets ............................................................................................. $ 9,740,807 $ Total debt ................................................................................................ $ 4,195,317 $ Total stockholders' equity .............................................................. $ 4,765,160 479,054 Cash flow provided by operations ............................................ $ $ (51,000) $ Cash flow (used for)/provided by investing activities ...... $ (399,061) $ Cash flow (used for)/provided by financing activities ...... $ $ 7,818,916 $ 8,592,760 $ 8,882,341 8,771,257 $ 9,397,147 $ 9,833,875 $ 10,183,079 9,628,762 $ 4,556,646 $ 4,058,987 $ 4,434,383 4,114,385 $ 3,983,698 $ 4,935,842 $ 4,852,973 4,686,386 567,599 403,582 448,613 $ $ (781,350) (343,236) $ (20,760) $ 262,429 (74,465) $ (440,125) $ 479,935 $ 37,904 $ (514,743) $ (1) Does not include (i) revenues from rental property relating to unconsolidated joint ventures, (ii) revenues relating to the investment in retail store leases and (iii) revenues from properties included in discontinued operations. (2) All years have been adjusted to reflect the impact of operating properties sold during the years ended December 31, 2012, 2011, 2010, 2009 and 2008 and properties classified as held for sale as of December 31, 2012, which are reflected in discontinued operations in the Consolidated Statements of Income. (3) Does not include amounts reflected in discontinued operations. (4) Does not include amounts reflected in discontinued operations and extraordinary gain. Amounts include income taxes related to gain on transfer/sale of operating properties. (5) Does not include amounts reflected in discontinued operations. Amounts include income taxes related to gain on transfer/sale of operating properties. (6) Amounts exclude noncontrolling interests and amounts reflected in discontinued operations. (7) Amounts include gain on transfer/sale of operating properties, net of tax and net income attributable to noncontrolling interests. 14 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 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. Executive Summary Kimco Realty Corporation is one of the nation’s largest publicly-traded owners and operators of neighborhood and community shopping centers. As of December 31, 2012, the Company had interests in 896 shopping center properties (the “Combined Shopping Center Portfolio”), aggregating 131.3 million square feet of gross leasable area (“GLA”) and 829 other property interests, primarily through the Company’s preferred equity investments, other real estate investments and non-retail properties, totaling 26.6 million square feet of GLA, for a grand total of 1,725 properties aggregating 157.9 million square feet of GLA, located in 44 states, Puerto Rico, Canada, Mexico, Chile, Brazil and Peru. The executive officers are engaged in the day-to-day management and operation of real estate exclusively with the Company, with nearly all operating functions, including leasing, asset management, maintenance, construction, legal, finance and accounting, administered by the Company. The Company’s vision is to be the premier owner and operator of shopping centers with its core business operations focusing on owning and operating neighborhood and community shopping centers through investments in North America. This vision has entailed a shift away from non-retail assets that the Company currently holds. These investments include non-retail preferred equity investments, marketable securities, mortgages on non-retail properties and several urban mixed-use properties. The Company has been actively selling its non-retail assets and investments. As of December 31, 2012, these investments had a book value of $398.4 million, which represents less than 3.5% of the Company’s total assets, before depreciation. In addition, the Company has an active capital recycling program of selling retail assets deemed non-strategic. If the Company accepts sales prices for these non-retail and/or non-strategic assets that are less than their net carrying values, the Company would be required to take impairment charges. In order to execute the Company’s vision, the Company’s strategy is to continue to strengthen its balance sheet by pursuing deleveraging efforts over time, providing it the necessary flexibility to invest opportunistically and selectively, primarily focusing on neighborhood and community shopping centers. In addition, the Company has an institutional management business with domestic and foreign institutional partners for the purpose of investing in neighborhood and community shopping centers. The following highlights the Company’s significant transactions, events and results that occurred during the year ended December 31, 2012: Portfolio Information:  Net income available to common shareholders increased by $63.0 million to $172.7 million for the year ended December 31, 2012, as compared to $109.7 million for the corresponding period in 2011.   Funds from operations (“FFO”) as adjusted increased from $1.20 for the year ended December 31, 2011 to $1.26 for the year ended December 31, 2012 (see additional disclosure on FFO beginning on page 31). Same Property net operating income (“NOI”) increased by $18.8 million or 2.3% for the year ended December 31, 2012, as compared to the corresponding period in 2011; excluding the negative impact of foreign currency fluctuation, this increase would have been $23.6 million or 2.9% (see additional disclosure on NOI beginning on page 32).  Occupancy rose from 93.3% at December 31, 2011 to 94.0% at December 31, 2012 in the Combined Shopping Center Portfolio.  Occupancy rose from 93.1% at December 31, 2011 to 93.9% at December 31, 2012 for the U.S. combined shopping center portfolio.  Recognized U.S. cash-basis leasing spreads of 9.8%; new leases increased 27.8% and renewals/options increased 4.5%.  Executed 2,678 leases, renewals and options totaling over 10.0 million square feet in the Combined Shopping Center Portfolio. Acquisition Activity:  Acquired 24 shopping center properties, five outparcels and 69 net leased parcels comprising an aggregate 3.1 million square feet of GLA, for an aggregate purchase price of $634.5 million including the assumption of $179.2 million of non-recourse mortgage debt encumbering seven of the properties. 15 Disposition Activity:  During 2012, the Company monetized non-retail assets of $83.0 million and reduced its non-retail book values by $114.1 million to $398.4 million.  Included in the monetization above are the disposition of four properties and one land parcel, in separate transactions, for an aggregate sales price of $40.3 million. These transactions resulted in an aggregate net gain of $4.8 million, before income taxes.  Also included in the monetization above is (i) the receipt of $24.8 million from payment of mortgage receivables, (ii) the Company’s receipt of $14.6 million in distributions from two preferred equity investments and one joint venture investment and (iii) $10.4 million in distributions from two cost method investments.  Additionally, during 2012, the Company disposed of 59 operating properties, four land parcels and four outparcels, in separate transactions, for an aggregate sales price of $443.0 million. These transactions resulted in an aggregate gain of $91.5 million and impairment charges of $22.5 million, before income taxes and noncontrolling interests. Capital Activity (for additional details see Liquidity and Capital Resources below):  During 2012, the Company issued 16,000,000 depositary shares of 6.00% Class I Cumulative Redeemable Preferred Stock, 9,000,000 depositary shares of 5.50% Class J Cumulative Redeemable Preferred Stock and 7,000,000 depositary shares of 5.625% Class K Cumulative Redeemable Preferred Stock resulting in aggregate proceeds after expenses of $774.1 million to the Company.  Additionally, during 2012, the Company redeemed all of its outstanding 18,400,000 depositary shares of the Company’s 7.75% Class G Cumulative Redeemable Preferred Stock and all of its outstanding 7,000,000 depositary shares of the Company’s 6.65% Class F Cumulative Redeemable Preferred Stock resulting in aggregate payments of $635.0 million.  Also during 2012, the Company (i) repaid the $17.0 million outstanding on its 5.98% medium-term notes, which matured in July 2012 and (ii) repaid the $198.9 million outstanding on its 6.00% senior unsecured note, which matured in November 2012.  The Company also obtained a new $400.0 million unsecured term loan with a consortium of banks, which accrues interest at LIBOR plus 105 basis points. The term loan is scheduled to mature in April 2014, with three additional one-year options to extend the maturity date, at the Company’s discretion, to April 17, 2017. Impairments:  Real estate market conditions, including capitalization rates, discount rates and vacancies had continued to improve throughout 2012; however, declines in certain real estate markets continued to have a negative effect on transactional activity as it related to dispositions of select real estate assets. This factor, in addition to the Company’s efforts to market certain assets and management’s assessment as to the likelihood and timing of such potential transactions caused the Company to recognize impairment charges of $59.6 million (including $22.5 million which is classified within discontinued operations), before income tax benefit and noncontrolling interests. Potential future adverse market and economic conditions could cause the Company to recognize additional impairments in the future (see Footnote 2 of the Notes to Consolidated Financial Statements included in this annual report on Form 10-K).  In addition to the impairment charges above, various unconsolidated joint ventures in which the Company holds noncontrolling interests recognized impairment charges relating to certain properties during 2012. The Company’s share of these charges was $11.1 million, before income taxes (see Footnotes 2 and 8 of the Notes to Consolidated Financial Statements included in this annual report on Form 10-K). Critical Accounting Policies The Consolidated Financial Statements of the Company include the accounts of the Company, its wholly-owned subsidiaries and all entities in which the Company has a controlling interest, including where the Company has been determined to be a primary beneficiary of a variable interest entity in accordance with the consolidation guidance of the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”). The Company applies these provisions to each of its joint venture investments to determine whether the cost, equity or consolidation method of accounting is appropriate. The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions in certain circumstances that affect amounts reported in the accompanying Consolidated Financial Statements and related notes. In preparing these financial statements, management has made its best estimates and assumptions that affect the reported amounts of assets and liabilities. These estimates are based on, but not limited to, historical results, industry standards and current economic conditions, giving due consideration to materiality. The most significant assumptions and estimates relate to revenue recognition and the recoverability of trade accounts receivable, depreciable lives, valuation of real estate and intangible assets and liabilities, valuation of joint venture investments and other investments, realizability of deferred tax assets and uncertain tax positions. Application of these assumptions requires the exercise of judgment as to future uncertainties, and, as a result, actual results could materially differ from these estimates. 16 The Company is required to make subjective assessments as to whether there are impairments in the value of its real estate properties, investments in joint ventures, marketable securities and other investments. The Company’s reported net earnings are directly affected by management’s estimate of impairments and/or valuation allowances. Revenue Recognition and Accounts Receivable Base rental revenues from rental property are recognized on a straight-line basis over the terms of the related leases. Certain of these leases also provide for percentage rents based upon the level of sales achieved by the lessee. These percentage rents are recorded once the required sales level is achieved. Operating expense reimbursements are recognized as earned. Rental income may also include payments received in connection with lease termination agreements. In addition, leases typically provide for reimbursement to the Company of common area maintenance, real estate taxes and other operating expenses. The Company makes estimates of the uncollectability of its accounts receivable related to base rents, straight-line rent, expense reimbursements and other revenues. The Company analyzes accounts receivable and historical bad debt levels, customer credit- worthiness and current economic trends when evaluating the adequacy of the allowance for doubtful accounts. In addition, tenants in bankruptcy are analyzed and estimates are made in connection with the expected recovery of pre-petition and post-petition claims. The Company’s reported net earnings are directly affected by management’s estimate of the collectability of accounts receivable. Real Estate The Company’s investments in real estate properties are stated at cost, less accumulated depreciation and amortization. Expenditures for maintenance and repairs are charged to operations as incurred. Significant renovations and replacements, which improve and extend the life of the asset, are capitalized. Upon acquisition of real estate operating properties, the Company estimates the fair value of acquired tangible assets (consisting of land, building, building improvements and tenant improvements) and identified intangible assets and liabilities (consisting of above and below-market leases, in-place leases and tenant relationships), assumed debt and redeemable units issued at the date of acquisition, based on evaluation of information and estimates available at that date. Based on these estimates, the Company allocates the estimated fair value to the applicable assets and liabilities. Fair value is determined based on an exit price approach, which contemplates the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. If, up to one year from the acquisition date, information regarding fair value of the assets acquired and liabilities assumed is received and estimates are refined, appropriate adjustments are made to the purchase price allocation on a retrospective basis. The Company expenses transaction costs associated with business combinations in the period incurred. Depreciation and amortization are provided on the straight-line method over the estimated useful lives of the assets, as follows: Buildings and building improvements 15 to 50 years Fixtures, leasehold and tenant improvements (including certain identified intangible assets) Terms of leases or useful lives, whichever is shorter The Company is required to make subjective assessments as to the useful lives of its properties for purposes of determining the amount of depreciation to reflect on an annual basis with respect to those properties. These assessments have a direct impact on the Company’s net earnings. On a continuous basis, management assesses whether there are any indicators, including property operating performance and general market conditions, that the value of the real estate properties (including any related amortizable intangible assets or liabilities) may be impaired. A property value is considered impaired only if management’s estimate of current and projected operating cash flows (undiscounted and unleveraged) of the property over its remaining useful life is less than the net carrying value of the property. Such cash flow projections consider factors such as expected future operating income, trends and prospects, as well as the effects of demand, competition and other factors. To the extent impairment has occurred, the carrying value of the property would be adjusted to reflect the estimated fair value of the property. When a real estate asset is identified by management as held-for-sale, the Company ceases depreciation of the asset and estimates the sales price of such asset net of selling costs. If, in management’s opinion, the net sales price of the asset is less than the net book value of such asset, an adjustment to the carrying value would be recorded to reflect the estimated fair value of the property. 17 Investments in Unconsolidated Joint Ventures The Company accounts for its investments in unconsolidated joint ventures under the equity method of accounting as the Company exercises significant influence, but does not control, these entities. These investments are recorded initially at cost and are subsequently adjusted for cash contributions and distributions. Earnings for each investment are recognized in accordance with each respective investment agreement and, where applicable, are based upon an allocation of the investment’s net assets at book value as if the investment was hypothetically liquidated at the end of each reporting period. The Company’s joint ventures and other real estate investments primarily consist of co-investments with institutional and other joint venture partners in neighborhood and community shopping center properties, consistent with its core business. These joint ventures typically obtain non-recourse third-party financing on their property investments, thus contractually limiting the Company’s exposure to losses to the amount of its equity investment, and, due to the lender’s exposure to losses, a lender typically will require a minimum level of equity in order to mitigate its risk. The Company’s exposure to losses associated with its unconsolidated joint ventures is primarily limited to its carrying value in these investments. The Company, on a limited selective basis, obtained unsecured financing for certain joint ventures. These unsecured financings are guaranteed by the Company with guarantees from the joint venture partners for their proportionate amounts of any guaranty payment the Company is obligated to make. On a continuous basis, management assesses whether there are any indicators, including property operating performance and general market conditions, that the value of the Company’s investments in unconsolidated joint ventures may be impaired. An investment’s value is impaired only if management’s estimate of the fair value of the investment is less than the carrying value of the investment and such difference is deemed to be other-than-temporary. To the extent impairment has occurred, the loss shall be measured as the excess of the carrying amount of the investment over the estimated fair value of the investment. The Company’s estimated fair values are based upon a discounted cash flow model for each specific property that includes all estimated cash inflows and outflows over a specified holding period and, where applicable, any estimated debt premiums. Capitalization rates, discount rates and credit spreads utilized in these models are based upon rates that the Company believes to be within a reasonable range of current market rates for each respective property. Realizability of Deferred Tax Assets and Uncertain Tax Positions The Company is subject to federal, state and local income taxes on the income from its activities relating to its TRS activities and subject to local taxes on certain non-U.S. investments. The Company accounts for income taxes using the asset and liability method, which requires that deferred tax assets and liabilities be recognized based on future tax consequences of temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply in the years in which temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in earnings in the period when the changes are enacted. A reduction of the carrying amounts of deferred tax assets by a valuation allowance is required, if based on the evidence available, it is more likely than not (a likelihood of more than 50 percent) that some portion or all of the deferred tax assets will not be realized. The valuation allowance should be sufficient to reduce the deferred tax asset to the amount that is more likely than not to be realized. The Company considers all available evidence, both positive and negative, to determine whether, based on the weight of that evidence, a valuation allowance is needed. Information about an enterprise's current financial position and its results of operations for the current and preceding years is supplemented by all currently available information about future years. The Company must use judgment in considering the relative impact of negative and positive evidence. The Company believes, when evaluating deferred tax assets within its taxable REIT subsidiaries, special consideration should be given to the unique relationship between the Company as a REIT and its taxable REIT subsidiaries. This relationship exists primarily to protect the REIT’s qualification under the Code by permitting, within certain limits, the REIT to engage in certain business activities in which the REIT cannot directly participate. As such, the REIT controls which and when investments are held in, or distributed or sold from, its taxable REIT subsidiaries. This relationship distinguishes a REIT and taxable REIT subsidiary from an enterprise that operates as a single, consolidated corporate taxpayer. The Company primarily utilizes a twenty year projection of pre-tax book income and taxable income as positive evidence to overcome any negative evidence. Although items of income and expense utilized in the projection are objectively verifiable there is also significant judgment used in determining the duration and timing of events that would impact the projection. Based upon the Company’s analysis of negative and positive evidence the Company will make a determination of the need for a valuation allowance against its deferred tax assets. If future income projections do not occur as forecasted, the Company will reevaluate the need for a valuation allowance. In addition, the Company can employ additional strategies to realize its deferred tax assets, including transferring a greater portion of its property management business to the TRS, sale of certain built-in gain assets, and reducing intercompany debt. 18 The Company recognizes and measures benefits for uncertain tax positions, which requires significant judgment from management. Although the Company believes it has adequately reserved for any uncertain tax positions, no assurance can be given that the final tax outcome of these matters will not be different. The Company adjusts these reserves in light of changing facts and circumstances, such as the closing of a tax audit or the refinement of an estimate. Changes in the recognition or measurement of uncertain tax positions could result in material increases or decreases in the Company’s income tax expense in the period in which a change is made, which could have a material impact on operating results (see Footnote 22 of the Notes to Consolidated Financial Statements included in this Form 10-K). Results of Operations Comparison 2012 to 2011 2012 2011 (amounts in millions) Increase/ (Decrease) % change Revenues from rental property (1) .............................. $ Rental property expenses: (2) Rent ............................................................................................... $ Real estate taxes ..................................................................... Operating and maintenance ............................................. $ Depreciation and amortization (3) ............................... $ 884.8 $ 825.7 $ 59.1 7.2% 12.8 $ 115.3 118.8 246.9 $ 249.5 $ 13.9 $ 108.8 114.1 236.8 $ 231.7 $ (1.1 ) 6.5 4.7 10.1 17.8 (7.9)% 6.0% 4.1% 4.3% 7.7% (1) Revenues from rental property increased primarily from the combined effect of (i) the acquisition of operating properties during 2012 and 2011, providing incremental revenues for the year ended December 31, 2012 of $50.9 million, as compared to the corresponding period in 2011, (ii) an increase in revenues relating to the Company’s Latin American portfolio of $8.0 and (iii) the completion of certain development and redevelopment projects, tenant buyouts and overall growth in the current portfolio, providing incremental revenues of $0.9 million, for the year ended December 31, 2012, as compared to the corresponding period in 2011, partially offset by (iv) a decrease in revenues of $0.7 million for the year ended December 31, 2012, as compared to the corresponding period in 2011, primarily resulting from the partial sale of certain properties during 2012 and 2011. (2) Rental property expenses include (i) rent expense relating to ground lease payments for which the Company is the lessee; (ii) real estate tax expense for consolidated properties for which the Company has a controlling ownership interest and (iii) operating and maintenance expense, which consists of property related costs including repairs and maintenance costs, roof repair, landscaping, parking lot repair, snow removal, utilities, property insurance costs, security and various other property related expenses. Rental property expenses increased for the year ended December 31, 2012, as compared to the corresponding period in 2011, primarily due to (i) an increase in real estate taxes of $6.5 million, primarily due to acquisitions of properties during 2012 and 2011, (ii) an increase in repairs and maintenance costs of $5.5 million, primarily due to acquisitions of properties during 2012 and 2011 (iii) an increase in insurance premiums and claims of $1.7 million and (iv) an increase in utilities of $1.8 million, partially offset by (v) a decrease in snow removal costs of $5.2 million and (vi) a decrease in rent expense of $1.1 million. (3) Depreciation and amortization increased for the year ended December 31, 2012, as compared to the corresponding period in 2011, primarily due to (i) operating property acquisitions during 2012 and 2011, (ii) the placement of certain development properties into service and (iii) tenant vacancies, partially offset by (iv) certain operating property dispositions during 2012 and 2011. Management and other fee income increased $2.2 million to $37.5 million for the year ended December 31, 2012, as compared to $35.3 million for the corresponding period in 2011. This increase is due to an increase in property management fees of $0.8 million, primarily due to the acquisitions of properties within the Company’s joint venture portfolio during 2012 and 2011, and an increase in transaction related fees of $1.4 million recognized during 2012, as compared to 2011. General and administrative costs include employee-related expenses (salaries, bonuses, equity awards, benefits, severance costs and payroll taxes), professional fees, office rent, travel expense, and other company-specific expenses. General and administrative expenses increased $5.6 million to $124.5 million for the year ended December 31, 2012, as compared to $118.9 million for the corresponding period in 2011. This increase is primarily a result of (i) an increase of $2.6 million in severance costs related to the departure of an executive officer in January 2012, (ii) an increase in professional and consulting fees of $2.1 million, primarily due to increased transactional activity, and (iii) an increase in other personnel related costs during 2012, as compared to the corresponding period in 2011. 19 During year ended December 31, 2012, the Company recognized impairment charges of $59.6 million ($22.5 million of which is included in discontinued operations) before income tax benefit and noncontrolling interest. During the year ended December 31, 2011, the Company recognized impairment charges of $32.8 million ($19.7 million of which is included in discontinued operations) before income tax benefit and noncontrolling interest. These impairments were primarily calculated based on the usage of estimated sales prices and comparable sales information as inputs. The Company determined that its valuation in these assets was classified within Level 3 of the FASB’s fair value hierarchy. These impairment charges resulted from the Company’s efforts to market certain assets and management’s assessment as to the likelihood and timing of such potential transactions. Interest, dividends and other investment income decreased $14.4 million to $2.2 million for the year ended December 31, 2012, as compared to $16.6 million for the corresponding period in 2011. This decrease is primarily due to (i) the Company’s sale of its investment in Valad notes during 2011, resulting in a decrease in interest income of $6.2 million, (ii) a decrease in other investment income of $6.4 million relating to the receipt of cash distributions during 2011 in excess of the Company’s carrying value of a cost method investment, (iii) a reduction in interest income of $0.5 million due to repayments of notes in 2012 and 2011 and (iv) a decrease in gains on sales of securities of $0.5 million. Other expense, net increased $3.3 million to $8.0 million for the year ended December 31, 2012, as compared to $4.7 million for the corresponding period in 2011. This change is primarily due to (i) an increase in acquisition related costs of $3.1 million relating to an increase in transactional activity, (ii) a decrease in gains on foreign currency of $2.4 million relating to changes in foreign currency exchange rates, partially offset by (iii) an increase of $2.5 million in gains on land sales during 2012, as compared to the corresponding period in 2011. Interest expense increased $4.1 million to $227.6 million for the year ended December 31, 2012, as compared to $223.5 million for the corresponding period in 2011. This increase is primarily related to a decrease in capitalization of interest due to the placement of certain development and redevelopment properties into service during 2012, as compared to the corresponding period in 2011. During 2011, the Company sold a merchant building property to an unconsolidated joint venture in which the Company has a noncontrolling interest for a sales price of $37.6 million resulting in a pretax gain of $12.1 million after a deferral of $2.1 million due to the Company’s continued involvement in the property. Provision for income taxes, net decreased by $17.4 million to $3.9 million for the year ended December 31, 2012, as compared to $21.3 million for the corresponding period in 2011. This decrease is primarily due to (i) an increase in income tax benefit of $10.2 million related to impairments taken during the year ended December 31, 2012, as compared to the corresponding period in 2011, (ii) a decrease in the income tax provision expense of $5.7 million in connection with a gain on sale of a development property during 2011, (iii) a decrease in tax provision of $2.8 million resulting from the receipt of a cash distribution during 2011 in excess of the Company’s carrying value of a cost method investment and (iv) a decrease in tax provision of $2.7 million resulting from a decrease in equity in income recognized in connection with the Albertson’s investment during 2012, as compared to 2011, partially offset by (v) an increase in foreign withholding taxes of $5.4 million primarily resulting from an unrealized foreign exchange gains recognized for Mexican tax purposes on U.S. denominated mortgage debt within the Company’s Latin American property portfolio. Equity in income of joint ventures, net increased $49.4 million to $112.9 million for the year ended December 31, 2012, as compared to $63.5 million for the corresponding period in 2011. This increase is primarily the result of (i) an increase in gains on sale and promote income recognized of $12.6 million, (ii) the recognition of $7.5 million in income on the sale of certain air rights at a property within one of the Company’s joint venture investments in Canada, (iii) an increase in equity in income of $5.9 million from the Company’s InTown Suites investment primarily resulting from increased operating profitability, (iv) the recognition of $2.1 million in income resulting from cash distributions received in excess of the Company’s carrying value of its investment in an unconsolidated joint venture, (v) a decrease in impairment charges of $3.2 million resulting from fewer impairment charges recognized against certain joint venture properties during the year ended December 31, 2012, as compared to the corresponding period in 2011, (vi) a decrease in equity in loss of $4.0 million resulting from the disposition of a portfolio of properties during 2011, (vii) an increase in equity in income of $6.0 million from the Company’s joint venture investments in Canada (viii) an increase in equity in income of $3.7 million from the Company’s joint venture investments in Mexico and (ix) incremental earnings due to increased profitability from properties within the Company’s joint venture program. During 2012, the Company acquired four properties from joint ventures in which the Company had noncontrolling interests. The Company recorded an aggregate gain on change in control of interests of $15.6 million related to the fair value adjustment associated with its original ownership. During 2011, the Company acquired one property from a joint venture in which the Company had a noncontrolling interest. The Company recorded an aggregate gain on change in control of interests of $0.6 million related to the fair value adjustment associated with its original ownership. 20 During 2012, the Company disposed of 62 operating properties and two outparcels, in separate transactions, for an aggregate sales price of $418.9 million. These transactions resulted in an aggregate gain of $85.9 million and impairment charges of $22.5 million, before income taxes, which is included in Discontinued operations in the Company’s Consolidated Statements of Income. During 2011, the Company disposed of 27 operating properties, one development property and one outparcel, in separate transactions, for an aggregate sales price of $124.9 million. These transactions resulted in an aggregate gain of $17.3 million and aggregate impairment charges of $16.9 million, before income taxes, which is included in Discontinued operations in the Company’s Consolidated Statements of Income. During 2011, a consolidated joint venture in which the Company had a preferred equity investment disposed of a property for a sales price of $6.1 million. As a result of this capital transaction, the Company received $1.4 million of profit participation, before noncontrolling interest of $0.1 million. This profit participation has been recorded as Income from other real estate investments and is reflected in Income from discontinued operating properties in the Company’s Consolidated Statements of Income. During 2012, the Company sold a previously consolidated operating property to a newly formed unconsolidated joint venture in which the Company has a 20% noncontrolling interest for a sales price of $55.5 million. This transaction resulted in a pre-tax gain of $10.0 million, of which the Company deferred $2.0 million due to its continued involvement. This gain has been recorded as Gain on sale of operating properties, net of tax in the Company’s Consolidated Statements of Income. Net income attributable to the Company increased $97.0 million to $266.1 million for the year ended December 31, 2012, as compared to $169.1 million for the corresponding period in 2011. On a diluted per share basis, net income attributable to the Company was $0.42 for 2012, as compared to net income of $0.27 for 2011. These increases are primarily attributable to (i) additional incremental earnings due to increased profitability from the Company’s operating properties and the acquisition of operating properties during 2012 and 2011, (ii) an increase in gains on disposition of operating properties and change in control of interests, (iii) an increase in equity in income of joint ventures, net primarily due to gains on sales of operating properties sold within various joint venture portfolios during 2012 and (iv) a decrease in provision for income taxes, partially offset by (v) an increase in impairment charges recognized during the year ended December 31, 2012, as compared to the corresponding period in 2011, (vi) a decrease in interest, dividends and other investment income resulting primarily from the sale of certain marketable securities during 2011 and (vii) a decrease in gain on sale of development properties recognized during 2012, as compared to 2011. The 2012 diluted per share results were decreased by a reduction in net income available to common shareholders of $21.7 million resulting from the deduction of original issuance costs associated with the redemption of the Company’s 6.65% Class F Cumulative Redeemable Preferred Stock and 7.75% Class G Cumulative Redeemable Preferred Stock. Comparison 2011 to 2010 Revenues from rental property (1) ............................... $ Rental property expenses: (2) .......................................... Rent ................................................................................................ $ Real estate taxes ...................................................................... Operating and maintenance .............................................. $ Depreciation and amortization (3) ................................ $ 2011 2010 (amounts in millions) Increase % change 825.7 $ 786.9 $ 38.8 13.9 $ 108.8 114.1 236.8 $ 231.7 $ 13.7 $ 105.3 108.4 227.4 $ 217.2 $ 0.2 3.5 5.7 9.4 14.5 4.9% 1.5% 3.3% 5.3% 4.1% 6.7% (1) Revenues from rental property increased primarily from the combined effect of (i) the acquisition of operating properties during 2011 and 2010, providing incremental revenues for the year ended December 31, 2011 of $35.7 million, as compared to the corresponding period in 2010 and (ii) the completion of certain development and redevelopment projects, tenant buyouts and overall growth in the current portfolio, providing incremental revenues of $4.2 million, for the year ended December 31, 2011, as compared to the corresponding period in 2010, which was partially offset by (iii) a decrease in revenues of $1.1 million for the year ended December 31, 2011, as compared to the corresponding period in 2010, primarily resulting from the partial sale of certain properties during 2011 and 2010. (2) Rental property expenses include (i) rent expense relating to ground lease payments for which the Company is the lessee; (ii) real estate tax expense for consolidated properties for which the Company has a controlling ownership interest and (iii) operating and maintenance expense, which consists of property related costs including repairs and maintenance costs, roof repair, landscaping, parking lot repair, snow removal, utilities, property insurance costs, security and various other property related expenses. Rental property expenses increased primarily due to (i) operating property acquisitions during 2011 and 2010, and (ii) the placement of certain development properties into service, which resulted in lower capitalization of carrying costs. (3) Depreciation and amortization increased primarily due to (i) operating property acquisitions during 2011 and 2010, (ii) the placement of certain development properties into service and (iii) tenant vacancies. 21 Management and other fee income decreased $4.6 million to $35.3 million for the year ended December 31, 2011, as compared to $39.9 million for the corresponding period in 2010. This decrease is primarily due to a decrease in property management fees of $2.4 million recognized during 2011, as compared to 2010, primarily due to the disposition of properties during 2011 and 2010 and a decrease in transaction related fees of $2.2 million recognized during 2011, as compared to 2010. General and administrative costs include employee-related expenses (salaries, bonuses, equity awards, benefits, severance costs and payroll taxes), professional fees, office rent, travel expense, and other company-specific expenses. General and administrative expenses increased $9.9 million to $118.9 million for the year ended December 31, 2011, as compared to $109.0 million for the corresponding period in 2010. This change is primarily a result of an increase in equity awards expense related to grants issued during 2011 and 2010 and an increase in other personnel related costs during 2011, as compared to the corresponding periods in 2010. During 2011, the Company recognized aggregate impairment charges of $32.2 million ($19.7 million of which is included in discontinued operations), before income taxes and noncontrolling interest, relating to adjustments to property carrying values, investments in other real estate investments, investment in real estate joint ventures and other investments. The Company’s estimated fair values relating to these impairment assessments were based upon their respective estimated sales prices. Based on these inputs, the Company determined that its valuation in these investments was classified within Level 3 of the FASB fair value hierarchy. These impairment charges resulted from the Company’s efforts to market certain assets and management’s assessment as to the likelihood and timing of such potential transactions. Additionally, during 2011, the Company recorded impairment charges of $0.6 million due to the decline in value of certain marketable securities that were deemed to be other-than-temporary. During 2010, the Company recognized impairment charges of $34.5 million ($6.5 million of which is included in discontinued operations), before income taxes and noncontrolling interest, relating to adjustments to property carrying values, real estate under development, investments in other real estate investments and other investments. The Company’s estimated fair values relating to these impairment assessments were based upon estimated sales prices and discounted cash flow models that included all estimated cash inflows and outflows over a specified holding period. These cash flows are comprised of unobservable inputs which include contractual rental revenues and forecasted rental revenues and expenses based upon market conditions and expectations for growth. Capitalization rates and discount rates utilized in these models were based upon observable rates that the Company believes to be within a reasonable range of current market rates for the respective properties. Based on these inputs, the Company determined that its valuation in these investments was classified within Level 3 of the FASB fair value hierarchy. Additionally, during 2010, the Company recorded impairment charges of $4.6 million due to the decline in value of certain marketable securities that were deemed to be other-than-temporary. Mortgage financing income decreased $2.1 million to $7.3 million for the year ended December 31, 2011, as compared to $9.4 million for the corresponding period in 2010. This decrease is primarily due to a decrease in interest income resulting from the repayment of certain mortgage receivables during 2011 and 2010. Interest, dividends and other investment income decreased $4.6 million to $16.6 million for the year ended December 31, 2011, as compared to $21.2 million for the corresponding period in 2010. This decrease is primarily due to the sale of Valad notes resulting in a decrease in interest income of $13.5 million, partially offset by (i) an increase in bank interest income of $1.1 million during 2011, as compared to the corresponding period in 2010, primarily resulting from the change in cash balances during 2011 and (ii) an income distribution of $7.4 million from a cost method investment during 2011. During the year ended December 31, 2010, the Company incurred early extinguishment of debt charges aggregating $10.8 million in connection with the optional make-whole provisions of notes that were repaid prior to maturity and prepayment penalties on five mortgages that the Company paid prior to their maturity. During 2011, the Company sold a merchant building property to an unconsolidated joint venture in which the Company has a noncontrolling interest for a sales price of $37.6 million resulting in a pretax gain of $12.1 million after a deferral of $2.1 million due to the Company’s continued involvement in the property. During 2010, the Company disposed of a land parcel for a sales price of $0.8 million resulting in a gain of $0.4 million. Additionally, the Company recognized $1.7 million in income on previously sold development properties during the year ended December 31, 2010. Provision for income taxes, net increased by $18.1 million to $21.3 million for the year ended December 31, 2011, as compared to $3.2 million for the corresponding period in 2010. This change is primarily due to (i) a decrease in income tax benefit of $10.3 million related to fewer impairments taken during the year ended December 31, 2011, as compared to the corresponding period in 2010, (ii) an increase in the income tax provision expense of $4.8 million in connection with gains on sale of development properties during 2011, as compared to 2010, (iii) a decrease in tax benefit of $4.9 million as a result of reduced interest expense for the Company’s taxable REIT subsidiaries, (iv) a tax provision of $2.7 million resulting from the receipt of a cash distribution in excess of the Company’s carrying value of a cost method investment during 2011 and (v) a tax provision of $1.4 million resulting from incremental earnings due to increased profitability from properties within the Company’s taxable REIT subsidiaries, partially offset by (vi) a decrease in foreign taxes of $6.8 million primarily resulting from an unrealized foreign exchange loss recognized for Mexican tax purposes on U.S. denominated mortgage debt within the Company’s Latin American property portfolio. 22 Equity in income of joint ventures, net increased $28.9 million to $63.5 million for the year ended December 31, 2011, as compared to $34.6 million for the corresponding period in 2010. This increase is primarily the result of (i) a decrease in impairment charges of $10.0 million resulting from fewer impairment charges recognized against certain joint venture properties during the year ended December 31, 2011, as compared to the corresponding period in 2010, (ii) an increase in equity in income of $4.2 million from the Company’s InTown Suites investment primarily resulting from increased operating profitability, (iii) an increase in equity in income of $2.3 million from the Company’s joint venture investments in Canada primarily resulting from the Company increasing its noncontrolling ownership interest in certain Canadian portfolios, (iv) an increase in equity in income of $2.1 million from the Company’s joint venture investments in Latin America primarily resulting from lease-up activities at properties that were placed into service, (v) a decrease of $7.2 million in equity in loss from a joint venture in which the Company no longer has an equity basis and is therefore no longer required to record equity losses, (vi) an increase in gains on sales of $4.4 million for 2011, as compared to 2010 and (vii) incremental earnings due to increased profitability from properties within the Company’s joint venture program, partially offset by (viii) the recognition of $8.0 million in income resulting from cash distributions received in excess of the Company’s carrying value of its investment in an unconsolidated limited liability partnership during the year ended December 31, 2010. Equity in income from other real estate investments, net decreased $9.0 million to $51.8 million for the year ended December 31, 2011, as compared to $60.8 million for the corresponding period in 2010. This decrease is primarily due to a decrease of $7.2 million in equity in income from the Albertson’s joint venture resulting from lower cash distributions received in excess of the Company’s investment during 2011, as compared to the corresponding period during 2010 and a decrease of $2.7 million in equity in earnings including profit participation earned from the Company’s Preferred Equity Program during 2011, as compared to the corresponding period in 2010. During 2011, the Company disposed of 27 operating properties, one development property and one outparcel, in separate transactions, for an aggregate sales price of $124.9 million. These transactions, which are included in Discontinued Operations, resulted in an aggregate gain of $17.3 million and aggregate impairment charges of $16.9 million, before income taxes. Additionally, during 2011, a consolidated joint venture in which the Company had a preferred equity investment disposed of a property for a sales price of $6.1 million. As a result of this capital transaction, the Company received $1.4 million of profit participation, before noncontrolling interest of $0.1 million. This profit participation has been recorded as Income from other real estate investments and is reflected in Income from discontinued operating properties in the Company’s Consolidated Statements of Income. During 2010, the Company (i) sold seven operating properties, which were previously consolidated, to two new joint ventures in which the Company holds noncontrolling equity interests for an aggregate sales price of $438.1 million including the assignment of $159.9 million of non-recourse mortgage debt encumbering three of the properties and (ii) disposed of, in separate transactions, seven operating properties for an aggregate sales price of $100.5 million including the assignment of $81.0 million of non-recourse mortgage debt encumbering one of the properties. These transactions resulted in aggregate gains of $4.4 million and aggregate losses/impairments of $5.0 million. Additionally, during 2010, the Company disposed of (i) three properties, in separate transactions, for an aggregate sales price of $23.8 million and (ii) five properties from a consolidated joint venture in which the Company had a preferred equity investment for a sales price of $40.8 million. These transactions resulted in an aggregate profit participation of $20.8 million, before income tax of $1.0 million and noncontrolling interest of $4.9 million. This profit participation has been recorded as Income from other real estate investments and is reflected in Income from discontinued operating properties, net of tax in the Company’s Consolidated Statements of Income. Net income attributable to the Company increased $26.2 million to $169.1 million for the year ended December 31, 2011, as compared to $142.9 million for the corresponding period in 2010. On a diluted per share basis, net income attributable to the Company was $0.27 for 2011, as compared to net income of $0.22 for 2010. These increases are primarily attributable to (i) additional incremental earnings due to increased profitability from the Company’s operating properties and the acquisition of operating properties during 2011 and 2010, (ii) an increase in gain on sale of development properties recognized during 2011, as compared to 2010, (iii) increased equity in income of joint ventures, net primarily due to incremental earnings from increased profitability within the joint venture portfolios and fewer impairment charges recognized against certain joint venture properties during the year ended December 31, 2011, as compared to the corresponding period in 2010 and (iv) early extinguishment of debt charges recognized during 2010, aggregating $10.8 million, partially offset by (v) an increase in provision for income taxes. Liquidity and Capital Resources The Company’s capital resources include accessing the public debt and equity capital markets, mortgage and construction loan financing and immediate access to an unsecured revolving credit facility with bank commitments of $1.75 billion. 23 The Company’s cash flow activities are summarized as follows (in millions): Net cash flow provided by operating activities ........................................................ $ Net cash flow (used for)/provided by investing activities .................................. $ Net cash flow used for financing activities .................................................................. $ 479.1 $ (51.0) $ (399.1) $ 448.6 $ (20.8) $ (440.1) $ 479.9 37.9 (514.7) Year Ended December 31, 2011 2012 2010 Operating Activities The Company anticipates that cash on hand, operating cash flows, 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. Net cash flow provided by operating activities for the year ended December 31, 2012, was primarily attributable to (i) cash flow from the diverse portfolio of rental properties, (ii) the acquisition of operating properties during 2012 and 2011, (iii) new leasing, expansion and re- tenanting of core portfolio properties and (iv) distributions from the Company’s joint venture programs. Cash flow provided by operating activities for the year ended December 31, 2012, was $479.1 million, as compared to $448.6 million for the comparable period in 2011. The change of $30.5 million is primarily attributable to higher operational income, increased distributions from joint ventures and other real estate investments and changes in accounts and notes receivable due to timing of receipts. Investing Activities Cash flow used for investing activities for the year ended December 31, 2012, was $51.0 million, as compared to $20.8 million for the comparable period in 2011. This change of $30.2 million resulted primarily from (i) an increase in acquisition of and improvements to operating real estate of $209.2 million, (ii) a decrease in proceeds from the sale/repayments of marketable securities of $187.8 million, (iii) an increase in investments and advances to real estate joint ventures of $48.2 million, (iv) a decrease in reimbursements of investments and advances to other real estate investments and other investments of $43.7 million and (v) investment in mortgage loans receivable of $16.0 million, partially offset by, (vi) an increase in proceeds from the sale of operating and development properties of $269.4 million, (vii) an increase in reimbursements of investments and advances to real estate joint ventures of $124.3 million, (viii) an increase in collections of mortgage receivables of $44.5 million and (ix) a decrease in acquisition of and improvements to real estate under development of $35.4 million. Acquisitions of and Improvements to Operating Real Estate During the year ended December 31, 2012, the Company expended $552.5 million towards acquisition of and improvements to operating real estate including $78.9 million (inclusive of $2.4 million in capitalized costs) expended in connection with redevelopments and re-tenanting projects. (See Footnote 4 of the Notes to the Consolidated Financial Statements included in this Form 10-K.) The Company has an ongoing program to reformat and re-tenant its properties to maintain or enhance its competitive position in the marketplace. The Company anticipates its capital commitment toward these reformatting and re-tenanting efforts and other redevelopment projects during 2013 will be approximately $90.0 million to $100.0 million. The funding of these capital requirements will be provided by cash flow from operating activities and availability under the Company’s revolving line of credit. Investments and Advances to Real Estate Joint Ventures During the year ended December 31, 2012, the Company expended $219.9 million for investments and advances to real estate joint ventures and received $187.9 million from reimbursements of investments and advances to real estate joint ventures, primarily due to the refinance of debt and sales of properties. (See Footnote 8 of the Notes to the Consolidated Financial Statements included in this Form 10-K.) Acquisitions of and Improvements to Real Estate Under Development The Company is engaged in ground-up development projects which will be held as long-term investments by the Company. The ground-up development projects generally have significant pre-leasing prior to the commencement of construction. As of December 31, 2012, the Company had a total of three ground-up development projects, consisting of two projects located in the U.S. and one project located in Peru. 24 The Company anticipates its capital commitment during 2013 toward these and other development projects will be approximately $15.0 million to $25.0 million. The funding of these capital requirements will be provided by cash flow from operating activities and availability under the Company’s revolving line of credit. Dispositions and Transfers During the year ended December 31, 2012, the Company received net proceeds of $449.5 million relating to the sale of various operating properties. (See Footnotes 5 and 7 of the Notes to the Consolidated Financial Statements included in this Form 10-K.) Financing Activities Cash flow used for financing activities for the year ended December 31, 2012, was $399.1 million, as compared to $440.1 million for the comparable period in 2011. This change of $41.0 million resulted primarily from (i) the redemption of the Company’s 6.65% Class F Preferred Stock and 7.75% Class G Preferred Stock of $635.0 million, (ii) an increase in principal payments of $221.5 million, (iii) an increase in the repayment of unsecured term loan/notes of $123.3 million, (iv) a decrease of $103.6 million in net borrowings under unsecured revolving credit facility, (v) an increase in dividends paid of $29.0 million due to the issuance of the Company’s 6.00% Class I Preferred Stock and 5.50% Class J Preferred Stock and (vi) an increase in repurchases of common stock of $24.9 million, partially offset by (vii) an increase of $790.2 million from the issuance of stock, primarily relating to the issuance of the Company’s 6.00% Class I Preferred Stock, 5.50% Class J Preferred Stock and 5.625% Class K Preferred Stock and (viii) an increase of $400.0 million in proceeds from the unsecured term loan. The Company continually evaluates its debt maturities, and, based on management’s current assessment, believes it has viable financing and refinancing alternatives that will not materially adversely impact its expected financial results. The credit environment has improved and the Company continues to pursue borrowing opportunities with large commercial U.S. and global banks, select life insurance companies and certain regional and local banks. The Company has noticed a continuing trend that although pricing remains dependent on specific deal terms, generally spreads for non-recourse mortgage financing are gradually compressing from levels a year ago. The unsecured debt markets are functioning well and credit spreads are at manageable levels. The Company continues to assess 2013 and beyond to ensure the Company is prepared if the current credit market conditions deteriorate. Debt maturities for 2013 consist of: $640.5 million of consolidated debt; $570.6 million of unconsolidated joint venture debt; and $98.2 million of preferred equity debt, assuming the utilization of extension options where available. The 2013 consolidated debt maturities are anticipated to be extended, refinanced or repaid with operating cash flows and borrowings from the Company’s credit facility, which at December 31, 2012, the Company had $1.5 billion available. The 2013 unconsolidated joint venture and preferred equity debt maturities are anticipated to be extended or repaid through debt refinancing and partner capital contributions, as deemed appropriate. The Company intends to maintain strong debt service coverage and fixed charge coverage ratios as part of its commitment to maintain its investment-grade debt ratings. The Company plans to continue strengthening its balance sheet by pursuing deleveraging efforts over time. The Company may, from time-to-time, seek to obtain funds through additional common and preferred equity offerings, unsecured debt financings and/or mortgage/construction loan financings and other capital alternatives. 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 for its expansion needs. Since the IPO, the Company has completed additional offerings of its public unsecured debt and equity, raising in the aggregate over $8.7 billion. Proceeds from public capital market activities have been used for the purposes of, among other things, repaying indebtedness, acquiring interests in neighborhood and community shopping centers, funding ground-up development projects, expanding and improving properties in the portfolio and other investments. The Company will continue to access these markets, as available. The Company has a $1.75 billion unsecured revolving credit facility (the “Credit Facility”) with a group of banks, which is scheduled to expire in October 2015 and has a one-year extension option. This credit facility, provides funds to finance general corporate purposes, including (i) property acquisitions, (ii) investments in the Company’s institutional management programs, (iii) development and redevelopment costs and (iv) any short-term working capital requirements. Interest on borrowings under the Credit Facility accrues at LIBOR plus 1.05% and fluctuates in accordance with changes in the Company’s senior debt ratings and has a facility fee of 0.20% per annum. As part of this Credit Facility, the Company has a competitive bid option whereby the Company could auction up to $875.0 million of its requested borrowings to the bank group. This competitive bid option provides the Company the opportunity to obtain pricing below the currently stated spread. In addition, as part of the Credit Facility, the Company has a $500.0 million sub-limit which provides it the opportunity to borrow in alternative currencies such as Canadian Dollars, British Pounds Sterling, Japanese Yen or Euros. Pursuant to the terms of the Credit Facility, the Company, among other things, is subject to covenants requiring the maintenance of (i) maximum leverage ratios on both unsecured and secured debt and (ii) minimum interest and fixed coverage ratios. As of December 31, 2012, the Credit Facility had a balance of $249.9 million outstanding and $27.3 million appropriated for letters of credit. 25 Pursuant to the terms of the Credit Facility, the Company, among other things, is subject to maintenance of various covenants. The Company is currently in compliance with these covenants. The financial covenants for the Credit Facility are as follows: Covenant Total Indebtedness to Gross Asset Value (“GAV”) Total Priority Indebtedness to GAV Unencumbered Asset Net Operating Income to Total Unsecured Interest Expense Fixed Charge Total Adjusted EBITDA to Total Debt Service Must Be <60% <35% >1.75x >1.50x As of 12/31/12 44% 9% 3.23x 2.17x For a full description of the Credit Facility’s covenants refer to the Credit Agreement dated as of October 27, 2011 filed in the Company’s Current Report on Form 8-K dated November 2, 2011. During April 2012, the Company obtained a $400.0 million unsecured term loan with a consortium of banks, which accrues interest at LIBOR plus 105 basis points. The term loan is scheduled to mature in April 2014, with three additional one-year options to extend the maturity date, at the Company’s discretion, to April 17, 2017. Pursuant to the terms of the Credit Agreement, the Company, among other things is subject to covenants requiring the maintenance of (i) maximum indebtedness ratios and (ii) minimum interest and fixed charge coverage ratios. Proceeds from this term loan were used for general corporate purposes including the repayment of debt. The term loan covenants are similar to the Credit Facility covenants described above. During March 2008, the Company obtained a Mexican peso (“MXN”) 1.0 billion term loan, which bears interest at a rate of 8.58%, subject to change in accordance with the Company’s senior debt ratings, and is scheduled to mature in March 2013. The Company utilized proceeds from this term loan to fully repay the outstanding balance of a MXN 500.0 million unsecured revolving credit facility, which was terminated by the Company. Remaining proceeds from this term loan were used for funding MXN denominated investments. As of December 31, 2012, the outstanding balance on this term loan was MXN 1.0 billion (USD $76.9 million). The Mexican term loan covenants are similar to the Credit Facility covenants described above. During December 2012, the lender agreed to extend this term loan for an additional five years at an interest rate of TIIE (Equilibrium Interbank Interest Rate) plus 1.35%, which will be effective subsequent to the scheduled maturity in March 2013. The Company has the option to swap this rate to a fixed rate at any time during the term of the loan. During April 2012, the Company filed a shelf registration statement on Form S-3, which is effective for a term of three years, for the future unlimited offerings, from time-to-time, of debt securities, preferred stock, depositary shares, common stock and common stock warrants. The Company, pursuant to this shelf registration statement 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 Footnote 13 of the Notes to Consolidated Financial Statements included in this Form 10-K.) The Company’s supplemental indenture governing its medium term notes and senior notes contains the following covenants, all of which the Company is compliant with: Covenant Consolidated Indebtedness to Total Assets Consolidated Secured Indebtedness to Total Assets Consolidated Income Available for Debt Service to Maximum Annual Service Charge Unencumbered Total Asset Value to Consolidated Unsecured Indebtedness Must Be <60% <40% >1.50x >1.50x As of 12/31/12 38% 9% 4.2x 2.8x For a full description of the various indenture covenants refer to the Indenture dated September 1, 1993, First Supplemental Indenture dated August 4, 1994, the Second Supplemental Indenture dated April 7, 1995, the Third Supplemental Indenture dated June 2, 2006, the Fifth Supplemental Indenture dated as of September 24, 2009, the Fifth Supplemental Indenture dated as of October 31, 2006 and First Supplemental Indenture dated October 31, 2006, as filed with the SEC. See Exhibits Index on page 38, for specific filing information. During 2012, the Company (i) repaid the $17.0 million outstanding on its 5.98% medium-term notes, which matured in July 2012, (ii) repaid the $198.9 million outstanding on its 6.00% senior unsecured note, which matured in November 2012, (iii) assumed $185.3 million of individual non-recourse mortgage debt relating to the acquisition of seven operating properties, including an increase of $6.1 million associated with fair value debt adjustments, (iv) paid off $284.8 million of mortgage debt that encumbered 19 operating properties and (v) assigned five mortgages aggregating $17.1 million in connection with property dispositions. 26 During March 2012, the Company issued 16,000,000 Depositary Shares (the "Class I Depositary Shares"), each representing a one- thousandth fractional interest in a share of the Company's 6.00% Class I Cumulative Redeemable Preferred Stock, $1.00 par value per share (the "Class I Preferred Stock"). Dividends on the Class I Depositary Shares are cumulative and payable quarterly in arrears at the rate of 6.00% per annum based on the $25.00 per share initial offering price, or $1.50 per annum. The Class I Depositary Shares are redeemable, in whole or part, for cash on or after March 20, 2017, at the option of the Company, at a redemption price of $25.00 per depositary share, plus any accrued and unpaid dividends thereon. The Class I Depositary Shares are not convertible or exchangeable for any other property or securities of the Company. The net proceeds received from this offering of $387.2 million were used for general corporate purposes, including the reduction of borrowings outstanding under the Company’s revolving credit facility and the redemption of shares of the Company’s preferred stock. During July 2012, the Company issued 9,000,000 Depositary Shares (the "Class J Depositary Shares"), each representing a one- thousandth fractional interest in a share of the Company's 5.50% Class J Cumulative Redeemable Preferred Stock, $1.00 par value per share (the "Class J Preferred Stock"). Dividends on the Class J Depositary Shares are cumulative and payable quarterly in arrears at the rate of 5.50% per annum based on the $25.00 per share initial offering price, or $1.375 per annum. The Class J Depositary Shares are redeemable, in whole or part, for cash on or after July 25, 2017, at the option of the Company, at a redemption price of $25.00 per depositary share, plus any accrued and unpaid dividends thereon. The Class J Depositary Shares are not convertible or exchangeable for any other property or securities of the Company. The net proceeds received from this offering of $217.8 million were used for the redemption of all the outstanding depositary shares representing the Company’s Class F preferred stock, which redemption occurred on August 15, 2012, as discussed below, with the remaining proceeds used towards the redemption of outstanding depositary shares representing the Company’s Class G preferred stock, which redemption occurred on October 10, 2012, as discussed below, and general corporate purposes. On August 15, 2012, the Company redeemed of all of its outstanding 7,000,000 depositary shares of the Company’s 6.65% Class F Cumulative Redeemable Preferred Stock, $1.00 par value per share (the “Class F Preferred Stock”) for $175.0 million, before payment of accrued and unpaid dividends of $1.0 million. In connection with this redemption the Company recorded a charge of $6.2 million resulting from the difference between the redemption amount and the carrying amount of the Class F Preferred Stock on the Company’s Consolidated Balance Sheets in accordance with the FASB’s guidance on Distinguishing Liabilities from Equity. The $6.2 million was subtracted from net income to arrive at net income available to common shareholders and is used in the calculation of earnings per share for the year ended December 31, 2012. On October 10, 2012, the Company redeemed all of its outstanding 18,400,000 depositary shares of the Company’s 7.75% Class G Cumulative Redeemable Preferred Stock, $1.00 par value per share (the “Class G Preferred Stock”) for $460.0 million, before payment of accrued and unpaid dividends of $8.5 million. In connection with this redemption the Company recorded a non-cash charge of $15.5 million resulting from the difference between the redemption amount and the carrying amount of the Class G Preferred Stock on the Company’s Consolidated Balance Sheets in accordance with the FASB’s guidance on Distinguishing Liabilities from Equity. The $15.5 million was subtracted from net income to arrive at net income available to common shareholders and is used in the calculation of earnings per share for the year ended December 31, 2012. During November 2012, the Company issued 7,000,000 Depositary Shares (the "Class K Depositary Shares"), each representing a one-thousandth fractional interest in a share of the Company's 5.625% Class K Cumulative Redeemable Preferred Stock, $1.00 par value per share (the "Class K Preferred Stock"). Dividends on the Class K Depositary Shares are cumulative and payable quarterly in arrears at the rate of 5.625% per annum based on the $25.00 per share initial offering price, or $1.40625 per annum. The Class K Depositary Shares are redeemable, in whole or part, for cash on or after December 7, 2017, at the option of the Company, at a redemption price of $25.00 per depositary share, plus any accrued and unpaid dividends thereon. The Class K Depositary Shares are not convertible or exchangeable for any other property or securities of the Company. The net proceeds received from this offering of $169.1 million, after expenses, were used for general corporate purposes, including funding towards the repayment of maturing Senior Unsecured Notes. The Company, from time to time, repurchases shares of its common stock in amounts that offset new issuances of common shares in connection with the exercise of stock options or the issuance of restricted stock awards. These share repurchases may occur in open market purchases, privately negotiated transactions or otherwise, subject to prevailing market conditions, the Company’s liquidity requirements, contractual restrictions and other factors. During the year ended December 31, 2012, the Company repurchased 1.6 million shares of the Company’s common stock for $30.9 million, of which $22.6 million was provided to the Company from stock options exercised. 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 and construction loans to partially fund the capital needs of its ground-up development projects. As of December 31, 2012, the Company had over 400 unencumbered property interests in its portfolio. 27 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. The Company’s Board of Directors will continue to evaluate the Company’s dividend policy on a quarterly basis as they monitor sources of capital and evaluate the impact of the economy and capital markets availability on operating fundamentals. 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 and other investments as suitable opportunities arise and such other factors as the Board of Directors considers appropriate. Cash dividends paid were $382.7 million in 2012, $353.8 million in 2011 and $307.0 million in 2010. 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’s Board of Directors declared a quarterly cash dividend of $0.21 per common share payable to shareholders of record on January 2, 2013, which was paid on January 15, 2013. Additionally, the Company’s Board of Directors declared a quarterly cash dividend of $0.21 per common share payable to shareholders of record on April 3, 2013, which is scheduled to be paid on April 15, 2013. The Company is subject to taxes on its activities in Canada, Mexico, Brazil, Chile, and Peru. During 2012, less than $0.1 million of withholding and transaction taxes were withheld from distributions related to foreign activities. In general, under local country law applicable to the structures the Company has in place and applicable treaties, the repatriation of cash to the Company from its subsidiaries and joint ventures in Canada, Mexico and Brazil generally are not subject to withholding tax. The Company does not anticipate the need to repatriate foreign funds from Chile, Peru or Brazil to provide for its cash flow needs in the U.S. and, as such, no significant withholding or transaction taxes are expected in the foreseeable future. Contractual Obligations and Other Commitments The Company has debt obligations relating to its revolving credit facility, MTNs, senior notes, mortgages and construction loans with maturities ranging from less than one year to 23 years. As of December 31, 2012, the Company’s total debt had a weighted average term to maturity of 3.4 years. In addition, the Company has non-cancelable operating leases pertaining to its shopping center portfolio. As of December 31, 2012, the Company has 47 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 to construct and/or operate a shopping center. In addition, the Company has 10 non-cancelable operating leases pertaining to its retail store lease portfolio. The following table summarizes the Company’s debt maturities (excluding extension options and fair market value of debt adjustments aggregating $10.6 million) and obligations under non- cancelable operating leases as of December 31, 2012 (in millions): Contractual Obligations: Long-Term Debt-Principal(1) ........................ $ Long-Term Debt-Interest(2) .......................... $ Operating Leases: Ground Leases.................................................... $ Retail Store Leases ........................................... $ 2013 2014 2015 2016 2017 Payments due by period 659.7 197.8 12.6 2.3 $ $ $ $ 900.7 152.8 12.2 1.7 $ $ $ $ 731.2 131.6 11.1 1.3 $ $ $ $ 553.1 96.9 10.3 1.0 $ $ $ $ Thereafter 871.1 107.2 468.9 $ 67.3 $ Total $ 4,184.7 753.6 $ 9.9 $ 0.5 $ 172.6 0.1 $ $ 228.7 6.9 (1) Maturities utilized do not reflect extension options, which range from one to five years. (2) For loans which have interest at floating rates, future interest expense was calculated using the rate as of December 31, 2012. The Company has accrued $16.9 million of non-current uncertain tax benefits and related interest under the provisions of the authoritative guidance that addresses accounting for income taxes, which are included in Other liabilities on the Company’s Consolidated Balance Sheets at December 31, 2012. These amounts are not included in the table above because a reasonably reliable estimate regarding the timing of settlements with the relevant tax authorities, if any, cannot be made. The Company has $100.0 million of medium term notes, $175.0 million of unsecured notes, $201.3 million of Canadian unsecured notes, a $76.9 million Mexican term loan, $2.2 million of unsecured debt and $85.1 million of secured debt scheduled to mature in 2013. The Company anticipates satisfying these maturities with a combination of operating cash flows, its unsecured revolving credit facility, exercise of extension options, where available, and new debt issuances. The Company has issued letters of credit in connection with completion and repayment guarantees for loans encumbering certain of the Company’s redevelopment projects and guarantee of payment related to the Company’s insurance program. As of December 31, 2012, these letters of credit aggregate $33.6 million. 28 On a select basis, the Company provides guarantees on interest bearing debt held within real estate joint ventures in which the Company has noncontrolling ownership interests. The Company is often provided with a back-stop guarantee from its partners. The Company had the following outstanding guarantees as of December 31, 2012 (amounts in millions): Name of Joint Venture Amount of Guarantee Interest rate Maturity, with extensions Terms InTown Suites Management, Inc. (1) ..... $ 145.2 LIBOR plus 1.15% 2015 25% partner back-stop Hillsborough ............................ $ 2.8 LIBOR plus 1.05% Victoriaville ............................... $ 5.1 3.92% 2013 2020 Jointly and severally with partner Jointly and severally with partner Type of debt Unsecured credit facility Promissory note Promissory note (1) During October 2012, a purchase and sale agreement was executed to sell the InTown Suites company and related real estate assets for a gross sales price of $735 million, including $617 million of existing debt. The sale is contingent upon satisfactorily completing a due diligence process and other closing conditions, including lender approvals. The Company expects to complete this transaction in the first half of 2013. If the transaction is completed, the Company has agreed to maintain $145.2 million in preexisting guarantees of outstanding debt to be assumed by the buyer. In connection with the construction of its development projects and related infrastructure, certain public agencies require posting of performance and surety bonds to guarantee that the Company’s obligations are satisfied. These bonds expire upon the completion of the improvements and infrastructure. As of December 31, 2012, the Company had $20.7 million in performance and surety bonds outstanding. Off-Balance Sheet Arrangements Unconsolidated Real Estate Joint Ventures The Company has investments in various unconsolidated real estate joint ventures with varying structures. These joint ventures primarily operate shopping center properties or are established for development projects. Such arrangements are generally with third- party institutional investors, local developers and individuals. The properties owned by the joint ventures are primarily financed with individual non-recourse mortgage loans, however, the Company, on a selective basis, obtains unsecured financing for certain joint ventures. These unsecured financings are guaranteed by the Company with guarantees from the joint venture partners for their proportionate amounts of any guaranty payment the Company is obligated to make (see guarantee table above). Non-recourse mortgage debt is generally defined as debt whereby the lenders’ sole recourse with respect to borrower defaults is limited to the value of the property collateralized by the mortgage. The lender generally does not have recourse against any other assets owned by the borrower or any of the constituent members of the borrower, except for certain specified exceptions listed in the particular loan documents (See Footnote 8 of the Notes to Consolidated Financial Statements included in this Form 10-K). These investments include the following joint ventures: Kimco Ownership Venture KimPru (c) .................................. Interest 15.0% RioCan Venture (k) ............... KIR (d) .......................................... 50.0% 45.0% KUBS (e) ..................................... 17.9%(a) Non- Recourse Mortgage Payable (in millions) Recourse Notes Payable (in millions) Number of Properties Total GLA (in thousands) 61 45 58 40 10,694 $ 1,010.2 $ 9,307 $ 923.2 $ 12,417 $ 914.6 $ 5,741 $ 691.9 $ - - - - InTown Suites (j) .................... (l) 138 N/A $ 469.2 $ 145.2(b) BIG Shopping Centers (f) .. 37.7%(a) SEB Immobilien (h) ................ CPP (g) ........................................ Kimco Income Fund (i) ........ 15.0% 55.0% 15.2% 22 13 6 12 3,627 $ 443.8 $ 1,800 $ 243.8 $ 2,424 $ 141.5 $ 1,522 $ 161.4 $ - - - - 29 Number of Encumbered Properties 41 Average Interest Rate Weighted Average Term (months) 44.5 41.2 78.6 39.1 46.1 45.5 55.3 31.0 20.7 5.54% 5.16% 5.22% 5.40% 4.46% 5.52% 5.11% 5.19% 5.45% 37 43 40 138 18 13 3 12 (a) Ownership % is a blended rate. (b) See Contractual Obligations and Other Commitments regarding guarantees by the Company and its joint venture partners. (c) Represents the Company’s joint ventures with Prudential Real Estate Investors. (d) Represents the Kimco Income Operating Partnership, L.P., formed in 1998. (e) Represents the Company’s joint ventures with UBS Wealth Management North American Property Fund Limited. (f) Represents the Company’s joint ventures with BIG Shopping Centers (TLV:BIG), an Israeli public company. (g) Represents the Company’s joint ventures with The Canadian Pension Plan Investment Board (CPPIB). (h) Represents the Company’s joint ventures with SEB Immobilien Investment GmbH. (i) Represents the Kimco Income Fund, formed in 2004. (j) Represents the Company’s joint ventures with Westmont Hospitality Group. (k) Represents the Company’s joint ventures with RioCan Real Estate Investment Trust. (l) The Company’s share of this investment is subject to fluctuation and is dependent upon property cash flows. The Company has various other unconsolidated real estate joint ventures with varying structures. As of December 31, 2012, these other unconsolidated joint ventures had individual non-recourse mortgage loans aggregating $1.9 billion and unsecured notes payable aggregating $2.8 million. The aggregate debt as of December 31, 2012, of all of the Company’s unconsolidated real estate joint ventures is $7.1 billion, of which the Company’s proportionate share of this debt is $2.8 billion. As of December 31, 2012, these loans had scheduled maturities ranging from one month to 10 years and bear interest at rates ranging from 1.21% to 10.50%. Approximately $570.6 million of the aggregate outstanding loan balance matures in 2013, of which the Company’s proportionate share is $274.1 million. These maturing loans are anticipated to be repaid with operating cash flows, debt refinancing and partner capital contributions, as deemed appropriate. (See Footnote 8 of the Notes to Consolidated Financial Statements included in this Form 10-K). Other Real Estate Investments The Company previously provided capital to owners and developers of real estate properties through its Preferred Equity program. The Company accounts for its preferred equity investments under the equity method of accounting. As of December 31, 2012, the Company’s net investment under the Preferred Equity Program was $157.2 million relating to 107 properties. As of December 31, 2012, these preferred equity investment properties had individual non-recourse mortgage loans aggregating $694.3 million. Due to the Company’s preferred position in these investments, the Company’s share of each investment is subject to fluctuation and is dependent upon property cash flows. The Company’s maximum exposure to losses associated with its preferred equity investments is primarily limited to its invested capital. Additionally, during July 2007, the Company invested $81.7 million of preferred equity capital in a portfolio comprised of 403 net leased properties which are divided into 30 master leased pools with each pool leased to individual corporate operators. These properties consist of a diverse array of free-standing restaurants, fast food restaurants, convenience and auto parts stores. As of December 31, 2012, the remaining 397 properties were encumbered by third party loans aggregating $358.9 million, not including $63.7 million in net fair market value of debt adjustments, with interest rates ranging from 5.08% to 10.47%, a weighted average interest rate of 9.3% and maturities ranging from one to 10 years. At December 31, 2012, the Company had a 90% equity participation interest in an existing leveraged lease of 11 properties, which is reported as a net investment in leveraged lease in accordance with the FASB’s Lease guidance. The properties are leased under a long- term bond-type net lease whose primary term expires in 2016, with the lessee having certain renewal option rights. These 11 properties were encumbered by third-party non-recourse debt of $21.1 million that is scheduled to fully amortize during the primary term of the lease from a portion of the periodic net rents receivable under the net lease. As an equity participant in the leveraged lease, the Company has no recourse obligation for principal or interest payments on the debt, which is collateralized by a first mortgage lien on the properties and collateral assignment of the lease. Accordingly, this debt has been offset against the related net rental receivable under the lease. Funds from Operations Funds From Operations (“FFO”) is a supplemental non-GAAP measure utilized to evaluate the operating performance of real estate companies. The National Association of Real Estate Investment Trusts (“NAREIT”) defines FFO as net income/(loss) attributable to common shareholders computed in accordance with generally accepted accounting principles (“GAAP”), excluding (i) gains or losses from sales of operating real estate assets and (ii) extraordinary items, plus (iii) depreciation and amortization of operating properties and (iv) impairment of depreciable real estate and in substance real estate equity investments and (v) after adjustments for unconsolidated partnerships and joint ventures calculated to reflect funds from operations on the same basis. The Company presents FFO as it considers it an important supplemental measure of our operating performance and believes it is frequently used by securities analysts, investors and other interested parties in the evaluation of REITs, many of which present FFO when reporting results. Comparison of our presentation of FFO to similarly titled measures for other REITs may not necessarily be meaningful due to possible differences in the application of the NAREIT definition used by such REITs. 30 The Company also presents FFO as adjusted as an additional supplemental measure as it believes it is more reflective of the Company’s core operating performance. The Company believes FFO as adjusted provides investors and analysts an additional measure in comparing the Company’s performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance. FFO as adjusted is generally calculated by the Company as FFO excluding certain transactional income and expenses and non-operating impairments which management believes are not reflective of the results within the Company’s operating real estate portfolio. FFO is a supplemental non-GAAP financial measure of real estate companies’ operating performances, which does not represent cash generated from operating activities in accordance with GAAP and therefore should not be considered an alternative for net income as a measure of liquidity. Our method of calculating FFO and FFO as adjusted may be different from methods used by other REITs and, accordingly, may not be comparable to such other REITs. The Company’s reconciliation of net income available to common shareholders to FFO and FFO as adjusted for the three months and years ended December 31, 2012 and 2011 is as follows (in thousands, except per share data): Net income available to common shareholders ....................................... $ Gain on disposition of operating property, net of noncontrolling interests ................................................................................................................. Gain on disposition of joint venture operating properties .................. Depreciation and amortization - real estate related ............................... Depreciation and amortization - real estate joint ventures, net of noncontrolling interests ........................................................................... Remeasurement of derivative instrument Impairments of operating properties, net of tax and noncontrolling interests ................................................................................ FFO .................................................................................................................................... Transactional (income)/charges: Promote income from other real estate investments.................... Promote income from real estate joint ventures .............................. Gains from development/land sales, net of tax.................................. Income from other real estate investments ......................................... Foreign currency exchange gains ............................................................... Acquisition costs ................................................................................................. Charge off of assets relating to sales ........................................................ Executive severance costs ............................................................................. Excess distribution from a cost method investment....................... Gain on sale of marketable securities ...................................................... Impairments on other investments, net of tax and noncontrolling interest ............................................................................. Preferred stock redemption costs ............................................................. Other expense/(income), net ...................................................................... Total transactional charges/(income), net.................. FFO as adjusted ........................................................................................................ $ Weighted average shares outstanding for FFO calculations: Basic ................................................................................................................................... Units ............................................................................................................................ Dilutive effect of equity awards .................................................................... Diluted (1) ..................................................................................................................... FFO per common share – basic .................................................................... $ FFO per common share – diluted (1) ........................................................ $ FFO as adjusted per common share – basic ......................................... $ FFO as adjusted per common share – diluted (1) ............................ $ Three Months Ended December 31, 2012 2011 Year Ended December 31, 2012 2011 59,231 $ 31,556 $ 172,673 $ 109,688 (49,023) (4,914) 63,246 32,228 - 26,440 127,208 (10,996) (1,151) (14) - - 701 3,785 - (398) - - 15,490 143 7,560 134,768 406,345 1,522 1,829 409,696 0.31 0.31 0.33 0.33 $ $ $ $ $ (11,398) (819) 60,561 (84,828) (27,927) 257,278 34,529 - 133,734 - (19,444) (4,050) 246,746 138,482 4,287 21,014 135,443 59,510 510,440 42,043 517,752 (9,715) (2,403) (3,699) - - 1,143 1,032 - (287) (778) 3,002 - 227 (11,932) 123,511 $ 406,554 1,532 787 408,873 0.33 $ 0.33 $ 0.30 $ 0.30 $ (20,746) (5,072) (8,309) - - 9,160 3,785 2,472 (398) - - 21,703 1,166 3,761 514,201 405,997 1,455 2,106 409,558 1.26 1.25 1.26 1.26 $ $ $ $ $ (9,829) (2,675) (5,317) (1,311) (839) 5,466 1,032 - (13,116) (4,895) 4,463 - (951) (27,972) 489,780 406,530 1,528 1,140 409,198 1.27 1.27 1.20 1.20 (1) For the three and twelve months ended December 31, 2012 and 2011, the effect of certain convertible units would have an anti-dilutive effect upon the calculation of Income from continuing operations per share. Accordingly, the impact of such conversion has not been included in the determination of diluted earnings per share calculations. 31 Same Property Net Operating Income Same Property Net Operating Income (“Same Property NOI”) is a supplemental non-GAAP financial measure of real estate companies’ operating performance. Same Property NOI is considered by management to be an important performance measure of the Company’s operations and management believes that it is helpful to investors as a measure of the Company’s operating performance because it includes only the net operating income of properties that have been owned for the entire current and prior year reporting periods and excludes properties under development and pending stabilization. As such, Same Property NOI assists in eliminating disparities in net income due to the development, acquisition or disposition of properties during the particular period presented, and thus provides a more consistent performance measure for the comparison of the Company's properties. Same Property NOI is calculated using revenues from rental properties (excluding straight-line rents, lease termination fees and above/below market rents) less operating and maintenance expense, real estate taxes and rent expense, plus the Company’s proportionate share of Same Property NOI from unconsolidated real estate joint ventures, calculated on the same basis. Same Property NOI includes all properties that are owned for the entire current and prior year reporting periods and excludes properties under development and properties pending stabilization. Properties are deemed stabilized at the earlier of (i) reaching 90% leased or (ii) one year following a projects inclusion in operating real estate (two years for Latin American properties). Same Property NOI is a supplemental non-GAAP financial measure of real estate companies’ operating performance and should not be considered an alternative to net income in accordance with GAAP or as a measure of liquidity. Our method of calculating Same Property NOI may differ from methods used by other REITs and, accordingly, may not be comparable to such other REITs. The following is a reconciliation of the Company’s Income from continuing operations to Same Property NOI (in thousands): Income from continuing operations ..................................... $ Adjustments: Management and other fee income .................................. General and administrative expenses ............................... Impairment of property carrying values .......................... Depreciation and amortization ............................................ Other income ................................................................................ (Benefit)/provision for income taxes, net ....................... Gains on change in control of interests ........................... Equity in income of other real estate investments, net ................................................................................................ Non same property net operating income ................... Non operational expense from joint ventures ............ Net operating income from noncontrolling interests ..................................................................................... Same Property NOI ........................................................................ $ Three Months Ended December 31, 2012 2011 Year Ended December 31, 2012 2011 45,887 $ 44,961 $ 211,978 $ 158,977 (10,469) 29,166 18,463 64,070 54,601 (802) (1,399) (18,057) (38,057) 77,357 (2,239) $ 218,521 (8,494) 28,689 5,320 58,307 42,883 6,968 - (16,690) (32,434) 84,797 (2,971) $ 211,336 (37,522) 124,480 37,111 249,493 223,441 3,939 (15,555) (53,397) (171,115) 289,234 (10,255) 851,832 $ (35,320) 118,873 13,077 231,712 188,468 21,330 (569) (51,813) (128,991) 328,804 (11,565) 832,983 Same Property NOI increased by $7.2 million or 3.4% for the three months ended December 31, 2012, as compared to the corresponding period in 2011. This increase is primarily the result of (i) an increase of $4.7 million related to lease-up and rent commencements, (ii) an increase of $2.0 million in other property and ancillary income, and (iii) the impact from changes in foreign currency exchange rates of $0.5 million. Same Property NOI increased by $18.8 million or 2.3% for the year ended December 31, 2012, as compared to the corresponding period in 2011. This increase is primarily the result of (i) an increase of $15.8 million related to lease-up and rent commencements and (ii) an increase of $7.8 million in other property and ancillary income, partially offset by, (iii) the negative impact from changes in foreign currency exchange rates of $4.8 million. 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 payment of additional rent calculated as a percentage of tenants' gross sales above pre-determined thresholds, which generally increase as prices rise, and/or escalation clauses, which generally increase rental rates during the terms of the leases. Such escalation clauses often include increases based upon changes 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 to 32 market rates upon renewal. 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 foreign currency exchange rates and will, from time-to-time, enter into interest rate protection agreements and/or foreign currency hedge agreements which mitigate, but do not eliminate, the effect of changes in interest rates on its floating-rate debt and fluctuations in foreign currency exchange rates. Market and Economic Conditions; Real Estate and Retail Shopping Sector In the U.S., economic and market conditions have improved. Credit conditions have continued to allow increased access and availability to secured mortgage debt and the unsecured bond and equity markets. However, there remains concern over high unemployment rates in the U.S. and concerns over uncertain economic conditions in Europe. These conditions have contributed to slow growth in the U.S. and international economies. Historically, real estate has been subject to a wide range of cyclical economic conditions that affect various real estate markets and geographic regions with differing intensities and at different times. Different regions of the United States have and may continue to experience varying degrees of economic growth or distress. Adverse changes in general or local economic conditions could result in the inability of some tenants of the Company to meet their lease obligations and could otherwise adversely affect the Company’s ability to attract or retain tenants. The Company’s shopping centers are typically anchored by two or more national tenants who generally offer day-to-day necessities, rather than high-priced luxury items. In addition, the Company seeks to reduce its operating and leasing risks through ownership of a portfolio of properties with a diverse geographic composition and tenant base. The Company monitors potential credit issues of its tenants, and analyzes the possible effects to the financial statements of the Company and its unconsolidated joint ventures. In addition to the collectability assessment of outstanding accounts receivable, the Company evaluates the related real estate for recoverability as well as any tenant related deferred charges for recoverability, which may include straight-line rents, deferred lease costs, tenant improvements, tenant inducements and intangible assets. The retail shopping sector overall has continued to steadily improve during 2012, however select markets, which experienced rapid expansion prior to the economic recession, such as Nevada, Arizona and select portions of California are experiencing slower growth. If growth in the retail shopping sector does not continue, the Company may experience tenants delaying lease commencements or declining to extend or renew leases upon expiration. These conditions also have forced some weaker retailers, in some cases, to declare bankruptcy and/or close stores. Certain retailers have announced store closings even though they have not filed for bankruptcy protection. However, any of these particular store closings affecting the Company often represent a small percentage of the Company’s overall gross leasable area and the Company does not currently expect store closings to have a material adverse effect on the Company’s overall performance. New Accounting Pronouncements See Footnote 1 of the Company’s Consolidated Financial Statements included in this Form 10-K. Item 7A. Quantitative and Qualitative Disclosures About Market Risk The Company’s primary market risk exposure is interest rate risk. The following table presents the Company’s aggregate fixed rate and variable rate domestic and foreign debt obligations outstanding as of December 31, 2012, with corresponding weighted-average interest rates sorted by maturity date. The table does not include extension options where available. Amounts include fair value purchase price allocation adjustments for assumed debt. The information is presented in U.S. dollar equivalents, which is the Company’s reporting currency. The instruments’ actual cash flows are denominated in U.S. dollars, Canadian dollars (CAD), Mexican pesos (MXN) and Chilean Pesos (CLP) as indicated by geographic description ($USD equivalent in millions). 2013 2014 2015 2016 2017 Thereafter Total Fair Value U.S. Dollar Denominated Secured Debt Fixed Rate ................................... $ Average Interest Rate ........... 85.1 $ 5.99% 192.0 $ 128.9 $ 256.6 $ 184.4 $ 6.47% 5.43% 6.69% 6.15% 88.4 $ 6.80% 935.4 $ 995.7 6.31% Variable Rate ............................. $ Average Interest Rate ........... - $ - $ - - $ 6.0 0.17% $ - - $ - - 21.5 $ 3.06% $ 27.5 2.43% 26.9 33 2013 2014 2015 2016 2017 Thereafter Total Fair Value Unsecured Debt Fixed Rate ................................... $ Average Interest Rate ........... 275.0 $ 5.40% 294.8 $ 350.0 $ 300.0 $ 290.9 $ 600.0 $ 2,110.7 $ 2,346.0 5.20% 5.29% 5.78% 5.70% 5.59% 5.50% Variable Rate ............................. $ Average Interest Rate ........... CAD Denominated Unsecured Debt Fixed Rate ................................... $ Average Interest Rate ........... MXN Denominated Unsecured Debt Fixed Rate ................................... $ Average Interest Rate ........... CLP Denominated Secured Debt Variable Rate ............................. $ Average Interest Rate ........... 2.2 $ 5.50% 400.0 $ 250.0 $ 1.26% 1.25% 201.3 $ 5.18% 76.9 $ 8.58% - $ - $ $ $ - - - - - - $ $ $ - - - - - - $ $ $ $ - - - - - - - - $ $ $ $ - - - - - - - - - $ - 652.2 $ 629.8 1.27% 151.0 $ 5.99% 352.3 $ 363.1 5.53% - $ - $ 76.9 8.58% 69.6 40.3 $ 5.72% $ 40.3 5.72% 45.9 Based on the Company’s variable-rate debt balances, interest expense would have increased by $7.2 million in 2012 if short-term interest rates were 1.0% higher. The Company also faces foreign currency exchange risk. The following table presents the Company’s foreign investments as of December 31, 2012. Investment amounts are shown in their respective local currencies and the U.S. dollar equivalents: Foreign Investment (in millions) Country Mexican real estate investments (MXN) ............................................................................................................... Canadian real estate joint venture and marketable securities investments (CAD)........................ Chilean real estate investments (CLP) .................................................................................................................... Brazilian real estate investments (Brazilian Real) ............................................................................................... Peruvian real estate investments (Peruvian Nuevo Sol) ............................................................................... Local Currency US Dollars 8,881.2 397.8 37,761.2 43.5 14.7 $ $ $ $ $ 685.0 400.5 78.9 21.3 5.9 The foreign currency exchange risk has been partially mitigated, but not eliminated, through the use of local currency denominated debt. The Company has not, and does not plan to, enter into any derivative financial instruments for trading or speculative purposes. As of December 31, 2012, the Company has no other material exposure to market risk. Item 8. Financial Statements and Supplementary Data The response to this Item 8 is included in our audited Notes to Consolidated Financial Statements, which are contained in Part IV Item 15 of this Form 10-K. Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure None. Item 9A. Controls and Procedures Evaluation of Disclosure Controls and Procedures The Company’s management, with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d- 15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act")) as of the end of the period covered by this report. Based on such evaluation, the Company’s Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of such period, the Company’s disclosure controls and procedures are effective. 34 Changes in Internal Control Over Financial Reporting There have not been any changes in the Company’s internal control over financial reporting (as such term is defined in Rules 13a- 15(f) and 15d-15(f) under the Exchange Act) during the fourth fiscal quarter ended December 31, 2012, to which this report relates, that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting. Management’s Report on Internal Control Over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f) and 15d-15(f). Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on our evaluation under the framework in Internal Control-Integrated Framework, our management concluded that our internal control over financial reporting was effective as of December 31, 2012. The effectiveness of our internal control over financial reporting as of December 31, 2012, has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report which is included herein. Item 9B. Other Information None. Item 10. Directors, Executive Officers and Corporate Governance PART III The information required by this item is incorporated by reference to “Proposal 1—Election of Directors,” “Corporate Governance,” “Committees of the Board of Directors” and “Section 16(a) Beneficial Ownership Reporting Compliance” in our Proxy Statement. We have adopted a Code of Ethics the Investors/Governance/Governance Documents section of our website at www.kimcorealty.com. A copy of the Code of Ethics is available in print, free of charge, to stockholders upon request to us at the address set forth in Item 1 of this Annual Report on Form 10-K under the section “Business - Background.” We intend to satisfy the disclosure requirements under the Securities and Exchange Act of 1934, as amended, regarding an amendment to or waiver from a provision of our Code of Ethics by posting such information on our web site. to all employees. The Code of Ethics is available at that applies Item 11. Executive Compensation The information required by this item is incorporated by reference to “Compensation Discussion and Analysis,” “Executive Compensation Committee Report,” “Compensation Tables” and “Compensation of Directors” in our Proxy Statement. Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters The information required by this item is incorporated by reference to “Security Ownership of Certain Beneficial Owners and Management” and “Compensation Tables” in our Proxy Statement. Item 13. Certain Relationships and Related Transactions, and Director Independence The information required by this item is incorporated by reference to “Certain Relationships and Related Transactions” and “Corporate Governance” in our Proxy Statement. Item 14. Principal Accounting Fees and Services The information required by this item is incorporated by reference to “Independent Registered Public Accountants” in our Proxy Statement. 35 Item 15. Exhibits and Financial Statement Schedules PART IV (a) 1. Financial Statements – The following consolidated financial information is included as a separate section of this annual report on Form 10-K. Form10-K Report Page Report of Independent Registered Public Accounting Firm....................................................................................... 41 Consolidated Financial Statements Consolidated Balance Sheets as of December 31, 2012 and 2011 ............................................................... 42 Consolidated Statements of Income for the years ended December 31, 2012, 2011 and 2010 ..................................................................................................................... 43 Consolidated Statements of Comprehensive Income for the years ended December 31, 2012, 2011 and 2010 ..................................................................................................................... 44 Consolidated Statements of Changes in Equity for the years ended December 31, 2012, 2011 and 2010 ..................................................................................................................... 45 Consolidated Statements of Cash Flows for the years ended December 31, 2012, 2011 and 2010 ..................................................................................................................... Notes to Consolidated Financial Statements ............................................................................................................... 2. Financial Statement Schedules - Schedule II - Valuation and Qualifying Accounts.............................................................................................................. Schedule III - Real Estate and Accumulated Depreciation ........................................................................................... Schedule IV - Mortgage Loans on Real Estate ..................................................................................................................... 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. 47 48 92 93 100 3. Exhibits - The exhibits listed on the accompanying Index to Exhibits are filed as part of this report. ....................... 37 36 INDEX TO EXHIBITS Incorporated by Reference Exhibit Number 3.1(a) 3.1(b) 3.2(a) 3.2(b) 3.2(c) 3.2(d) 4.1 4.2 4.3 4.4 4.5 4.6 4.7 4.8 4.9 4.10 4.11 4.12 10.1 10.2 10.3 10.4 10.5 10.6 Exhibit Description Articles of Restatement of the Company, dated January 14, 2011 Articles Supplementary of the Company dated November 8, 2010 Amended and Restated By-laws of the Company, dated February 25, 2009 Articles Supplementary of Kimco Realty Corporation, dated March 12, 2012 Articles Supplementary of Kimco Realty Corporation, dated July 17, 2012 Articles Supplementary of Kimco Realty Corporation, dated November 30, 2012 Agreement of the Company pursuant to Item 601(b)(4)(iii)(A) of Regulation S-K Form of Certificate of Designations for the Preferred Stock Indenture dated September 1, 1993, between Kimco Realty Corporation and Bank of New York (as successor to IBJ Schroder Bank and Trust Company) First Supplemental Indenture, dated as of August 4, 1994 Second Supplemental Indenture, dated as of April 7, 1995 Indenture dated April 1, 2005, between Kimco North Trust III, Kimco Realty Corporation, as guarantor and BNY Trust Company of Canada, as trustee Third Supplemental Indenture, dated as of June 2, 2006 Fifth Supplemental Indenture, dated as of October 31, 2006, among Kimco Realty Corporation, Pan Pacific Retail Properties, Inc. and Bank of New York Trust Company, N.A., as trustee First Supplemental Indenture, dated as of October 31, 2006, among Kimco Realty Corporation, Pan Pacific Retail Properties, Inc. and Bank of New York Trust Company, N.A., as trustee First Supplemental Indenture, dated as of June 2, 2006, among Kimco North Trust III, Kimco Realty Corporation, as guarantor and BNY Trust Company of Canada, as trustee Second Supplemental Indenture, dated as of August 16, 2006, among Kimco North Trust III, Kimco Realty Corporation, as guarantor and BNY Trust Company of Canada, as trustee Fifth Supplemental Indenture, dated September 24, 2009, between Kimco Realty Corporation and The Bank of New York Mellon, as trustee Amended and Restated Stock Option Plan Second Amended and Restated 1998 Equity Participation Plan of Kimco Realty Corporation (restated February 25, 2009) Form of Indemnification Agreement Employment Agreement between Kimco Realty Corporation and Glenn G. Cohen, dated February 25, 2009 1 billion MXN Credit Agreement, dated as of March 3, 2008, among KRC Mexico Acquisition, LLC, as borrower, Kimco Realty Corporation, as guarantor and each of the parties named therein Amendment to Employment Agreement between Kimco Realty Corporation and Glenn G. Cohen, dated March 15, 2010 37 Form File No. 10-K 1-10899 02/28/11 3.1(a) Date of Filing Exhibit Number Filed Herewith Page Number 10-K 1-10899 02/28/11 3.1(b) 10-K 1-10899 02/27/09 3.2 8-A12B 1-10899 03/13/12 3.2 8-A12B 1-10899 07/18/12 3.2 3.2 4.1 S-11 8-A12B 1-10899 12/03/12 09/11/91 333- 42588 333- 67552 333- 67552 S-3 S-3 09/10/93 4(d) 09/10/93 4(a) 10-K 8-K 8-K 4.6 1-10899 03/28/96 1-10899 04/07/95 4(a) 4.1 1-10899 04/25/05 8-K 8-K 1-10899 06/05/06 1-10899 11/03/06 4.1 4.1 8-K 1-10899 11/03/06 4.2 10-K 1-10899 02/28/07 4.12 10-K 1-10899 02/28/07 4.13 8-K 1-10899 09/24/09 4.1 10-K 10-K 10-K 10-K 1-10899 03/28/95 10.3 1-10899 02/27/09 10.9 1-10899 02/27/09 10.16 1-10899 02/27/09 10.17 10-K/A 1-10899 08/17/10 10.18 8-K 1-10899 03/19/10 10.4 Incorporated by Reference Date of Exhibit Number Filed Herewith Page Number Exhibit Number 10.7 8-K 8-K 8-K Filing Form File No. 1-10899 03/19/10 10.5 10-Q 1-10899 05/07/10 99.1 10-Q 1-10899 05/07/10 99.2 1-10899 03/19/10 10.7 1-10899 03/19/10 10.8 Exhibit Description Kimco Realty Corporation Executive Severance Plan, dated March 15, 2010 Kimco Realty Corporation 2010 Equity Participation Plan Form of Performance Share Award Grant Notice and Performance Share Award Agreement Underwriting Agreement, dated April 6, 2010, by and among Kimco Realty Corporation, Kimco North Trust III, and each of the parties named therein Third Supplemental Indenture, dated as of April 13, 2010, among Kimco Realty Corporation, as guarantor, Kimco North Trust III, as issuer and BNY Trust Company of Canada, as trustee Credit Agreement, dated as of April 17, 2009, among Kimco Realty Corporation and each of the parties named therein Underwriting Agreement, dated August 23, 2010, by and among Kimco Realty Corporation and each of the parties named therein $1.75 Billion Credit Agreement, dated as of October 27, 2011, among Kimco Realty Corporation and each of the parties named therein Agreement and General Release between Kimco Realty Corporation and Barbara Pooley, dated January 18, 2012 $400 Million Credit Agreement, dated as of April 17, 2012, among Kimco Realty Corporation as borrower and each of the parties named therein First Amendment to the Kimco Realty Corporation Executive Severance Plan, dated as of March 20, 2012 $147.5 Million Credit Agreement, dated as of June 28, 2012, by and among InTown Hospitality Corp. as borrower, Kimco Realty Corporation as guarantor, and each of the parties named therein 8-K 1-10899 7/03/12 10.1 8-K 1-10899 1/19/12 10.1 8-K 1-10899 4/20/12 10.1 10-Q 1-10899 5/10/12 10.3 1-10899 11/2/11 10.1 1-10899 08/24/10 10-K/A 1-10899 08/17/10 10.19 1.1 8-K 8-K Kimco Realty Corporation 2010 Equity Participation Plan S-8 184776 11/06/12 99.1 333- 10.8 10.9 10.10 10.11 10.12 10.13 10.14 10.15 10.16 10.17 10.18 10.19 31.2 32.1 12.1 12.2 21.1 23.1 31.1 Computation of Ratio of Earnings to Fixed Charges Computation of Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends Significant Subsidiaries of the Company Consent of PricewaterhouseCoopers LLP Certification of the Company’s Chief Executive Officer, David B. Henry, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 Certification of the Company’s Chief Financial Officer, Glenn G. Cohen, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 Certification of the Company’s Chief Executive Officer, David B. Henry, and the Company’s Chief Financial Officer, Glenn G. Cohen, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 99.1 Property Chart 101.INS XBRL Instance Document 101.SCH XBRL Taxonomy Extension Schema 101.CAL XBRL Taxonomy Extension Calculation Linkbase 101.DEF XBRL Taxonomy Extension Definition Linkbase 101.LAB XBRL Taxonomy Extension Label Linkbase 101.PRE XBRL Taxonomy Extension Presentation Linkbase * Incorporated by reference to the corresponding Exhibit to the ’ Company’s 38 — — — — — — — — — — — — — — — — — — — — — — — — — — — — X X * * X X X 101 102 103 104 105 106 — — — — — — — — — — — — — — — — — — — — — Annual Report on Form 10-K filed on February 27, 2013. — — — — — — — X * * * * * * 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. SIGNATURES KIMCO REALTY CORPORATION By: /s/ David B. Henry David B. Henry Chief Executive Officer Dated: February 26, 2013 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/ Milton Cooper Milton Cooper /s/ David B. Henry David B. Henry /s/ Richard G. Dooley Richard G. Dooley /s/ Joe Grills Joe Grills /s/ F. Patrick Hughes F. Patrick Hughes /s/ Frank Lourenso Frank Lourenso /s/ Richard Saltzman Richard Saltzman /s/ Philip Coviello Philip Coviello /s/ Colombe Nicholas Colombe Nicholas /s/ Michael V. Pappagallo Michael V. Pappagallo /s/ Glenn G. Cohen Glenn G. Cohen /s/ Paul Westbrook Paul Westbrook Executive Chairman of the Board of Directors February 26, 2013 Chief Executive Officer and Vice Chairman of the Board of Directors Director Director Director Director Director Director Director Executive Vice President - Chief Operating Officer Executive Vice President - Chief Financial Officer and Treasurer Vice President - Chief Accounting Officer 39 February 26, 2013 February 26, 2013 February 26, 2013 February 26, 2013 February 26, 2013 February 26, 2013 February 26, 2013 February 26, 2013 February 26, 2013 February 26, 2013 February 26, 2013 ANNUAL REPORT ON FORM 10-K ITEM 8, ITEM 15 (a) (1) and (2) INDEX TO FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES Form10-K Page KIMCO REALTY CORPORATION AND SUBSIDIARIES Report of Independent Registered Public Accounting Firm ............................................................................................................................................ 41 Consolidated Financial Statements and Financial Statement Schedules: Consolidated Balance Sheets as of December 31, 2012 and 2011 ............................................................................................................. Consolidated Statements of Income for the years ended December 31, 2012, 2011 and 2010 ............................................... Consolidated Statements of Comprehensive Income for the years ended December 31, 2012, 2011 and 2010 ........... Consolidated Statements of Changes in Equity for the years ended December 31, 2012, 2011 and 2010 ......................... Consolidated Statements of Cash Flows for the years ended December 31, 2012, 2011 and 2010 ....................................... Notes to Consolidated Financial Statements ............................................................................................................................................................ Financial Statement Schedules: II. Valuation and Qualifying Accounts .......................................................................................................................................................... III. Real Estate and Accumulated Depreciation........................................................................................................................................ IV. Mortgage Loans on Real Estate ................................................................................................................................................................. 42 43 44 45 47 48 92 93 100 40 Report of Independent Registered Public Accounting Firm To the Board of Directors and Stockholders of Kimco Realty Corporation: In our opinion, the consolidated financial statements listed in the index appearing under Item 15(a)(1) present fairly, in all material respects, the financial position of Kimco Realty Corporation and its subsidiaries (the "Company") at December 31, 2012 and 2011, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2012 in conformity with accounting principles generally accepted in the United States of America. In addition, in our opinion, the financial statement schedules listed in the index appearing under Item 15(a)(2) present fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial statements. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2012, based on criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Company's management is responsible for these financial statements and financial statement schedules, for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in Management's Report on Internal Control over Financial Reporting appearing under Item 9A. Our responsibility is to express opinions on these financial statements, on the financial statement schedules, and on the Company's internal control over financial reporting based on our integrated audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the financial statements included 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. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions. A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. /s/ PricewaterhouseCoopers LLP New York, New York February 26, 2013 41 KIMCO REALTY CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in thousands, except share information) December 31, December 31, 2012 2011 Assets: Real Estate Rental property Land ............................................................................................................................................................................. $ Building and improvements ............................................................................................................................ Less: accumulated depreciation and amortization.............................................................................. Real estate under development .................................................................................................................................. Real estate, net ........................................................................................................................................................... Investments and advances in real estate joint ventures ...................................................................................... Other real estate investments ........................................................................................................................................... Mortgages and other financing receivables ................................................................................................................ Cash and cash equivalents ................................................................................................................................................... Marketable securities .............................................................................................................................................................. Accounts and notes receivable ......................................................................................................................................... Deferred charges and prepaid expenses ..................................................................................................................... Other assets ................................................................................................................................................................................ Total assets ....................................................................................................................................................................................... $ Liabilities: Notes payable ............................................................................................................................................................................ $ Mortgages payable ................................................................................................................................................................... Construction loans payable ................................................................................................................................................ Accounts payable and accrued expenses ................................................................................................................... Dividends payable .................................................................................................................................................................... Other liabilities ........................................................................................................................................................................... Total liabilities .................................................................................................................................................................................. Redeemable noncontrolling interests ................................................................................................................................. Stockholders' equity: Preferred stock, $1.00 par value, authorized 5,961,200 and 5,146,000 shares, respectively, 102,000 and 954,000 shares issued and outstanding (in series), respectively, Aggregate liquidation preference $975,000 and $810,000, respectively ..................................................................... Common stock, $.01 par value, authorized 750,000,000 shares issued and outstanding 407,782,102 and 406,937,830 shares, respectively ........................................................................................... Paid-in capital .............................................................................................................................................................................. Cumulative distributions in excess of net income .................................................................................................. Accumulated other comprehensive income ............................................................................................................. Total stockholders' equity ........................................................................................................................................................ Noncontrolling interests ....................................................................................................................................................... Total equity ...................................................................................................................................................................................... Total liabilities and equity .......................................................................................................................................................... $ 2,024,300 $ 6,825,724 8,850,024 (1,745,462) 7,104,562 97,263 7,201,825 1,428,155 317,557 70,704 141,875 36,541 161,113 171,373 211,664 9,740,807 $ 3,192,127 $ 1,003,190 - 111,881 96,518 323,535 4,727,251 81,076 1,945,045 6,646,490 8,591,535 (1,693,090) 6,898,445 179,722 7,078,167 1,404,214 344,131 102,972 112,882 33,540 164,053 161,974 226,829 9,628,762 2,983,886 1,085,371 45,128 125,544 92,159 321,457 4,653,545 95,074 102 954 4,078 5,651,170 (824,008) (66,182) 4,765,160 167,320 4,932,480 9,740,807 $ 4,069 5,492,022 (702,999) (107,660) 4,686,386 193,757 4,880,143 9,628,762 The accompanying notes are an integral part of these consolidated financial statements. 42 KIMCO REALTY CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (in thousands, except per share data) 2012 Year Ended December 31, 2011 2010 Revenues Revenues from rental properties ................................................................................................................. Management and other fee income ........................................................................................................... Total revenues ................................................................................................................................................. $ Operating expenses Rent .................................................................................................................................................................................... Real estate taxes ......................................................................................................................................................... Operating and maintenance ................................................................................................................................. General and administrative expenses .............................................................................................................. Provision for doubtful accounts .......................................................................................................................... Impairment charges ................................................................................................................................................... Depreciation and amortization ........................................................................................................................... Total operating expenses .......................................................................................................................... Operating income ................................................................................................................................................................... Other income/(expense) Mortgage financing income .................................................................................................................................... Interest, dividends and other investment income ..................................................................................... Other expense, net ................................................................................................................................................... Interest expense .......................................................................................................................................................... Early extinguishment of debt ................................................................................................................................ Income from other real estate investments ................................................................................................. Gain on sale of development properties ....................................................................................................... Income from continuing operations before income taxes, equity in income of joint ventures, gains on change in control of interests and equity in income from other real estate investments .................................................................................................................................. Provision for income taxes, net .......................................................................................................................... Equity in income of joint ventures, net ........................................................................................................... Gains on change in control of interests .......................................................................................................... Equity in income of other real estate investments, net .......................................................................... Income from continuing operations ....................................................................................................... Discontinued operations Income from discontinued operating properties, net of tax ............................................................... Impairment/loss on operating properties sold, net of tax .................................................................... Gain on disposition of operating properties, net of tax ........................................................................ Income from discontinued operations.................................................................................................. Loss on transfer of operating properties, net .................................................................................................... Gain on sale of operating properties, net of tax .............................................................................................. Total net gain on transfer of operating properties, net ............................................................ Net income ............................................................................................................................................................. Net income attributable to noncontrolling interests ............................................................................... Net income attributable to the Company ......................................................................................... Preferred stock redemption costs ..................................................................................................................... Preferred stock dividends ....................................................................................................................................... 884,782 37,522 922,304 12,761 115,282 118,787 124,480 6,880 37,111 249,493 664,794 257,510 7,504 2,170 (7,971) (227,595) - 2,451 - 34,069 (3,939) 112,896 15,555 53,397 211,978 3,084 (22,339) 83,253 63,998 - 4,299 4,299 280,275 (14,202) 266,073 (21,703) (71,697) $ $ 825,737 35,320 861,057 13,863 108,782 114,101 118,873 7,723 13,077 231,712 608,131 252,926 7,273 16,567 (4,680) (223,526) - 3,824 12,074 64,458 (21,330) 63,467 569 51,813 158,977 23,021 (17,343) 17,327 23,005 - 108 108 182,090 (13,039) 169,051 - (59,363) Net income available to the Company's common shareholders ....................................... $ 172,673 $ 109,688 $ Per common share: Income from continuing operations: -Basic .................................................................................................................................................................................. -Diluted ............................................................................................................................................................................ Net income attributable to the Company: -Basic .................................................................................................................................................................................. -Diluted ............................................................................................................................................................................ Weighted average shares: -Basic .................................................................................................................................................................................. -Diluted ............................................................................................................................................................................ Amounts attributable to the Company's common shareholders: Income from continuing operations, net of tax .......................................................................................... Income from discontinued operations ............................................................................................................. Net income ..................................................................................................................................................................... $ $ $ $ $ $ 0.27 0.27 0.42 0.42 405,997 406,689 110,406 62,267 172,673 $ $ $ $ $ $ 0.22 0.21 0.27 0.27 406,530 407,669 88,067 21,621 109,688 $ $ $ $ $ $ The accompanying notes are an integral part of these consolidated financial statements. 43 786,940 39,866 826,806 13,731 105,336 108,357 109,034 10,642 32,661 217,205 596,966 229,840 9,405 21,229 (4,459) (223,032) (10,811) 3,653 2,080 27,905 (3,208) 34,579 - 60,846 120,122 43,366 (6,175) 1,961 39,152 (57) 2,434 2,377 161,651 (18,783) 142,868 - (51,346) 91,522 0.14 0.14 0.22 0.22 405,827 406,201 57,658 33,864 91,522 KIMCO REALTY CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (in thousands) Year Ended December 31, 2012 2011 2010 Net income ......................................................................................................................................... $ Other comprehensive income: Change in unrealized gain/(loss) on marketable securities, net....................... Change in unrealized gain/(loss) on interest rate swaps, net............................ Change in foreign currency translation adjustment, net...................................... Other comprehensive income/(loss) ..................................................................................... 280,275 $ 182,090 $ 161,651 3,013 450 43,515 46,978 (4,065) 549 (82,228) (85,744) 37,006 (420) 52,849 89,435 Comprehensive income ............................................................................................................... 327,253 96,346 251,086 Comprehensive income attributable to noncontrolling interests .......................... (19,702) (11,102) (35,639) Comprehensive income attributable to the Company ............................................... $ 307,551 $ 85,244 $ 215,447 The accompanying notes are an integral part of these consolidated financial statements. 44 KIMCO REALTY CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY For the Years Ended December 31, 2012, 2011 and 2010 (in thousands) Cumulative Distributions Accumulated in Excess of Net Comprehensive Other Income Income Balance, January 1, 2010 ................... $ (338,738) $ (96,432) Preferred Stock Issued Amount 884 884 $ Paid-in Common Stock Issued Amount Capital 405,533 $ 4,055 $5,283,204 $ 4,852,973 $ Equity Stockholders' Noncontrolling Interests Total Equity 265,005 $5,117,978 Total Contributions from noncontrolling interests .............. - - - - - - - - 2,721 2,721 Comprehensive income: Net income ................................. Other comprehensive income: Change in unrealized gain on marketable securities ........................... Change in unrealized loss on interest rate swaps ................................. Change in foreign currency translation adjustment ....................... Redeemable noncontrolling interests ............................................... Dividends ($0.66 per Common Share; $1.6625 per Class F Depositary Share, $1.9375 per Class G Depositary Share and $0.5798 per Class H Depositary Share, respectively) ...................................... Distributions to noncontrolling interests ............................................... Issuance of common stock .............. Surrender of common stock .......... Issuance of preferred stock ............. Exercise of common stock options ................................................. 142,868 - - - - - - 142,868 18,783 161,651 - - - - 37,006 - - - - - 37,006 - 37,006 (420) - - - - - (420) - (420) 35,993 - - - - - 35,993 16,856 52,849 - - - - - - - (6,500) (6,500) (319,294) - - - - - - - - - - - - - - - - 70 - - - 70 - - 353 (78) - - - 4 (1) - - (319,294) - (319,294) - 4,426 - 169,114 - 4,430 (1) 169,184 (64,658) - - - (64,658) 4,430 (1) 169,184 - - 616 6 8,561 8,567 - 8,567 Acquisition of noncontrolling interests ............................................... Amortization of equity awards ..... Balance, December 31, 2010 ........ - - (515,164) - - (23,853) - - 954 - - 954 - - 406,424 - - 4,064 (7,196) 11,732 5,469,841 (7,196) 11,732 4,935,842 (6,763) - 225,444 (13,959) 11,732 5,161,286 Contributions from noncontrolling interests .............. - - - - - - - - 1,045 1,045 Comprehensive income: Net income ................................. Other comprehensive income, net of tax: ............ Change in unrealized loss on marketable securities ........................... Change in unrealized gain on interest rate swaps ................................. Change in foreign currency translation adjustment ....................... Redeemable noncontrolling interests ............................................... 169,051 - - - - - - 169,051 13,039 182,090 - - - - (4,065) - - - - - (4,065) - (4,065) 549 - - - - - 549 - 549 (80,291) - - - - - (80,291) (1,937) (82,228) - - - - - - - (6,370) (6,370) The accompanying notes are an integral part of these consolidated financial statements. 45 KIMCO REALTY CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY For the Years Ended December 31, 2012, 2011 and 2010 (in thousands) (continued) Cumulative Distributions Accumulated in Excess of Net Comprehensive Other Income Income Preferred Stock Issued Amount Common Stock Issued Amount Paid-in Capital Total Stockholders' Noncontrolling Equity Interests Total Equity (356,886) - - - - - - - - - - - - - - - - - - - - - - - - - 438 (34) (334) - - 5 (2) (2) - (356,886) - (356,886) - 4,936 (579) (6,001) - 4,941 (581) (6,003) (13,827) - - - (13,827) 4,941 (581) (6,003) 444 4 6,533 6,537 - 6,537 - - (702,999) - - (107,660) - - 954 - - 954 - - 406,938 - - 4,069 4,452 12,840 5,492,022 4,452 12,840 4,686,386 (23,637) - 193,757 (19,185) 12,840 4,880,143 - 266,073 - - - - - - 3,013 450 38,015 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 1,384 1,384 266,073 14,202 280,275 3,013 450 38,015 - - 3,013 450 5,500 43,515 - (6,337) (6,337) Dividends ($0.73 per Common Share; $1.6625 per Class F Depositary Share, $1.9375 per Class G Depositary Share and $1.7250 per Class H Depositary Share, respectively) ...................................... Distributions to noncontrolling interests ............................................... Issuance of common stock .............. Surrender of common stock .......... Repurchase of common stock ...... Exercise of common stock options ................................................. Acquisition of noncontrolling interests ............................................... Amortization of equity awards ..... Balance, December 31, 2011 ........ Contributions from noncontrolling interests .............. Comprehensive income: Net income ....................................... Other comprehensive income, net of tax: ........................................... Change in unrealized gain on marketable securities .................... Change in unrealized gain on interest rate swaps ........................ Change in foreign currency translation adjustment ................. Redeemable noncontrolling interests ............................................... Dividends ($0.78 per common share; $1.0344 per Class F Depositary Share, $1.5016 per Class G Depositary Share, $1.725 per Class H Depositary Share and $1.1708 per Class I Depositary Share, and $0.5958 per Class J Depositary Share, and $0.0938 per Class K Depositary Share, respectively) ...................................... Distributions to noncontrolling interests ............................................... Issuance of common stock .............. Issuance of preferred stock ............. Surrender of common stock .......... Repurchase of common stock ...... Exercise of common stock options ................................................. (387,082) - - - - - - - - - - 32 - - - - 32 - - - - 1,096 - (111) (1,636) - - 11 - (1) (16) - (387,082) - (387,082) - 18,104 774,125 (2,072) (30,931) - 18,115 774,157 (2,073) (30,947) (15,328) - - - - (15,328) 18,115 774,157 (2,073) (30,947) - - 1,495 15 22,576 22,591 - 22,591 Acquisition of noncontrolling interests ............................................... Amortization of equity awards ..... Redemption of preferred stock .... Balance, December 31, 2012 ........ $ - - - (824,008) $ - - (884) (95) - 11,557 - (635,000) (884) 102 407,782 $ 4,078 $5,651,170 $ 4,765,160 $ (95) 11,557 (634,116) - - - - - - (25,858) - - (25,953) 11,557 (635,000) 167,320 $4,932,480 (66,182) 102 $ - - - - - - - - - - The accompanying notes are an integral part of these consolidated financial statements. 46 KIMCO REALTY CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) Cash flow from operating activities: Net income .............................................................................................................................................................................. $ 280,275 $ 182,090 $ 161,651 Adjustments to reconcile net income to net cash provided by operating activities: Year Ended December 31, 2011 2012 2010 Depreciation and amortization ................................................................................................................................ Loss on operating/development properties held for sale/sold/transferred ...................................... Impairment charges ........................................................................................................................................................ Gain on sale of development properties............................................................................................................ Gain on sale of operating properties .................................................................................................................... Equity in income of joint ventures, net ................................................................................................................ Gains on change in control of interests .............................................................................................................. Equity in income from other real estate investments, net ........................................................................ Distributions from joint ventures and other real estate investments ................................................. Cash retained from excess tax benefits .............................................................................................................. Change in accounts and notes receivable .......................................................................................................... Change in accounts payable and accrued expenses .................................................................................... Change in other operating assets and liabilities .............................................................................................. Net cash flow provided by operating activities .............................................................................. Cash flow from investing activities: Acquisition of and improvements to operating real estate ...................................................................... Acquisition of and improvements to real estate under development ............................................... Investment in marketable securities ...................................................................................................................... Proceeds from sale/repayments of marketable securities ......................................................................... Investments and advances to real estate joint ventures ............................................................................. Reimbursements of investments and advances to real estate joint ventures ................................. Other real estate investments .................................................................................................................................. Reimbursements of investments and advances to other real estate investments ....................... Investment in mortgage loans receivable ........................................................................................................... Collection of mortgage loans receivable ............................................................................................................ Other investments .......................................................................................................................................................... Reimbursements of other investments ............................................................................................................... Proceeds from sale of operating properties ..................................................................................................... Proceeds from sale of development properties ............................................................................................. Net cash flow (used for)/provided by investing activities .............................................................. Cash flow from financing activities: Principal payments on debt, excluding normal amortization of rental property debt..................... Principal payments on rental property debt ..................................................................................................... Principal payments on construction loan financings ..................................................................................... Proceeds from mortgage/construction loan financings ............................................................................... Proceeds from (repayment of)/borrowings under unsecured revolving credit facilities, net .................................................................................................................................................. Repayment of unsecured term loan/notes ........................................................................................................ Proceeds from issuance of unsecured term loan/notes ............................................................................. Financing origination costs .......................................................................................................................................... Redemption of/distribution to noncontrolling interests ............................................................................. Dividends paid .................................................................................................................................................................. Cash retained from excess tax benefits .............................................................................................................. Proceeds from issuance of stock ............................................................................................................................ Redemption of preferred stock ............................................................................................................................... Repurchase of common stock ................................................................................................................................. Net cash flow used for financing activities .............................................................................................. 262,742 - 59,569 - (94,369) (112,896) (15,555) (53,397) 194,110 - 2,940 (11,281) (33,084) 479,054 (552,469) (2,487) - 156 (219,885) 187,856 (5,638) 33,720 (16,021) 63,600 (924) 11,553 449,539 - (51,000) (284,815) (23,130) (2,177) 14,776 8,559 (215,900) 400,000 (2,138) (42,315) (382,722) - 796,748 (635,000) (30,947) (399,061) 251,139 - 32,763 (12,074) (17,435) (63,467) (569) (51,813) 163,048 - (19,271) (8,082) (7,716) 448,613 (343,299) (37,896) - 188,003 (171,695) 63,529 (6,958) 68,881 - 19,148 (730) 20,116 135,646 44,495 (20,760) (62,470) (22,720) (3,428) 20,346 112,137 (92,600) - (11,478) (26,682) (353,764) - 6,537 - (6,003) (440,125) Change in cash and cash equivalents ............................................................................................................. 28,993 (12,272) Cash and cash equivalents, beginning of period ............................................................................................................. Cash and cash equivalents, end of period ......................................................................................................................... $ 112,882 141,875 $ 125,154 112,882 Interest paid during the period (net of capitalized interest of $1,538, $7,086, and $14,730 respectively) ....................................................................................................................................................................................... $ 226,775 $ 220,270 Income taxes paid during the period ................................................................................................................................... $ 2,122 $ 2,606 $ $ $ 247,637 57 39,121 (2,130) (4,366) (55,705) - (39,642) 162,860 (103) (17,388) 15,811 (27,868) 479,935 (182,482) (41,975) (9,041) 30,455 (138,796) 85,205 (12,528) 30,861 (2,745) 27,587 (4,004) 8,792 238,746 7,829 37,904 (226,155) (23,645) (30,383) 13,960 (11,309) (471,725) 449,720 (5,330) (80,852) (306,964) 103 177,837 - - (514,743) 3,096 122,058 125,154 242,033 3,278 The accompanying notes are an integral part of these consolidated financial statements. 47 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Amounts relating to the number of buildings, square footage, tenant and occupancy data, joint venture debt average interest rates and terms and estimated project costs are unaudited. 1. Summary of Significant Accounting Policies: Business Kimco Realty Corporation and subsidiaries (the "Company" or "Kimco"), 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. The Company also provides property management services for shopping centers owned by affiliated entities, various real estate joint ventures and unaffiliated third parties. Additionally, in connection with the Tax Relief Extension Act of 1999 (the "RMA"), which became effective January 1, 2001, the Company is permitted to participate in activities which it was precluded from previously in order to maintain its qualification as a Real Estate Investment Trust ("REIT"), so long as these activities are conducted in entities which elect to be treated as taxable subsidiaries under the Internal Revenue Code, as amended (the "Code"), subject to certain limitations. As such, the Company, through its wholly-owned taxable REIT subsidiaries (“TRS”), has been engaged in various retail real estate related opportunities including (i) ground-up development of neighborhood and community shopping centers and the subsequent sale thereof upon completion, (ii) retail real estate management and disposition services which primarily focuses on leasing and disposition strategies of retail real estate controlled by both healthy and distressed and/or bankrupt retailers and (iii) acting as an agent or principal in connection with tax deferred exchange transactions. 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, 2012, the Company's single largest neighborhood and community shopping center accounted for only 1.7% of the Company's annualized base rental revenues and only 1.2% of the Company’s total shopping center gross leasable area ("GLA"), including the proportionate share of base rental revenues from properties in which the Company has less than a 100% economic interest. At December 31, 2012, the Company’s five largest tenants were The Home Depot, TJX Companies, Wal-Mart, Sears Holdings and Bed Bath & Beyond, which represented 3.0%, 2.9%, 2.6%, 2.0% and 1.7%, respectively, of the Company’s annualized base rental revenues, including the proportionate share of base rental revenues from properties in which the Company has less than a 100% economic interest. The principal business of the Company and its consolidated subsidiaries is the ownership, management, development and operation of retail shopping centers, including complementary services that capitalize on the Company’s established retail real estate expertise. The Company evaluates performance on a property specific or transactional basis and does not distinguish its principal business or group its operations on a geographical basis for purposes of measuring performance. Accordingly, the Company believes it has a single reportable segment for disclosure purposes in accordance with accounting principles generally accepted in the United States of America ("GAAP"). Principles of Consolidation and Estimates The accompanying Consolidated Financial Statements include the accounts of Kimco Realty Corporation and subsidiaries (the “Company”). The Company’s subsidiaries includes subsidiaries which are wholly-owned and all entities in which the Company has a controlling interest, including where the Company has been determined to be a primary beneficiary of a variable interest entity (“VIE”) or meets certain criteria of a sole general partner or managing member in accordance with the Consolidation guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”). All inter-company balances and transactions have been eliminated in consolidation. GAAP requires 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. The most significant assumptions and estimates relate to the valuation of real estate and related intangible assets and liabilities, equity method investments, marketable securities and other investments, including the assessment of impairments, as well as, depreciable lives, revenue recognition, the collectability of trade accounts receivable, realizability of deferred tax assets and the assessment of uncertain tax positions. Application of these assumptions requires the exercise of judgment as to future uncertainties, and, as a result, actual results could differ from these estimates. 48 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued Subsequent Events The Company has evaluated subsequent events and transactions for potential recognition or disclosure in its consolidated financial statements. Real Estate Real estate assets are stated at cost, less accumulated depreciation and amortization. Upon acquisition of real estate operating properties, the Company estimates the fair value of acquired tangible assets (consisting of land, building, building improvements and tenant improvements) and identified intangible assets and liabilities (consisting of above and below-market leases, in-place leases and tenant relationships), assumed debt and redeemable units issued at the date of acquisition, based on evaluation of information and estimates available at that date. Based on these estimates, the Company allocates the estimated fair value to the applicable assets and liabilities. Fair value is determined based on an exit price approach, which contemplates the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. If, up to one year from the acquisition date, information regarding fair value of the assets acquired and liabilities assumed is received and estimates are refined, appropriate adjustments are made to the purchase price allocation on a retrospective basis. The Company expenses transaction costs associated with business combinations in the period incurred. In allocating the purchase price to identified intangible assets and liabilities of an acquired property, the value of above-market and below-market leases is estimated based on the present value of the difference between the contractual amounts, including fixed rate renewal options, to be paid pursuant to the leases and management’s estimate of the market lease rates and other lease provisions (i.e., expense recapture, base rental changes, etc.) measured over a period equal to the estimated remaining term of the lease. The capitalized above-market or below-market intangible is amortized to rental income over the estimated remaining term of the respective leases, which includes the expected renewal option period. Mortgage debt discounts or premiums are amortized into interest expense over the remaining term of the related debt instrument. Unit discounts and premiums are amortized into noncontrolling interest in income, net over the period from the date of issuance to the earliest redemption date of the units. In determining the value of in-place leases, management considers current market conditions and costs to execute similar leases in arriving at an estimate of the carrying costs during the expected lease-up period from vacant to existing occupancy. In estimating carrying costs, management includes real estate taxes, insurance, other operating expenses, estimates of lost rental revenue during the expected lease-up periods and costs to execute similar leases including leasing commissions, legal and other related costs based on current market demand. The value assigned to in-place leases and tenant relationships is amortized over the estimated remaining term of the leases. If a lease were to be terminated prior to its scheduled expiration, all unamortized costs relating to that lease would be written off. Depreciation and amortization are provided on the straight-line method over the estimated useful lives of the assets, as follows: Buildings and building improvements Fixtures, leasehold and tenant improvements (including certain identified intangible assets) 15 to 50 years Terms of leases or useful lives, whichever is shorter Expenditures for maintenance and repairs are charged to operations as incurred. Significant renovations and replacements, which improve and extend the life of the asset, are capitalized. The useful lives of amortizable intangible assets are evaluated each reporting period with any changes in estimated useful lives being accounted for over the revised remaining useful life. When a real estate asset is identified by management as held-for-sale, the Company ceases depreciation of the asset and estimates the sales price, net of selling costs. If, in management’s opinion, the net sales price of the asset is less than the net book value of the asset, an adjustment to the carrying value would be recorded to reflect the estimated fair value of the property. On a continuous basis, management assesses whether there are any indicators, including property operating performance and general market conditions, that the value of the real estate properties (including any related amortizable intangible assets or liabilities) may be impaired. A property value is considered impaired only if management’s estimate of current and projected operating cash flows (undiscounted and unleveraged) of the property over its remaining useful life is less than the net carrying value of the property. Such cash flow projections consider factors such as expected future operating income, trends and prospects, as well as the effects of demand, competition and other factors. To the extent impairment has occurred, the carrying value of the property would be adjusted to an amount to reflect the estimated fair value of the property. 49 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued Real Estate Under Development Real estate under development represents both the ground-up development of neighborhood and community shopping center projects which may be subsequently sold upon completion and projects which the Company may hold as long-term investments. These properties are carried at cost. The cost of land and buildings under development includes specifically identifiable costs. The capitalized costs include pre-construction costs essential to the development of the property, development costs, construction costs, interest costs, real estate taxes, salaries and related costs of personnel directly involved and other costs incurred during the period of development. The Company ceases cost capitalization when the property is held available for occupancy upon substantial completion of tenant improvements, but no later than one year from the completion of major construction activity. If, in management’s opinion, the net sales price of assets held for resale or the current and projected undiscounted cash flows of these assets to be held as long-term investments is less than the net carrying value, the carrying value would be adjusted to an amount that reflects the estimated fair value of the property. Investments in Unconsolidated Joint Ventures The Company accounts for its investments in unconsolidated joint ventures under the equity method of accounting as the Company exercises significant influence, but does not control these entities. These investments are recorded initially at cost and subsequently adjusted for cash contributions and distributions. Earnings for each investment are recognized in accordance with each respective investment agreement and where applicable, based upon an allocation of the investment’s net assets at book value as if the investment was hypothetically liquidated at the end of each reporting period. The Company’s joint ventures and other real estate investments primarily consist of co-investments with institutional and other joint venture partners in neighborhood and community shopping center properties, consistent with its core business. These joint ventures typically obtain non-recourse third-party financing on their property investments, thus contractually limiting the Company’s exposure to losses primarily to the amount of its equity investment; and due to the lender’s exposure to losses, a lender typically will require a minimum level of equity in order to mitigate its risk. The Company, on a limited selective basis, obtains unsecured financing for certain joint ventures. These unsecured financings are guaranteed by the Company with guarantees from the joint venture partners for their proportionate amounts of any guaranty payment the Company is obligated to make. To recognize the character of distributions from equity investees the Company reviews the nature of the cash distribution to determine the proper character of cash flow distributions as either returns on investment, which would be included in operating activities or returns of investment, which would be included in investing activities. On a continuous basis, management assesses whether there are any indicators, including the underlying investment property operating performance and general market conditions, that the value of the Company’s investments in unconsolidated joint ventures may be impaired. An investment’s value is impaired only if management’s estimate of the fair value of the investment is less than the carrying value of the investment and such difference is deemed to be other-than-temporary. To the extent impairment has occurred, the loss shall be measured as the excess of the carrying amount of the investment over the estimated fair value of the investment. The Company’s estimated fair values are based upon a discounted cash flow model for each specific property that includes all estimated cash inflows and outflows over a specified holding period and, where applicable, any estimated debt premiums. Capitalization rates, discount rates and credit spreads utilized in these models are based upon rates that the Company believes to be within a reasonable range of current market rates for each respective property. Other Real Estate Investments Other real estate investments primarily consist of preferred equity investments for which the Company provides capital to owners and developers of real estate. The Company typically accounts for its preferred equity investments on the equity method of accounting, whereby earnings for each investment are recognized in accordance with each respective investment agreement and based upon an allocation of the investment’s net assets at book value as if the investment was hypothetically liquidated at the end of each reporting period. On a continuous basis, management assesses whether there are any indicators, including the underlying investment property operating performance and general market conditions, that the value of the Company’s Other real estate investments may be impaired. An investment’s value is impaired only if management’s estimate of the fair value of the investment is less than the carrying value of the investment and such difference is deemed to be other-than-temporary. To the extent impairment has occurred, the loss shall be measured as the excess of the carrying amount of the investment over the estimated fair value of the investment. 50 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued The Company’s estimated fair values are based upon a discounted cash flow model for each specific property that includes all estimated cash inflows and outflows over a specified holding period and, where applicable, any estimated debt premiums. Capitalization rates, discount rates and credit spreads utilized in these models are based upon rates that the Company believes to be within a reasonable range of current market rates for each respective property. Mortgages and Other Financing Receivables Mortgages and other financing receivables consist of loans acquired and loans originated by the Company. Borrowers of these loans are primarily experienced owners, operators or developers of commercial real estate. The Company’s loans are primarily mortgage loans that are collateralized by real estate. Loan receivables are recorded at stated principal amounts, net of any discount or premium or deferred loan origination costs or fees. The related discounts or premiums on mortgages and other loans purchased are amortized or accreted over the life of the related loan receivable. The Company defers certain loan origination and commitment fees, net of certain origination costs and amortizes them as an adjustment of the loan’s yield over the term of the related loan. The Company reviews on a quarterly basis credit quality indicators such as (i) payment status to identify performing versus non- performing loans, (ii) changes affecting the underlying real estate collateral and (iii) national and regional economic factors. Interest income on performing loans is accrued as earned. A non-performing loan is placed on non-accrual status when it is probable that the borrower may be unable to meet interest payments as they become due. Generally, loans 90 days or more past due are placed on non-accrual status unless there is sufficient collateral to assure collectability of principal and interest. Upon the designation of non-accrual status, all unpaid accrued interest is reserved against through current income. Interest income on non-performing loans is generally recognized on a cash basis. Recognition of interest income on non-performing loans on an accrual basis is resumed when it is probable that the Company will be able to collect amounts due according to the contractual terms. The Company has determined that it has one portfolio segment, primarily represented by loans collateralized by real estate, whereby it determines, as needed, reserves for loan losses on an asset-specific basis. The reserve for loan losses reflects management's estimate of loan losses as of the balance sheet date. The reserve is increased through loan loss expense and is decreased by charge-offs when losses are confirmed through the receipt of assets such as cash or via ownership control of the underlying collateral in full satisfaction of the loan upon foreclosure or when significant collection efforts have ceased. The Company considers a loan to be impaired when, based upon current information and events, it is probable that the Company will be unable to collect all amounts due under the existing contractual terms. A reserve allowance is established for an impaired loan when the estimated fair value of the underlying collateral (for collateralized loans) or the present value of expected future cash flows is lower than the carrying value of the loan. An internal valuation is performed generally using the income approach to estimate the fair value of the collateral at the time a loan is determined to be impaired. The model is updated if circumstances indicate a significant change in value has occurred. The Company does not provide for an additional allowance for loan losses based on the grouping of loans as the Company believes the characteristics of the loans are not sufficiently similar to allow an evaluation of these loans as a group for a possible loan loss allowance. As such, all of the Company’s loans are evaluated individually for impairment purposes. Cash and Cash Equivalents Cash and 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 of $4.0 million and $5.6 million as of December 31, 2012 and 2011, respectively. Cash and cash equivalent balances may, at a limited number of banks and financial institutions, exceed insurable amounts. The Company believes it mitigates risk by investing in or through major financial institutions and primarily in funds that are currently U.S. federal government insured. Recoverability of investments is dependent upon the performance of the issuers. Marketable Securities The Company classifies its marketable equity securities as available-for-sale in accordance with the FASB’s Investments-Debt and Equity Securities guidance. These securities are carried at fair market value with unrealized gains and losses reported in stockholders’ equity as a component of Accumulated other comprehensive income ("OCI"). Gains or losses on securities sold are based on the specific identification method. 51 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued All debt securities are generally classified as held-to-maturity because the Company has the positive intent and ability to hold the securities to maturity. It is more likely than not that the Company will not be required to sell the debt security before its anticipated recovery and the Company expects to recover the security’s entire amortized cost basis even if the entity does not intend to sell. Held-to-maturity securities are stated at amortized cost, adjusted for amortization of premiums and accretion of discounts to maturity. Debt securities which contain conversion features generally are classified as available-for-sale. On a continuous basis, management assesses whether there are any indicators that the value of the Company’s marketable securities may be impaired, which includes reviewing the underlying cause of any decline in value and the estimated recovery period, as well as the severity and duration of the decline. In the Company’s evaluation, the Company considers its ability and intent to hold these investments for a reasonable period of time sufficient for the Company to recover its cost basis. A marketable security is impaired if the fair value of the security is less than the carrying value of the security and such difference is deemed to be other-than-temporary. To the extent impairment has occurred, the loss shall be measured as the excess of the carrying amount of the security over the estimated fair value in the security. 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 on a straight-line basis, which approximates the effective interest method, over the terms of the related leases or debt agreements, as applicable. Such capitalized costs include salaries, lease incentives and related costs of personnel directly involved in successful leasing efforts. Software Development Costs Expenditures for major software purchases and software developed for internal use are capitalized and amortized on a straight-line basis generally over a 3 to 5 year period. The Company’s policy provides for the capitalization of external direct costs of materials and services associated with developing or obtaining internal use computer software. In addition, the Company also capitalizes certain payroll and payroll-related costs for employees who are directly associated with internal use computer software projects. The amount of capitalizable payroll costs with respect to these employees is limited to the time directly spent on such projects. Costs associated with preliminary project stage activities, training, maintenance and all other post-implementation stage activities are expensed as incurred. As of December 31, 2012 and 2011, the Company had unamortized software development costs of $26.8 million and $23.8 million, respectively. The Company incurred $5.5 million, $3.1 million and $1.9 million in amortization of software development costs during the years ended December 31, 2012, 2011 and 2010, respectively. Revenue Recognition and Accounts Receivable Base rental revenues from rental property are recognized on a straight-line basis over the terms of the related leases. Certain of these leases also provide for percentage rents based upon the level of sales achieved by the lessee. These percentage rents are recognized once the required sales level is achieved. Rental income may also include payments received in connection with lease termination agreements. In addition, leases typically provide for reimbursement to the Company of common area maintenance costs, real estate taxes and other operating expenses. Operating expense reimbursements are recognized as earned. Management and other fee income consists of property management fees, leasing fees, property acquisition and disposition fees, development fees and asset management fees. These fees arise from contractual agreements with third parties or with entities in which the Company has a noncontrolling interest. Management and other fee income, including acquisition and disposition fees, are recognized as earned under the respective agreements. Management and other fee income related to partially owned entities are recognized to the extent attributable to the unaffiliated interest. Gains and losses from the sale of depreciated operating property and ground-up development projects are generally recognized using the full accrual method in accordance with the FASB’s real estate sales guidance, provided that various criteria relating to the terms of sale and subsequent involvement by the Company with the properties are met. Gains and losses on transfers of operating properties result from the sale of a partial interest in properties to unconsolidated joint ventures and are recognized using the partial sale provisions of the FASB’s real estate sales guidance. The Company makes estimates of the uncollectability of its accounts receivable related to base rents, straight-line rent, expense reimbursements and other revenues. The Company analyzes accounts receivable and historical bad debt levels, customer credit worthiness and current economic trends when evaluating the adequacy of the allowance for doubtful accounts. In addition, tenants in bankruptcy are analyzed and estimates are made in connection with the expected recovery of pre-petition and post-petition claims. The Company’s reported net earnings are directly affected by management’s estimate of the collectability of accounts receivable. 52 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued Income Taxes The Company has made an election to qualify, and believes it is operating so as to qualify, as 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 Section 856 through 860 of the Code. In connection with the RMA, which became effective January 1, 2001, the Company is permitted to participate in certain activities which it was previously precluded from in order to maintain its qualification as a REIT, so long as these activities are conducted by entities which elect to be treated as taxable REIT subsidiaries under the Code. As such, the Company is subject to federal and state income taxes on the income from these activities. The Company is also subject to local taxes on certain non-U.S. investments. Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. The Company provides a valuation allowance for deferred tax assets for which it does not consider realization of such assets to be more likely than not. The Company reviews the need to establish a valuation allowance against deferred tax assets on a quarterly basis. The review includes an analysis of various factors, such as future reversals of existing taxable temporary differences, the capacity for the carryback or carryforward of any losses, the expected occurrence of future income or loss and available tax planning strategies. The Company applies the FASB’s guidance relating to uncertainty in income taxes recognized in a company’s financial statements. Under this guidance the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position are measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. The guidance on accounting for uncertainty in income taxes also provides guidance on de-recognition, classification, interest and penalties on income taxes, and accounting in interim periods. Foreign Currency Translation and Transactions Assets and liabilities of the Company’s foreign operations are translated using year-end exchange rates, and revenues and expenses are translated using exchange rates as determined throughout the year. Gains or losses resulting from translation are included in OCI, as a separate component of the Company’s stockholders’ equity. Gains or losses resulting from foreign currency transactions are translated to local currency at the rates of exchange prevailing at the dates of the transactions. The effect of the transactions gain or loss is included in the caption Other expense, net in the Consolidated Statements of Income. Derivative/Financial Instruments The Company is exposed to certain risk arising from both its business operations and economic conditions. The Company principally manages its exposures to a wide variety of business and operational risk through management of its core business activities. The Company manages economic risks, including interest rate, liquidity, and credit risk primarily by managing the amount, sources, and duration of its debt funding and the use of derivative financial instruments. Specifically, the Company may use derivatives to manage exposures that arise from changes in interest rates, foreign currency exchange rate fluctuations and market value fluctuations of equity securities. The Company limits these risks by following established risk management policies and procedures including the use of derivatives. The Company measures its derivative instruments at fair value and records them in the Consolidated Balance Sheet as an asset or liability, depending on the Company’s rights or obligations under the applicable derivative contract. The accounting for changes in the fair value of the derivatives depends on the intended use of the derivative, whether the Company has elected to designate a derivative in a hedging relationship and apply hedge accounting and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to changes in the fair value of an asset, liability, or firm commitment attributable to a particular risk, such as interest rate risk, are considered fair value hedges. Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges. Derivatives may also be designated as hedges of the foreign currency exposure of a net investment in a foreign operation. Hedge accounting generally provides for the matching of the timing of gain or loss recognition on the hedging instrument with the recognition of the changes in the fair value of the hedged asset or liability that are attributable to the hedged risk in a fair value hedge or the earnings effect of the hedged forecasted transactions in a cash flow 53 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued hedge. The Company may enter into derivative contracts that are intended to economically hedge certain of its risk, even though hedge accounting does not apply or the Company elects not to apply hedge accounting under the Derivatives and Hedging guidance issued by the FASB. The effective portion of the changes in fair value of derivatives designated and that qualify as cash flow hedges is recorded in OCI and is subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings. Any ineffective portion of the change in fair value of the derivatives is recognized directly in earnings. During 2012, 2011 and 2010, the Company had no hedge ineffectiveness. Noncontrolling Interests The Company accounts for noncontrolling interests in accordance with the Consolidation guidance and the Distinguishing Liabilities from Equity guidance issued by the FASB. Noncontrolling interests represent the portion of equity that the Company does not own in those entities it consolidates. The Company identifies its noncontrolling interests separately within the equity section on the Company’s Consolidated Balance Sheets. The amounts of consolidated net earnings attributable to the Company and to the noncontrolling interests are presented separately on the Company’s Consolidated Statements of Income. Noncontrolling interests also includes amounts related to partnership units issued by consolidated subsidiaries of the Company in connection with certain property acquisitions. These units have a stated redemption value or a defined redemption amount based upon the trading price of the Company’s common stock and provides the unit holders various rates of return during the holding period. The unit holders generally have the right to redeem their units for cash at any time after one year from issuance. For convertible units, the Company typically has the option to settle redemption amounts in cash or common stock. The Company evaluates the terms of the partnership units issued in accordance with the FASB’s Distinguishing Liabilities from Equity guidance. Units which embody an unconditional obligation requiring the Company to redeem the units for cash at a specified or determinable date (or dates) or upon an event that is certain to occur are determined to be mandatorily redeemable under this guidance and are included as Redeemable noncontrolling interest and classified within the mezzanine section between Total liabilities and Stockholders’ equity on the Company’s Consolidated Balance Sheets. Convertible units for which the Company has the option to settle redemption amounts in cash or Common Stock are included in the caption Noncontrolling interest within the equity section on the Company’s Consolidated Balance Sheets. Earnings Per Share The following table sets forth the reconciliation of earnings and the weighted-average number of shares used in the calculation of basic and diluted earnings per share (amounts presented in thousands, except per share data): For the year ended December 31, 2011 2010 2012 Computation of Basic Earnings Per Share: Income from continuing operations ......................................................................... $ Total net gain on transfer or sale of operating properties, net ................. Net income attributable to noncontrolling interests....................................... Discontinued operations attributable to noncontrolling interests ........... Preferred stock redemption costs ............................................................................. Preferred stock dividends ............................................................................................... Income from continuing operations available to the common shareholders ................................................................................................................ Earnings attributable to unvested restricted shares ......................................... Income from continuing operations attributable to common shareholders ................................................................................................................ Income from discontinued operations attributable to the Company.... Net income attributable to the Company’s common shareholders for $ 211,978 4,299 (14,202) 1,731 (21,703) (71,697) 110,406 (1,221) 109,185 62,267 158,977 $ 108 (13,039) 1,384 - (59,363) 88,067 (608) 87,459 21,621 120,122 2,377 (18,783) 5,288 - (51,346) 57,658 (375) 57,283 33,864 basic earnings per share ........................................................................................ $ 171,452 $ 109,080 $ 91,147 Weighted average common shares outstanding ............................................... 405,997 406,530 405,827 54 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued Basic Earnings Per Share Attributable to the Company’s Common Shareholders: Income from continuing operations .......................................................................... $ Income from discontinued operations ..................................................................... Net income ............................................................................................................................. $ 0.27 0.15 0.42 $ $ 0.22 $ 0.05 0.27 $ 0.14 0.08 0.22 Computation of Diluted Earnings Per Share: Income from continuing operations attributable to common shareholders ................................................................................................................. $ Income from discontinued operations attributable to the Company..... Net income attributable to common shareholders for diluted earnings 109,185 $ 62,267 87,459 $ 21,621 57,283 33,864 per share ......................................................................................................................... $ 171,452 $ 109,080 $ 91,147 Weighted average common shares outstanding – basic................................ Effect of dilutive securities(a): Equity awards ............................................................................................................... Shares for diluted earnings per common share .................................................. 405,997 692 406,689 406,530 1,139 407,669 405,827 374 406,201 Diluted Earnings Per Share Attributable to the Company’s Common Shareholders: Income from continuing operations .......................................................................... $ Income from discontinued operations ..................................................................... Net income ............................................................................................................................. $ 0.27 0.15 0.42 $ $ 0.21 $ 0.06 0.27 $ 0.14 0.08 0.22 (a) The effect of the assumed conversion of certain convertible units had an anti-dilutive effect upon the calculation of Income from continuing operations per share. Accordingly, the impact of such conversions has not been included in the determination of diluted earnings per share calculations. Additionally, there were 11,159,160, 13,304,016 and 12,085,874, stock options that were not dilutive as of December 31, 2012, 2011 and 2010, respectively. The Company's unvested restricted share awards contain non-forfeitable rights to distributions or distribution equivalents. The impact of the unvested restricted share awards on earnings per share has been calculated using the two-class method whereby earnings are allocated to the unvested restricted share awards based on dividends declared and the unvested restricted shares' participation rights in undistributed earnings. Stock Compensation The Company maintains two equity participation plans, the Second Amended and Restated 1998 Equity Participation Plan (the “Prior Plan”) and the 2010 Equity Participation Plan (the “2010 Plan”) (collectively, the “Plans”). The Prior Plan provides for a maximum of 47,000,000 shares of the Company’s common stock to be issued for qualified and non-qualified options and restricted stock grants. The 2010 Plan provides for a maximum of 10,000,000 shares of the Company’s common stock to be issued for qualified and non-qualified options, restricted stock, performance awards and other awards, plus the number of shares of common stock which are or become available for issuance under the Prior Plan and which are not thereafter issued under the Prior Plan, subject to certain conditions. Unless otherwise determined by the Board of Directors at its sole discretion, options granted under the Plans generally vest ratably over a range of three to five years, expire ten years from the date of grant and are exercisable at the market price on the date of grant. Restricted stock grants generally vest (i) 100% on the fourth or fifth anniversary of the grant, (ii) ratably over three or four years, (iii) over three years at 50% after two years and 50% after the third year or (iv) over ten years at 20% per year commencing after the fifth year. Performance share awards may provide a right to receive shares of restricted stock based on the Company’s performance relative to its peers, as defined, or based on other performance criteria as determined by the Board of Directors. In addition, the Plans provide for the granting of certain options and restricted stock 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. The Company accounts for equity awards in accordance with the FASB’s Stock Compensation guidance which requires that all share based payments to employees, be recognized in the Statement of Income over the service period based on their fair values. Fair value is determined, depending on the type of award, using either the Black-Scholes option pricing formula or the Monte Carlo method, both of which are intended to estimate the fair value of the awards at the grant date (see Footnote 21 for additional disclosure on the assumptions and methodology). 55 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued New Accounting Pronouncements In May 2011, the FASB issued ASU 2011-04 Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRS (“ASU 2011-04”). ASU 2011-04 is intended to improve comparability of fair value measurements presented and disclosed in financial statements prepared in accordance with U.S. GAAP and International Financial Reporting Standards (“IFRS”). The amendments are of two types: (i) those that clarify the Board’s intent about the application of existing fair value measurement and disclosure requirements and (ii) those that change a particular principle or requirement for measuring fair value or for disclosing information about fair value measurements. The update is effective for annual periods beginning after December 15, 201l. The Company’s adoption of this guidance did not have a material impact on its financial statement presentation. In June 2011, the FASB issued ASU No. 2011-05, Comprehensive Income (Topic 220): Presentation of Comprehensive Income (“ASU 2011-05”). The amendments in this ASU require an entity to present the total of comprehensive income, the components of net income, and the components of other comprehensive income either in a single continuous statement of comprehensive income or in two separate but consecutive statements. ASU 2011-05 eliminates the option to present the components of other comprehensive income as part of the statement of equity. In December 2011, the FASB deferred portions of this update in its issuance of Accounting Standards Update No. 2011-12 (“ASU 2011-12”), Comprehensive Income (Topic 220): Deferral of the Effective Date for Amendments to the Presentation of Reclassifications of Items Out of Accumulated Other Comprehensive Income in ASU 2011-05. The amendment requires that all non-owner changes in stockholders’ equity be presented in either a single continuous statement of comprehensive income or in two separate but consecutive statements. ASU 2011-12 defers only those changes in ASU 2011-05 that relate to the presentation of reclassification adjustments out of accumulated other comprehensive income. ASU 2011-05 is effective for fiscal years, and interim periods within those fiscal years, beginning on or after December 15, 2011, with early adoption permitted, but full retrospective application is required. The adoption of ASU 2011-05 and ASU 2011-12 did not have a material impact on the Company’s financial statement presentation. In January 2013, the FASB released ASU 2013-02, Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income (“ASU 2013-02”). This guidance is the culmination of the board’s redeliberation on reporting reclassification adjustments from accumulated other comprehensive income. The standard requires that companies present either in a single note or parenthetically on the face of the financial statements, the effect of significant amounts reclassified from each component of accumulated other comprehensive income based on its source (e.g., the release due to cash flow hedges from interest rate contracts) and the income statement line items affected by the reclassification (e.g., interest income or interest expense). If a component is not required to be reclassified to net income in its entirety (e.g., the net periodic pension cost), companies would instead cross reference to the related footnote for additional information (e.g., the pension footnote). The new requirements will take effect for public companies in interim and annual reporting periods beginning after December 15, 2012. The adoption of ASU 2013-02 is not expected to have a material impact on the Company’s financial statement presentation. In November 2011, the FASB issued ASU 2011-10, Property, Plant and Equipment (Topic 360): Derecognition of in Substance Real Estate - a Scope Clarification (a consensus of the FASB Emerging Issues Task Force) (“ASU 2011-10”). ASU 2011-10 requires a parent company that ceases to have a controlling financial interest in a subsidiary that is in substance real estate because the subsidiary has defaulted on its nonrecourse debt should use the FASB’s Real Estate guidance to determine whether to derecognize the in substance real estate entities. ASU 2011-10 is effective for reporting periods beginning on or after June 15, 2012. The adoption of ASU 2011-10 did not have a material impact on the Company’s financial position or results of operations. In December 2011, the FASB released ASU 2011-11, Balance Sheet (Topic 210): Disclosures about Offsetting Assets and Liabilities (“ASU 2011-11”). ASU 2011-11 requires companies to provide new disclosures about offsetting and related arrangements for financial instruments and derivatives. The provisions of ASU 2011-11 are effective for annual reporting periods beginning on or after January 1, 2013, and are required to be applied retrospectively. The adoption of ASU 2011-11 will not have a material impact on the Company’s financial statement presentation. Reclassifications Certain reclassifications have been made to previously reported amounts to conform to the current year presentation. Specifically, the Company reclassified amounts relating to rent security deposits from Accounts payable and accrued expenses to Other liabilities. Additionally, the Company is presenting on its Consolidated Statements of Income its provision for doubtful accounts, which was previously included in Revenues from rental properties, as a separate line item included in Operating expenses as well as certain other immaterial reclassifications. 56 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued 2. Impairments: Management assesses on a continuous basis whether there are any indicators, including property operating performance and general market conditions, that the value of the Company’s assets (including any related amortizable intangible assets or liabilities) may be impaired. To the extent impairment has occurred, the carrying value of the asset would be adjusted to an amount to reflect the estimated fair value of the asset. Real estate market conditions, including capitalization rates, discount rates and vacancies continued to improve throughout 2011 and 2012; however, declines in certain real estate markets continued to have a negative effect on transactional activity as it related to dispositions of select real estate assets. This factor, in addition to the Company’s efforts to market certain assets and management’s assessment as to the likelihood and timing of such potential transactions caused the Company to recognize impairment charges for the years ended December 31, 2012, 2011 and 2010 as follows (in millions): Impairment of property carrying values (including amounts within discontinued operations) ............................................................................. $ Real estate under development .............................................................................. Investments in other real estate investments................................................... Marketable securities and other investments ................................................... Investments in real estate joint ventures ............................................................ Total gross impairment charges ............................................................... Noncontrolling interests .............................................................................................. Income tax benefit .......................................................................................................... Total net impairment charges.................................................................... $ 2012 2011 2010 56.9 $ - 2.7 - - 59.6 (0.4) (10.6) 48.6 $ 22.8 $ - 3.3 1.6 5.1 32.8 0.7 (4.5) 29.0 $ 8.7 11.7 13.4 5.3 - 39.1 (0.1) (7.6) 31.4 In addition to the impairment charges above, the Company recognized pretax impairment charges during 2012, 2011 and 2010 of $11.1 million, $14.1 million, and $28.3 million, respectively, relating to certain properties held by various unconsolidated joint ventures in which the Company holds noncontrolling interests. These impairment charges are included in Equity in income of joint ventures, net in the Company’s Consolidated Statements of Income. The Company will continue to assess the value of its assets on an on-going basis. Based on these assessments, the Company may determine that one or more of its assets may be impaired due to a decline in value and would therefore write-down its cost basis accordingly (see Footnotes 6, 8, 9, 11, and 12). 3. Real Estate: The Company’s components of Rental property consist of the following (in thousands): Land ............................................................................................................................................... $ Undeveloped land ................................................................................................................. Buildings and improvements: Buildings ................................................................................................................... Building improvements .................................................................................... Tenant improvements ..................................................................................... Fixtures and leasehold improvements .................................................... Other rental property (1) .............................................................................. Accumulated depreciation and amortization.......................................................... Total .......................................................................................................................... $ December 31, 2012 1,927,800 $ 96,500 2011 1,847,770 97,275 4,607,931 1,091,810 708,626 59,690 357,667 8,850,024 (1,745,462) 7,104,562 $ 4,513,339 1,024,514 715,951 56,827 335,859 8,591,535 (1,693,090) 6,898,445 (1) At December 31, 2012 and 2011, Other rental property (net of accumulated amortization of $212.9 million and $180.7 million, respectively), consisted of intangible assets including (i) $237,166 and $213,915, respectively, of in-place leases, (ii) $21,335 and $21,444, respectively, of tenant relationships, and (iii) $99,166 and $100,500, respectively, of above-market leases. 57 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued In addition, at December 31, 2012 and 2011, the Company had intangible liabilities relating to below-market leases from property acquisitions of $167.2 million and $165.0 million, respectively, net of accumulated amortization of $138.3 million and $120.5 million, respectively. These amounts are included in the caption Other liabilities in the Company’s Consolidated Balance Sheets. The Company’s amortization expense associated with the above mentioned intangible assets and liabilities for the years ended December 31, 2012, 2011 and 2010 was $15.4 million, $15.2 million and $12.6 million, respectively. The estimated net amortization expense associated with the Company’s intangible assets and liabilities for the next five years are as follows (in millions): 2013, $9.6; 2014, $1.7; 2015, $(0.8); 2016, $(3.4) and 2017, $(3.0). 4. Property Acquisitions, Developments and Other Investments: Operating property acquisitions, ground-up development costs and other investments have been funded principally through the application of proceeds from the Company's public equity and unsecured debt issuances, proceeds from mortgage and construction financings and availability under the Company’s revolving lines of credit. Acquisition of Operating Properties – During the year ended December 31, 2012, the Company acquired 24 operating properties, 69 net leased parcels and five outparcels, in separate transactions as follows (in thousands): Location Property Name Woodbridge S.C. ................................. Sugarland, TX Bell Camino Center ............................ Sun City, AZ 31 parcels (2) ......................................... Various 1 parcel (3) .............................................. Duncan, SC Olympia West Outparcel ................ Olympia, WA Frontier Village (1) ............................... Lake Stevens, WA Silverdale S.C. (1) ................................. Silverdale, WA 30 parcels (2) ......................................... Various 1 parcel (3) .............................................. Peru, IL Towson Place (4) ................................. Towson, MD Prien Lake Outparcel ......................... Lake Charles, LA Devon Village ......................................... Devon, PA 4 Properties ............................................. Various, NC Lake Jackson (5) .................................... Lake Jackson, TX Woodlawn S.C. ..................................... Charlotte, NC Columbia Crossing - 2 Outparcels ............................................... Columbia, MD Pompano Beach (6) ............................ Pompano Beach, FL 6 Parcels (2) ............................................ Various Wilton S.C. .............................................. Wilton, CT Hawthorne Hills S. C. ........................ Vernon Hills, IL Greeley Shopping Center (7)........ Greeley, CO Savi Ranch Center Phase II ............. Yorba Linda, CA Wild Lake Plaza Outparcel ............. Columbia, MD City Heights Retail Village ................ San Francisco, CA Snowden Square (8) .......................... Columbia, MD “Key Food” Portfolio (5 properties) ......................................... Various, NY Month Acquired Jan-12 Jan-12 Jan-12 Jan-12 Feb-12 Mar-12 Mar-12 Mar-12 Mar-12 Apr-12 May-12 Jun-12 Jun-12 Jul-12 Jul-12 Jul-12 Jul-12 Jul-12 Aug-12 Aug-12 Oct-12 Oct-12 Nov-12 Nov-12 Dec-12 Purchase Price Debt Cash Assumed Total GLA* $ $ 9,000 4,185 30,753 1,048 1,200 12,231 8,335 39,493 995 69,375 1,800 28,550 63,750 5,500 7,050 11,060 12,180 8,111 18,800 15,974 23,250 34,500 300 15,600 6,182 $ - 4,210 - - - 30,900 24,000 - - 57,625 - - - - - - - - 20,900 21,563 - - - 20,000 - 9,000 8,395 30,753 1,048 1,200 43,131 32,335 39,493 995 127,000 1,800 28,550 63,750 5,500 7,050 11,060 12,180 8,111 39,700 37,537 23,250 34,500 300 35,600 6,182 97 63 83 3 6 195 170 107 4 680 8 79 368 35 137 69 81 19 96 193 139 161 75 109 50 Dec-12 Total 26,058 $ 455,280 $ - 179,198 26,058 $ 634,478 59 3,086 * Gross leasable area ("GLA") (1) These properties were acquired from a joint venture in which the Company has a 15% noncontrolling interest. The Company evaluated these transactions pursuant to the FASB’s Consolidation guidance and as such recognized an aggregate gain of $2.0 million from the fair value adjustment associated with its original ownership due to a change in control. (2) Acquired an aggregate of 67 parcels net leased to restaurants through a consolidated joint venture, in which the Company has a 99.1% controlling interest. During July 2012, the Company purchased the remaining 0.9% interest for $0.7 million. (3) Acquired an aggregate of two parcels net leased to restaurants through a consolidated joint venture, in which the Company has a 92.0% controlling interest. During July 2012, the Company sold 4% of its interest for $0.1 million. The Company continues to have a controlling interest in the joint venture and therefore continues to consolidate this investment. 58 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued (4) This property was acquired from a joint venture in which the Company had a 30% noncontrolling interest. The Company evaluated this transaction pursuant to the FASB’s Consolidation guidance and as such recognized a gain of $12.1 million from the fair value adjustment associated with its original ownership due to a change in control. In addition, the Company recognized promote income of $1.1 million in connection with this transaction. The promote income is included in Equity in income of joint ventures, net on the Company’s Consolidated Statements of Income. Additionally, the debt assumed in connection with this transaction of $57.6 million was repaid in May 2012. (5) The Company acquired this property from a preferred equity investment in which the Company held a noncontrolling interest. The Company evaluated this transaction pursuant to the FASB’s Consolidation guidance. This transaction resulted in a change in control with no gain or loss recognized. (6) This property was acquired from a joint venture in which the Company had a 50% noncontrolling interest. The Company evaluated this transaction pursuant to the FASB’s Consolidation guidance. This transaction resulted in a change in control with no gain or loss recognized. (7) This property was acquired from a joint venture in which the Company has an 11% noncontrolling interest. The Company evaluated this transaction pursuant to the FASB’s Consolidation guidance and as such recognized a gain of $0.4 million from the fair value adjustment associated with its original ownership due to a change in control. (8) This property was acquired from a joint venture in which the Company has a 50% noncontrolling interest. The Company evaluated this transaction pursuant to the FASB’s Consolidation guidance and as such recognized a gain of $1.0 million from the fair value adjustment associated with its original ownership due to a change in control. During the year ended December 31, 2011, the Company acquired 19 operating properties, a land parcel and an outparcel, in separate transactions as follows (in thousands): Property Name Location Columbia Crossing .............................. Columbia, MD Turnpike Plaza ........................................ Huntington Station, NY Center Court ......................................... Pikesville, MD Flowery Branch ...................................... Flowery Branch, GA Garden State Pavilions ...................... Cherry Hill, NJ Village Crossroads ............................... Phoenix, AZ University Town Center(1) ............ Pensacola, FL Gateway Station(2) ............................. Burleson, TX Park Hill Plaza ......................................... Island Gate ............................................... Village Center West ........................... Belleville Road S.C.(3) ........................ Fairview Heights, IL Grand Oaks Village ............................. Market at Southpark ........................... Jetton Village Shoppes ....................... Brennan Station ..................................... Woodruff Outparcel(4) ................... Woodruff, SC Westridge Square ................................ Highlands Ranch ................................... North Valley Plaza ............................... College Park S.C. .................................. Greensboro, NC Highland Ranch, CO Peoria, AZ Tempe, AZ Miami, FL Corpus Christi, TX Highlands Ranch, CO Orlando, FL Littleton, CO Charlotte, NC Raleigh, NC Purchase Price Debt Cash Assumed Total GLA* $ Month Acquired Jan-11 Feb-11 Mar-11 April-11 June-11 July-11 Aug-11 Sept-11 Sept-11 Oct-11 Oct-11 Oct-11 Nov-11 Nov-11 Nov-11 Nov-11 Nov-11 Nov-11 Nov-11 Dec-11 Dec-11 4,100 7,920 9,955 4,427 18,250 29,240 17,750 6,625 17,251 8,750 3,995 1,900 19,051 30,000 5,110 20,225 1,183 26,125 7,035 7,260 10,500 Total $ 256,652 $ $ $ - - 15,445 9,273 - - - 18,832 8,199 - 6,105 - 5,949 - 8,250 9,125 - - 20,599 16,135 - 4,100 7,920 25,400 13,700 18,250 29,240 17,750 25,457 25,450 8,750 10,100 1,900 25,000 30,000 13,360 29,350 1,183 26,125 27,634 23,395 10,500 117,912 $ 374,564 31 53 106 93 257 185 101 280 112 60 30 - 86 190 81 136 119 215 123 168 62 2,488 * Gross leasable area ("GLA") (1) This property was acquired from a joint venture in which the Company has a 13.4% noncontrolling interest. The Company evaluated this transaction pursuant to the FASB’s Consolidation guidance and as such recorded a gain of $0.6 million from the fair value adjustment associated with its original 13.4% ownership due to a change in control. (2) The Company purchased the leasehold improvements at this property for which it previously owned the land. (3) The Company acquired the land at this site for which it previously held a ground lease. (4) The Company purchased this out parcel next to an existing property that the Company previously owned. 59 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued The aggregate purchase price of the above 2012 and 2011 property acquisitions have been allocated as follows (in thousands): Land ............................................................................................................................................... $ Buildings ....................................................................................................................................... Below Market Rents ............................................................................................................. Above Market Rents ............................................................................................................ In-Place Leases ......................................................................................................................... Building Improvements ........................................................................................................ Tenant Improvements ......................................................................................................... Mortgage Fair Value Adjustment ................................................................................... $ 2012 2011 196,219 $ 319,955 (40,375) 14,977 31,248 99,092 19,327 (5,965) 634,478 $ 104,824 174,129 (16,958) 12,345 20,031 72,979 14,110 (6,896) 374,564 Additionally, during the years ended December 31, 2012 and 2011, the Company acquired the remaining interest in six and two previously consolidated joint ventures for $12.0 million and $0.2 million, respectively. Also during 2011, the Company acquired additional interests in two separate consolidated joint ventures for an aggregate cost of $9.7 million. The Company continues to consolidate these entities as there was no change in control from these transactions. The purchase of the remaining and additional partnership interests resulted in an aggregate decrease in noncontrolling interest of $10.4 million and $13.0 million for the years ended December 31, 2012 and 2011, respectively, and an aggregate decrease of $0.3 million and an aggregate increase of $3.6 million to the Company’s Paid-in capital, during 2012 and 2011, respectively. Ground-Up Development - The Company is engaged in ground-up development projects, which will be held as long-term investments by the Company. As of December 31, 2012, the Company had in progress a total of three ground-up development projects, consisting of two located in the U.S. and one located in Peru. During 2011, the Company acquired a land parcel located in Lima, Peru through a newly formed joint venture in which the Company has a 95% controlling ownership interest for a purchase price of 6.8 million Peruvian Sols (USD $2.5 million). This parcel will be developed into a grocery anchored shopping center. Kimsouth - Kimsouth Realty Inc. (“Kimsouth”) is a wholly-owned subsidiary of the Company that holds a 13.4% noncontrolling interest in a joint venture which owns a portion of Albertson’s Inc. During 2012, the joint venture distributed $50.3 million of which the Company received $6.9 million, which was recognized as income from cash received in excess of the Company’s investment, before income tax. During 2011, the joint venture distributed $100.0 million of which the Company received $13.9 million, which was recognized as income from cash received in excess of the Company’s investment, before income tax. The income for both 2012 and 2011 was included in Equity in income from other real estate investments, net on the Company’s Consolidated Statements of Income. FNC Realty Corporation – During 2011, the Company acquired an additional 12.48% interest in FNC Realty Corporation (“FNC”) for $12.4 million, which increased the Company’s total controlling ownership interest to 69.08%. During 2012, the Company acquired an additional 13.62% interest in FNC for $15.3 million, which increased the Company’s total ownership interest to 82.70%. The Company had previously and continues to consolidate FNC. Since there was no change in control from these transactions, the purchase of the additional interest resulted in an increase to the Company’s Paid-in capital of $0.1 million and $1.0 million during 2012 and 2011, respectively. 5. Dispositions of Real Estate: Operating Real Estate – During 2012, the Company disposed of 62 operating properties and two outparcels, in separate transactions, for an aggregate sales price of $418.9 million. These transactions, which are included in discontinued operations, resulted in an aggregate pre-tax gain of $85.9 million and aggregate impairment charges of $22.5 million, before income taxes. The Company provided seller financing in connection with the sale of one of the operating properties for $4.2 million, which bears interest at a rate of 6.0% and matures in November 2013. The Company evaluated this transaction pursuant to the FASB’s real estate sales guidance and concluded that the criteria for sale recognition were met. 60 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued Additionally, during 2012, the Company disposed of four land parcels and two outparcels for an aggregate sales price of $7.1 million and recognized an aggregate gain of $2.0 million and aggregate impairment charges of $0.3 million related to these transactions. The gains from these transactions are recorded as other income, which is included in Other expense, net, and the impairment charges have been recorded as Impairment charges in the Company’s Consolidated Statements of Income. The Company provided seller financing in connection with the sale of one of the land parcels for $1.8 million, which bears interest at a rate of 6.5% for the first six months and 7.5% for the remaining term and is scheduled to mature in March 2013. The Company evaluated this transaction pursuant to the FASB’s real estate sales guidance and concluded that the criteria for sale recognition were met. Also, during 2012, the Company sold a land parcel in San Juan del Rio, Mexico for a sales price of 24.3 million Mexican Pesos (“MXN”) (USD $1.9 million). The Company recognized a gain of MXN 5.7 million (USD $0.4 million) on this transaction. The gain from this transaction is recorded as other income, which is included in Other expense, net, in the Company’s Consolidated Statements of Income. During 2012, the Company sold a previously consolidated operating property to a newly formed unconsolidated joint venture in which the Company has a 20% noncontrolling interest for a sales price of $55.5 million. This transaction resulted in a pre-tax gain of $10.0 million, of which the Company deferred $2.0 million due to its continued involvement. This gain has been recorded as Gain on sale of operating properties, net of tax in the Company’s Consolidated Statements of Income. During 2011, the Company disposed of 27 operating properties, one development property and one outparcel, in separate transactions, for an aggregate sales price of $124.9 million. These transactions, which are included in discontinued operations, resulted in an aggregate gain of $17.3 million and aggregate impairment charges of $16.9 million, before an income tax benefit and noncontrolling interest. The Company provided seller financing aggregating $11.9 million on three of these transactions which bear interest at rates ranging from 5.50% to 8.00% per annum and have maturities ranging from one to seven years. The Company evaluated these transactions pursuant to the FASB’s real estate sales guidance to determine sale and gain recognition. Additionally, during 2011 the Company disposed of a portion of an operating property and a land parcel, in separate transactions, for an aggregate sales price of $5.4 million. These transactions resulted in aggregate impairment charges of $1.6 million which is included in Impairment charges, on the Company’s Consolidated Statements of Income. Also, during 2011, a consolidated joint venture in which the Company had a preferred equity investment disposed of a property for a sales price of $6.1 million. As a result of this capital transaction, the Company received $1.4 million of profit participation, before noncontrolling interest of $0.1 million. This profit participation has been recorded as Income from other real estate investments and is reflected in Income from discontinued operating properties in the Company’s Consolidated Statements of Income. During 2011, the Company transferred an operating property for a sales price of $23.9 million to a newly formed unconsolidated joint venture in which the Company has a noncontrolling interest. This transaction resulted in a gain of $0.4 million, of which the Company deferred $0.1 million due to its continued involvement. During 2010, the Company (i) sold seven operating properties, which were previously consolidated, to two new joint ventures in which the Company holds noncontrolling equity interests for an aggregate sales price of $438.1 million including the assignment of $159.9 million of non-recourse mortgage debt encumbering three of the properties and (ii) disposed of, in separate transactions, seven operating properties for an aggregate sales price of $100.5 million including the assignment of $81.0 million of non-recourse mortgage debt encumbering one of the properties. These transactions resulted in aggregate gains of $4.4 million and aggregate losses/impairments of $5.0 million. Additionally, during 2010, the Company disposed of (i) three properties, in separate transactions, for an aggregate sales price of $23.8 million and (ii) five properties from a consolidated joint venture in which the Company had a preferred equity investment for a sales price of $40.8 million. These transactions resulted in an aggregate profit participation of $20.8 million, before income tax of $1.0 million and noncontrolling interest of $4.9 million. This profit participation has been recorded as Income from other real estate investments and is reflected in Income from discontinued operating properties, net of tax in the Company’s Consolidated Statements of Income. During 2010, the Company also disposed of, in separate transactions, nine land parcels for an aggregate sales price of $25.6 million which resulted in an aggregate gain of $3.4 million. This gain is included in Other expense, net in the Company’s Consolidated Statements of Income. 61 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued Ground-up Development – During 2011, the Company transferred a merchant building property for a sales price of $37.6 million to a newly formed unconsolidated joint venture in which the Company has a noncontrolling interest. This transaction resulted in an aggregate gain of $14.2 million, before income tax expense, of which the Company deferred $2.1 million due to its continued involvement. During 2010, the Company disposed of a land parcel for a sales price of $0.8 million resulting in a gain of $0.4 million. Additionally, the Company recognized $1.7 million in income on previously sold development properties during the year ended December 31, 2010. 6. Adjustment of Property Carrying Values and Real Estate Under Development: Impairments – During 2012, the Company recognized an aggregate impairment charge of $34.1 million, before income tax benefit of $10.7 million, relating to its investment in four operating properties, which are included in Impairment charges in the Company’s Consolidated Statements of Income. The aggregate book value of these properties was $86.6 million. The estimated aggregate fair value of these properties is based upon purchase price offers and comparable sales information aggregating $52.5 million (see footnote 16 for additional disclosure on fair value). These impairment charges resulted from the Company’s efforts to market certain assets and management’s assessment as to the likelihood and timing of such potential transactions. During 2011, the Company recognized an aggregate impairment charge of $3.9 million, before income tax benefit of $1.1 million, relating to its investment in two operating properties and one land parcel. The aggregate book value of these properties was $9.2 million. The estimated aggregate fair value of these properties was based upon purchase prices and purchase price offers aggregating $5.3 million. These impairment charges resulted from the Company’s efforts to market certain assets and management’s assessment as to the likelihood and timing of such potential transactions. During 2010, the Company recognized an aggregate impairment charge of $8.7 million, of which $5.2 million is classified as discontinued operations on the Company’s Consolidated Statement of Income, relating to its investment in seven properties. Four of these properties were sold during 2010 and one of these properties was classified as held-for-sale as of December 31, 2010. The estimated individual fair value of these properties was based upon purchase prices and current purchase price offers. These impairments were primarily due to declines in real estate fundamentals along with adverse changes in local market conditions and the uncertainty of their recovery. Additionally, during 2010, the Company had determined that one of its unconsolidated joint ventures’ ground-up development projects, located in Miramar, FL, estimated recoverable value will not exceed its estimated cost. As a result, the Company recorded a pre-tax other-than-temporary impairment on its investment of $11.7 million, representing the excess of the investment’s carrying value over its estimated fair value. The Company’s estimated fair value was based upon projected operating cash flows (discounted and unleveraged) of the property over its specified holding period. Such cash flow projections consider factors such as expected future operating income, trends and prospects, as well as the effects of demand, competition and other factors. Capitalization rates and discount rates utilized in this model were based upon rates that the Company believes to be within a reasonable range of current market rates for the respective properties. 7. Discontinued Operations and Assets Held-for-Sale: The Company reports as discontinued operations assets held-for-sale as of the end of the current period and assets sold during the period. All results of these discontinued operations are included in a separate component of income on the Consolidated Statements of Income under the caption Discontinued operations. This has resulted in certain reclassifications of 2012, 2011 and 2010 financial statement amounts. 62 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued The components of Income from discontinued operations for each of the three years in the period ended December 31, 2012, are shown below. These include the results of Income through the date of each respective sale for properties sold during 2012, 2011 and 2010, and the operations for the applicable periods for those assets classified as held-for-sale as of December 31, 2012 (in thousands): Discontinued operations: Revenues from rental property ............................................................................... $ Rental property expenses ........................................................................................... Depreciation and amortization ................................................................................ Interest expense .............................................................................................................. Income from other real estate investments ...................................................... Other expense, net ........................................................................................................ Income from discontinued operating properties, before income taxes ............................................................................................ Loss on operating properties sold, before income taxes.......................... Impairment of property carrying value, before income taxes................. Gain on disposition of operating properties, before income taxes ..... (Provision)/ benefit for income taxes ................................................................... Income from discontinued operating properties ........................................... Net income attributable to noncontrolling interests ................................... Income from discontinued operations attributable 2012 2011 2010 27,155 $ (10,069) (13,249) (997) 13 (212) 2,641 - (22,458) 85,894 (2,079) 63,998 (1,731) 65,783 $ (24,144) (19,427) (1,848) 2,000 (114) 22,250 - (19,698) 17,327 3,126 23,005 (1,384) 96,794 (33,015) (30,431) (9,429) 20,781 (760) 43,940 (35) (6,460) 1,981 (274) 39,152 (5,288) to the Company .................................................................................................... $ 62,267 $ 21,621 $ 33,864 During 2012, the Company classified as held-for-sale 18 operating properties, comprising 2.1 million square feet of GLA. The book value of these properties was $73.2 million, net of accumulated depreciation of $57.2 million. The Company recognized impairment charges of $4.2 million on three of these properties. The book value of the other properties did not exceed their estimated fair value, less costs to sell, and as such no impairment charges were recognized. The Company’s determination of the fair value of these properties, aggregating $102.0 million, was based upon executed contracts of sale with third parties (see Footnote 16). In addition, the Company completed the sale of 19 operating properties during the year ended December 31, 2012, of which two were classified as held-for-sale during 2011 (these dispositions are included in Footnote 2 above). At December 31, 2012, the Company had one operating property classified as held-for-sale at a carrying amount of $3.4 million, net of accumulated depreciation of $6.8 million, which is included in Other assets on the Company’s Consolidated Balance Sheets. During 2011, the Company classified as held-for-sale seven operating properties and one land parcel, comprising 0.2 million square feet of GLA. The book value of each of these properties aggregated $10.0 million, net of accumulated depreciation of $7.3 million. The Company recognized impairment charges of $1.1 million on the land parcel. The individual book values of the seven operating properties did not exceed each of their estimated fair values less costs to sell; as such no impairments were recognized. The Company’s determination of the fair value of these properties and land parcel, aggregating $19.7 million, was based upon executed contracts of sale with third parties. The Company completed the sale of five of these operating properties during the year ended December 31, 2011. At December 31, 2011 the Company had two properties classified as held-for-sale at an aggregate carrying amount of $3.8 million, net of accumulated depreciation of $0.5 million, which are included in Other assets on the Company’s Consolidated Balance Sheets. During 2010, the Company classified as held-for-sale 12 operating properties comprising 0.5 million square feet of GLA. The book value of each of these properties aggregated $40.5 million, net of accumulated depreciation of $11.9 million. The Company recognized impairment charges of $5.2 million, before income tax benefit, on seven of these properties. The individual book value of the five remaining properties did not exceed each of their estimated fair values less costs to sell. The Company’s determination of the fair value of the 12 properties, aggregating $66.1 million, was based upon executed contracts of sale with third parties. The Company completed the sale of eleven of these properties during 2010. During 2011, the Company reclassified one property previously classified as held-for-sale into held-for-use. At December 31, 2010 the Company had one property classified as held-for- sale at a carrying value of $4.4 million, which was included in Other assets on the Company’s Consolidated Balance Sheets. 8. Investment 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. The 63 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued Company and the joint venture partners have joint approval rights for major decisions, including those regarding property operations. As such, the Company holds noncontrolling interests in these joint ventures and accounts for them under the equity method of accounting. The table below presents joint venture investments for which the Company held an ownership interest at December 31, 2012 and 2011 (in millions, except number of properties): Venture Prudential Investment Program (“KimPru” and “KimPru II”) (1) (2) .............................................. Kimco Income Opportunity Portfolio (“KIR”) (2) ................. UBS Programs (2)* ......................... BIG Shopping Centers (2)* ........ The Canada Pension Plan Investment Board (“CPP”) (2) ................................... Kimco Income Fund (2)................ SEB Immobilien (2) ......................... Other Institutional Programs (2) ................................ RioCan ................................................... Intown (3) ............................................ Latin America ..................................... Other Joint Venture Programs (4) (5) (7) (8) .............................. Total ....................................................... As of December 31, 2012 As of December 31, 2011 Average Ownership Interest Number of Properties GLA Gross Real Estate The Company's Investment Number of Properties GLA Gross Real Estate The Company's Investment 15.00% 61 10.7 $ 2,744.9 $ 170.1 63 10.9 $ 2,781.4 $ 45.00% 17.90% 37.70% 55.00% 15.20% 15.00% Various 50.00% - Various Various 58 40 22 6 12 13 58 45 138 131 87 671 12.4 5.7 3.6 2.4 1.5 1.8 2.6 9.3 N/A 18.0 13.2 81.2 1,543.2 1,260.1 547.7 436.1 287.0 361.2 499.2 1,379.3 841.0 1,198.1 1,846.7 $ 12,944.5 $ 140.3 58.4 31.3 149.5 12.3 1.5 21.3 111.0 86.9 334.2 311.4 1,428.2 59 42 23 6 12 13 67 45 138 130 92 690 12.6 5.9 3.7 1,556.6 1,330.5 557.4 2.4 1.5 1.8 4.7 9.3 N/A 17.9 430.0 281.1 360.5 804.4 1,367.0 829.9 1,145.8 151.9 151.4 61.3 41.2 140.6 12.1 2.1 33.7 62.2 90.8 318.0 13.7 2,016.5 84.4 $ 13,461.1 $ 338.9 1,404.2 * Ownership % is a blended rate The table below presents the Company’s share of net income/(loss) for these investments which is included in the Company’s Consolidated Statements of Income under Equity in income of joint ventures, net and Gains on change in control of interests for the years ended December 31, 2012, 2011 and 2010 (in millions): Year ended December 31, 2011 2010 2012 KimPru and KimPru II (14) (15) (16) ................................................................................... $ KIR (17) (18) .............................................................................................................................................. UBS Programs (19) ........................................................................................................................... BIG Shopping Centers (20) ..................................................................................................... CPP ................................................................................................................................. Kimco Income Fund ............................................................................................... SEB Immobilien ......................................................................................................... Other Institutional Programs (6) (10) (13) (21) ............................................................. RioCan (9) ................................................................................................................................................. Intown ........................................................................................................................... Latin America ............................................................................................................ Other Joint Venture Programs (11) (12) (22) (23) (24) ..................................... Total ............................................................................................................................... $ 7.4 $ 23.4 0.5 (3.7) 5.3 1.7 0.7 19.6 30.4 4.0 15.8 23.4 128.5 $ (1.6) $ 17.3 (0.8) (2.9) 5.2 1.0 - 5.5 19.7 (1.9) 12.5 10.0 64.0 $ (18.4) 19.8 1.2 (1.2) 3.2 1.0 0.8 - 18.6 (6.0) 10.4 5.2 34.6 (1) (2) (3) (4) (5) This venture represents four separate joint ventures, with four separate accounts managed by Prudential Real Estate Investors (“PREI”), three of these ventures are collectively referred to as KimPru and the remaining venture is referred to as KimPru II. The Company manages these joint venture investments and, where applicable, earns acquisition fees, leasing commissions, property management fees, assets management fees and construction management fees. The Company’s share of this investment is subject to fluctuation and is dependent upon property cash flows. During the year ended December 31, 2012, the Company amended one of its Canadian preferred equity investment agreements to restructure the investment as a pari passu joint venture in which the Company holds a noncontrolling interest. As a result of this transaction, the Company continues to account for its investment in this joint venture under the equity method of accounting and includes this investment in Investments and advances to real estate joint ventures within the Company’s Consolidated Balance Sheets. During the year ended December 31, 2012, a joint venture in which the Company holds a noncontrolling interest sold an operating property for a sales price of $62.0 million, which resulted in no gain or loss recognized. 64 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued (6) (7) (8) (9) During the year ended December 31, 2012, a joint venture in which the Company held a noncontrolling interest sold an operating property to the Company for a sales price of $127.0 million. The Company evaluated this transaction pursuant to the FASB’s Consolidation guidance and as such recognized a gain of $12.1 million from the fair value adjustment associated with its original ownership due to a change in control. In addition, the Company recognized promote income of $1.1 million in connection with this transaction. During the year ended December 31, 2012, the Company sold an operating property to a newly formed unconsolidated joint venture in which the Company has a noncontrolling interest for a sales price of $55.5 million. During the year ended December 31, 2012, a joint venture in which the Company holds a noncontrolling interest acquired an operating property in Alberta, Canada for a purchase price of $42.4 million. The Company’s capital contribution was $14.5 million. During the year ended December 31, 2012, the Company recognized income of $7.5 million, before taxes of $1.5 million, from the sale of certain air rights at one of the properties in this portfolio. (10) During the year ended December 31, 2012, the Company acquired four properties from joint ventures in which the Company has a noncontrolling interest. The Company evaluated these transactions pursuant to the FASB’s Consolidation guidance and as such recognized an aggregate gain of $14.5 million from the fair value adjustment associated with its original ownership due to a change in control. (11) During the year ended December 31, 2012, the Company acquired a property from a joint venture in which the Company had a noncontrolling interest. The Company evaluated this transaction pursuant to the FASB’s Consolidation guidance and as such recognized an aggregate gain of $1.0 million from the fair value adjustment associated with its original ownership due to a change in control. (12) During the year ended December 31, 2012, two joint ventures in which the Company holds noncontrolling interests sold two properties for an aggregate sales price of $118.0 million. The Company received distributions of $18.5 million and recognized an aggregate gain of $8.3 million. (13) During the year ended December 31, 2012, a joint venture in which the Company holds a noncontrolling interest sold two encumbered operating (14) properties to the Company for an aggregate sales price of $75.5 million. The Company recognized promote income of $2.6 million. KimPru recognized impairment charges of $6.5 million related to the sale of two properties; $53.6 million related to the potential foreclosure of two properties and $161.7 million related to the sale of 26 properties, during the years ended December 31, 2012, 2011 and 2010, respectively. The Company had previously taken other-than-temporary impairment charges on its investment in KimPru and had allocated these impairment charges to the underlying assets of the KimPru joint ventures including a portion to these operating properties. As such, the Company’s share of these impairment charges for the years ended December 31, 2012, 2011 and 2010 were $0.8 million, $6.0 million and $14.8 million, respectively. (16) (15) During 2011, a third party mortgage lender foreclosed on an operating property for which KimPru had previously taken an impairment charge during 2010. As a result of the foreclosure during 2011, KimPru recognized an aggregate gain on early extinguishment of debt of $29.6 million. The Company’s share of this gain was $4.4 million, before income taxes. KimPru II recognized impairment charges of $7.3 million and $25.6 million, during the years ended December 31, 2011 and 2010, respectively. The impairment charges recognized in 2011 related to the foreclosure of one operating property and the impairment charges recognized in 2010 related to the sale of four operating properties. The Company had previously taken other-than-temporary impairment charges on its investment in KimPru II and had allocated these impairment charges to the underlying assets of the KimPru II joint ventures including a portion to these operating properties. As such, the Company’s share of these impairment charges for the years ended December 31, 2011 and 2010 were $1.0 million and $3.4 million, respectively. KIR recognized impairment charges of $4.6 million related to the sale of one operating property and $6.7 million related to the sale of one operating property and one out-parcel during the years ended December 31, 2011 and 2010, respectively. The Company’s share of these impairment charges for the years ended December 31, 2011 and 2010 were $2.1 million and $3.0 million, respectively. (17) (18) During 2010, KIR recognized a gain on early extinguishment of debt of $5.8 million related to a property that was foreclosed on by a third party lender. The Company’s share of this gain was $2.6 million. (19) The UBS Program recognized impairment charges of $13.0 million related to the sale of two properties and $9.7 million related to the sale of one property, during the years ended December 31, 2012 and 2011, respectively. The Company’s share of these impairment charges for the years ended December 31, 2012 and 2011 were $2.2 million and $1.9 million, respectively. Additionally, during the year ended December 31, 2011, the UBS Program recognized an impairment charge of $5.0 million relating to a property that was anticipated to be foreclosed on by the third party lender in 2012. The Company’s share of this impairment charge was $0.8 million. A deed in lieu of foreclosure was given to the third party lender in 2012. (20) During the year ended December 31, 2012, BIG recognized an impairment charge of $9.0 million on a property that is expected to be foreclosed upon in 2013. The Company’s share of this impairment charge was $0.9 million. (21) During the year ended December 31, 2012, two joint ventures in which the Company has a noncontrolling interest recognized aggregate impairment charges of $6.5 million related to the sale of four operating properties. The Company’s share of these impairment charges was $0.8 million. (22) During the year ended December 31, 2012, three joint ventures in which the Company has noncontrolling interests recognized aggregate impairment charges of $12.8 million related to the sale of one operating property, the pending sale of one property and the potential foreclosure of another property. The Company’s share of these impairment charges was $6.4 million. (23) During the year ended December 31, 2011, the Company sold its interest in a Canadian hotel portfolio to its partner, for Canadian Dollars (“CAD”) $2.5 (24) million (USD $2.4 million). As a result, the Company recorded an impairment charge of USD $5.2 million, before income taxes. For the year ended December 31, 2010, the Company recognized impairment charges of $7.0 million, against the carrying value of its investments in various unconsolidated joint ventures. These impairment charges resulted from properties, within various unconsolidated joint ventures, being classified as held-for-sale. 65 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued The table below presents debt balances within the Company’s joint venture investments for which the Company held noncontrolling ownership interests at December 31, 2012 and 2011 (dollars in millions): As of December 31, 2012 As of December 31, 2011 Mortgages and Notes Payable Venture KimPru and KimPru II ........................... $ KIR .................................................................. UBS Programs .......................................... BIG Shopping Centers ......................... CPP ................................................................ Kimco Income Fund .............................. SEB Immobilien ........................................ RioCan ......................................................... Intown .......................................................... Other Institutional Programs............ Other Joint Venture Programs ........ Total $ 1,010.2 914.6 691.9 443.8 141.5 161.4 243.8 923.2 614.4 310.5 1,612.2 7,067.5 Average Interest Rate Average Remaining Term (months)** Mortgages and Notes Payable Average Interest Rate 5.54% 5.22% 5.40% 5.52% 5.19% 5.45% 5.11% 5.16% 4.46% 5.24% 5.70% 44.5 $ 78.6 39.1 45.5 31.0 20.7 55.3 41.2 46.1 39.0 57.8 $ 1,185.2 911.5 718.9 444.5 166.3 164.7 243.7 925.0 621.8 514.4 1,804.7 7,700.7 5.59% 5.89% 5.66% 5.52% 4.45% 5.45% 5.34% 5.66% 5.09% 4.90% 5.60% Average Remaining Term (months)** 52.6 75.6 47.4 57.4 27.0 32.7 61.9 43.3 39.6 45.4 56.9 ** Average remaining term includes extensions Other Real Estate Joint Ventures - During 2011, the Company exited its investment in a redevelopment joint venture property in Harlem, NY. As a result, the Company recognized an other-than-temporary impairment charge of approximately $3.1 million representing the Company’s entire investment balance. Additionally, during 2011, the Company recorded an other-than-temporary impairment of $2.0 million, before income tax benefit, against the carrying value of an investment in which the Company holds a 13.4% noncontrolling ownership interest. The Company determined the fair value of its investment based on the estimated sales price of the property in the joint venture. KIR - The Company holds a 45% noncontrolling limited partnership interest in KIR and has a master management agreement whereby the Company performs services for fees relating to the management, operation, supervision and maintenance of the joint venture properties. The Company’s equity in income from KIR for the year ended December 31, 2012, exceeded 10% of the Company’s income from continuing operations before income taxes; as such the Company is providing summarized financial information for KIR as follows (in millions): Assets: Real estate, net ......................................................................................................... $ Other assets ............................................................................................................... $ Liabilities and Members’ Capital: Mortgages payable .................................................................................................. $ Other liabilities .......................................................................................................... Noncontrolling interests ...................................................................................... Members’ capital...................................................................................................... $ 66 December 31, 2012 2011 1,134.2 $ 87.7 1,221.9 $ 914.6 $ 26.8 - 280.5 1,221.9 $ 1,177.6 76.4 1,254.0 911.5 27.4 10.7 304.4 1,254.0 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued Revenues from rental property ............................................................................... $ Operating expenses ....................................................................................................... Interest expense .............................................................................................................. Depreciation and amortization ................................................................................ Impairment charges ........................................................................................................ Other expense, net ........................................................................................................ Income from continuing operations ...................................................................... Discontinued Operations: Income/(loss) from discontinued operations............................................ Impairment on dispositions of properties .................................................. Gain on dispositions of properties ................................................................. Net income ........................................................................................................................ $ RioCan Investments - Year Ended December 31, 2011 2010 2012 197.3 $ (53.0) (54.0) (40.7) (0.1) (1.3) (149.1) 48.2 0.1 (0.1) - 48.2 $ 195.1 $ (54.3) (60.2) (38.2) (0.5) (2.5) (155.7) 39.4 (0.7) (4.6) - 34.1 $ 193.9 (54.0) (66.6) (38.6) (0.5) (2.6) (162.3) 31.6 8.3 (6.3) 5.6 39.2 During October 2001, the Company formed three joint ventures (collectively, the "RioCan Ventures") with RioCan Real Estate Investment Trust ("RioCan"), in which the Company has 50% noncontrolling interests, to acquire retail properties and development projects in Canada. The acquisition and development projects are to be sourced and managed by RioCan and are subject to review and approval by a joint oversight committee consisting of RioCan management and the Company’s management personnel. Capital contributions will only be required as suitable opportunities arise and are agreed to by the Company and RioCan. The Company’s equity in income from the Riocan Ventures for the year ended December 31, 2012, exceeded 10% of the Company’s income from continuing operations, as such the Company is providing summarized financial information for the RioCan Ventures as follows (in millions): Assets: Real estate, net ................................................................................................................. $ Other assets ....................................................................................................................... $ Liabilities and Members' Capital: Mortgages payable .......................................................................................................... $ Other liabilities .................................................................................................................. Members' capital.............................................................................................................. $ December 31, 2012 2011 1,189.9 $ 43.7 1,233.6 $ 923.2 $ 18.1 292.3 1,233.6 $ 1,143.6 26.6 1,170.2 925.0 19.7 225.5 1,170.2 2012 December 31, 2011 2010 Revenues from rental properties ............................................. $ 213.3 $ 209.2 $ 197.1 Operating expenses ........................................................................ Interest expense ............................................................................... Depreciation and amortization ................................................. Other income/(expense), net ................................................... (78.1) (51.9) (37.3) 14.7 (152.6) Net income ......................................................................................... $ 60.7 $ (73.0) (57.5) (36.8) (0.2) (167.5) 41.7 $ (70.9) (52.6) (34.4) (0.3) (158.2) 38.9 67 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued Summarized financial information for the Company’s investment and advances in real estate joint ventures (excluding KIR and the RioCan Ventures, which is presented above) is as follows (in millions): Assets: Real estate, net ............................................................................................................ $ Other assets .................................................................................................................. $ Liabilities and Partners’/Members’ Capital: Notes payable .............................................................................................................. $ Mortgages payable ..................................................................................................... Construction loans .................................................................................................... Other liabilities ............................................................................................................. Noncontrolling interests ......................................................................................... Partners’/Members’ capital .................................................................................... $ December 31, 2012 2011 8,523.3 $ 507.7 9,031.0 $ 148.0 $ 5,056.5 25.1 188.5 19.1 3,593.8 9,031.0 $ 9,158.5 609.3 9,767.8 150.5 5,604.3 109.4 216.2 25.4 3,662.0 9,767.8 Revenues from rental property ............................................................................... $ Operating expenses ....................................................................................................... Interest expense .............................................................................................................. Depreciation and amortization ................................................................................ Impairment charges ........................................................................................................ Other (expense)/income, net .................................................................................. Income from continuing operations ...................................................................... Discontinued Operations: Income/(loss) from discontinued operations............................................ Impairment on dispositions of properties .................................................. Gain on dispositions of properties ................................................................. Net income/(loss) ........................................................................................................... $ Year Ended December 31, 2011 2012 2010 1,074.5 $ (350.2) (311.3) (283.3) (15.5) (11.2) (971.5) 103.0 0.3 (31.4) 94.5 166.4 $ 1,115.4 $ (390.5) (332.7) (325.1) (20.9) 22.9 (1,046.3) 69.1 16.6 (68.4) (0.1) 17.2 $ 1,028.6 (368.1) (316.6) (313.3) (3.1) (18.4) (1,019.5) 9.1 (12.4) (194.3) 3.1 (194.5) Other liabilities included in the Company’s accompanying Consolidated Balance Sheets include accounts with certain real estate joint ventures totaling $21.3 million and $24.2 million at December 31, 2012 and 2011, 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 GAAP. The Company’s maximum exposure to losses associated with its unconsolidated joint ventures is primarily limited to its carrying value in these investments. Generally, such investments contain operating properties and the Company has determined these entities do not contain the characteristics of a VIE. As of December 31, 2012 and 2011, the Company’s carrying value in these investments is $1.4 billion. 9. Other Real Estate Investments: Preferred Equity Capital – The Company previously provided capital to owners and developers of real estate properties through its Preferred Equity program. As of December 31, 2012, the Company’s net investment under the Preferred Equity program was $287.8 million relating to 504 properties, including 397 net leased properties. For the year ended December 31, 2012, the Company earned $43.1 million from its preferred equity investments, including $17.6 million in profit participation earned from 21 capital transactions. For the year ended December 31, 2011, the Company earned $35.7 million from its preferred equity investments, including $13.7 million in profit participation earned from 13 capital transactions. For the year ended December 31, 2010, the Company earned $37.6 million from its preferred equity investments, including $9.7 million in profit participation earned from nine capital transactions. 68 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued During 2012, the Company amended one of its preferred equity agreements to restructure its investment, into a pari passu joint venture investment in which the Company holds a noncontrolling interest. The Company will continue to account for this investment under the equity method of accounting and from the date of the amendment will include this investment in Investments and advances in real estate joint ventures within the Company’s Consolidated Balance Sheets. Included in the capital transactions described above for the year ended December 31, 2012, is the sale of three preferred equity investments in which the Company had a $0 investment and recognized promote income of $10.0 million. In connection with this transaction, the Company provided seller financing for $7.5 million, which bears interest at a rate of 7.0% and matures in December 2013. The Company evaluated this transaction pursuant to the FASB’s real estate sales guidance and concluded that the criteria for sale recognition was met. During 2011, the Company, in separate transactions, amended three preferred equity agreements to restructure its investments, which hold investments in seven retail properties, into three pari passu joint venture investments in which the Company holds noncontrolling interests. The Company will continue to account for these investments under the equity method of accounting and from the dates of the amendments will include these investments in Investments and advances in real estate joint ventures within the Company’s Consolidated Balance Sheets (see Footnote 8). Additionally, during the year ended December 31, 2011, two properties within two of the Company’s preferred equity investments were in default of the their respective mortgages and received foreclosure notices from the respective mortgage lenders. As such, the Company recognized full impairment charges on both of the investments aggregating $2.2 million. During 2010, the Company sold 50% of a preferred equity investment in a Canadian retail operating property for CAD $31.9 million (USD $31.0 million). In connection with this sale the Company (i) recognized profit participation of CAD $1.7 million (USD $1.6 million) and (ii) amended its preferred equity agreement to restructure the Company’s remaining investment as a pari passu joint venture investment. Additionally, during 2010, the Company amended its preferred equity agreement to restructure another Canadian investment that holds investments in 12 retail properties as a pari passu joint venture investment. The Company will continue to account for both of these investments under the equity method of accounting and includes these investments in Investments and advances in real estate joint ventures within the Company’s Consolidated Balance Sheets (see Footnote 8). Also during 2010, the Company recognized an impairment charge of $3.8 million against the carrying value of its preferred equity investment in an operating property located in Tucson, AZ based on its estimated sales price. During 2010, the Company acquired the remaining ownership interest in this operating property for a purchase price of $90.0 million, including the assumption of $81.0 million in non-recourse mortgage debt, which bears interest at a rate of 6.08% and is scheduled to mature in 2016. During August 2010, this property was fully disposed of. Additionally, during the year ended December 31, 2010, the Company recognized an impairment charge of $5.0 million against the carrying value of two of its preferred equity investments, based on estimated sales prices. During 2010, the Company sold one of these preferred equity investments for a sales price of $0.3 million. The Company’s estimated fair values relating to the impairment assessments above were based upon sales prices, where applicable, or discounted cash flow models that include all estimated cash inflows and outflows over a specified holding period and where applicable, any estimated debt premiums. Capitalization rates, discount rates and credit spreads utilized in these models were based upon rates that the Company believes to be within a reasonable range of current market rates for the respective properties. During 2007, the Company invested $81.7 million of preferred equity capital in an entity which was comprised of 403 net leased properties (“Net Leased Portfolio”) which consist of 30 master leased pools with each pool leased to individual corporate operators. Each master leased pool is accounted for as a direct financing lease. These properties consist of a diverse array of free-standing restaurants, fast food restaurants, convenience and auto parts stores. As of December 31, 2012, the remaining 397 properties were encumbered by third party loans aggregating $358.9 million with interest rates ranging from 5.08% to 10.47% with a weighted- average interest rate of 9.3% and maturities ranging from one to 10 years. The Company recognized $14.0 million, $12.7 million and $12.1 million in equity in income from this investment during the years ended December 31, 2012, 2011 and 2010, respectively. The Company’s maximum exposure to losses associated with its preferred equity investments is primarily limited to its invested capital. As of December 31, 2012 and 2011, the Company’s invested capital in its preferred equity investments approximated $287.8 million and $316.0 million, respectively. 69 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued Summarized financial information relating to the Company’s preferred equity investments is as follows (in millions): Assets: Real estate, net .................................................................................................................... $ Other assets .......................................................................................................................... $ Liabilities and Partners’/Members’ Capital: Notes and mortgages payable ..................................................................................... $ Other liabilities ..................................................................................................................... Partners’/Members’ capital ............................................................................................. $ December 31, 2012 2011 824.7 $ 719.1 1,543.8 $ 1,116.9 $ 51.8 375.1 1,543.8 $ 1,058.1 760.5 1,818.6 1,338.7 39.9 440.0 1,818.6 Revenues from rental property ............................................................................... $ Operating expenses ....................................................................................................... Interest expense .............................................................................................................. Depreciation and amortization ................................................................................ Impairment charges (a) ................................................................................................ Other expense, net ........................................................................................................ Income from continuing operations ...................................................................... Discontinued Operations: .......................................................................................... Gain on disposition of properties ................................................................. Net income .............................................................................................................. $ Year Ended December 31, 2011 2010 2012 195.0 $ (44.7) (72.0) (33.7) (2.7) (8.3) 33.6 17.5 51.1 $ 233.1 $ (57.0) (89.5) (43.6) - (6.3) 36.7 6.2 42.9 $ 278.4 (73.2) (104.0) (52.3) - (6.3) 42.6 13.7 56.3 (a) Represents an impairment charge against one master leased pool due to decline in fair market value. Other – During 2010, the Company recognized an other-than-temporary impairment charge of $2.1 million against the carrying value of an investment that owns two operating properties located in Manchester, NH and Nashua, NH. The Company determined the fair value of its investment based on an estimated sales price of the operating properties. During 2011, these two properties were sold and as a result of an adjustment to the purchase price, the Company recognized an additional $0.5 million in impairment charges. 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 sublet to retailers who lease the stores pursuant to net lease agreements. Income from the investment in these retail store leases during the years ended December 31, 2012, 2011 and 2010, was $0.9 million, $0.8 million and $1.6 million, respectively. These amounts represent sublease revenues during the years ended December 31, 2012, 2011 and 2010, of $3.9 million, $5.1 million and $5.9 million, respectively, less related expenses of $3.0 million, $4.3 million and $4.3 million, respectively. The Company's future minimum revenues under the terms of all non-cancelable 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): 2013, $3.7 and $2.3; 2014, $2.9 and $1.7; 2015, $2.0 and $1.3; 2016, $1.6 and $1.0; 2017, $1.0 and $0.5, and thereafter, $0.4 and $0.04, respectively. Leveraged Lease - During June 2002, the Company acquired a 90% equity participation interest in an existing leveraged lease of 30 properties. The properties are leased under a long-term bond-type net lease whose primary term expires in 2016, with the lessee having certain renewal option rights. The Company’s cash equity investment was $4.0 million. This equity investment is reported as a net investment in leveraged lease in accordance with the FASB’s lease guidance. 70 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued As of December 31, 2012, 19 of these properties were sold, whereby the proceeds from the sales were used to pay down the mortgage debt by $32.3 million and the remaining 11 properties were encumbered by third-party non-recourse debt of $21.1 million that is scheduled to fully amortize during the primary term of the lease from a portion of the periodic net rents receivable under the net lease. As an equity participant in the leveraged lease, the Company has no recourse obligation for principal or interest payments on the debt, which is collateralized by a first mortgage lien on the properties and collateral assignment of the lease. Accordingly, this obligation has been offset against the related net rental receivable under the lease. At December 31, 2012 and 2011, the Company’s net investment in the leveraged lease consisted of the following (in millions): Remaining net rentals ........................................................................................................... $ Estimated unguaranteed residual value ...................................................................... Non-recourse mortgage debt ......................................................................................... Unearned and deferred income ..................................................................................... Net investment in leveraged lease ................................................................................ $ 2012 2011 24.0 $ 30.3 (19.0) (27.6) 7.7 $ 30.8 30.3 (25.1) (29.9) 6.1 10. Variable Interest Entities: Consolidated Operating Properties Included within the Company’s consolidated operating properties at December 31, 2012, are two consolidated entities that are VIEs, for which the Company is the primary beneficiary. These entities have been established to own and operate real estate property. The Company’s involvement with these entities is through its majority ownership and management of the properties. The entities were deemed VIEs primarily based on the fact that the voting rights of the equity investors is not proportional to their obligation to absorb expected losses or receive the expected residual returns of the entity and substantially all of the entity's activities are conducted on behalf of the investor which has disproportionately fewer voting rights. The Company determined that it was the primary beneficiary of these VIEs as a result of its controlling financial interest. At December 31, 2012, total assets of these VIEs were $10.8 million and total liabilities were $0.1 million. The classification of these assets is primarily within real estate and the classifications of liabilities are primarily within accounts payable and accrued expenses. The majority of the operations of these VIEs are funded with cash flows generated from the properties. The Company has not provided financial support to any of these VIEs that it was not previously contractually required to provide, which consists primarily of funding any capital expenditures, including tenant improvements, which are deemed necessary to continue to operate the entity and any operating cash shortfalls that the entity may experience. Consolidated Ground-Up Development Projects Included within the Company’s ground-up development projects at December 31, 2012, are two entities that are VIEs, for which the Company is the primary beneficiary. These entities were established to develop real estate property to hold as long-term investments. The Company’s involvement with these entities is through its majority ownership and management of the properties. The entities were deemed VIEs primarily based on the fact that the equity investment at risk is not sufficient to permit the entity to finance its activities without additional financial support. The initial equity contributed to these entities was not sufficient to fully finance the real estate construction as development costs are funded by the partners throughout the construction period. The Company determined that it was the primary beneficiary of these VIEs as a result of its controlling financial interest. At December 31, 2012, total assets of these ground-up development VIEs were $87.8 million and total liabilities were $0.1 million. The classification of these assets is primarily within real estate under development and the classifications of liabilities are primarily within accounts payable and accrued expenses. Substantially all of the projected development costs to be funded for these ground-up development VIEs, aggregating $33.3 million, will be funded with capital contributions from the Company and by the outside partners, when contractually obligated. The Company has not provided financial support to these VIEs that it was not previously contractually required to provide. 71 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued Unconsolidated Ground-Up Development Also included within the Company’s ground-up development projects at December 31, 2012, is an unconsolidated joint venture, which is a VIE for which the Company is not the primary beneficiary. This joint venture is primarily established to develop real estate property for long-term investment and was deemed a VIE primarily based on the fact that the equity investment at risk was not sufficient to permit the entity to finance its activities without additional financial support. The initial equity contributed to this entity was not sufficient to fully finance the real estate construction as development costs are funded by the partners throughout the construction period. The Company determined that it was not the primary beneficiary of this VIE based on the fact that the Company has shared control of this entity along with the entity’s partners and therefore does not have a controlling financial interest. The Company’s investment in this VIE was $17.9 million as of December 31, 2012, which is included in Real estate under development in the Company’s Condensed Consolidated Balance Sheets. The Company’s maximum exposure to loss as a result of its involvement with this VIE is estimated to be $36.3 million, which primarily represents the Company’s current investment and estimated future funding commitments of $18.4 million. The Company has not provided financial support to this VIE that it was not previously contractually required to provide. All future costs of development will be funded with capital contributions from the Company and the outside partner in accordance with their respective ownership percentages. Unconsolidated Redevelopment Investment Included in the Company’s joint venture investments at December 31, 2012, is one unconsolidated joint venture, which is a VIE for which the Company is not the primary beneficiary. This joint venture was primarily established to develop real estate property for long-term investment and was deemed a VIE primarily based on the fact that the equity investment at risk was not sufficient to permit the entity to finance its activities without additional financial support. The initial equity contributed to this entity was not sufficient to fully finance the real estate construction as development costs are funded by the partners throughout the construction period. The Company determined that it was not the primary beneficiary of this VIE based on the fact that the Company has shared control of this entity along with the entity’s partners and therefore does not have a controlling financial interest. As of December 31, 2012, the Company’s investment in this VIE was a negative $12.1 million, due to the fact that the Company had a remaining capital commitment obligation, which is included in Other liabilities in the Company’s Condensed Consolidated Balance Sheets. The Company’s maximum exposure to loss as a result of its involvement with this VIE is estimated to be $12.1 million, which is the remaining capital commitment obligation. The Company has not provided financial support to this VIE that it was not previously contractually required to provide. All future costs of development will be funded with capital contributions from the Company and the outside partner in accordance with their respective ownership percentages. 11. Mortgages and Other Financing Receivables: The Company has various mortgages and other financing receivables which consist of loans acquired and loans originated by the Company. For a complete listing of the Company’s mortgages and other financing receivables at December 31, 2012, see Financial Statement Schedule IV included in this annual report on Form 10-K. The following table reconciles mortgage loans and other financing receivables from January 1, 2010 to December 31, 2012 (in thousands): Balance at January 1 ....................................................................................................... $ Additions: New mortgage loans ................................................................................................ Additions under existing mortgage loans ...................................................... Foreign currency translation ................................................................................. Amortization of loan discounts ........................................................................... Deductions: Loan repayments ........................................................................................................ Loan impairments ....................................................................................................... Charge off/foreign currency translation .......................................................... Collections of principal ............................................................................................ Amortization of loan costs .................................................................................... Balance at December 31 ............................................................................................ $ 2012 2011 2010 102,972 $ 108,493 $ 131,332 29,496 895 1,181 247 (60,740) - (430) (2,861) (56) 70,704 $ 14,297 - - 247 (15,803) - (863) (3,345) (54) 102,972 $ 1,411 3,047 3,923 247 (24,860) (700) (3,101) (2,726) (80) 108,493 72 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued The Company reviews payment status to identify performing versus non-performing loans. Interest income on performing loans is accrued as earned. A non-performing loan is placed on non-accrual status when it is probable that the borrower may be unable to meet interest payments as they become due. Generally, loans 90 days or more past due are placed on non-accrual status unless there is sufficient collateral to assure collectability of principal and interest. Upon the designation of non-accrual status, all unpaid accrued interest is reserved against through current income. Interest income on non-performing loans is generally recognized on a cash basis. The following table presents performing and non-performing loans as of December 31, 2012 (in thousands): Performing Loans ................................................................................................................... Non-Performing Loans ........................................................................................................ Total ................................................................................................................................... 24 $ 4 28 $ Number of Loans Amount 50,802 19,902 70,704 As of December 31, 2012, the Company had four loans aggregating $19.9 million which were in default for nonpayment of interest only or principal and interest. The Company has placed all of these loans on non-accrual status with respect to the recognition of interest income starting from each loan’s nonperformance date. Nonperformance dates for these loans range from 7 months to 7 years. The Company assessed each of these four loans and determined that the estimated fair value of the underlying collateral exceeded the respective carrying values as of December 31, 2012. During 2010, the Company recognized an impairment charge of $0.7 million, against the carrying value, including accrued interest of a mortgage receivable that was in default. This impairment charge reflects a decrease in the estimated fair value of the underlying collateral. The remaining balance on this mortgage receivable as of December 31, 2010, was $1.4 million. This impairment charge is reflected in Impairments charges on the Company’s Consolidated Statements of Income. 12. Marketable Securities: The amortized cost and estimated fair values of securities available-for-sale and held-to-maturity at December 31, 2012 and 2011, are as follows (in thousands): December 31, 2012 Gross Unrealized Gains Gross Unrealized Losses Amortized Cost Available-for-sale: Equity securities ................................................................... $ Held-to-maturity: Other debt securities ....................................................... Total marketable securities ................................................ $ 14,205 $ 19,223 $ 3,113 17,318 $ 284 19,507 $ Estimated Fair Value - $ - - $ 33,428 3,397 36,825 December 31, 2011 Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Amortized Cost Available-for-sale: Equity securities ................................................................... $ Held-to-maturity: Other debt securities ....................................................... Total marketable securities ................................................ $ 14,253 $ 16,210 $ (1) $ 30,462 3,078 17,331 $ 378 16,588 $ (10) (11) $ 3,446 33,908 During February 2008, the Company acquired an aggregate $190 million Australian denominated (“AUD”) ( USD $170.1 million) convertible notes (the “Valad notes”) issued by a subsidiary of Valad Property Group (“Valad”), a publicly traded Australian company listed on the Australian stock exchange that is a diversified, property fund manager, investor, developer and property investment banker with property investments in Australia, Europe and Asia. The notes were guaranteed by Valad and bore interest at 9.5% payable semi-annually in arrears. The notes were repayable after five years with an option for Valad to extend up to 18 months, subject to certain interest rate and conversion price resets. The notes were convertible any time into publicly traded Valad securities at a price of AUD $26.60. During 2010, the Company acquired an additional AUD $10 million (USD $9.3 million) of Valad notes. Additionally, during 2010, Valad made a principal payment of AUD $8.0 million (USD $7.9 million). 73 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued During 2011, the Company received an additional principal payment of $7.0 million AUD ( USD $6.9 million) and the Company sold its remaining Valad notes for a sales price of AUD $165.0 million ( USD $169.1 million), plus unpaid accrued interest. In connection with the anticipation of this sale, the Company entered into a foreign currency forward contract to sell AUD $165.0 million and buy USD $169.1 million in efforts to mitigate the foreign exchange risk resulting from fluctuations in currency exchange rates. The Company designated the AUD-USD foreign exchange risk as the risk being hedged. The Company recorded an adjustment to the carrying value of the Valad notes, including amounts allocated to the conversion option described below, of USD $0.9 million based upon the agreed sales price. This adjustment is recorded in Other expense, net on the Company’s Consolidated Statements of Income. At the completion of the sale, the Company received AUD $170.2 million (USD $174.7 million) representing the principal and unpaid interest and settled its foreign currency forward contract. Upon settling the foreign currency forward contract, the Company recorded a reclass of $10.0 million from Accumulated other comprehensive income to Other expense, net, which was fully offset by a foreign currency gain on sale of the Valad notes. As a result there was no net gain or loss recognized. In accordance with the FASB’s Derivative and Hedging guidance, the Company bifurcated the conversion option within the Valad notes and separately accounted for this option as an embedded derivative. The original host instrument was classified as an available- for-sale security at fair value and was included in Marketable securities on the Company’s Consolidated Balance Sheets with changes in the fair value recorded through Stockholders’ equity as a component of other comprehensive income. At December 31, 2010, the Company had an unrealized gain, including foreign currency adjustments, associated with these notes of $6.0 million. The embedded derivative was recorded at fair value and was included in Other assets on the Company’s Consolidated Balance Sheets with changes in fair value recognized in the Company’s Consolidated Statements of Income. The value attributed to the embedded convertible option was AUD $10.0 million, ( USD $10.2 million). As a result of the fair value remeasurement of this derivative instrument during 2010 there was an AUD $0.2 million (USD $0.2 million) unrealized decrease in the fair value of the convertible option. This unrealized increase/decrease is included in Other expense, net on the Company’s Consolidated Statements of Income. During 2011, and 2010, the Company recorded impairment charges of $0.6 million, and $4.6 million, respectively, before income tax benefits of $0.4 million, and $0 million, respectively, due to the decline in value of certain marketable securities and other investments that were deemed to be other-than-temporary. These impairments were a result of the deterioration of the equity markets for these securities during their respective years and the uncertainty of their future recoverability. Market value for the equity securities represents the closing price of each security as it appears on their respective stock exchange at the end of the period. During 2012, 2011 and 2010, the Company received $0.1 million, $22.7 million and $23.2 million in proceeds from the sale/redemption of certain marketable securities, respectively. In connection with these transactions, during 2012. 2011 and 2010 the Company recognized (i) gross realizable gains of $0.0 million, $0.8 million and $2.6 million, respectively, (ii) foreign currency gains of $0.0 million, $1.6 million and $0.0 million, respectively, and (iii) gross realizable losses of $0.0 million, $0.3 million and $1.9 million, respectively. As of December 31, 2012, the contractual maturities of Other debt securities classified as held-to-maturity are as follows: after one year through five years, $0.1 million; and after five years through 10 years, $3.0 million. Actual maturities may differ from contractual maturities as issuers may have the right to prepay debt obligations with or without prepayment penalties. 13. Notes Payable: As of December 31, 2012 and 2011 the Company’s Notes Payable consisted of the following (dollars in millions): Balance at 12/31/12 Interest Rate Range (Low) Senior Unsecured Notes (c) ...... Medium Term Notes ..................... Unsecured Term Loan .................. Canadian Notes Payable .............. Credit Facility (a) .............................. Mexican Term Loan........................ Other Notes Payable (b) ............. $ $ 965.9 1,144.6 400.0 352.4 249.9 76.9 2.4 3,192.1 4.70% 4.30% 1.26% 5.18% 1.10% 8.58% 5.50% 74 Interest Rate Range (High) 6.88% 5.78% 1.26% 5.99% 1.26% 8.58% 5.50% Maturity Date Range (Low) Jan-2013 Oct-2013 Apr-2014 Aug-2013 Oct-2015 Mar-2013 Jan-2013 Maturity Date Range (High) Oct-2019 Feb-2018 Apr-2014 Apr-2018 Oct-2015 Mar-2013 Sept-2013 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued Balance at 12/31/11 Senior Unsecured Notes ............. Medium Term Notes ..................... Canadian Notes Payable .............. Credit Facilities (a) ........................... Mexican Term Loan........................ Other Notes Payable (b) ............. $ $ 1,164.8 1,161.6 342.6 238.9 71.5 4.5 2,983.9 Interest Rate Range (Low) 4.70% 4.30% 5.18% 1.35% 8.58% 3.80% Interest Rate Range (High) 6.88% 5.98% 5.99% 1.35% 8.58% 3.80% Maturity Date Range (Low) Nov-2012 July-2012 Aug-2013 Oct-2015 Mar-2013 Sept-2012 Maturity Date Range (High) Oct-2019 Feb-2018 Apr-2018 Oct-2015 Mar-2013 Sept-2012 (a) Interest rate is equal to LIBOR plus 1.05% (b) Interest rate is equal to LIBOR plus 3.50% (c) During January 2013, the Company repaid the $100.0 million outstanding balance on its 6.125% senior unsecured note, which matured in January 2013. Senior Unsecured Notes/Medium Term Notes – During September 2009, the Company entered into a fifth supplemental indenture, under the indenture governing its Medium Term Notes ("MTN") and Senior Notes, which included the financial covenants for future offerings under the indenture that were removed by the fourth supplemental indenture. In accordance with the terms of the Indenture, as amended, pursuant to which the Company's Senior Unsecured Notes, except for $300.0 million issued during April 2007 under the fourth supplemental indenture, have been issued, the Company is subject to maintaining (a) certain maximum leverage ratios on both unsecured senior corporate and secured debt, minimum debt service coverage ratios and minimum equity levels, (b) certain debt service ratios, (c) certain asset to debt ratios and (d) restricted from paying dividends in amounts that exceed by more than $26.0 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 had a MTN program pursuant to which it offered 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. Interest on these fixed-rate senior unsecured notes is payable semi-annually in arrears. Proceeds from these issuances were primarily used for the acquisition of neighborhood and community shopping centers, the expansion and improvement of properties in the Company’s portfolio and the repayment of certain debt obligations of the Company. During the years ended December 31, 2012 and 2011, the Company repaid the following notes (dollars in millions): Type MTN .............................. Senior Note .............. MTN .............................. Credit Facility – Date Issued July-02 Nov-02 Aug-04 Amount Repaid $ $ $ 17.0 198.9 88.0 Interest Rate 5.98% 6.00% 4.82% Maturity Date July-12 Nov-12 Aug-11 Date Paid July-12 Nov-12 Aug-11 The Company has a $1.75 billion unsecured revolving credit facility (the “Credit Facility”) with a group of banks, which is scheduled to expire in October 2015 and has a one-year extension option. This credit facility, provides funds to finance general corporate purposes, including (i) property acquisitions, (ii) investments in the Company’s institutional management programs, (iii) development and redevelopment costs and (iv) any short-term working capital requirements. Interest on borrowings under the Credit Facility accrues at LIBOR plus 1.05% and fluctuates in accordance with changes in the Company’s senior debt ratings and has a facility fee of 0.20% per annum. As part of this Credit Facility, the Company has a competitive bid option whereby the Company could auction up to $875.0 million of its requested borrowings to the bank group. This competitive bid option provides the Company the opportunity to obtain pricing below the currently stated spread. In addition, as part of the Credit Facility, the Company has a $500.0 million sub- limit which provides it the opportunity to borrow in alternative currencies such as Canadian Dollars, British Pounds Sterling, Japanese Yen or Euros. Pursuant to the terms of the Credit Facility, the Company, among other things, is subject to covenants requiring the 75 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued maintenance of (i) maximum leverage ratios on both unsecured and secured debt and (ii) minimum interest and fixed coverage ratios. As of December 31, 2012, the Credit Facility had a balance of $249.9 million outstanding and $27.3 million appropriated for letters of credit. U.S. Term Loan - During 2012, the Company obtained a $400.0 million unsecured term loan with a consortium of banks, which accrues interest at LIBOR plus 105 basis points. The term loan is scheduled to mature in April 2014, with three additional one-year options to extend the maturity date, at the Company’s discretion, to April 17, 2017. Proceeds from this term loan were used for general corporate purposes including the repayment of maturing debt amounts. Pursuant to the terms of the Credit Agreement, the Company, among other things is subject to covenants requiring the maintenance of (i) maximum indebtedness ratios and (ii) minimum interest and fixed charge coverage ratios. Mexican Term Loan - During March 2008, the Company obtained a Mexican peso (“MXN”) 1.0 billion term loan, which bears interest at a rate of 8.58%, subject to change in accordance with the Company’s senior debt ratings, and is scheduled to mature in March 2013. The Company utilized proceeds from this term loan to fully repay the outstanding balance of a MXN 500.0 million unsecured revolving credit facility, which was terminated by the Company. Remaining proceeds from this term loan were used for funding MXN denominated investments. As of December 31, 2012, the outstanding balance on this term loan was MXN 1.0 billion (USD $76.9 million). The Mexican term loan covenants are similar to the Credit Facility covenants described above. During December 2012, the lender agreed to extend this term loan for an additional five years at an interest rate of TIIE (Equilibrium Interbank Interest Rate) plus 1.35%, which will be effective subsequent to the scheduled maturity in March 2013. The Company has the option to swap this rate to a fixed rate at any time during the term of the loan. The weighted-average interest rate for all unsecured notes payable is 4.72% as of December 31, 2012. The scheduled maturities of all unsecured notes payable as of December 31, 2012, were as follows (in millions): 2013, $555.4; 2014, $694.8; 2015, $600.0; 2016, $300.0; 2017, $290.9 and thereafter, $751.0. 14. Mortgages Payable: During 2012, the Company (i) assumed $185.3 million of individual non-recourse mortgage debt relating to the acquisition of seven operating properties, including an increase of $6.1 million associated with fair value debt adjustments, (ii) paid off $284.8 million of mortgage debt that encumbered 19 properties and (iii) assigned five mortgages aggregating $17.1 million in connection with property dispositions. During 2011, the Company assumed $124.8 million of individual non-recourse mortgage debt relating to the acquisition of 12 operating properties, including an increase of $6.9 million associated with fair value debt adjustments and paid off $62.5 million of mortgage debt that encumbered 10 operating properties. 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 2035. Interest rates range from LIBOR (0.17% as of December 31, 2012) to 9.75% (weighted-average interest rate of 6.18% as of December 31, 2012). The scheduled principal payments (excluding any extension options available to the Company) of all mortgages payable, excluding unamortized fair value debt adjustments of $10.3 million, as of December 31, 2012, were as follows (in millions): 2013, $104.3; 2014, $206.1; 2015, $131.3; 2016, $253.1; 2017, $178.0 and thereafter, $120.1. 15. Noncontrolling Interests: Noncontrolling interests represent the portion of equity that the Company does not own in those entities it consolidates as a result of having a controlling interest or determined that the Company was the primary beneficiary of a VIE in accordance with the provisions of the FASB’s Consolidation guidance. The Company accounts and reports for noncontrolling interests in accordance with the Consolidation guidance and the Distinguishing Liabilities from Equity guidance issued by the FASB. The Company identifies its noncontrolling interests separately within the equity section on the Company’s Consolidated Balance Sheets. Units that are determined to be mandatorily redeemable are classified as Redeemable noncontrolling interests and presented in the mezzanine section between Total liabilities and Stockholder’s equity on the Company’s Consolidated Balance Sheets. The amounts of consolidated net income attributable to the Company and to the noncontrolling interests are presented separately on the Company’s Consolidated Statements of Income. 76 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued The Company owns seven shopping center properties located throughout Puerto Rico. These properties were acquired partially through the issuance of $158.6 million of non-convertible units and $45.8 million of convertible units. Noncontrolling interests related to these acquisitions totaled $233.0 million of units, including premiums of $13.5 million and a fair market value adjustment of $15.1 million (collectively, the "Units"). The Company is restricted from disposing of these assets, other than through a tax free transaction until November 2015. The Units and related annual cash distribution rates consisted of the following: Type Preferred A Units (1) ............................ Class A Preferred Units (1) ............... Class B-1 Preferred Units (2) ............ Class B-2 Preferred Units (1) ............ Class C DownReit Units (2) ............. Number of Units Issued Par Value Per Unit 81,800,000 2,000 2,627 5,673 640,001 $ $ $ $ $ 1.00 10,000 10,000 10,000 30.52 Return Per Annum 7.0% LIBOR plus 2.0% 7.0% 7.0% Equal to the Company’s common stock dividend (1) These units are redeemable for cash by the holder or callable by the Company and are included in Redeemable noncontrolling interests on the Company’s Consolidated Balance Sheets. (2) These units are redeemable for cash by the holder or at the Company’s option, shares of the Company’s common stock, based upon the conversion calculation as defined in the agreement. These units are included in Noncontrolling interests on the Company’s Consolidated Balance Sheets. The following Units have been redeemed for cash as of December 31, 2012: Type Preferred A Units ................................................................................ Class A Preferred Units .................................................................... Class B-1 Preferred Units ................................................................ Class B-2 Preferred Units ................................................................ Class C DownReit Units .................................................................. Units Redeemed Par Value Redeemed (in millions) 2,200,000 $ 2,000 $ 2,438 $ 5,576 $ 61,804 $ 2.2 20.0 24.4 55.8 1.9 Noncontrolling interest relating to the remaining units was $110.8 million and $110.5 million as of December 31, 2012 and 2011, respectively. The Company owns two shopping center properties located in Bay Shore, NY and Centereach, NY. Included in Noncontrolling interests was $41.6 million, including a discount of $0.3 million and a fair market value adjustment of $3.8 million, in redeemable units, issued by the Company in connection with these transactions. The properties were acquired through the issuance of $24.2 million of these units, which are redeemable at the option of the holder; $14.0 million of fixed rate units and the assumption of $23.4 million of non-recourse debt. These units and related annual cash distribution rates consist of the following: Type Class A Units (1) ...................................... Class B Units (2) ...................................... Number of Units Issued Par Value Per Unit 13,963 647,758 $ $ 1,000 37.24 Return Per Annum 5.0% Equal to the Company’s common stock dividend (1) These units are redeemable for cash by the holder or callable by the Company any time after April 3, 2016 and are included in Redeemable noncontrolling interests on the Company’s Consolidated Balance Sheets. (2) These units are redeemable for cash by the holder or at the Company’s option, shares of the Company’s common stock at a ratio of 1:1 and are callable by the Company any time after April 3, 2026. These units are included in Noncontrolling interests on the Company’s Consolidated Balance Sheets. During 2012, all 13,963 Class A Units were redeemed by the holder in cash. Additionally, during 2007, 30,000 units, or $1.1 million par value, of the Class B Units were redeemed by the holder in cash at the option of the Company. As of December 31, 2012 and 2011, noncontrolling interest relating to the units was $26.4 million and $40.4 million, respectively. 77 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued Noncontrolling interests also includes 138,015 convertible units issued during 2006, by the Company, which were valued at $5.3 million, including a fair market value adjustment of $0.3 million, related to an interest acquired in an office building located in Albany, NY. These units are redeemable at the option of the holder after one year for cash or at the option of the Company for the Company’s common stock at a ratio of 1:1. The holder is entitled to a distribution equal to the dividend rate of the Company’s common stock. The Company is restricted from disposing of these assets, other than through a tax free transaction, until January 2017. The following table presents the change in the redemption value of the Redeemable noncontrolling interests for the years ended December 31, 2012 and December 31, 2011 (in thousands): Balance at January 1, ....................................................................................... $ Unit redemptions ........................................................................................ Fair market value amortization ............................................................ Balance at December 31, ........................................................................... $ 95,074 $ (13,998) - 81,076 $ 95,060 - 14 95,074 2012 2011 16. 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, reasonably approximate their fair values, except those listed below, for which fair values are reflected. The valuation method used to estimate fair value for fixed-rate and variable-rate debt and noncontrolling interests relating to mandatorily redeemable noncontrolling interests associated with finite-lived subsidiaries of the Company is based on discounted cash flow analyses, with assumptions that include credit spreads, loan amounts and debt maturities. The fair values for marketable securities are based on published or securities dealers’ estimated market values. Such fair value estimates are not necessarily indicative of the amounts that would be realized upon disposition. As a basis for considering market participant assumptions in fair value measurements, the FASB’s Fair Value Measurements and Disclosures guidance establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy). The following are financial instruments for which the Company’s estimate of fair value differs from the carrying amounts (in thousands): Marketable Securities (1) .............................................. $ Notes Payable (2) ............................................................. $ Mortgages Payable (3) .................................................... $ Construction Loans Payable (3) ................................ $ Mandatorily Redeemable Noncontrolling Interests (termination dates ranging from 2019 – 2027) (4) .......................................................... $ December 31, 2012 2011 Carrying Amounts Estimated Fair Value Carrying Amounts Estimated Fair Value 36,541 3,192,127 1,003,190 - $ $ $ $ 36,825 3,408,632 1,068,616 - $ $ $ $ 33,540 $ 2,983,886 $ 1,085,371 $ 45,128 $ 33,908 3,136,728 1,166,116 49,345 - $ - $ 2,654 $ 5,044 (1) As of December 31, 2012, $33.4 million of these assets’ estimated fair value were classified within Level 1 of the fair value hierarchy and the remaining $3.4 million were classified within Level 3 of the fair value hierarchy. (2) The Company determined that its valuation of these Notes payable was classified within Level 2 of the fair value hierarchy. (3) The Company determined that its valuation of these liabilities was classified within Level 3 of the fair value hierarchy. (4) The Company sold its investment in the consolidated joint ventures that included mandatorily redeemable noncontrolling interests during 2012. 78 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued The Company has certain financial instruments that must be measured under the FASB’s Fair Value Measurements and Disclosures guidance, including: available for sale securities, convertible notes and derivatives. The Company currently does not have non-financial assets and non-financial liabilities that are required to be measured at fair value on a recurring basis. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the asset or liability. Available for sale securities are measured at fair value using quoted market prices and are classified within Level 1 of the valuation hierarchy. The Company from time to time has used interest rate swaps to manage its interest rate risk. The fair values of interest rate swaps are determined using the market standard methodology of netting the discounted future fixed cash receipts (or payments) and the discounted expected variable cash payments (or receipts). The variable cash payments (or receipts) are based on an expectation of future interest rates (forward curves) derived from observable market interest rate curves. Based on these inputs, the Company has determined that interest rate swap valuations are classified within Level 2 of the fair value hierarchy. The Company did not have any interest rate swaps as of December 31, 2012. To comply with the FASB’s Fair Value Measurements and Disclosures guidance, the Company incorporates credit valuation adjustments to appropriately reflect both its own nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements. The credit valuation adjustments associated with its derivatives utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by itself and its counterparties. However, as of December 31, 2012, the Company has assessed the significance of the impact of the credit valuation adjustments on the overall valuation of its derivative positions and has determined that the credit valuation adjustments are not significant to the overall valuation of its derivatives. The table below presents the Company’s assets and liabilities measured at fair value on a recurring basis as of December 31, 2012 and 2011, aggregated by the level in the fair value hierarchy within which those measurements fall. Assets measured at fair value on a recurring basis at December 31, 2012 and 2011 (in thousands): Assets: Marketable equity securities .................... $ 33,428 $ 33,428 $ - $ Balance at December 31, 2012 Level 1 Level 2 Level 3 Balance at December 31, 2011 Level 1 Level 2 Level 3 Assets: Marketable equity securities .................... $ 30,462 $ 30,462 $ - $ Liabilities: Interest rate swaps ....................................... $ 222 $ - $ 222 $ - - - Assets and liabilities measured at fair value on a non-recurring basis at December 31, 2012 and 2011 are as follows (in thousands): Assets: Real estate ........................................................ $ 52,505 $ - $ - $ 52,505 Balance at December 31, 2012 Level 1 Level 2 Level 3 Balance at December 31, 2011 Level 1 Level 2 Level 3 Assets: Real estate ........................................................ $ Other investments ....................................... $ 5,289 $ 9,041 $ - $ - $ - $ 9,041 $ 5,289 - The Company’s estimated fair values for the year ended December 31, 2012, relating to the real estate assets measured on a non- recurring basis, which were non-retail assets, were based upon estimated sales prices from third party offers and comparable sales values ranging from $1.1 million to $42.0 million. The Company does not have access to certain unobservable inputs used by these 79 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued third parties to determine these estimated fair values (see footnote 6 for additional discussion related to these assets). Certain assets in 2011 were valued through the usage of discounted cash flow models that included all estimated cash inflows and outflows over a specified holding period and where applicable, any estimated debt premiums. These cash flows were comprised of unobservable inputs which included contractual rental revenues and forecasted rental revenues and expenses based upon market conditions and expectations for growth. Capitalization rates and discount rates utilized in these models were based upon observable rates that the Company believed to be within a reasonable range of current market rates for the respective properties. Based on these inputs, the Company determined that its valuation in these investments was classified within Level 3 of the fair value hierarchy. 17. Preferred Stock, Common Stock and Convertible Unit Transactions – Preferred Stock – The Company’s outstanding Preferred Stock is detailed below (in thousands, except share information and par values): As of December 31, 2012 Series of Preferred Stock Series H ..................... Series I ........................ Series J ........................ Series K ...................... Shares Authorized Shares Issued and Outstanding Liquidation Preference Dividend Rate 70,000 18,400 9,000 8,050 105,450 70,000 16,000 9,000 7,000 102,000 $ $ 175,000 400,000 225,000 175,000 975,000 6.90% $ 6.00% $ 5.50% $ 5.625% $ Annual Dividend per Depositary Share Par Value 1.00 1.00 1.00 1.00 $ $ $ $ 1.72500 1.50000 1.37500 1.40625 Series of Preferred Stock Series F ...................... Series G ..................... Series H ..................... As of December 31, 2011 Shares Authorized Shares Issued and Outstanding Liquidation Preference Dividend Rate Annual Dividend per Depositary Share 700,000 184,000 70,000 954,000 700,000 184,000 70,000 954,000 $ $ 175,000 460,000 175,000 810,000 6.65% $ 7.75% $ 6.90% $ Par Value 1.00 1.00 1.00 $ $ $ 1.66250 1.93750 1.72500 The following Preferred Stock series were issued during the years ended December 31, 2012 and 2010: Series of Preferred Stock Series H(1) ............ Series I (2) .............. Series J (3) .............. Series K (4) ............ Date Issued 8/30/2010 3/20/2012 7/25/2012 12/7/2012 Depositary Shares Issued 7,000,000 16,000,000 9,000,000 7,000,000 Fractional Interest per Share Net Proceeds, After Expenses (in millions) Offering/ Redemption Price 1/100 $ 1/1000 $ 1/1000 $ 1/1000 $ 169.2 $ 387.2 $ 217.8 $ 169.1 $ 25.00 25.00 25.00 25.00 Optional Redemption Date 8/30/2015 3/20/2017 7/25/2017 12/7/2017 (1) The net proceeds received from this offering were used to repay $150.0 million in mortgages payable and for general corporate purposes. (2) The net proceeds received from this offering were used for general corporate purposes, including the reduction of borrowings outstanding under the Company’s revolving credit facility and the redemption of shares of the Company’s preferred stock. (3) The net proceeds received from this offering were used for the redemption of all the outstanding depositary shares representing the Company’s Class F preferred stock, which redemption occurred on August 15, 2012, as discussed below, with the remaining proceeds used towards the redemption of outstanding depositary shares representing the Company’s Class G preferred stock, which redemption occurred on October 10, 2012, as discussed below, and general corporate purposes. (4) The net proceeds received from this offering were used for general corporate purposes, including funding towards the repayment of maturing Senior Unsecured Notes. 80 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued The following Preferred Stock series were redeemed during the year ended December 31, 2012: Series of Preferred Stock Date Issued 6/5/2003 10/10/2007 Series F (1) .............. Series G (2) ............ Depositary Shares Issued Redemption Amount (in millions) Offering/ Redemption Price Optional Redemption Date 7,000,000 $ 18,400,000 $ 175.0 $ 460.0 $ 25.00 25.00 6/5/2008 10/10/2012 Actual Redemption Date 8/15/2012 10/10/2012 (1) In connection with this redemption the Company recorded a non-cash charge of $6.2 million resulting from the difference between the redemption amount and the carrying amount of the Class F Preferred Stock on the Company’s Consolidated Balance Sheets in accordance with the FASB’s guidance on Distinguishing Liabilities from Equity. The $6.2 million was subtracted from net income to arrive at net income available to common shareholders and is used in the calculation of earnings per share for the year ended December 31, 2012. (2) In connection with this redemption the Company recorded a non-cash charge of $15.5 million resulting from the difference between the redemption amount and the carrying amount of the Class G Preferred Stock on the Company’s Consolidated Balance Sheets in accordance with the FASB’s guidance on Distinguishing Liabilities from Equity. The $15.5 million was subtracted from net income to arrive at net income available to common shareholders and is used in the calculation of earnings per share for the year ended December 31, 2012. The Company’s Preferred Stock Depositary Shares for all series are not convertible or exchangeable for any other property or securities of the Company. Voting Rights - The Class K Preferred Stock, Class J Preferred Stock, Class I Preferred Stock and Class H Preferred Stock rank pari passu as to voting rights, priority for receiving dividends and liquidation preference as set forth below. As to any matter on which the Class H Preferred Stock may vote, including any actions by written consent, each share of the Class H Preferred Stock shall be entitled to 100 votes, each of which 100 votes may be directed separately by the holder thereof. With respect to each share of Class H Preferred Stock, the holder thereof may designate up to 100 proxies, with each such proxy having the right to vote a whole number of votes (totaling 100 votes per share of Class H Preferred Stock). As a result, each Class H Depositary Share is entitled to one vote. As to any matter on which the Class I, J, or K Preferred Stock may vote, including any actions by written consent, each share of the Class I, J or K Preferred Stock shall be entitled to 1,000 votes, each of which 1,000 votes may be directed separately by the holder thereof. With respect to each share of Class I, J or K Preferred Stock, the holder thereof may designate up to 1,000 proxies, with each such proxy having the right to vote a whole number of votes (totaling 1,000 votes per share of Class I, J or K Preferred Stock). As a result, each Class I, J or K Depositary Share is entitled to one vote. Liquidation Rights – In the event of any liquidation, dissolution or winding up of the affairs of the Company, 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 $2,500.00 Class H Preferred Stock per share, $25,000.00 Class I Preferred Stock per share, $25,000.00 Class J Preferred Stock per share and $25,000.00 Class K Preferred Stock per share ($25.00 per each Class H, Class I, Class J and Class K Depositary Share), 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. Common Stock – The Company, from time to time, repurchases shares of its common stock in amounts that offset new issuances of common shares in connection with the exercise of stock options or the issuance of restricted stock awards. These share repurchases may occur in open market purchases, privately negotiated transactions or otherwise subject to prevailing market conditions, the Company’s liquidity requirements, contractual restrictions and other factors. During the year ended December 31, 2012, the Company repurchased 1,635,823 shares of the Company’s common stock for $30.9 million, of which $22.6 million was provided to the Company from stock options exercised. 81 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued Convertible Units – The Company has varies types of convertible units that were issued in connection with the purchase of operating properties (see footnote 15). The amount of consideration that would be paid to unaffiliated holders of units issued from the Company’s consolidated subsidiaries which are not mandatorily redeemable, as if the termination of these consolidated subsidiaries occurred on December 31, 2012, is $28.7 million. The Company has the option to settle such redemption in cash or shares of the Company’s common stock. If the Company exercised its right to settle in Common Stock, the unit holders would receive 1.5 million shares of Common Stock. 18. Supplemental Schedule of Non-Cash Investing/Financing Activities: The following schedule summarizes the non-cash investing and financing activities of the Company for the years ended December 31, 2012, 2011 and 2010 (in thousands): 2012 2011 2010 Acquisition of real estate interests by assumption of mortgage debt........... $ Disposition of real estate interest by assignment of debt ................................... $ Issuance of common stock ................................................................................................... $ Surrender of common stock ............................................................................................... $ Disposition of real estate through the issuance of loan receivables .............. $ Investment in real estate joint venture by contribution of properties and assignment of debt ................................................................................................ $ Declaration of dividends paid in succeeding period ............................................... $ Consolidation of Joint Ventures: Increase in real estate and other assets ............................................................... $ Increase in mortgage payable .................................................................................... $ $ 179,198 $ 17,083 $ 18,115 (2,073) $ $ 13,475 117,912 $ - $ 4,940 $ (596) $ 14,297 $ - $ $ 96,518 - $ 92,159 $ - - $ $ - $ - $ 670 81,000 5,070 (840) 975 149,034 89,037 174,327 144,803 19. 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. Reference is made to Footnotes 4, 5, 8 and 20 for additional information regarding transactions with related parties. Ripco Real Estate Corp. (“Ripco”) business activities include serving as a leasing agent and representative for national and regional retailers including Target, Best Buy, Kohls and many others, providing real estate brokerage services and principal real estate investing. Mr. Todd Cooper, an officer and 50% shareholder of Ripco, is a son of Mr. Milton Cooper, Executive Chairman of the Board of Directors of the Company. During 2012, 2011 and 2010, the Company paid brokerage commissions of $0.8 million, $0.5 million and $0.7 million, respectively, to Ripco for services rendered primarily as leasing agent for various national tenants in shopping center properties owned by the Company. The Company believes that the brokerage commissions paid were at or below the customary rates for such leasing services. Additionally, the Company held joint venture investments with Ripco. As of December 31, 2010, the Company had two operating properties and one land parcel, through joint ventures, in which the Company and Ripco each held 50% noncontrolling interests. The Company accounts for its investment in these joint ventures under the equity method of accounting. During 2011, the joint ventures sold one land parcel and one operating property to third parties, in separate transactions, which were encumbered by loans aggregating $14.2 million. As a result of these transactions the loans were fully repaid and the Company was relieved of the corresponding debt guarantees on these two loans. During 2012, the Company acquired the remaining 50% noncontrolling interest held by Ripco in a joint venture investment. As a result of this transaction, the Company now owns a 100% controlling interest and consolidates this investment. As of December 31, 2012, the remaining joint venture has a $2.8 million loan payable which is scheduled to mature in 2013 and bears interest at rate of LIBOR plus 1.05%. This loan is jointly and severally guaranteed by the Company and the joint venture partner. 82 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued 20. Commitments and Contingencies: Operations - The Company and its subsidiaries are primarily engaged in the operation of shopping centers that are either owned or held under long-term leases that expire at various dates through 2095. 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 97% of total revenues from rental property for each of the three years ended December 31, 2012, 2011 and 2010. The future minimum revenues from rental property under the terms of all non-cancelable tenant leases, assuming no new or renegotiated leases are executed for such premises, for future years are as follows (in millions): 2013, $676.0; 2014, $614.0; 2015, $545.4; 2016, $465.4; 2017, $380.3 and thereafter; $1,815.1. Base rental revenues from rental property are recognized on a straight-line basis over the terms of the related leases. The difference between the amount of rental income contracted through leases and rental income recognized on a straight-line basis for the years ended December 31, 2012, 2011 and 2010 is $9.5 million, $9.8 million and $12.0 million, respectively. Minimum rental payments under the terms of all non-cancelable operating leases pertaining to the Company’s shopping center portfolio for future years are as follows (in millions): 2013, $12.6; 2014, $12.2; 2015, $11.1; 2016, $10.3; 2017, $9.9 and thereafter, $172.6. Captive Insurance - In October 2007, the Company formed a wholly-owned captive insurance company, Kimco Insurance Company, Inc., ("KIC"), which provides general liability insurance coverage for all losses below the deductible under our third-party policy. The Company entered into the Insurance Captive as part of its overall risk management program and to stabilize its insurance costs, manage exposure and recoup expenses through the functions of the captive program. The Company capitalized KIC in accordance with the applicable regulatory requirements. KIC established annual premiums based on projections derived from the past loss experience of the Company’s properties. KIC has engaged an independent third party to perform an actuarial estimate of future projected claims, related deductibles and projected expenses necessary to fund associated risk management programs. Premiums paid to KIC may be adjusted based on this estimate, like premiums paid to third-party insurance companies, premiums paid to KIC may be reimbursed by tenants pursuant to specific lease terms. Guarantees – On a select basis, the Company provides guarantees on interest bearing debt held within real estate joint ventures in which the Company has noncontrolling ownership interests. The Company is often provided with a back-stop guarantee from its partners. The Company had the following outstanding guarantees as of December 31, 2012 (amounts in millions): Name of Joint Venture Amount of Guarantee Interest rate Maturity, with extensions Terms Type of debt InTown Suites Management, Inc. (1) .... $ Hillsborough ......................... $ Victoriaville ............................ $ 145.2 LIBOR plus 1.15% 2.8 LIBOR plus 1.05% 5.1 3.92% 2015 2013 2020 25% partner back-stop Jointly and severally with partner Promissory note Jointly and severally with partner Promissory note Unsecured credit facility (1) During October 2012, a purchase and sale agreement was executed to sell the InTown Suites company and related real estate assets for a gross sales price of $735 million, including $617 million of existing debt. The sale is contingent upon satisfactorily completing a due diligence process and other closing conditions, including lender approvals. The Company expects to complete this transaction in the first half of 2013. If the transaction is completed, the Company has agreed to maintain $145.2 million in preexisting guarantees of outstanding debt to be assumed by the buyer. The Company evaluated these guarantees in connection with the provisions of the FASB’s Guarantees guidance and determined that the impact did not have a material effect on the Company’s financial position or results of operations. 83 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued Letters of Credit - The Company has issued letters of credit in connection with the completion and repayment guarantees for loans encumbering certain of the Company’s redevelopment projects and guaranty of payment related to the Company’s insurance program. At December 31, 2012, these letters of credit aggregated $33.6 million. Other - In connection with the construction of its development and redevelopment projects and related infrastructure, certain public agencies require posting of performance and surety bonds to guarantee that the Company’s obligations are satisfied. These bonds expire upon the completion of the improvements and infrastructure. As of December 31, 2012, there were $20.7 million in performance and surety bonds outstanding. On January 28, 2013, the Company received a subpoena from the Enforcement Division of the SEC in connection with an investigation, In the Matter of Wal-Mart Stores, Inc. (FW-3678), that the SEC Staff is currently conducting with respect to possible violations of the Foreign Corrupt Practices Act. The Company is responding to the subpoena and intends to cooperate fully with the SEC in this matter. The Company has also been notified that the U.S. Department of Justice (“DOJ”) is conducting a parallel investigation, and the Company expects that it will cooperate with the DOJ investigation. At this point, we are unable to predict the duration, scope or result of the SEC or DOJ investigation. The Company is subject to various other legal proceedings and claims that arise in the ordinary course of business. Management believes that the final outcome of such matters will not have a material adverse effect on the financial position, results of operations or liquidity of the Company as of December 31, 2012. 21. Incentive Plans: The Company maintains two equity participation plans, the Second Amended and Restated 1998 Equity Participation Plan (the “Prior Plan”) and the 2010 Equity Participation Plan (the “2010 Plan”) (collectively, the “Plans”). The Prior Plan provides for a maximum of 47,000,000 shares of the Company’s common stock to be issued for qualified and non-qualified options and restricted stock grants. The 2010 Plan provides for a maximum of 10,000,000 shares of the Company’s common stock to be issued for qualified and non-qualified options, restricted stock, performance awards and other awards, plus the number of shares of common stock which are or become available for issuance under the Prior Plan and which are not thereafter issued under the Prior Plan, subject to certain conditions. Unless otherwise determined by the Board of Directors at its sole discretion, options granted under the Plans generally vest ratably over a range of three to five years, expire ten years from the date of grant and are exercisable at the market price on the date of grant. Restricted stock grants generally vest (i) 100% on the fourth or fifth anniversary of the grant, (ii) ratably over three or four years, (iii) over three years at 50% after two years and 50% after the third year or (iv) over ten years at 20% per year commencing after the fifth year. Performance share awards may provide a right to receive shares of restricted stock based on the Company’s performance relative to its peers, as defined, or based on other performance criteria as determined by the Board of Directors. In addition, the Plans provide for the granting of certain options and restricted stock to each of the Company’s non-employee directors (the “Independent Directors”) and permit such Independent Directors to elect to receive deferred stock awards in lieu of directors’ fees. The Company accounts for equity awards in accordance with FASB’s Compensation – Stock Compensation guidance which requires that all share based payments to employees, including grants of employee stock options, be recognized in the Statement of Income over the service period based on their fair values. The fair value of each option award is estimated on the date of grant using the Black-Scholes option pricing formula. The assumption for expected volatility has a significant effect on the grant date fair value. Volatility is determined based on the historical equity of common stock for the most recent historical period equal to the expected term of the options plus an implied volatility measure. The expected term is determined using the simplified method due to the lack of exercise and cancelation history for the current vesting terms. The more significant assumptions underlying the determination of fair values for options granted during 2012, 2011 and 2010 were as follows: Weighted average fair value of options granted............................ $ Weighted average risk-free interest rates.......................................... Weighted average expected option lives (in years) .................... Weighted average expected volatility.................................................. Weighted average expected dividend yield ..................................... $ 4.52 1.04% 6.25 37.53% 3.94% 4.39 $ 2.02 % 6.25 36.82 % 3.98 % 3.82 2.40% 6.25 37.98% 4.21% Year Ended December 31, 2011 2010 2012 84 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued Information with respect to stock options under the Plan for the years ended December 31, 2012, 2011, and 2010 are as follows: Options outstanding, January 1, 2010 ................................................................. Exercised .................................................................................................................. Granted ..................................................................................................................... Forfeited .................................................................................................................... Options outstanding, December 31, 2010 ...................................................... Exercised .................................................................................................................. Granted ..................................................................................................................... Expired ...................................................................................................................... Forfeited .................................................................................................................... Options outstanding, December 31, 2011 ...................................................... Exercised .................................................................................................................. Granted ..................................................................................................................... Forfeited .................................................................................................................... Options outstanding, December 31, 2012 ...................................................... Options exercisable (fully vested)- Weighted- Average Exercise Price Per Share Aggregate Intrinsic Value (in millions) 3.4 Shares 17,560,921 $ (616,245) $ $ 1,776,175 (1,605,062) $ $ 17,115,789 (444,368) $ $ 1,888,017 (655,748) $ (793,098) $ 17,110,592 $ (1,495,432) $ $ 1,522,450 (579,613) $ $ 16,557,997 29.69 $ 13.73 15.63 33.68 28.32 $ 14.71 18.77 16.40 23.74 28.14 $ 19.84 18.78 28.73 28.42 $ 18.0 8.0 14.9 5.8 3.9 7.7 December 31, 2010 ............................................................................ December 31, 2011 ............................................................................ December 31, 2012 ............................................................................ 11,712,900 12,459,598 12,830,255 $ $ $ 29.74 $ 30.77 $ 31.57 $ The exercise prices for options outstanding as of December 31, 2012, range from $11.54 to $53.14 per share. The Company estimates forfeitures based on historical data. The weighted-average remaining contractual life for options outstanding as of December 31, 2012, was 4.9 years. The weighted-average remaining contractual term of options currently exercisable as of December 31, 2012, was 4.9 years. Options to purchase 8,871,495, 5,776,270 and 5,874,704, shares of the Company’s common stock were available for issuance under the Plan at December 31, 2012, 2011 and 2010, respectively. As of December 31, 2012, the Company had 3,727,742 options expected to vest, with a weighted-average exercise price per share of $17.58 and an aggregate intrinsic value of $7.2 million. Cash received from options exercised under the Plan was $22.6 million, $6.5 million and $8.5 million, for the years ended December 31, 2012, 2011 and 2010, respectively. The total intrinsic value of options exercised during 2012, 2011 and 2010 was $7.0 million, $1.5 million, and $2.1 million, respectively. As of December 31, 2012, 2011 and 2010, the Company had restricted shares outstanding of 1,562,912, 832,726 and 526,728, respectively. The Company recognized expense associated with its equity awards of $17.9 million, $16.9 million and $14.2 million, for the years ended December 31, 2012, 2011 and 2010, respectively. As of December 31, 2012, the Company had $31.5 million of total unrecognized compensation cost related to unvested stock compensation granted under the Plans. That cost is expected to be recognized over a weighted average period of 3.8 years. The Company, from time to time, repurchases shares of its common stock in amounts that offset new issuances of common shares in connection with the exercise of stock options or the issuance of restricted stock awards. These repurchases may occur in open market purchases, privately negotiated transactions or otherwise, subject to prevailing market conditions, the Company’s liquidity requirements, contractual restrictions and other factors. During 2012, the Company repurchased 1.6 million shares of the Company’s common stock for $30.9 million, of which $22.6 million was provided to the Company from options exercised. During 2011, the Company repurchased 333,998 shares of the Company’s common stock for $6.0 million, of which $4.9 million was provided to the Company from options exercised. 85 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued The Company maintains a 401(k) retirement plan covering substantially all officers and employees, which permits participants to defer up to the maximum allowable amount determined by the Internal Revenue Service of their eligible compensation. This deferred compensation, together with Company matching contributions, which generally equal employee deferrals up to a maximum of 5% of their eligible compensation (capped at $250,000), is fully vested and funded as of December 31, 2012. The Company’s contributions to the plan were $2.1 million, $1.9 million, and $2.1 million for the years ended December 31, 2012, 2011 and 2010, respectively. The Company recognized severance costs associated with employee terminations during the years ended December 31, 2012, 2011 and 2010 of $5.4 million, $1.7 million and $0.4 million, respectively. The 2012 expense includes $2.5 million of severance costs related to the departure of an executive officer during January 2012. 22. Income Taxes: The Company elected to qualify as a REIT in accordance with the Code commencing with its taxable year which began January 1, 1992. To qualify as a REIT, the Company must meet several organizational and operational requirements, including a requirement that it currently distribute at least 90% of its adjusted REIT taxable income to its stockholders. Management intends to adhere to these requirements and maintain the Company’s REIT status. As a REIT, the Company generally will not be subject to corporate federal income tax, provided that distributions to its stockholders equal at least the amount of its REIT taxable income. If the Company failed to qualify as a REIT in any taxable year, it would be subject to federal income taxes at regular corporate rates (including any applicable alternative minimum tax) and may not be permitted to elect REIT status for four subsequent taxable years. Even if the Company qualifies for taxation as a REIT, the Company is subject to certain state and local taxes on its income and property, and federal income and excise taxes on its undistributed taxable income. In addition, taxable income from non-REIT activities managed through taxable REIT subsidiaries is subject to federal, state and local income taxes. The Company is also subject to local taxes on certain Non-U.S. investments. Reconciliation between GAAP Net Income and Federal Taxable Income: The following table reconciles GAAP net income to taxable income for the years ended December 31, 2012, 2011 and 2010 (in thousands): 2012 (Estimated) 2011 (Actual) 2010 (Actual) GAAP net income attributable to the Company ................................................ $ Less: GAAP net (income)/loss of taxable REIT subsidiaries ................ GAAP net income from REIT operations (a) ........................................................ Net book depreciation in excess of tax depreciation....................................... Deferred/prepaid/above and below market rents, net..................................... Book/tax differences from non-qualified stock options.................................... Book/tax differences from investments in real estate joint ventures ........ Book/tax difference on sale of property ................................................................... Book adjustment to property carrying values and marketable equity securities ........................................................................................................................... Taxable currency exchange (loss)/gain, net ............................................................ Book/tax differences on capitalized costs ................................................................ Dividends from taxable REIT subsidiaries ................................................................ Other book/tax differences, net.................................................................................... Adjusted REIT taxable income ....................................................................................... $ $ 266,073 (5,249) 260,824 32,517 (17,643) 1,653 16,837 (69,961) 9,956 (1,611) 2,899 1,000 (845) 235,626 $ 169,051 $ (19,572) 149,479 30,603 (16,463) 9,879 52,564 1,811 8,721 6,502 3,228 15,969 1,016 263,309 $ 142,868 13,920 156,788 13,568 (19,978) 9,103 69,581 (39,139) 19,065 13,134 (12,782) - (6,064) 203,276 Certain amounts in the prior periods have been reclassified to conform to the current year presentation, in the table above. (a) All adjustments to "GAAP net income from REIT operations" are net of amounts attributable to noncontrolling interest and taxable REIT subsidiaries. 86 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued Cash Dividends Paid and Dividends Paid Deductions (in thousands): For the years ended December 31, 2012, 2011 and 2010 cash dividends paid exceeded the dividends paid deduction and amounted to $382,722, $353,764, and $306,964, respectively. Characterization of Distributions: The following characterizes distributions paid for the years ended December 31, 2012, 2011 and 2010, (in thousands): 2012 2011 2010 Preferred F Dividends Ordinary income .................................. $ Capital gain .............................................. $ Preferred G Dividends Ordinary income .................................. $ Capital gain .............................................. $ Preferred H Dividends Ordinary income .................................. $ Capital gain .............................................. $ Preferred I Dividends Ordinary income .................................. $ Capital gain .............................................. $ Preferred J Dividends Ordinary income .................................. $ Capital gain .............................................. $ Common Dividends Ordinary income .................................. $ Capital Gain ............................................ Return of capital ................................... $ Total dividends distributed ............. $ 9,116 582 9,698 33,046 2,109 35,155 11,351 725 12,076 12,847 820 13,667 2,585 165 2,750 222,751 15,469 71,156 309,376 382,722 Taxable REIT Subsidiaries and Taxable Entities: 94% $ 6% 100% $ 94% $ 6% 100% $ 94% $ 6% 100% $ 94% $ 6% 100% $ 94% $ 6% 100% $ 72% $ 5% 23% 100% $ $ 11,638 - 11,638 35,650 - 35,650 13,584 - 13,584 - - - - - - 208,832 - 84,060 292,892 353,764 100% $ -% 100% $ 100% $ -% 100% $ 100% $ -% 100% $ -% $ -% -% $ -% $ -% -% $ 11,638 - 11,638 35,650 - 35,650 - - - - - - - - - 71% $ -% 29% 100% $ $ 181,773 - 77,903 259,676 306,964 100% -% 100% 100% -% 100% -% -% -% -% -% -% -% -% -% 70% -% 30% 100% The Company is subject to federal, state and local income taxes on income earned from activities conducted through taxable REIT subsidiaries (“TRS”). TRS activities include Kimco Realty Services ("KRS"), a wholly-owned subsidiary of the Company and its subsidiaries, and the consolidated entities of FNC Corporation (“FNC”), and Blue Ridge Real Estate Company/Big Boulder Corporation. The Company is also subject to taxes on its activities in Canada, Mexico, Brazil, Chile, and Peru. Dividends paid to the Company from its subsidiaries and joint ventures in Canada, Mexico and Brazil are generally not subject to withholding taxes under the applicable tax treaty with the United States. Chile and Peru impose a 10% and 4.1% withholding tax, respectively, on dividend distributions. Brazil levies a 0.38% transaction tax on return of capital distributions. During 2012, less than $0.1 million of withholding and transaction taxes were withheld from distributions related to foreign activities. Income taxes have been provided for on the asset and liability method as required by the FASB’s Income Tax guidance. Under the asset and liability method, deferred income taxes are recognized for the temporary differences between the financial reporting basis and the tax basis of taxable assets and liabilities. 87 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued The Company’s pre-tax book income/(loss) and (provision)/benefit for income taxes relating to the Company’s TRS and taxable entities which have been consolidated for accounting reporting purposes, for the years ended December 31, 2012, 2011, and 2010, are summarized as follows (in thousands): Income/(loss) before income taxes – U.S. (Provision)/benefit for income taxes, net: Federal : 2012 2011 2010 $ 8,389 $ 36,077 $ (23,658) Current .......................................................................................................... Deferred ....................................................................................................... Federal tax (provision)/benefit .................................................... State and local: Current ............................................................................................................. Deferred .......................................................................................................... State tax (provision)/benefit.......................................................... Total tax (provision)/benefit – U.S. ....................................................................... Net income/(loss) from U.S. taxable REIT subsidiaries .............................. $ Income before taxes – Non-U.S. ........................................................................... $ (Provision)/benefit for Non-U.S. income taxes: Current ............................................................................................................. $ Deferred .......................................................................................................... Non-U.S. tax provision ................................................................................................. $ (503) (535) (1,038) (1,543) (560) (2,103) (3,141) 5,248 $ 33,842 $ 5,790 $ 1,239 7,029 $ (2,463) (10,635) (13,098) (1,343) (2,064) (3,407) (16,505) 19,572 $ 63,154 $ (4,484) $ 2,784 (1,700) $ 1,482 7,136 8,618 (265) 1,385 1,120 9,738 (13,920) 102,426 (13,671) 430 (13,241) The Company’s deferred tax assets and liabilities at December 31, 2012 and 2011, were as follows (in thousands): Deferred tax assets: Tax/GAAP basis differences ......................................................................................... $ Net operating losses ......................................................................................................... Related party deferred loss ........................................................................................... Tax credit carryforwards ................................................................................................ Capital loss carryforwards .............................................................................................. Charitable contribution carryforward...................................................................... Non-U.S. tax/GAAP basis differences..................................................................... Valuation allowance – U.S. ............................................................................................ Valuation allowance – Non-U.S. ................................................................................. Total deferred tax assets ..................................................................................................... Deferred tax liabilities – U.S. ............................................................................................. Deferred tax liabilities – Non-U.S. ................................................................................. Net deferred tax assets ....................................................................................................... $ 2012 2011 68,623 $ 43,483 6,214 3,815 647 3 62,548 (33,783) (38,129) 113,421 (9,933) (13,263) 90,225 $ 66,177 47,719 7,577 3,537 364 - 63,610 (33,783) (32,737) 122,464 (11,434) (16,085) 94,945 As of December 31, 2012, the Company had net deferred tax assets of $90.2 million comprised of (i) $58.7 million relating to the difference between the basis of accounting for federal and state income tax reporting and GAAP reporting for real estate assets, joint ventures, and other investments, net of $9.9 million of deferred tax liabilities, (ii) $4.0 million and $5.7 million for the tax effect of net operating loss carryovers within KRS and FNC, respectively, net of a valuation allowance within FNC of $33.8 million, (iii) $6.2 million for losses deferred for federal and state income tax purposes for transactions with related parties, (iv) $3.8 million for tax credit carryovers, (v) $0.6 million for capital loss carryovers, and (vi) $11.2 million of deferred tax assets related to its investments in Canada and Latin America, net of a valuation allowance of $38.1 million and deferred tax liabilities of $13.3 million. General business tax credit carryovers of $2.2 million within KRS expire during taxable years from 2027 through 2031, and alternative minimum tax credit carryovers of $1.6 million do not expire. 88 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued The major differences between GAAP basis of accounting and the basis of accounting used for federal and state income tax reporting consist of impairment charges recorded for GAAP, but not recognized for tax purposes, depreciation and amortization, rental revenue recognized on the straight line method for GAAP, reserves for doubtful accounts, and the period in which certain gains were recognized for tax purposes, but not yet recognized under GAAP. The Company had foreign net deferred tax assets of $11.2 million, related to its operations in Canada and Latin America, which consists primarily of differences between the GAAP book basis and the basis of accounting applicable to the jurisdictions in which the Company is subject to tax. Deferred tax assets and deferred tax liabilities are included in the caption Other assets and Other liabilities on the accompanying Consolidated Balance Sheets at December 31, 2012 and 2011. Operating losses and the valuation allowance are related primarily to the Company’s consolidation of its taxable REIT subsidiaries for accounting and reporting purposes. For the year ended December 31, 2011, KRS generated $12.5 million, of net operating loss carryovers that expire 2031. For the year ended December 31, 2012, KRS produced $12.1 million of taxable income and utilized $12.1 million of its $22.1 million net operating loss carryovers. At December 31, 2012 and 2011, FNC had $101.3 million and $106.2 million, respectively, of net operating loss carryovers that expire from 2021 through 2026. The Company maintained a valuation allowance of $33.8 million within FNC to reduce the deferred tax asset of $39.5 million related to net operating loss carryovers to the amount the Company determined is more likely than not realizable. The Company analyzed projected taxable income and the expected utilization of FNC’s remaining net operating loss carryovers and determined a partial valuation allowance was appropriate. The Company’s investments in Latin America are made through individual entities which are subject to local taxes. The Company assesses each entity to determine if deferred tax assets are more likely than not realizable. This assessment primarily includes an analysis of cumulative earnings and the determination of future earnings to the extent necessary to fully realize the individual deferred tax asset. Based on this analysis the Company has determined that a full valuation allowance is required for entities which have a three-year cumulative book loss and for which future earnings are not readily determinable. In addition, the Company has determined that no valuation allowance is needed for entities that have three-years of cumulative book income and future earnings are anticipated to be sufficient to more likely than not realize their deferred tax assets. At December 31, 2012, the Company had total deferred tax assets of $43.8 million relating to its Latin American investments with an aggregate valuation allowance of $38.1 million. The Company’s deferred tax assets in Canada result principally from depreciation deducted under GAAP that exceed capital cost allowances claimed under Canadian tax rules. The deferred tax asset will naturally reverse upon disposition as tax basis will be greater than the basis of the assets under generally accepted accounting principles. As of December 31, 2012, the Company determined that no valuation allowance was needed against a $70.2 million net deferred tax asset within KRS. The Company based its determination on an analysis of both positive evidence and negative evidence using its judgment as to the relative weight of each. The Company believes, when evaluating KRS’s deferred tax assets, special consideration should be given to the unique relationship between the Company as a REIT and KRS as a taxable REIT subsidiary. This relationship exists primarily to protect the REIT’s qualification under the Code by permitting, within certain limits, the REIT to engage in certain business activities in which the REIT cannot directly participate. As such, the REIT controls which and when investments are held in, or distributed or sold from, KRS. This relationship distinguishes a REIT and taxable REIT subsidiary from an enterprise that operates as a single, consolidated corporate taxpayer. The Company will continue through this structure to operate certain business activities in KRS. The Company’s analysis of KRS’s ability to utilize its deferred tax assets includes an estimate of future projected income. To determine future projected income, the Company scheduled KRS’s pre-tax book income and taxable income over a twenty year period taking into account its continuing operations (“Core Earnings”). Core Earnings consist of estimated net operating income for properties currently in service and generating rental income. Major lease turnover is not expected in these properties as these properties were generally constructed and leased within the past five years. The Company also included known future events in its projected income forecast. In addition, the Company can employ additional strategies to realize KRS’s deferred tax assets including transferring its property management business, sale of certain built-in gain assets, and further reducing intercompany debt. The Company’s projection of KRS’s future taxable income over twenty years, utilizing the assumptions above with respect to Core Earnings, net of related expenses, generates $315.2 million after the reversal of $87.4 million of deductible temporary differences. Based on this analysis, the Company concluded it is more likely than not that KRS’s net deferred tax asset of $70.2 million will be realized and therefore, no valuation allowance is needed at December 31, 2012. If future income projections do not occur as forecasted or the Company incurs additional impairment losses in excess of the amount Core Earnings can absorb, the Company will reconsider the need for a valuation allowance. 89 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued (Benefit)/provision differ from the amount computed by applying the statutory federal income tax rate to taxable income before income taxes were as follows (in thousands): Federal benefit at statutory tax rate (35%)....................................... $ State and local taxes, net of federal benefit...................................... Other ..................................................................................................................... Total tax provision/(benefit) – U.S. .............................................. $ 2,936 $ 230 (25) 3,141 $ 12,627 $ 1,683 2,195 16,505 $ (8,280) (728) (730) (9,738) 2012 2011 2010 Uncertain Tax Positions: The Company is subject to income tax in certain jurisdictions outside the U.S., principally Canada and Mexico. The statute of limitations on assessment of tax varies from three to seven years depending on the jurisdiction and tax issue. Tax returns filed in each jurisdiction are subject to examination by local tax authorities. The Company is currently under audit by the Canadian Revenue Agency, Mexican Tax Authority and the U.S. Internal Revenue Service (“IRS”). In October 2011, the IRS issued a notice of proposed adjustment, which proposes pursuant to Section 482 of the Code, to disallow a capital loss claimed by KRS on the disposition of common shares of Valad Property Ltd., an Australian publicly listed company. Because the adjustment is being made pursuant to Section 482 of the Code, the IRS may assert a 100 percent “penalty” tax pursuant to Section 857(b)(7) of the Code in lieu of disallowing the capital loss deduction. The notice of proposed adjustment indicates the IRS’ intention to impose the 100 percent penalty tax on the Company in the amount of $40.9 million and disallowing the capital loss claimed by KRS. The Company strongly disagrees with the IRS’ position on the application of Section 482 of the Code to the disposition of the shares, the imposition of the 100 percent penalty tax and the simultaneous assertion of the penalty tax and disallowance of the capital loss deduction. The Company received a Notice of Proposed Assessment and filed a written protest and requested an IRS Appeals Office conference, which has yet to be scheduled. The Company intends to vigorously defend its position in this matter and believes it will prevail. Resolutions of these audits are not expected to have a material effect on the Company’s financial statements. The Company does not believe that the total amount of unrecognized tax benefits will significantly increase or decrease within the next 12 months. The liability for uncertain tax benefits principally consists of estimated foreign, federal and state income tax liabilities for the years ended December 31, 2012 and 2011. The aggregate changes in the balance of unrecognized tax benefits were as follows (in thousands): Balance, beginning of year ................................................................................................ $ Increases for tax positions related to current year............................................. Reductions due to lapsed statute of limitations.................................................... Balance, end of year ............................................................................................................. $ 2012 2011 16,901 $ 3,079 (3,090) 16,890 $ 14,908 1,993 - 16,901 23. Supplemental Financial Information: The following represents the results of income, expressed in thousands except per share amounts, for each quarter during the years 2012 and 2011: Mar. 31 June 30 Sept. 30 Dec. 31 2012 (Unaudited) Revenues from rental property(1) ....................................... $ Net income attributable to the Company ...................... $ 214,851 $ 53,638 $ 220,670 $ 69,112 $ 220,188 $ 54,941 $ 229,073 88,382 Net income per common share: Basic .................................................................................. $ Diluted ............................................................................ $ 0.09 $ 0.09 $ 0.12 $ 0.12 $ 0.07 $ 0.07 $ 0.14 0.14 90 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, continued Mar. 31 June 30 Sept. 30 Dec. 31 2011 (Unaudited) Revenues from rental property(1) ....................................... $ Net income attributable to the Company ...................... $ 206,156 $ 28,963 $ 206,034 $ 38,709 $ 201,082 $ 54,981 $ 212,465 46,398 Net income per common share: Basic .................................................................................. $ Diluted ............................................................................ $ 0.03 $ 0.03 $ 0.06 $ 0.06 $ 0.10 $ 0.10 $ 0.08 0.08 (1) All periods have been adjusted to reflect the impact of operating properties sold during 2012 and 2011 and properties classified as held-for-sale as of December 31, 2012, which are reflected in the caption Discontinued operations on the accompanying Consolidated Statements of Income. Accounts and notes receivable in the accompanying Consolidated Balance Sheets are net of estimated unrecoverable amounts of $16.4 million and $18.1 million of billed accounts receivable at December 31, 2012 and 2011, respectively. Additionally, Accounts and notes receivable in the accompanying Consolidated Balance Sheets are net of estimated unrecoverable amounts of $22.8 million and $25.4 million of straight-line rent receivable at December 31, 2012 and 2011, respectively. 24. Pro Forma Financial Information (Unaudited): As discussed in Notes 5, 6 and 7, the Company and certain of its subsidiaries acquired and disposed of interests in certain operating properties during 2012. 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, 2012 and 2011, adjusted to give effect to these transactions at the beginning of 2011. The pro forma financial information is presented for informational purposes only and may not be indicative of what actual results of Income would have been had the transactions occurred at the beginning of 2011, nor does it purport to represent the results of Income for future periods. (Amounts presented in millions, except per share figures.) Year ended December 31, 2011 2012 Revenues from rental property .................................................................................................. $ Net income ........................................................................................................................................... $ Net income attributable to the Company’s common shareholders ..................... $ 903.2 $ 228.5 $ 120.9 $ Net income attributable to the Company’s common shareholders per common share: Basic ................................................................................................................................................ $ Diluted ........................................................................................................................................... $ 0.30 $ 0.30 $ 867.5 174.7 102.3 0.25 0.25 91 KIMCO REALTY CORPORATION AND SUBSIDIARIES SCHEDULE II – VALUATION AND QUALIFYING ACCOUNTS For Years Ended December 31, 2012, 2011 and 2010 (in thousands) Balance at beginning of period Charged to expenses Adjustments to valuation accounts Deductions Balance at end of period Year Ended December 31, 2012 Allowance for uncollectable accounts ..................................... $ 18,059 $ 6,309 $ - $ (7,966) $ 16,402 Allowance for deferred tax asset ............................................. $ 66,520 $ - $ 5,392 $ - $ 71,912 Year Ended December 31, 2011 Allowance for uncollectable accounts ..................................... $ 15,712 $ 7,027 $ - $ (4,680) $ 18,059 Allowance for deferred tax asset ............................................. $ 43,596 $ - $ 22,924 $ - $ 66,520 Year Ended December 31, 2010 Allowance for uncollectable accounts ..................................... $ 12,200 $ 10,043 $ - $ (6,531) $ 15,712 Allowance for deferred tax asset ............................................. $ 33,783 $ - $ 9,813 $ - $ 43,596 92 KIMCO REALTY CORPORATION AND SUBSIDIARIES SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 2012 TOTAL COST, NET OF LAND BUILDING & IMPROVEMENT TOTAL ACCUMULATED ACCUMULATED DEPRECIATION DEPRECIATION INITIAL COST BUILDING & SUBSEQUENT TO IMPROVEMENT ACQUISITION - 6,403,809 - 503,987 17,291,542 35,955,005 - - 148,508 16,410,632 4,126,509 21,269,943 9,802,046 44,149,548 3,306,779 27,536,024 16,395,647 (4,255,793) 4,623,497 130,064 6,786,441 (24,407) 8,046,677 (19,054) 6,060,018 139,626,899 307,992 7,698,708 30,131,356 - (27,651) 520,771 4,101,017 5,013,176 2,015,726 1,033,546 4,577,869 929,417 2,450,341 439,305 634,051 44,149,548 47,456,327 36,495,949 52,891,596 5,062,802 7,420,492 17,267,135 25,313,812 35,935,950 41,995,969 154,318,907 154,626,899 7,610,996 37,742,352 120,858 16,931,403 21,032,420 9,139,685 11,155,411 23,050,120 27,627,990 10,731,463 13,181,804 120,858 DATE OF ENCUMBRANCES ACQUISITION CONSTRUCTION 2006 2007 2004 2008 DATE OF PROPERTIES 1,228,000 5,662,554 6,861,564 8,702,635 4,138,760 2,427,465 LAND 3,306,779 18,951,763 9,318,595 6,786,441 8,046,677 6,060,018 15,000,000 30,043,645 - 4,101,017 2,015,726 5,324,501 2,450,341 GLENN SQUARE THE GROVE CHANDLER AUTO MALLS EL MIRAGE TALAVI TOWN CENTER MESA PAVILLIONS MESA RIVERVIEW ANA MARIANA POWER CENTER MESA PAVILLIONS - SOUTH METRO SQUARE HAYDEN PLAZA NORTH PHOENIX, COSTCO PHOENIX PINACLE PEAK- N. CANYON RANCH VILLAGE CROSSROADS NORTH VALLEY ASANTE RETAIL CENTER SURPRISE II BELL CAMINO CENTER COLLEGE PARK SHOPPING 3,276,951 CENTER 4,995,639 ALHAMBRA, COSTCO ANGEL'S CAMP TOWN CENTER 1,000,000 MADISON PLAZA 5,874,396 6,460,743 CHULA VISTA, COSTCO 13,360,965 CORONA HILLS, COSTCO 5,600,000 LABAND VILLAGE SC 19,886,099 CUPERTINO VILLAGE 9,975,810 CHICO CROSSROADS 9,727,446 CORONA HILLS MARKETPLACE RIVER PARK SHOPPING CENTER 4,324,000 3,272,212 GOLD COUNTRY CENTER LA MIRADA THEATRE CENTER 8,816,741 4,114,863 KENNETH HAHN PLAZA 9,259,778 NOVATO FAIR S.C. 1,100,000 SOUTH NAPA MARKET PLACE 12,900,000 PLAZA DI NORTHRIDGE 5,854,585 POWAY CITY CENTRE 2,552,000 REDWOOD CITY 3,020,883 TYLER STREET SANTA ANA, HOME DEPOT 4,592,364 SAN/DIEGO CARMEL MOUNTAIN 5,322,600 2,966,018 FULTON MARKET PLACE 15,300,000 MARIGOLD SC 4,678,015 BLACK MOUNTAIN VILLAGE 10,687,472 CITY HEIGHTS 2,140,000 TRUCKEE CROSSROADS 16,174,307 WESTLAKE SHOPPING CENTER 7,295,646 SAVI RANCH VILLAGE ON THE PARK 2,194,463 1,148,317 AURORA QUINCY 1,500,568 AURORA EAST BANK 1,423,260 SPRING CREEK COLORADO 161,167 DENVER WEST 38TH STREET ENGLEWOOD PHAR MOR 805,837 1,253,497 FORT COLLINS GREELEY COMMONS 3,313,095 HIGHLANDS RANCH VILLAGE S.C. 8,135,427 2,010,519 VILLAGE CENTER WEST 1,526,576 HERITAGE WEST MARKET AT SOUTHPARK 9,782,769 5,805,969 WEST FARM SHOPPING CENTER 7,704,968 N.HAVEN, HOME DEPOT WATERBURY 2,253,078 WILTON RIVER PARK SHOPPING CTR BRIGHT HORIZONS DOVER ELSMERE ALTAMONTE SPRINGS AUBURNDALE BOCA RATON BAYSHORE GARDENS, BRADENTON FL SHOPPES @ MT. CARMEL CORAL SPRINGS CORAL SPRINGS CURLEW CROSSING S.C. CLEARWATER FL EAST ORLANDO FT.LAUDERDALE/CYPRESS CREEK OAKWOOD BUSINESS CTR-BLDG 1 SHOPPES AT AMELIA CONCOURSE AVENUES WALKS 2,901,000 204,432 710,000 1,649,000 5,315,955 3,627,946 491,676 14,258,760 7,154,585 1,211,748 122,741 - 770,893 751,315 573,875 7,600,000 26,984,546 6,792,500 8,774,694 24,981,223 18,200,901 3,405,683 94,572 6,439,065 7,741,323 19,982,557 6,463,129 23,476,190 25,863,153 53,373,453 13,289,347 46,534,919 30,534,524 24,778,390 18,018,653 7,864,878 35,259,965 7,660,855 15,599,790 22,159,086 40,574,842 13,792,470 6,215,168 7,811,339 18,345,257 8,873,991 6,920,710 25,563,978 11,913,344 28,324,896 8,255,753 64,818,562 29,752,511 8,885,987 4,608,249 6,180,103 5,718,813 646,983 3,232,650 7,625,278 20,069,559 21,579,936 8,361,084 6,124,074 20,779,522 23,348,024 30,797,640 9,017,012 27,509,279 4,610,610 66,738 3,185,642 3,083,574 - 2,295,501 11,738,955 937,457 2,842,907 6,626,301 12,529,467 918,466 1,440,000 28,042,390 20,500 1,228,000 (171,233) 5,662,554 2,539,809 3,861,272 2,865,559 11,039,472 1,035 4,138,760 - 2,427,465 37,500 3,276,951 333,261 4,995,639 - 1,000,000 668,915 5,874,396 11,689,917 6,460,743 5,955,208 13,360,965 9,337 5,607,237 4,625,122 19,886,099 717,076 9,987,652 184,823 9,727,446 (448,708) 4,324,000 37,687 3,278,290 (6,747,916) 6,888,680 47,284 4,114,863 159,789 9,259,778 6,838,973 1,100,000 (792,333) 12,900,000 7,701,699 7,247,814 - 2,552,000 53,109 3,200,516 - 4,592,364 (11,005) 5,322,600 927,435 2,966,018 3,406,662 15,300,000 89,992 4,678,015 26,489 10,687,472 611,777 2,140,000 94,358,492 16,174,307 - 7,295,646 5,619,852 2,194,463 988,825 1,148,317 753,032 1,500,568 798,280 1,423,260 - 161,167 249,867 805,837 1,599,608 1,253,497 24,300 3,313,095 (879,782) 5,337,081 6,815 2,010,519 774,090 1,526,576 (32,455) 9,782,769 4,537,981 5,805,969 1,050,387 7,704,968 653,224 2,253,078 70,777 7,154,585 9,499 1,211,748 4,007,816 3,024,375 2,287,586 - (1,322,574) 538,796 - 751,315 1,722,099 733,875 1,234,179 2,901,000 79,652 204,432 3,804,755 710,000 443,196 1,649,000 1,709,383 5,315,955 (269,494) 2,174,938 2,626,124 1,007,882 1,856,935 14,258,760 8,795,194 10,023,194 24,809,989 30,472,543 23,741,002 27,602,274 3,934,405 14,973,877 4,234,367 8,866,530 95,607 6,439,065 7,778,823 11,055,774 20,315,818 25,311,457 6,463,129 7,463,129 24,145,105 30,019,501 37,553,070 44,013,813 59,328,661 72,689,626 13,291,448 18,898,685 51,160,041 71,046,140 31,239,758 41,227,410 24,963,214 34,690,660 17,569,945 21,893,945 7,896,487 11,174,777 30,440,110 37,328,790 7,708,139 11,823,002 15,759,579 25,019,357 28,998,059 30,098,059 39,782,509 52,682,509 20,100,941 27,348,754 6,215,168 8,767,168 7,684,814 10,885,331 18,345,257 22,937,622 8,862,986 14,185,586 7,848,145 10,814,163 28,970,640 44,270,640 12,003,336 16,681,350 28,351,385 39,038,857 8,867,531 11,007,530 159,177,054 175,351,360 29,752,511 37,048,157 14,505,839 16,700,302 6,745,391 5,597,074 8,433,703 6,933,136 7,940,353 6,517,092 808,150 646,983 3,482,517 4,288,354 9,224,886 10,478,382 20,093,859 23,406,954 23,498,500 28,835,581 8,367,899 10,378,418 6,898,164 8,424,740 20,747,067 30,529,837 27,886,005 33,691,974 31,848,027 39,552,995 9,670,236 11,923,314 27,580,056 34,734,641 5,831,857 4,620,109 4,197,296 1,172,921 5,473,228 5,473,228 2,531,893 1,993,097 751,315 - 4,591,475 3,857,600 1,017,110 6,647,662 7,069,497 12,973,134 15,874,134 1,221,542 7,357,662 8,718,497 14,238,851 19,554,805 4,276,918 2,101,980 3,549,918 4,557,800 29,899,324 44,158,084 3,457,974 2,930,399 8,907 18,289 8,289,742 4,207,683 28,304,759 213,200 25,871 6,486,711 3,053,920 6,000,660 4,411,736 1,855,367 1,190,895 1,113,619 105,624 2,833 352,701 412,115 7,654,985 728,463 8,984,338 12,001,986 22,144,201 4,736,363 14,969,322 5,833,271 6,349,975 1,933,015 2,178,896 11,068,980 2,295,093 2,600,473 10,512,866 10,809,040 5,923,090 516,707 2,486,959 6,935,088 1,432,895 2,371,319 12,905,960 3,265,898 85,288 4,803,398 30,127,534 321,298 4,460,720 1,995,723 2,773,641 2,438,037 247,437 1,354,400 2,706,634 241,795 833,081 377,958 2,464,339 1,045,288 8,979,729 11,775,885 4,631,458 423,247 64,596 52,085 3,235,258 808,903 - 2,030,398 4,848,241 72,719 2,685,234 2,795,837 3,480,389 227,901 2,297,443 4,115,199 43,998,353 49,961,197 5,053,895 7,402,203 17,024,070 37,788,286 126,322,140 37,529,152 94,986 14,545,708 8,101,491 21,627,330 8,770,068 8,167,828 29,281,648 26,488,655 14,868,253 4,231,534 8,513,829 10,643,659 17,656,472 6,734,666 21,035,163 32,011,828 50,545,425 14,162,322 56,076,818 35,394,139 28,340,684 19,960,930 8,995,881 26,259,809 9,527,909 22,418,884 19,585,193 41,873,469 21,425,664 8,250,461 8,398,372 16,002,534 12,752,691 8,442,844 31,364,680 13,415,452 38,953,568 6,204,133 145,223,827 36,726,859 12,239,582 4,749,668 5,660,063 5,502,316 560,713 2,933,954 7,771,748 23,165,159 28,002,500 10,000,460 5,960,401 29,484,549 24,712,246 27,777,110 7,291,857 34,311,394 5,767,262 4,145,211 2,237,969 1,722,990 751,315 2,561,077 11,025,893 1,148,823 4,672,428 5,922,660 16,074,416 4,049,016 2,260,357 40,042,885 2007 2009 2011 1998 1998 1998 1997 2009 2011 2011 2012 2011 1998 2009 1998 1998 1998 2008 2006 2008 2007 2009 2008 1998 2010 2009 2006 2005 2005 2009 2008 1998 2009 2005 2005 2007 2012 2006 2002 2012 1998 1998 1998 1998 1998 1998 2000 2012 2011 2011 1998 2011 1998 1998 1993 2012 2012 2003 1995 2009 1992 1998 2009 1994 1997 2005 2007 2009 2009 1,853,110 16,320,882 8,500,000 33,678,588 24,510,565 6,901,658 6,000,000 - - 6,643,654 21,808,858 3,264,029 20,870,995 6,205,857 19,896,160 1,768,215 - - 2005 2006 2004 2008 1979 1971 2003 2005 18,662,565 773,436 6,792,500 19,436,000 26,228,500 2,661,544 23,566,957 - - 8,936,082 1,138,216 49,385,331 33,225,306 15,397,866 16,536,082 43,144,571 76,369,877 1,246,842 - 15,289,240 76,369,877 93 INITIAL COST SUBSEQUENT BUILDING & TO IMPROVEMENT ACQUISITION LAND BUILDING & IMPROVEMENT TOTAL ACCUMULATED ACCUMULATED DEPRECIATION DEPRECIATION TOTAL COST, NET OF DATE OF ENCUMBRANCES ACQUISITION CONSTRUCTION 1974 DATE OF PROPERTIES LAND 1,002,733 LAUDERHILL 1,676,082 THE GROVES 601,052 LAKE WALES - MELBOURNE 365,893 GROVE GATE 530,570 CHEVRON OUTPARCEL 732,914 NORTH MIAMI 1,138,082 MILLER ROAD 2,948,530 MARGATE 1,011,000 MT. DORA 18,491,461 KENDALE LAKES PLAZA 7,524,800 PLANTATION CROSSING 1,275,593 MILTON, FL 26,162,980 FLAGLER PARK 10,763,612 PARK HILL PLAZA 9,104,379 RENAISSANCE CENTER 560,800 ORLANDO 1,980,000 OCALA 7,711,000 MILLENIA PLAZA PHASE II 7,409,319 GRAND OAKS VILLAGE 1,620,203 GONZALEZ 10,516,500 POMPANO BEACH 5,515,265 UNIVERSITY TOWN CENTER 2,764,953 PALM BEACH GARDENS - ST. PETERSBURG 254,961 TUTTLE BEE SARASOTA 1,283,400 SOUTH EAST SARASOTA 1,832,732 SANFORD 2,109,677 STUART 1,280,440 SOUTH MIAMI 5,220,445 TAMPA VILLAGE COMMONS S.C. 2,192,331 MISSION BELL SHOPPING CENTER 5,056,426 550,896 WEST PALM BEACH CROSS COUNTRY PLAZA 16,510,000 1,482,564 AUGUSTA 4,880,659 MARKET AT HAYNES BRIDGE EMBRY VILLAGE 18,147,054 VILLAGE SHOPPES-FLOWERY 4,444,148 BRANCH 2,052,270 SAVANNAH CHATHAM PLAZA 13,390,238 3,406,707 KIHEI CENTER 500,525 CLIVE 3,013,647 METRO CROSSING SOUTHDALE SHOPPING CENTER 1,720,330 500,525 DES MOINES - DUBUQUE WATERLOO 500,525 NAMPA (HORSHAM) FUTURE DEV. 6,501,240 2,059,908 AURORA, N. LAKE 805,521 BLOOMINGTON - BELLEVILLE S.C. BRADLEY 500,422 1,479,217 CALUMET CITY - COUNTRYSIDE - CHICAGO 230,519 CHAMPAIGN, NEIL ST. 1,010,374 ELSTON CRYSTAL LAKE, NW HWY 179,964 2,393,894 108 WEST GERMANIA PLACE 1,601,960 BUTTERFIELD SQUARE 2,510,455 DOWNERS PARK PLAZA 811,778 DOWNER GROVE 842,555 ELGIN FOREST PARK - - FAIRVIEW HTS, BELLVILLE RD. 1,900,000 BELLEVILLE ROAD S.C..-fee 500,422 GENEVA 1,890,319 LAKE ZURICH PLAZA 950,515 MATTERSON 1,017,345 MT. PROSPECT 1,127,720 MUNDELEIN, S. LAKE - NORRIDGE 669,483 NAPERVILLE - MARKETPLACE OF OAKLAWN 476,972 ORLAND PARK, S. HARLEM 1,530,111 OAK LAWN 1,527,188 OAKBROOK TERRACE - PEORIA 252,723 FREESTATE BOWL 4,575,990 ROCKFORD CROSSING ROUND LAKE BEACH PLAZA 790,129 - SKOKIE 181,962 KRC STREAMWOOD 6,783,928 HAWTHORN HILLS SQUARE 5,049,149 WOODGROVE FESTIVAL 349,409 WAUKEGAN PLAZA 423,371 GREENWOOD 183,463 SOUTH BEND, S. HIGH ST. 7,503,282 RIVERPLACE SHOPPING CTR. 2,580,816 MERCHANTS WALK 2,602,415 6,533,681 - 1,754,000 1,049,172 1,253,410 4,080,460 4,552,327 11,754,120 4,062,890 28,496,001 - - 80,737,041 19,264,248 36,540,873 2,268,112 7,927,484 20,702,992 19,653,869 - 1,359,236 13,041,400 11,059,812 917,360 828,465 5,133,544 9,523,261 8,415,323 5,133,825 16,884,228 8,774,158 11,843,119 2,298,964 18,264,427 5,928,122 21,549,424 33,009,514 10,510,657 8,232,978 35,115,882 7,663,360 2,002,101 - 6,916,294 2,559,019 2,152,476 2,002,101 - 9,531,721 2,222,353 5,372,253 2,001,687 8,815,760 4,770,671 2,687,046 1,285,460 5,692,212 1,025,811 7,366,681 6,637,926 10,164,494 4,322,956 2,108,674 2,335,884 11,866,880 - 12,917,712 2,649,381 6,292,319 6,572,176 5,826,129 2,918,315 4,464,998 678,668 2,764,775 8,776,631 8,679,108 5,081,290 998,099 11,654,022 1,634,148 2,276,360 1,057,740 33,033,624 20,822,993 883,975 1,883,421 1,070,401 31,011,027 10,366,090 12,606,236 1,774,443 (1,330,869) 2,606,246 - 601,052 2,666,332 - 1,207,100 365,893 - 530,570 10,926,161 732,914 2,220,561 1,138,082 7,919,694 2,948,530 436,174 1,011,000 (2,846,737) 15,362,227 11,187,936 7,153,784 - 1,275,593 1,766,686 26,162,980 142,579 10,891,930 5,612,056 9,122,758 3,203,429 580,030 8,942,057 1,980,000 300,011 7,711,000 (946,240) 5,846,339 40,689 954,876 530,900 10,516,500 149,024 5,515,265 278,643 2,764,953 1,266,811 - 1,806,633 254,961 3,400,091 1,399,525 6,256,188 1,832,732 1,694,863 2,109,677 3,087,209 1,280,440 2,249,431 5,220,445 2,715,244 2,192,331 8,661,955 5,067,033 1,426,083 550,896 465,515 16,510,000 2,439,437 1,482,564 505,236 4,889,863 215,338 18,160,524 239,217 (17,119) 4,444,148 2,408,812 2,052,270 848,242 13,403,262 654,468 3,406,707 - 500,525 35,426,260 1,514,916 3,760,738 1,720,330 37,079 500,525 - 2,869,100 500,525 11,902,537 10,567,218 308,208 2,059,908 4,246,390 805,521 1,255,387 1,161,195 424,877 500,422 13,905,512 1,479,216 95,647 (4,531,252) 871,802 - 725,493 230,519 498,828 1,010,374 564,039 180,269 360 2,393,894 (3,588,725) 1,182,677 968,249 2,510,455 3,221,260 811,778 1,728,298 500,927 - - - 1,900,000 33,551 500,422 63,057 1,890,319 10,560,785 950,514 4,016,735 1,017,345 77,350 1,129,634 - 456,947 669,483 25,343 - 87,998 (2,694,903) 588,483 1,530,111 3,298,212 1,527,188 2,403,560 - (485,425) 252,723 (577,091) 4,583,005 587,575 790,129 9,518,382 2,628,440 216,585 181,962 - 6,783,928 4,067,683 4,805,866 2,276,671 349,409 3,259,073 584,445 196,857 183,463 (97,137) 7,503,282 4,929,224 2,580,816 154,213 2,049,362 - 9,000,490 1,239,092 - 2,845,961 1,869,682 125,210 7,875,165 5,404,854 7,798,185 1,698,879 3,093,301 1,210,330 - 14,174,502 1,411,534 17,212,832 2,167,664 6,361,694 4,905,798 1,057,056 62,757 46,452 585,718 663,589 1,104,439 2,027,155 4,875,432 9,703,986 4,480,377 3,418,560 6,951,838 3,772,873 4,908,884 1,526,491 2,278,594 3,508,069 4,382,415 6,869,361 692,289 5,042,393 8,985,806 4,710,325 868,433 2,167,911 3,338,432 1,101,693 852,030 2,930,608 264,671 3,618,787 4,118,981 1,996,939 1,024,922 5,850,753 77,913 1,377,935 771,170 2,095,504 471,852 312,936 1,180,384 4,071,520 2,348,423 2,922,303 915,328 4,916,488 - 4,920,006 381,569 6,079,166 4,277,134 2,197,292 1,136,649 1,742,823 487,474 163,240 3,596,903 4,215,711 5,368,740 123,060 1,881,847 298,029 2,763,160 443,639 449,689 9,043,249 244,873 3,221,547 446,936 3,406,770 3,872,480 - 4,499,064 5,452,310 4,272,648 - 4,420,332 2,256,272 1,253,410 14,436,941 16,211,384 6,878,894 601,052 4,420,332 2,622,165 1,783,980 15,006,621 15,739,535 7,910,970 6,772,889 19,673,814 22,622,344 5,510,064 28,778,497 44,140,724 11,558,952 18,712,736 1,275,593 82,503,727 108,666,707 19,278,508 30,170,439 42,134,550 51,257,308 6,032,341 16,869,541 18,849,541 21,003,004 28,714,004 20,270,609 26,116,948 1,660,892 1,890,136 12,406,636 13,190,424 18,705,689 11,338,456 14,103,409 2,184,171 2,184,171 2,890,059 2,635,098 9,817,035 8,417,510 15,779,449 17,612,181 10,110,186 12,219,863 9,501,474 19,133,659 24,354,104 11,489,402 13,681,733 20,494,467 25,561,501 3,725,047 4,275,943 18,729,942 35,239,942 8,367,559 9,850,123 22,045,456 26,935,319 33,211,382 51,371,906 8,221,034 706,016 143,772 3,558,848 2,010,953 6,191,040 1,589,545 7,367,041 3,468,484 10,493,538 14,937,686 10,641,790 12,694,060 35,951,100 49,354,362 8,317,828 11,724,535 2,502,626 2,002,101 36,924,991 38,439,907 10,677,032 12,397,362 3,096,623 2,596,098 2,391,693 2,391,693 4,871,201 5,371,726 7,836,559 18,403,777 9,839,929 11,899,837 7,274,264 6,468,743 6,627,640 5,466,445 2,926,986 2,426,564 22,721,273 24,200,489 239,419 3,558,848 2,241,472 7,201,414 1,769,814 9,760,935 4,651,161 11,132,743 13,643,198 8,355,994 7,544,216 4,679,527 4,178,600 2,490,097 2,490,097 13,916,242 13,916,242 1,900,000 12,951,263 13,451,685 2,712,438 4,602,757 16,853,105 17,803,619 10,588,911 11,606,256 7,031,199 2,918,315 5,591,428 704,011 546,844 9,365,115 10,895,225 11,977,320 13,504,508 7,484,850 765,396 11,069,916 15,652,921 2,221,723 3,011,852 9,166,303 11,794,742 1,456,287 1,274,324 33,033,624 39,817,551 25,133,960 29,939,825 3,510,055 5,565,865 1,450,721 30,913,890 38,417,172 15,295,313 17,876,130 5,901,565 2,918,315 4,921,945 704,011 458,846 3,160,646 4,981,420 1,267,258 7,484,850 512,674 - 94 7,210,894 5,639,802 601,052 1,574,372 752,483 1,658,770 7,864,370 2,506,116 14,824,159 3,811,185 41,047,424 17,502,406 1,275,593 94,492,205 28,758,905 34,044,475 3,864,677 12,487,848 23,808,205 25,059,892 1,598,135 12,360,184 18,119,971 13,439,820 1,079,732 862,904 4,941,603 7,908,195 7,739,486 6,082,914 17,402,267 9,908,860 20,652,617 2,749,452 32,961,348 6,342,054 22,552,904 44,502,545 14,245,397 7,651,667 40,368,556 7,014,210 1,634,193 36,271,996 9,058,930 1,994,930 1,539,663 2,441,117 18,139,106 8,281,050 3,155,283 4,630,701 1,902,064 18,349,735 161,506 2,180,912 1,470,302 5,105,910 1,297,962 9,447,998 3,470,777 9,571,678 6,007,571 1,757,224 1,574,768 8,999,754 1,900,000 8,531,679 4,221,189 11,724,453 7,329,122 4,833,907 1,781,666 3,848,605 216,537 383,603 7,298,322 9,288,797 2,116,110 642,336 13,771,073 2,713,823 9,031,582 1,012,648 39,367,863 20,896,576 3,265,182 2,344,318 1,003,786 35,010,402 14,003,650 6,178,961 - 25,428,794 8,328,658 6,553,929 15,626,501 30,025,443 8,992,979 28,767,663 635,871 10,226,384 21,471,879 2006 2009 2010 1985 1986 1993 1997 2009 2007 2007 2011 1998 1996 1997 2009 2011 2007 2012 2011 2009 2008 1989 1989 1994 1995 1997 1998 2004 1995 2009 1995 2008 2008 2011 1993 2008 2006 1996 1999 1996 1997 1996 1998 1998 1996 1997 1997 1997 1998 1997 1998 2008 1998 1999 1997 1997 1998 2011 1996 2005 1997 1997 1998 1997 1997 1998 1998 1997 1997 1997 2003 2008 2005 1997 1998 2012 1998 2005 1998 2010 2001 1968 1968 2005 1968 2006 2005 1972 1972 1970 INITIAL COST BUILDING & SUBSEQUENT TO IMPROVEMENT ACQUISITION LAND TOTAL COST, NET OF ACCUMULATED ACCUMULATED DEPRECIATION DEPRECIATION DATE OF ENCUMBRANCES ACQUISITION CONSTRUCTION 1968 1969 DATE OF PROPERTIES 403,034 303,911 3,339,309 1,035,359 3,854,099 LAND 293,686 LARGO - LEESBURG 2,832,296 LARGO EAST BAY OVERLAND PARK 1,183,911 405,217 BELLEVUE 1,675,031 LEXINGTON 3,813,873 HAMMOND AIR PLAZA 9,554,230 CENTRE AT WESTBANK 2,115,000 LAFAYETTE 6,426,167 PRIEN LAKE 540,000 PRIEN LAKE PLAZA OUTPARCEL 1,803,672 AMBASSADOR PLAZA 4,586,895 BAYOU WALK 3,295,799 EAST SIDE PLAZA 642,170 GREAT BARRINGTON SHREWSBURY SHOPPING CENTER 1,284,168 1,929,402 SNOWDEN SQUARE S.C. 1,468,038 WILDE LAKE 1,019,035 LYNX LANE 82,967 CLINTON BANK BUILDING 39,779 CLINTON BOWL 1,279,200 TJMAXX 3,190,074 VILLAGES AT URBANA 244,890 GAITHERSBURG SHAWAN PLAZA 4,466,000 349,562 LAUREL LAUREL 274,580 SOUTHWEST MIXED USE PROPERTY OWINGS MILLS PLAZA PERRY HALL CENTRE COURT-RETAIL/BANK CENTRE COURT-GIANT CENTRE COURT-OLD COURT/COURTYD TIMONIUM SHOPPING CENTER TOWSON PLACE WALDORF BOWL WALDORF FIRESTONE BANGOR, ME MALLSIDE PLAZA CLAWSON WHITE LAKE CANTON TWP PLAZA CLINTON TWP PLAZA FARMINGTON FLINT - VACANT LAND LIVONIA MUSKEGON OKEMOS PLAZA TAYLOR WALKER EDEN PRAIRIE PLAZA FOUNTAINS AT ARBOR LAKES ROSEVILLE PLAZA CREVE COEUR, WOODCREST/OLIVE CRYSTAL CITY, MI INDEPENDENCE, NOLAND DR. NORTH POINT SHOPPING CENTER KIRKWOOD KANSAS CITY LEMAY GRAVOIS ST. CHARLES-UNDERDEVELOPED LAND, MO SPRINGFIELD KMART PARCEL KRC ST. CHARLES ST. LOUIS, CHRISTY BLVD. OVERLAND ST. LOUIS ST. LOUIS ST. PETERS SPRINGFIELD,GLENSTONE AVE. TURTLE CREEK OVERLOOK VILLAGE CHARLOTTE TYVOLA RD. CROSSROADS PLAZA KIMCO CARY 696, INC. JETTON VILLAGE SHOPPES MOUNTAIN ISLAND MARKETPLACE 3,318,587 WOODLAWN SHOPPING CENTER 2,010,725 1,882,800 DURHAM 2,978,533 DAVIDSON COMMONS 7,456,381 WESTRIDGE SQUARE S.C. 519,395 HILLSBOROUGH CROSSING 5,461,478 PARK PLACE 12,013,727 MOORESVILLE CROSSING 2,279,177 6,000,000 43,886,876 225,099 57,127 403,833 6,930,996 1,624,771 2,300,050 163,740 175,515 1,098,426 101,424 178,785 391,500 166,706 1,451,397 3,682,478 882,596 28,585,296 132,842 431,960 2,745,595 905,674 - 809,087 - - - 1,182,194 - 11,535,281 8,276,500 919,251 - 767,864 2,180,000 3,875,224 1,935,380 - 574,777 125,879 1,032,416 1,044,598 - 1,728,367 792,119 171,636 11,329,185 6,335,308 1,743,573 6,848,209 15,260,609 24,401,082 8,508,218 15,181,072 1,260,000 4,260,966 10,836,007 7,785,942 2,547,830 5,284,853 4,557,934 5,869,862 4,091,894 362,371 130,716 2,870,800 6,067 6,787,534 20,222,367 1,398,250 1,100,968 1,325,126 1,370,221 12,377,339 7,785,830 12,769,628 5,284,577 24,282,998 101,764,931 739,362 221,621 1,622,331 18,148,727 6,578,142 9,249,607 926,150 714,279 4,525,723 - 925,818 958,500 591,193 5,806,263 14,730,060 911,373 66,699,024 957,340 5,475,623 234,378 8,951,101 7,800,746 9,704,005 2,971,191 503,510 4,455,514 - 10,985,778 3,666,386 550,204 4,430,514 4,928,677 5,756,736 2,766,644 7,423,459 608,793 - 17,249,587 3,570,981 4,736,345 3,098,881 8,756,865 10,292,231 7,331,413 5,833,626 7,551,576 12,859,867 19,778,703 - 16,163,494 30,604,173 193,651 1,620,990 293,686 - 2,144,729 2,832,296 142,374 1,185,906 247,204 405,217 5,773,377 1,551,079 7,073,544 3,813,873 748,757 9,564,644 10,371,406 3,678,274 (109,020) 6,341,896 - 540,000 (6,701) 1,796,972 153,992 4,586,326 216,325 3,295,635 7,315,207 751,124 5,000,687 1,284,168 - 1,929,402 1,800,813 1,558,038 76,423 1,019,035 82,967 38,779 11,810,000 4,597,200 10,496,574 4,828,774 230,545 244,890 (857,895) 4,466,000 1,073,324 349,562 283,421 274,580 - 4,247 BUILDING & IMPROVEMENT 2,413,109 365,287 TOTAL 2,706,795 365,287 13,473,914 16,306,210 7,661,593 6,475,686 2,395,994 1,990,776 12,745,538 14,296,617 22,334,153 26,148,025 25,139,425 34,704,069 17,316,349 20,994,624 15,156,323 21,498,219 1,800,000 1,260,000 6,057,938 4,260,966 10,990,568 15,576,894 8,002,431 11,298,065 9,754,083 10,505,207 10,285,540 11,569,708 6,487,336 4,557,934 9,138,712 7,580,675 5,187,352 4,168,317 445,338 362,371 174,742 135,963 11,362,800 15,960,000 8,863,942 13,692,715 7,262,969 7,018,079 19,364,472 23,830,472 2,821,136 1,658,969 2,471,574 1,384,389 306,510 361,035 (503,247) 303,911 824,994 3,339,309 - 1,035,359 - 3,854,099 1,673,635 866,973 2,034,670 1,170,885 13,202,333 16,541,642 7,785,830 8,821,189 12,769,628 16,623,727 - - 2,279,177 16,354,691 7,331,195 533,557 43,886,876 84,327 235,099 57,127 93,752 403,833 (245,736) 6,939,589 8,699,369 1,624,771 1,980,754 2,300,050 5,249,730 163,740 1,147,275 59,450 2,563,624 1,098,426 - 101,424 1,180,992 178,785 952,381 391,500 1,878,684 166,706 275,289 1,451,397 2,108,718 3,682,478 570,450 882,596 10,230,741 28,585,296 4,739,103 132,842 813,688 221,621 1,716,083 5,284,577 7,563,754 39,306,494 46,637,689 102,298,489 146,185,364 1,048,787 278,749 2,119,916 17,894,397 24,833,987 15,277,511 16,902,282 11,230,361 13,530,411 6,339,620 6,175,879 2,037,068 1,977,619 8,187,773 7,089,347 101,424 - 2,285,595 2,106,810 2,302,381 1,910,881 2,636,583 2,469,877 6,081,552 7,532,949 16,838,778 20,521,256 2,364,419 1,481,823 76,929,765 105,515,061 5,829,285 5,696,443 615,905 960,814 - 193,000 1,731,300 - 6,175,312 234,378 7,136,126 234,378 9,141,168 10,872,468 13,172,627 679,841 1,935,380 - 274,976 574,777 3,828,858 451,155 11,032,682 1,032,413 758,854 431,960 7,221,086 2,904,022 4,933,942 905,674 - - 3,160,390 809,087 - 1,136,797 - 849,684 - 143,298 7,227,838 1,563,694 2,100,419 - 32,945,553 10,150,881 - 8,276,500 2,343,716 919,251 - 5,082,086 34,566 767,864 527,277 2,256,799 (535,197) 2,143,695 - 3,318,587 - 2,010,725 2,097,270 1,882,800 11,600 2,978,533 (282,578) 11,977,700 - 519,395 79,783 5,469,809 (520,444) 11,625,801 8,480,587 10,415,967 22,876,632 22,876,632 3,820,944 3,246,167 4,007,092 4,458,247 15,488,199 16,520,612 758,855 8,600,328 550,204 7,590,904 6,065,474 6,606,420 2,909,942 1,190,814 18,048,437 20,952,459 9,506,001 550,204 8,399,991 6,065,474 6,606,420 2,909,942 14,269,797 15,833,491 2,709,212 34,329,953 44,480,834 17,249,587 25,526,087 5,914,696 6,833,948 9,818,431 9,818,431 3,901,310 3,133,447 9,207,343 11,464,142 11,488,563 13,632,258 2,709,212 7,331,413 10,650,000 5,833,626 7,844,351 9,648,846 11,531,646 12,871,467 15,850,000 14,974,806 26,952,506 519,395 16,234,946 21,704,755 30,471,654 42,097,455 - 95 1,979,625 308,023 8,224,095 2,357,930 1,837,655 5,987,902 7,305,037 5,454,766 6,429,882 2,265,376 14,700 636,346 2,162,600 1,155,980 3,875,356 3,049,544 - 1,699,357 1,183,038 234,824 73,284 256,207 802,502 2,366,356 7,681,230 1,300,592 1,384,389 846,473 88,106 5,332,593 474,591 642,900 386,602 16,208,739 3,523,695 423,742 120,629 483,647 4,981,362 5,264,478 4,782,295 686,681 499,210 3,427,716 - 1,274,808 1,628,078 175,724 2,978,032 7,957,641 186,485 14,214,473 699,739 2,298,884 85,376 3,378,067 2,982,749 11,532,591 1,264,213 1,306,750 7,923,972 229,569 7,377,882 2,258,408 197,509 2,496,596 2,369,370 2,647,657 2,909,942 9,292,852 820,464 5,525,086 446,927 2,100,714 7,346,453 1,029,216 3,416,224 410,825 211,794 93,684 4,027,430 224,091 1,441,815 - 3,327,202 5,874,124 727,169 57,264 8,082,115 5,303,662 558,339 8,308,715 18,842,988 29,249,302 14,564,742 19,232,843 1,785,300 5,421,592 13,414,294 10,142,086 6,629,851 8,520,163 6,487,336 7,439,355 4,004,314 210,514 101,459 15,703,793 12,890,214 4,896,613 16,149,242 1,520,544 274,580 1,188,197 1,082,779 11,209,049 8,346,598 15,980,828 7,177,152 30,428,950 142,661,670 625,045 158,120 1,636,270 19,852,624 11,637,804 8,748,116 5,652,938 1,537,858 4,760,057 101,424 1,010,787 674,303 2,460,859 4,554,917 12,563,616 2,177,934 91,300,588 5,129,546 4,837,242 149,003 7,494,401 7,433,218 11,344,042 2,556,730 3,151,497 8,596,640 961,246 13,574,577 7,247,593 352,695 5,903,395 3,696,104 3,958,763 - 6,540,639 1,888,748 38,955,748 25,079,160 4,733,233 2,471,979 2,872,094 8,047,917 13,221,433 10,438,206 7,750,667 7,504,216 15,625,909 25,510,691 519,395 18,377,553 36,223,332 1992 1998 1976 1993 1997 2008 1997 2010 2012 2010 2010 2010 1994 2000 2012 2002 2002 2003 2003 2011 2003 1999 2008 1995 2003 2005 2003 2011 2011 2011 2003 2012 2003 2003 2001 2008 1993 1996 2005 2005 1993 2012 1985 2005 1993 1993 2005 2006 2005 1998 1997 1998 1998 1998 1997 2008 1998 1994 2002 1998 1998 1997 1997 1997 1997 1998 2012 2008 1986 2000 1998 2011 2012 2012 1996 2012 2011 2003 2008 2007 18,622,165 15,696,967 4,585,336 12,654,406 8,786,146 8,449,348 2,757,103 7,622,825 5,366,536 14,706,340 - 1,418,352 8,174,304 13,351,804 1972 1968 1974 2004 INITIAL COST SUBSEQUENT BUILDING & TO IMPROVEMENT ACQUISITION BUILDING & IMPROVEMENT TOTAL DATE OF ENCUMBRANCES ACQUISITION CONSTRUCTION DATE OF PROPERTIES LAND 5,208,885 6,506,450 3,413,932 3,150,000 7,749,751 627,906 540,667 5,104,294 8,872,529 2,660,915 1,982,481 1,434,737 344,884 350,705 2,417,583 - 652,123 7,530,709 9,335,011 11,886,809 10,824,624 16,537,556 311,384 - 3,204,978 3,851,839 450,000 457,039 7,895,483 601,655 15,320,436 1,404,443 4,653,197 1,141,200 7,226,363 2,581,908 2,489,429 11,556,067 1,500,000 1,811,752 564,097 2,743,820 4,414,466 1,272,269 12,359,621 6,035,726 RALEIGH WAKEFIELD COMMONS II WAKEFIELD CROSSINGS EDGEWATER PLACE BRENNAN STATION BRENNAN STATION OUTPARCEL WINSTON-SALEM SORENSON PARK PLAZA LORDEN PLAZA ROCKINGHAM BRIDGEWATER NJ BAYONNE BROADWAY BRICKTOWN PLAZA BRIDGEWATER PLAZA CHERRY HILL MARLTON PIKE CINNAMINSON GARDEN STATE PAVILIONS EASTWINDOR VILLAGE HILLSBOROUGH HOLMDEL TOWNE CENTER HOLMDEL COMMONS HOWELL PLAZA MAPLE SHADE NORTH BRUNSWICK PISCATAWAY TOWN CENTER RIDGEWOOD SEA GIRT PLAZA UNION CRESCENT WESTMONT WILLOWBROOK PLAZA SYCAMORE PLAZA PLAZA PASEO DEL-NORTE JUAN TABO, ALBUQUERQUE WARM SPRINGS PROMENADE COMP USA CENTER DEL MONTE PLAZA D'ANDREA MARKETPLACE KEY BANK BUILDING BRIDGEHAMPTON GENOVESE DRUG STORE KINGS HIGHWAY HOMEPORT-RALPH AVENUE BELLMORE MARKET AT BAY SHORE 5959 BROADWAY KEY FOOD OPERATOR ATLANTIC AVE KING KULLEN PLAZA PATHMARK SC BIRCHWOOD PLAZA COMMACK ELMONT FRANKLIN SQUARE KISSENA BOULEVARD SC HAMPTON BAYS HICKSVILLE TURNPIKE PLAZA BIRCHWOOD PLAZA (NORTH & SOUTH) 501 NORTH BROADWAY MERRYLANE (P/L) FAMILY DOLLAR UNION TURNPIKE DOUGLASTON SHOPPING CENTER KEY FOOD OPERATOR 21ST 1,090,800 STREET 4,567,003 MANHASSET VENTURE LLC MANHASSET CENTER (residential) 950,000 MASPETH QUEENS-DUANE READE 1,872,013 1,880,816 MASSAPEQUA MINEOLA SC 4,150,000 BIRCHWOOD PARK DRIVE (LAND LOT) SMITHTOWN PLAZA 4452 BROADWAY PREF. EQUITY-30 WEST 21ST STREET PLAINVIEW POUGHKEEPSIE SYOSSET, NY STATEN ISLAND STATEN ISLAND STATEN ISLAND PLAZA HYLAN PLAZA STOP N SHOP STATEN ISLAND KEY FOOD OPERATOR CENTRAL AVE. WHITE PLAINS CHAMPION FOOD SUPERMARKET YONKERS STRAUSS ROMAINE AVENUE BEAVERCREEK 2,272,500 5,968,082 6,714,664 3,630,000 3,011,658 1,078,541 11,610,000 1,495,105 3,542,739 2,471,832 6,250,000 263,693 876,548 106,655 2,280,000 2,940,000 5,600,744 28,723,536 4,558,592 2,787,600 1,777,775 757,500 871,977 782,459 635,228 12,368,330 - 1,485,531 909,000 3,507,162 3,528,000 12,412,724 3,277,254 9,000 LAND 12,105,168 5,208,885 (2,728,390) 2,357,636 (3,017,960) 336,236 10,087,943 3,062,768 (970,033) 6,321,923 450,232 (93,482) 6,059,518 540,667 31,258,442 4,017,569 222,227 8,883,003 12,042,678 3,148,715 11,229,293 1,982,481 2,825,469 1,434,737 (307,857) 344,884 6,068,929 350,705 1,583,669 2,417,583 - 3,448,659 652,123 (249,040) 7,530,709 63,800 9,335,011 (6,880,755) 5,006,054 5,002,494 10,824,624 3,442,519 16,537,556 4,694,515 311,384 - 21,300,476 3,204,978 692,255 3,851,839 1,015,675 450,000 1,460,149 457,039 25,415,422 8,696,579 10,689,752 601,655 (969,688) 15,320,436 283,450 1,404,443 1,334,022 4,653,197 264,134 1,141,200 2,609,141 7,226,363 (363,745) 2,581,908 332,589 2,210,000 (56,105) 11,556,067 - 1,500,000 24,873,129 1,858,188 - 564,097 1,338,513 2,743,820 3,227,468 4,414,467 381,803 1,272,269 1,145,127 12,359,621 (2,612,192) 3,405,334 (78,995) TOTAL COST, NET OF - 1,749,768 6,779,173 32,990,960 38,199,845 3,778,060 1,420,424 395,973 59,737 10,175,175 13,237,943 21,014,686 27,336,609 2,200,000 7,319,840 32,345,167 36,362,736 22,760,134 31,643,138 22,198,538 25,347,253 9,544,815 7,562,335 7,607,924 6,173,188 1,045,968 701,084 7,430,453 7,781,158 7,947,764 10,365,346 4,327,534 4,327,534 6,057,150 6,709,273 10,552,909 18,083,618 23,841,778 33,176,789 5,006,054 48,303,988 59,128,612 42,202,471 58,740,027 6,149,058 5,837,674 9,878,615 9,878,615 34,120,388 37,325,366 16,103,106 19,954,945 3,572,241 3,225,198 27,624,967 36,321,545 13,094,356 13,696,011 40,027,186 55,347,622 7,301,163 19,967,606 24,620,803 5,972,151 21,719,087 28,945,450 8,016,255 8,412,434 29,379,259 40,935,327 40,486,755 41,986,755 27,933,925 29,792,113 2,268,768 2,832,865 8,149,781 10,893,601 14,567,325 18,981,792 4,837,619 31,852,929 44,212,550 3,423,534 3,122,241 2,768,159 5,434,347 6,202,433 3,565,350 4,830,951 5,896,720 18,200 DEPRECIATION ACCUMULATED ACCUMULATED DEPRECIATION 14,412,743 320,662 1,650 1,744,609 1,037,588 77,396 3,116,963 2,732,253 3,994,273 9,091,824 3,502,689 1,454,367 50,634 323,509 6,178,224 1,814,867 2,570,735 1,249,226 3,196,805 - 12,618,170 11,798,091 525,817 639,957 13,175,516 6,075,094 1,328,600 219,802 5,896,757 4,742,968 7,082,874 2,289,963 7,484,306 1,795,765 4,642,620 2,767,691 1,707,367 4,295,084 11,581,670 15,789,825 568,249 2,423,832 3,378,307 999,255 8,591,642 4,651 23,787,102 3,457,399 394,323 11,493,334 26,299,021 2,122,604 4,202,877 33,630,484 27,648,865 16,255,430 6,042,126 6,153,557 995,334 7,457,649 4,187,122 2,512,667 4,138,538 16,834,392 29,979,984 5,006,054 46,510,442 46,941,936 5,623,240 9,238,659 24,149,850 13,879,851 2,243,641 3,005,396 30,424,788 8,953,043 48,264,747 5,011,200 17,136,497 4,176,386 24,302,830 5,248,564 6,705,067 36,640,243 30,405,086 14,002,288 2,264,616 8,469,769 15,603,485 3,838,364 35,620,908 3,418,883 - 2,272,500 4,934,985 5,980,130 526,939 6,714,664 274,672 3,630,000 2,204,704 3,011,658 3,835,813 1,078,541 1,519 11,610,000 3,304,710 1,495,105 1,327,458 3,542,739 125,480 2,471,832 5,624,589 7,897,089 28,166,341 34,146,471 17,886,100 24,600,764 5,049,463 8,679,463 9,810,769 12,822,428 6,352,394 7,430,934 2,935,006 14,545,006 9,284,031 10,779,135 9,593,833 13,136,572 8,436,728 5,964,896 224,943 12,368,330 607 - 539 1,485,531 - 909,000 33,296,439 45,664,769 1,176,150 1,176,150 1,487,819 2,288 3,158,775 2,249,775 - 9,678,626 4,018,260 1,299,251 2,597,309 1,296,602 807,978 5,186,357 2,654,197 1,097,876 5,969,361 593,997 208 - 7,897,089 24,467,845 20,582,504 7,380,213 10,225,118 6,134,332 13,737,027 5,592,778 10,482,376 7,338,852 39,695,407 582,153 1,487,611 3,158,775 20,885,792 - - - 20,556,891 1,665,576 719,655 - 22,548,382 10,643,660 (3,666,959) 3,347,719 1,008,941 1,361,524 6,364,094 4,318,534 2,608,491 10,801,949 23,777,978 - 43,301,494 38,759,952 1,143,159 9,957,611 12,819,912 15,410,851 2,106,566 1,308,010 3,010,640 2,404,604 40,996,874 5,613,270 18,633,584 4,566,817 19,109,946 5,798,092 5,590,415 29,435,364 40,486,755 3,107,232 2,268,768 6,811,268 11,339,857 3,183,547 30,707,802 - 5,624,589 23,243,404 17,359,161 4,774,791 7,606,066 2,516,581 2,933,487 5,979,320 8,266,375 5,839,416 33,071,495 1,175,543 1,749 2,249,775 13,161,218 3,777,781 3,277,253 16,939,000 20,216,253 3,897,231 16,319,023 2,699,730 19,165,808 - 4,827,940 4,388,549 7,520,692 - 1,090,800 24,661,004 3,471,939 - 950,000 931,187 1,872,013 964,761 1,880,816 (413,995) 4,150,000 2,699,730 3,790,530 44,921,876 48,393,816 950,000 - 7,631,139 5,759,126 5,353,310 7,234,126 7,106,697 11,256,697 4,126 7,364,098 - 49,191 3,507,406 289,959 3,528,000 (5,400,000) 7,012,724 21,974,274 584,031 4,695,659 76,197 9,027,951 11,811,964 6,788,460 38,232,267 10,441,408 6,899,310 4,453,894 1,874,813 3,487,909 1,825,737 3,024,722 11,441,353 6,250,000 9,810,734 263,693 13,008,483 876,548 1,551,676 106,655 7,421,413 2,280,000 1,191,309 3,148,424 (1,553,829) 5,600,744 33,893,096 28,723,536 155,848 4,558,592 - 2,787,600 2,010,606 1,777,775 - 757,500 - 871,977 586,255 782,459 4,205,673 635,228 53,074 3,560,480 7,654,056 11,182,056 7,012,724 - 1,627,873 33,415,627 39,665,627 10,394,766 10,658,458 17,704,142 18,580,690 1,734,528 16,449,364 18,729,364 12,794,849 15,943,273 5,234,632 10,835,375 72,125,364 100,848,899 10,597,256 15,155,848 6,899,310 6,464,500 1,874,813 3,487,909 2,411,992 7,230,395 9,686,910 8,242,274 2,632,313 4,359,886 3,194,451 7,865,623 96 - 17,724,834 - 1,472,344 1,594,788 1,506,875 466 885,427 - 2,291,319 5,253,472 8,630,708 987,021 9,386,052 4,920,384 303,161 19,716,591 2,977,858 - 1,783,336 - 1,773,622 303,737 4,633,238 3,790,530 30,668,982 950,000 6,158,795 5,639,337 9,749,822 3,560,014 10,296,630 7,012,724 37,374,308 5,404,986 9,949,982 747,507 9,343,312 11,022,889 10,532,215 81,132,308 12,177,990 9,686,910 6,458,938 2,632,313 2,586,264 2,890,714 3,232,385 2001 2001 2003 1969 2005 1998 1985 2001 1972 1969 1972 1990 9,223,411 4,800,575 24,688,250 17,652,812 - 26,182,239 18,964,653 27,001,490 10,741,884 2,749,590 3,625,911 14,350,098 13,967,886 33,628,529 78,209 - 12,364,313 - - 13,372,058 15,055,537 2,956,088 1993 2011 2011 2008 2008 2004 2005 2005 1996 1996 2011 2008 2002 2004 2005 2009 1994 1998 1993 2005 2007 1994 2009 1998 1998 1998 2009 2006 2006 2007 2006 2003 2004 2004 2004 2006 2008 2012 1998 2006 2007 2004 2004 2007 1989 2004 2011 2007 2007 2007 2012 2003 2012 1999 2012 2004 2004 2007 2007 2009 2007 2007 1989 1997 2005 2006 2005 2012 2004 2012 1998 2005 1986 INITIAL COST BUILDING & SUBSEQUENT TO IMPROVEMENT ACQUISITION LAND ACCUMULATED ACCUMULATED DEPRECIATION DEPRECIATION DATE OF ENCUMBRANCES ACQUISITION CONSTRUCTION DATE OF LAND 764,517 530,893 6,254 2,261,530 626,818 3,783,875 477,036 4,650,634 2,727,000 5,802,422 5,062,500 8,940,798 4,062,327 952,740 - 70,679,871 2,881,525 254,694 - 731,888 6,127,623 9,090,288 4,856,379 1,050,000 1,525,337 176,666 731,888 889,001 294,378 520,521 74,626 452,888 439,232 731,888 686,134 521,945 731,888 209,197 424,659 6,413,635 704,263 PROPERTIES OLENTANGY RIVER RD. MONTGOMERY PLAZA KENT, OH KENT NORTH OLMSTED ORANGE OHIO EDMOND CENTENNIAL PLAZA CANBY SQUARE SHOPPING CENTER OREGON TRAIL CENTER POWELL VALLEY JUNCTION MEDFORD CENTER MCMINNVILLE PIONEER PLAZA ALLEGHENY SUBURBAN SQUARE CHIPPEWA BROOKHAVEN PLAZA CARNEGIE CENTER SQUARE WAYNE PLAZA CHAMBERSBURG CROSSING DEVON VILLAGE EAST STROUDSBURG RIDGE PIKE PLAZA EXTON EXTON EASTWICK EXTON PLAZA FEASTERVILLE GETTYSBURG HARRISBURG, PA HAMBURG HAVERTOWN NORRISTOWN NEW KENSINGTON PHILADELPHIA PHILADELPHIA PLAZA STRAUSS WASHINGTON AVENUE WEXFORD PLAZA 242-244 MARKET STREET 1401 WALNUT ST LOWER ESTATE - UNIT A 1401 WALNUT ST LOWER ESTATE 1831-33 CHESTNUT STREET 1429 WALNUT STREET- COMMERCIAL 1805 WALNUT STREET UNIT A RICHBORO SPRINGFIELD UPPER DARBY WEST MIFFLIN WHITEHALL W. MARKET ST. REXVILLE TOWN CENTER PLAZA CENTRO - COSTCO PLAZA CENTRO - MALL PLAZA CENTRO - RETAIL PLAZA CENTRO - SAM'S CLUB LOS COLOBOS - BUILDERS SQUARE LOS COLOBOS - KMART LOS COLOBOS I LOS COLOBOS II WESTERN PLAZA - MAYAQUEZ ONE WESTERN PLAZA - MAYAGUEZ 16,874,345 TWO 2,781,447 MANATI VILLA MARIA SC 14,432,778 PONCE TOWN CENTER TRUJILLO ALTO PLAZA 12,053,673 MARSHALL PLAZA, CRANSTON RI 1,886,600 730,164 CHARLESTON 1,744,430 CHARLESTON 1,465,661 FLORENCE 2,209,812 GREENVILLE 5,801,948 CHERRYDALE POINT 3,110,439 WOODRUFF SHOPPING CENTER FOREST PARK 1,920,241 - MADISON 596,347 HICKORY RIDGE COMMONS 3,303,682 TROLLEY STATION 2,574,635 MARKET PLACE AT RIVERGATE 3,038,561 RIVERGATE, TN 2,923,585 CENTER OF THE HILLS, TX 3,160,203 ARLINGTON 2,244,581 DOWLEN CENTER 1,373,692 GATEWAY STATION 500,422 BAYTOWN LAS TIENDAS PLAZA 8,678,107 - CORPUS CHRISTI, TX 5,881,640 - 788,761 919,998 231,821 1,468,342 - 188,562 24,872,982 3,627,973 19,873,263 5,935,566 6,643,224 4,404,593 4,594,944 12,890,882 14,893,698 - - 1,982,143 10,857,773 1,833,600 1,302,656 3,028,914 - 3,712,045 - 3,591,493 18,604,307 4,347,500 12,622,879 3,152,982 16,995,113 - 6,638,583 30,061,177 166,351,381 11,526,101 973,318 3,298,908 2,927,551 15,605,012 - 25,846,910 2,372,628 4,251,732 4,895,360 2,927,551 2,762,888 1,404,778 2,082,083 671,630 6,665,238 - 2,927,551 2,664,535 2,548,322 2,927,551 1,373,843 990,872 9,774,600 2,117,182 7,001,199 32,081,992 5,982,231 17,796,661 17,311,529 3,155,044 4,981,589 927,286 - 5,195,577 1,158,307 48,688,161 10,752,213 58,719,179 16,509,748 20,224,758 9,627,903 10,120,147 26,046,669 30,680,556 2,340,830 764,517 3,226,699 530,893 - 6,254 - 2,261,530 35,000 626,818 (2,342,306) 921,704 375,195 477,036 437,071 4,650,634 59,094 (180,402) 2,727,000 (164,516) 5,802,422 (2,801,856) 2,035,125 46,881 8,943,600 881,473 4,062,327 3,012,460 3,982,020 - 4,358,017 71,279,871 153,289 2,881,525 (61,414) 254,694 - 17,747 1,269,064 731,888 210,038 6,135,670 26,037,242 8,790,288 - 4,856,379 1,434,371 1,050,000 3,016,678 1,525,337 - 176,666 - 731,888 3,074,728 889,001 338,373 130,246 2,593,014 520,521 74,626 3,969,364 452,888 2,023,428 494,982 - 731,888 3,751,641 774,084 705,540 521,945 - 731,888 16,952 209,197 468,821 424,659 5,413,946 6,413,635 290,927 704,263 101,519 BUILDING & IMPROVEMENT 4,174,430 4,529,354 3,028,914 - 3,747,045 519,865 3,966,688 TOTAL 4,938,947 5,060,248 3,035,168 2,261,530 4,373,862 1,441,569 4,443,724 19,041,378 23,692,012 881,473 4,167,098 6,894,098 12,458,362 18,260,784 5,413,626 3,378,501 17,039,192 25,982,792 4,943,800 6,621,763 10,603,783 30,120,271 30,120,271 170,109,398 241,389,270 11,679,391 14,560,916 1,166,598 911,903 3,316,655 3,316,655 4,196,615 4,928,503 15,807,004 21,942,674 26,337,242 35,127,530 25,846,910 30,703,289 4,856,999 8,793,747 5,072,026 3,659,439 6,726,617 2,037,529 5,195,618 847,775 10,634,601 11,087,489 2,462,660 3,659,439 7,102,310 3,775,807 3,659,439 1,599,992 1,884,352 15,188,547 21,602,182 3,112,372 3,806,999 7,268,410 4,895,360 2,927,551 5,837,616 1,907,284 4,675,097 773,149 1,967,677 2,927,551 6,328,226 3,253,862 2,927,551 1,390,795 1,459,693 2,408,109 173,928 - - (256,606) (601,274) 1,740,416 7,175,127 7,175,127 31,825,386 31,825,386 7,363,100 5,622,684 (17,251,273) 4,530,789 2,929,832 - 12,694,159 976,439 10,121,925 920,000 5,779,270 231,821 - 1,468,342 - - - 188,562 6,073,121 25,678,064 1,554,239 3,866,206 7,435,470 19,408,112 2,482,741 6,026,070 2,356,555 6,520,090 1,896,240 6,706,556 - 5,195,577 1,158,307 6,427,029 20,241,360 20,241,360 15,661,524 16,637,964 15,103,512 16,023,512 6,938,377 1,468,342 5,195,577 1,346,869 53,956,200 79,634,264 12,068,219 15,934,425 66,619,799 86,027,911 18,901,985 24,928,055 22,704,447 29,224,537 1,378,199 4,461,145 743,305 4,402,338 3,340,866 13,613,375 3,367,798 15,142,300 10,949,550 15,410,696 11,056,057 15,458,396 28,665,042 42,278,417 33,799,752 48,942,052 TOTAL COST, NET OF 3,554,751 414,150 1,967,433 - 2,635,775 - 1,401,219 8,114,100 1,058,383 2,835,919 913,731 3,765,357 18,895 2,039,818 6,162,210 34,626,138 3,911,007 72,032 1,105,552 2,250,128 2,118,606 4,038,945 407,493 2,985,664 1,152,303 1,631,787 1,226,069 2,271,015 175,108 887,834 750,878 7,428,586 543,391 1,226,069 4,249,355 2,939,109 1,226,069 125,900 363,424 1,742,241 104,290 1,113,355 3,417,725 258,238 1,776,743 424,388 8,557,940 6,559,055 2,604,689 - 2,175,926 1,158,307 19,860,598 5,303,539 28,394,791 8,212,600 20,944,334 6,255,889 6,510,717 12,145,876 14,422,685 1,384,196 4,646,098 1,067,735 2,261,530 1,738,087 1,441,569 3,042,505 15,577,912 5,835,714 15,424,866 4,499,895 22,217,435 4,924,906 8,563,965 23,958,061 206,763,132 10,649,909 1,094,565 2,211,103 2,678,375 19,824,068 31,088,585 30,295,795 1,871,335 7,641,444 3,440,239 2,433,370 4,455,603 1,862,422 4,307,784 96,897 3,658,903 1,919,269 2,433,370 2,852,956 836,698 2,433,370 1,474,093 1,520,928 19,859,940 3,008,082 6,061,771 28,407,661 7,104,862 4,650,286 19,816,972 8,080,024 9,464,457 4,333,688 1,468,342 3,019,651 188,562 59,773,666 10,630,885 57,633,121 16,715,455 8,280,203 9,154,807 8,947,679 30,132,541 34,519,367 12,252,522 1,296,644 11,241,993 13,164,945 24,406,939 5,724,931 18,682,007 19,911,045 5,673,119 28,448,754 24,445,858 7,575,302 3,132,092 6,986,094 6,011,013 8,850,864 32,055,019 15,501,117 9,544,875 4,133,904 2,545,033 13,218,740 10,339,449 12,157,408 11,706,145 2,285,378 - 28,145,158 2,431,651 - 944,562 1,732,421 16,872,647 417,977 2,606,588 4,972,360 14,903,024 3,847,438 12,289,288 1,771,187 1,886,600 18,725,743 730,164 4,308,629 1,744,430 849,832 1,465,661 887,322 2,209,811 1,165,166 5,801,948 1,182,533 3,465,199 - 1,920,241 - 2,880,678 (2,404,809) 683,820 203,711 3,303,682 1,544,098 2,574,635 3,914,995 3,038,561 1,106,611 2,923,585 490,738 3,160,203 (722,251) 484,828 14,389 1,374,880 681,655 500,422 25,971,206 7,943,925 - 3,526,281 6,265,955 21,645,164 38,517,811 8,872,543 32,950,868 47,853,893 28,057,682 40,346,970 9,346,489 11,233,089 21,857,835 22,587,999 11,294,723 13,039,153 6,860,845 8,326,506 9,738,187 11,947,998 33,220,185 39,022,133 16,328,890 19,794,089 9,544,875 11,465,115 7,014,582 7,014,582 736,571 52,750 13,422,451 16,726,133 11,883,547 14,458,182 16,072,403 19,110,964 12,812,756 15,736,341 5,936,320 1,522,330 28,158,358 29,533,238 3,613,728 26,705,388 34,649,313 4,470,843 2,776,116 1,037,502 4,470,843 3,113,306 9,464,269 3,505,919 8,985,068 14,827,153 3,821,835 6,357,742 4,681,114 2,476,193 3,849,666 3,676,308 980,086 183,040 5,461,380 15,667 4,909,872 4,616,355 5,793,057 5,106,895 891,995 87,738 903,104 1,201,001 2,393,126 1,216,263 29,053,542 5,366,624 38,868,825 25,519,817 7,411,254 16,230,257 8,358,040 5,850,313 8,098,332 35,345,825 18,814,003 11,282,075 1,553,202 720,903 11,816,262 9,841,827 13,317,907 10,629,446 5,044,325 1,434,592 28,630,133 2,412,727 32,256,187 3,254,579 97 1988 2005 1999 1995 1999 1997 1998 2009 2009 2009 2009 2009 2004 2007 2000 2005 1999 1996 2008 2012 2008 1999 1996 1997 2005 1996 1986 2002 1996 1984 1986 1996 2005 2005 2010 2007 2008 2008 2007 2008 2008 1986 1983 1996 1986 1996 1986 2006 2006 2006 2006 2006 2006 2006 2006 2006 2006 2006 2006 2006 2006 1998 1995 1997 1997 2009 2010 2012 2000 1998 1998 1998 2008 1997 2011 1996 1997 5,919,679 13,803,320 4,258,331 2,062,577 12,500,000 6,705,528 9,353,995 3,345,831 39,022,236 22,728,601 - 9,876,829 - 2001 2006 2006 1973 2000 1978 1978 2002 2005 INITIAL COST SUBSEQUENT BUILDING & TO LAND 4,343,000 IMPROVEMENT ACQUISITION 230,224 4,723,215 LAND 4,343,000 BUILDING & IMPROVEMENT 4,953,438 TOTAL 9,296,438 TOTAL COST, NET OF 293,813 9,002,625 ACCUMULATED ACCUMULATED DEPRECIATION DEPRECIATION DATE OF ENCUMBRANCES ACQUISITION CONSTRUCTION DATE OF PROPERTIES ISLAND GATE PLAZA PRESTON LEBANON CROSSING LAKE PRAIRIE TOWN CROSSING CENTER AT BAYBROOK HARRIS COUNTY CYPRESS TOWNE CENTER SHOPS AT VISTA RIDGE VISTA RIDGE PLAZA VISTA RIDGE PHASE II SOUTH PLAINES PLAZA, TX LAKE JACKSON MESQUITE MESQUITE TOWN CENTER NEW BRAUNSFELS PARKER PLAZA PLANO SOUTHLAKE OAKS WOODBRIDGE SHOPPING CENTER WEST OAKS OGDEN COLONIAL HEIGHTS OLD TOWN VILLAGE RICHMOND RICHMOND VALLEY VIEW SHOPPING CENTER POTOMAC RUN PLAZA MANCHESTER SHOPPING CENTER AUBURN NORTH FRONTIER VILLAGE SHOPPING CTR. OLYMPIA WEST OUTPARCEL SILVERDALE PLAZA CHARLES TOWN BLUE RIDGE MICROPROPERTIES BRAZIL-RIO CLARO BRAZIL-VALINHOS CHILE-EKONO CHILE-VICUNA MACKENA CHILE-VINA DEL MAR MEXICO-HERMOSILLO MEXICO-GIGANTE ACQ. MEXICO-MOTOROLA MEXICO-NON ADM BT-LOS CABOS MEXICO-NON ADM-GRAN PLZ CANCUN MEXICO-NON BUS ADM- MULT.CANCUN MEXICO-PLAZA SORIANA MEXICO-PLAZA CENTENARIO MEXICO-NON BUS.ADM - LINDAVISTA MEXICO-NONADM BUS- NUEVO LAREDO MEXICO-NON ADM-PLAZA LAGO REAL MEXICO-MULTIPLAZA OJO DE AGUA MEXICO-PACHUCA (WALMART) MEXICO-NON ADM -PLAZA SAN JUAN MEXICO-RHODESIA MEXICO-RIO BRAVO HEB MEXICO-SALTILLO 2 MEXICO-SAN PEDRO MEXICO-TAPACHULA MEXICO-TIJUANA 2000 LAND PURCHASE MEXICO-WALDO ACQ. PERU-CAMPOY PERU-LIMA BALANCE OF PORTFOLIO TOTALS 13,552,180 - 25,307,090 12,163,694 26,695,576 38,859,270 2,377,064 36,482,206 7,897,491 6,941,017 1,843,000 6,033,932 3,257,199 2,926,495 2,276,575 1,890,000 1,562,328 520,340 3,757,324 840,000 7,846,946 500,414 3,011,260 2,568,705 500,422 213,818 125,376 4,500,000 82,544 670,500 - 27,727,491 7,372,420 - 13,029,416 11,716,483 9,106,300 7,555,099 4,144,212 2,081,356 15,061,644 3,360,000 - 2,830,835 7,703,844 6,813,716 2,001,687 855,275 3,476,073 41,569,735 2,289,288 2,751,375 24,220,124 9,849,161 2,272,522 1,041,845 332,552 2,239,786 1,226,061 444,355 - 1,081,051 2,394,853 - - - (62,791) - 325,191 4,084,007 294,598 (2,194,866) 280,600 - 6,783,464 7,063,186 2,003,260 2,251,666 3,257,199 2,926,495 2,276,575 1,890,000 1,562,328 520,340 3,757,324 840,000 7,846,946 500,414 3,019,951 2,568,705 500,422 850,699 125,376 4,300,819 82,544 670,500 25,334,151 37,454,483 9,484,682 4,824,111 13,361,967 13,956,270 10,332,361 7,999,454 4,144,212 3,162,408 17,456,497 3,360,000 - 2,830,835 7,632,363 6,813,716 2,326,878 4,302,401 3,770,671 39,574,050 2,569,889 2,751,375 32,117,615 44,517,669 11,487,942 7,075,777 16,619,167 16,882,764 12,608,936 9,889,454 5,706,540 3,682,747 21,213,821 4,200,000 7,846,946 3,331,249 10,652,313 9,382,421 2,827,300 5,153,100 3,896,047 43,874,869 2,652,432 3,421,875 2,783,528 11,379,867 3,459,942 211,531 5,201,257 5,297,941 3,536,613 2,978,446 153,224 1,360,886 6,637,964 820,144 - 1,174,107 2,009,778 222,553 875,080 1,960,182 1,241,353 2,185,444 727,619 1,241,294 3,440,018 27,369,515 8,054,004 48,451,209 922,790 (639,454) 3,440,018 27,369,515 8,976,794 47,811,755 12,416,812 75,181,270 1,945,689 10,338,425 2,722,461 7,785,841 6,403,866 18,157,625 639,555 60,221 2,722,461 7,785,841 7,043,421 18,217,846 9,765,882 26,003,688 2,278,877 5,120,435 29,334,087 33,137,802 8,028,000 6,864,246 11,417,909 11,584,823 9,072,324 6,911,008 5,553,316 2,321,862 14,575,857 3,379,856 7,846,946 2,157,142 8,642,536 9,159,869 1,952,220 3,192,918 2,654,695 41,689,424 1,924,813 2,180,580 10,471,123 64,842,845 7,487,005 20,883,253 6,192,143 40,997,953 10,750,863 34,566,734 96,299 10,750,863 34,663,033 45,413,896 936,452 44,477,445 32,418,427 25,050,616 14,561,754 40,336,996 360,000 3,875,013 602,000 12,346,900 24,206,390 1,300,000 5,204,507 414,730 362,556 11,096,948 11,424,531 7,568,417 47,272,528 799,640 32,083,427 3,725,871 71,529,796 56,481,576 - 14,997,200 - 5,205,439 720,781 - 19,878,026 - 40,360 205,450 11,269,416 (8,432,419) 360,000 3,875,013 602,000 17,608,591 - 24,206,390 1,485,574 3,772,616 1,777,214 7,368,362 477,858 782,802 (1,083,208) 2,083,831 57,366,844 17,095,769 32,709,395 11,933,599 (5,696,608) 5,866,102 57,967,312 39,201,766 1,200,000 840,000 36,163,890 32,288,878 15,597,287 14,995,287 75,444,277 57,835,686 80,687,966 56,481,576 5,072,616 3,587,042 27,570,069 25,792,855 1,197,532 719,674 4,484,787 2,400,956 69,184,573 52,088,804 44,133,926 32,200,327 15,883,733 21,749,835 66,038,074 105,239,840 15,400 907,828 8,669,491 16,200,943 2,096,513 255,004 1,073,687 93,789 218,218 848,759 1,639,074 3,970,928 2,993,678 1,184,600 35,256,063 6,927,796 59,243,334 78,591,453 4,817,612 26,496,382 1,103,743 4,266,569 68,335,814 42,494,852 17,778,908 102,246,162 10,873,070 1,257,517 9,050,975 9,127,801 12,053,761 21,181,563 2,078,591 19,102,972 13,976,402 30,219,719 (9,417,640) 15,782,094 18,996,388 34,778,481 5,092,210 29,686,271 4,471,987 2,639,975 3,388,861 19,352,453 10,627,540 11,336,743 4,089,067 3,621,985 9,631,035 3,924,464 2,970,663 11,150,023 3,309,654 13,716,428 - 346,945 12,789,095 257,302 4,650,512 2,384,667 12,610,570 859,555 17,261,082 3,244,222 450,635 - 16,810,447 3,244,222 - - - - - - 3,914,208 2,698,888 4,604,181 7,303,069 566,388 6,736,681 24,362,687 16,484,680 27,230,460 43,715,140 2,761,512 40,953,628 19,967,340 8,697,111 21,897,768 30,594,879 4,266,135 26,328,744 18,051,588 9,521,305 19,867,026 29,388,331 631,171 28,757,159 11,247,962 4,244,783 11,092,246 15,337,029 1,072,271 14,264,758 5,711,916 3,253,476 6,080,425 9,333,901 1,838,821 7,495,080 - - - - 13,238,616 - 2,494,078 6,586,692 9,767,648 4,517,829 12,816,912 2,860,837 16,604,023 9,425,609 3,443,840 (3,098,054) 19,589,751 11,329,441 5,538,421 9,174,283 12,926,738 18,328,437 10,006,376 21,976,738 12,125,113 13,692,112 15,787,575 27,754,046 13,450,216 33,306,179 524,000 894,726 1,864,929 4,974,037 5,825,049 1,375,665 11,601,113 12,797,386 13,922,646 22,780,009 7,625,167 31,930,514 1,200,000 8,929,278 2,675,461 811,916 133,248,688 2,239,195,318 - 16,888,627 - - 4,492,127 1,262,833 7,135,228 2,784,870 1,051,179 1,763,183 4,916,652,429 1,791,438,899 2,045,185,881 62,833 (6,134,466) 278,383 2,453,532 11,287,272 - 12,548,212 168,974 2,214,269 1,262,833 19,683,439 2,953,844 3,265,448 147,264,903.95 149,028,087 6,902,100,765 8,947,286,646 - 2,457,726 0 140,510 40,346,030 1,745,461,577 1,262,833 17,225,713 2,953,844 3,124,938 108,682,055 7,201,825,069 1,003,189,611 98 2011 1998 1997 1998 1998 1998 1998 2012 1995 1998 2003 1996 2008 2012 1996 1999 2007 1999 1995 2004 2008 2004 2007 2012 2012 2012 1985 2005 2012 2007 2007 2007 2007 2007 2007 2007 2008 2008 2006 2007 2009 2007 2006 2006 2003 2005 1967 2009 2008 2008 2008 2008 2008 2006 2006 2006 2005 2006 2009 2005 2011 2008 Depreciation and amortization are provided on the straight-line method over the estimated useful lives of the assets as follows: Buildings Fixtures, building and leasehold improvements (including certain identified intangible assets) 15 to 50 years Terms of leases or useful lives, whichever is shorter The aggregate cost for Federal income tax purposes was approximately $7.9 billion at December 31, 2012. The changes in total real estate assets for the years ended December 31, 2012, 2011 and 2010, are as follows: Balance, beginning of period Acquisitions Improvements Transfers from (to) unconsolidated joint ventures Sales Assets held for sale Adjustment of fully depreciated assets Adjustment of property carrying values Change in exchange rate Balance, end of period The changes in accumulated depreciation for the years ended December 31, 2012, 2011 and 2010 are as follows: Balance, beginning of period Depreciation for year Transfers (to) unconsolidated joint ventures Sales Adjustment of fully depreciated assets Assets held for sale Change in exchange rate Balance, end of period Reclassifications: Certain Amounts in the Prior Period Have Been Reclassified in Order to Conform with the Current Period's Presentation. 2012 2011 2010 8,771,256,852 411,166,315 85,801,777 212,231,319 (503,767,086) (9,845,065) (21,711,782) (34,121,504) 36,275,820 8,947,286,646 8,587,378,001 406,431,259 118,072,955 (49,812,485) (186,887,870) (4,503,823) (27,412,282) (4,616,890) (67,392,013) 8,771,256,852 8,877,013,625 83,833,304 115,592,035 115,482,953 (603,652,663) (4,445,309) (15,047,644) (17,601,053) 36,202,753 8,587,378,001 2012 2011 2010 1,693,089,989 248,426,786 (8,390,550) (161,515,292) (21,711,782) (6,582,611) 2,145,037 1,745,461,577 1,549,380,256 237,782,626 (2,725,794) (59,086,170) (27,412,282) (633,676) (4,214,971) 1,693,089,989 1,343,148,498 244,903,628 - (23,610,893) (15,047,644) (13,333) 1,549,380,256 99 KIMCO REALTY CORPORATION AND SUBSIDIARIES Schedule IV - Mortgage Loans on Real Estate As of December 31, 2012 (in thousands) Type of Loan/Borrower Description Location (c) Interest Accrual Rates Interest Payment Rates Final Maturity Date Periodic Payment Terms (a) Prior Liens Face Amount of Mortgages or Maximum Available Credit (b) Carrying Amount of Mortgages (b) (c) Mortgage Loans: Borrower A Borrower B Borrower C Borrower D Borrower E Borrower F Borrower G Borrower H Borrower I Borrower J Borrower K Individually < 3% 8.50% 8.50% 7.00% 6.00% 8.10% 7.57% Retail Development Ontario, Canada Apartments Montreal, Canada Senior Living Center Parker, CO Retail Retail Retail Retail Retail Retail Retail Retail 8.50% 4/13/2013 8.50% 6/27/2013 7.00% 12/31/2013 Jacksonville, FL 6.00% 11/2/2013 8.10% 12/16/2013 Arboledas, Mexico Miami, FL 7.57% 6/1/2019 Las Vegas, NV 10.00% 10.00% 5/14/2033 Guadalajara, Mexico 12.00% 12.00% 9/1/2016 Miami, FL 7.57% 6/1/2019 7.57% Miami, FL 7.57% 6/1/2019 7.57% Miami, FL 7.57% 7.57% 6/1/2019 (e) (e) (f) (d) I P& I P& I P&I P&I P&I I P&I P&I P&I P&I $ - - - - - - - - - - - - 16,906 $ 23,800 4,358 4,221 13,000 6,509 3,075 5,307 4,201 3,966 3,678 15,779 104,800 16,897 7,016 4,358 4,221 3,835 3,792 3,075 2,706 2,633 2,584 2,394 13,800 67,311 Lines of Credit: Individually < 3% Other: Individually < 3% Capitalized loan costs Total 8.00% 8.00% 12/31/2013 2,400 1,405 (g) (g) (h) 2,050 1,952 36 $ 109,250 $ 70,704 (a) I = Interest only; P&I = Principal & Interest (b) The instruments actual cash flows are denominated in U.S. dollars, Canadian dollars and Mexican pesos as indicated by the geographic location above (c) The aggregate cost for Federal income tax purposes is $70.7 million (d) Comprised of 14 separate loans with original loan amounts ranging between $0.4 million and $3.3 million (e) Interest rates range from 6.00% to 12.00% (f) Maturity dates range from one to 18 years (g) Interest rates range from 2.28% to 5.50% (h) Maturity dates range from six to 15 years For a reconcilition of mortgage and other financing receivables from January 1, 2010 to December 31, 2012 see Note 11 of the Notes to Consolidated Financial Statements included in this annual report of Form 10K. The Company feels it is not practicable to estimate the fair value of each receivable as quoted market prices are not available. The cost of obtaining an independent valuation on these assets is deemed excessive considering the materiality of the total receivables. 100 Kimco Realty Corporation and Subsidiaries Computation of Ratio of Earnings to Fixed Charges For the year ended December 31, 2012 Exhibit 12.1 Pretax earnings from continuing operations before adjustment for noncontrolling interests or income loss from equity investees $ 42,544,588 Add: Interest on indebtedness (excluding capitalized interest) Amortization of debt related expenses Portion of rents representative of the interest factor Distributed income from equity investees 229,911,807 7,683,550 6,946,781 287,086,726 194,109,970 Pretax earnings from continuing operations, as adjusted $ 481,196,696 Fixed charges - Interest on indebtedness (including capitalized interest) Amortization of debt related expenses Portion of rents representative of the interest factor Fixed charges Ratio of earnings to fixed charges $ 231,449,478 3,099,218 6,946,781 $ 241,495,477 2.0 101 Kimco Realty Corporation and Subsidiaries Computation of Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends For the year ended December 31, 2012 Pretax earnings from continuing operations before adjustment for noncontrolling interests or income loss from equity investees $ 42,544,588 Exhibit 12.2 Add: Interest on indebtedness (excluding capitalized interest) Amortization of debt related expenses Portion of rents representative of the interest factor Distributed income from equity investees 229,911,807 7,683,550 6,946,781 287,086,726 194,109,970 Pretax earnings from continuing operations, as adjusted $ 481,196,696 Combined fixed charges and preferred stock dividends - Interest on indebtedness (including capitalized interest) Preferred dividend factor Amortization of debt related expenses Portion of rents representative of the interest factor Combined fixed charges and preferred stock dividends $ 231,449,478 72,978,005 3,099,218 6,946,781 $ 314,473,482 Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends 1.5 102 CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002 Exhibit 31.1 I, David B. Henry, certify that: 1. I have reviewed this annual report on Form 10-K of Kimco Realty Corporation; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; 4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; (c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and (d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. Date: February 26, 2013 /s/ David B. Henry David B. Henry Chief Executive Officer 103 CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002 Exhibit 31.2 I, Glenn G. Cohen, certify that: 1. I have reviewed this annual report on Form 10-K of Kimco Realty Corporation; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; 4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; (c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and (d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. Date: February 26, 2013 /s/ Glenn G. Cohen Glenn G. Cohen Chief Financial Officer 104 Section 1350 Certification Exhibit 32.1 Pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, each of the undersigned officers of Kimco Realty Corporation (the “Company”) hereby certifies, to such officer’s knowledge, that: (i) the accompanying Annual Report on Form 10-K of the Company for the year ended December 31, 2012 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and (ii) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. Date: February 26, 2013 Date: February 26, 2013 By: /s/ David B. Henry David B. Henry Chief Executive Officer By: /s/ Glenn G. Cohen Glenn G. Cohen Chief Financial Officer 105 LOCATION PORTFOLIO ACQUIRED YEAR DEVELOPED OR LEASABLE AREA (SQ.FT.) PERCENT LEASED (1) TENANT NAME GLA TENANT NAME GLA TENANT NAME GLA MAJOR LEASES Exhibit 99.1 ALABAMA HOOVER MOBILE (5) ALASKA ANCHORAGE KENAI ARIZONA GLENDALE GLENDALE MARANA MESA MESA MESA NORTH PHOENIX PEORIA PHOENIX PHOENIX PHOENIX PHOENIX PHOENIX PHOENIX SUN CITY TEMPE TUCSON CALIFORNIA ALHAMBRA ANAHEIM ANAHEIM ANAHEIM (5) ANAHEIM ANGEL'S CAMP BELLFLOWER CARLSBAD CARMICHAEL CHICO CHICO CHINO CHINO CHINO HILLS CHULA VISTA COLMA CORONA CORONA COVINA CUPERTINO DALY CITY DUBLIN EL CAJON EL CAJON ELK GROVE ENCINITAS ESCONDIDO FAIR OAKS FOLSOM FREMONT FREMONT FRESNO FULLERTON GARDENA GRANITE BAY GRASS VALLEY HACIENDA HEIGHTS HAYWARD HUNTINGTON BEACH JACKSON LA MIRADA LA VERNE LAGUNA HILLS LINCOLN LIVERMORE LOS ANGELES LOS ANGELES MANTECA MODESTO MONTEBELLO MORAGA MORGAN HILL NAPA NORTHRIDGE NOVATO OCEANSIDE OCEANSIDE OCEANSIDE OIP OJV KIR OJV PRU OJV PRU PRU PRU BIG BIG UBS PRU PRU UBS KIR PRU OJV CPP PRU PRU PRU PRU OJV PRU PRU BIG PRU PRU PRU OJV PRU PRU BIG OJV UBS PRU PRU BIG PRU KIR BIG OJV PRU PRU PRU 2007 2006 2006 2003 1998 2008 2003 2009 2005 2011 1998 2011 1998 1998 1997 2009 2006 2011 2012 2011 2003 1998 1995 2006 2006 2006 2009 2010 2010 1998 2008 2007 2006 2006 2008 1998 2006 1998 2007 2000 2006 2002 2006 2003 2010 2006 2006 2006 2006 2003 2007 2006 2009 2010 2006 2006 2006 2011 2006 2006 2008 1998 2010 2007 2007 2006 2010 2006 2010 2006 2000 2010 2003 2006 2005 2009 2006 2006 2006 115,358 348,745 81.1 PETCO 87.1 ACADEMY SPORTS & OUTDOORS 15,000 DOLLAR TREE 84,464 VIRGINIA COLLEGE 10,000 SHOE CARNIVAL 60,293 ROSS DRESS FOR LESS 132,653 146,759 82.2 MICHAELS 100.0 HOME DEPOT 25,937 BED BATH & BEYOND 146,759 25,000 OLD NAVY 221,388 169,257 191,008 227,627 1,080,000 75.8 FLOOR & DECOR 100.0 WALMART 100.0 LOWE'S HOME CENTER 91.9 SPORTS AUTHORITY 94.3 WALMART 75,000 HOWIE'S FURNITURE 81,535 MOR FURNITURE FOR LESS 191,008 51,154 MEGA FURNITURE 208,000 BASS PRO SHOPS OUTDOOR WORLD 45,000 SALON BOUTIQUE ÿ 40,000 MICHAELS 41,750 PETSMART 170,000 HOME DEPOT 79,790 228,071 167,862 153,180 229,707 131,621 70,428 94,379 184,329 62,559 62,285 190,174 195,455 15,396 347,236 161,073 105,338 77,967 113,233 160,928 206,261 264,335 69,812 339,001 168,264 73,352 356,335 213,463 491,998 148,805 278,562 107,969 614,026 155,070 128,343 98,396 89,164 118,804 231,157 104,866 108,255 504,666 131,239 121,107 268,091 65,987 140,240 217,461 135,012 80,911 156,305 67,665 264,513 226,872 160,000 119,559 104,244 165,195 169,653 96,393 214,389 251,489 163,630 103,362 349,530 158,812 133,745 352,098 92,378 87,863 98.2 MOR FURNITURE FOR LESS 96.0 BURLINGTON COAT FACTORY 98.2 JCPENNEY 78.8 HOME DEPOT 82.3 COSTCO 92.8 SAFEWAY 87.3 SAFEWAY (6) 82.5 ROSS DRESS FOR LESS 96.3 WALMART 87.0 CVS 93.6 WHOLE FOODS MARKET 100.0 LOWE'S HOME CENTER 33,234 MICHAELS 98,054 MICHAELS 53,984 JO-ANN FABRICS 107,724 141,659 DD'S DISCOUNTS 62,573 TRADER JOE'S 42,504 29,765 DOLLAR TREE 110,627 MICHAELS 24,519 32,306 190,174 100.0 COSTCO 100.0 NORTHGATE GONZALEZ MARKETS 116,560 COSTCO 15,396 100.0 FOREVER 21 90.3 RALPHS 100.0 STATER BROTHERS 91.5 SAVE MART 100.0 STATER BROTHERS 83.1 MARSHALLS 89.4 HOME DEPOT 98.3 EVANS FURNITURE GALLERIES 92.9 RALEY'S 87.4 LA CURACAO 95.6 DOLLAR TREE 97.2 STATER BROTHERS 100.0 COSTCO 98.9 MARSHALLS 94.8 COSTCO 97.0 VONS 96.9 LOWE'S HOME CENTER 89.8 99 RANCH MARKET HOME DEPOT 95.7 100.0 ORCHARD SUPPLY HARDWARE 100.0 KOHL'S 92.8 RITE AID 100.0 BEL AIR MARKET 92.9 KOHL'S 84.6 LA FITNESS 89.9 RALEY'S 100.0 KOHL'S 90.1 SAFEWAY 96.2 SAVE MART 100.0 BED BATH & BEYOND 91.8 TOYS R US 93.7 99 RANCH MARKET 89.9 RALEY'S 87.3 RALEY'S 97.5 ALBERTSONS (6) 92.3 99 CENTS ONLY STORES 84.5 VONS 100.0 RALEY'S 82.2 U.S. POSTAL SERVICE 93.4 TARGET 100.0 MACY'S 91.9 SAFEWAY 91.2 ROSS DRESS FOR LESS 93.8 RALPHS/FOOD 4 LESS 100.0 KMART 96.9 SAFEWAY 60.7 RALEY'S (6) 98.0 SEARS 89.7 TJ MAXX 100.0 HOME DEPOT 100.0 TARGET 67.5 DSW SHOE WAREHOUSE 95.6 SAFEWAY 94.5 SEARS 98.7 TRADER JOE'S 85.3 SMART & FINAL 80,000 EL SUPER 45,000 RITE AID 37,440 41,956 RITE AID 64,039 PLANET FITNESS 27,000 DOLLAR TREE 110,861 WALMART 57,635 FOOD MAXX 62,098 104,465 ROSS DRESS FOR LESS 25,060 PETSMART 43,235 154,569 WALMART 32,000 NORDSTROM RACK 114,112 HOME DEPOT 55,650 PETSMART 111,348 STAPLES 29,657 109,000 SAFEWAY 35,829 MARSHALLS 94,926 MICHAELS 27,642 ROSS DRESS FOR LESS 56,435 58,004 TOTAL WOMAN GYM 40,000 VONS 65,472 108,255 54,741 BED BATH & BEYOND 48,000 CVS 36,725 SPROUTS FARMERS MARKET 66,960 AMC THEATERS 22,000 RITE AID 60,114 60,114 JCPENNEY 44,128 VIVO DANCESPORT CENTER 29,300 BIG LOTS CVS 40,800 62,625 26,577 MOVIES 7 DOLLAR THEATRE 114,732 MARSHALLS 160,000 55,342 CVS 24,000 RICHARD CRAFTS 38,950 FACTORY 2-U 82,504 SUPERIOR MARKETS 58,090 BIG 5 SPORTING GOODS 49,800 PLANET FITNESS 105,000 TOYS R US 31,133 CVS 103,362 116,000 HOME DEPOT 43,000 SUPER KING MARKET 51,199 RITE AID 38,902 ROSS DRESS FOR LESS 12,881 LAMPS PLUS 25,000 USA DISCOUNTERS 25,520 23,190 GUITAR CENTER 40,734 ROSS DRESS FOR LESS 21,406 11,145 11,450 25,666 40,459 JO-ANN FABRICS 54,087 SMART & FINAL 18,235 99 CENT DISCOUNT 19,120 29,025 16,610 KIDS R US 44,257 54,239 BED BATH & BEYOND 30,730 DD'S DISCOUNTS 24,225 RITE AID 153,578 NAVCARE 30,809 BED BATH & BEYOND 100,000 UFC GYMS 24,515 ANNA'S LINENS 25,632 SKYZONE 57,817 BURLINGTON COAT FACTORY 32,000 ROSS DRESS FOR LESS 28,417 24,000 PETCO 13,000 40,000 CVS 39,830 MARSHALLS 24,437 BALLY TOTAL FITNESS 35,747 ROSS DRESS FOR LESS 42,963 AMC THEATERS 19,300 37,842 SOUTH YUBA CLUB 12,000 DAISO JAPAN 23,334 20,120 24,900 CVS 27,764 STAPLES 23,077 12,061 BIG 5 SPORTING GOODS 22,224 RITE AID 34,420 CVS 10,000 23,240 46,270 AMC THEATERS 25,844 U.S. POSTAL SERVICE 100,238 RALEY'S 39,348 LINENS N THINGS 24,769 DOLLAR TREE 30,000 BARNES & NOBLE 11,000 23,800 10,000 31,500 19,580 11,000 17,500 25,339 102,589 20,293 23,984 13,454 30,000 12,200 15,062 25,002 25,000 21,440 14,580 30,644 45,000 15,120 25,608 55,000 31,060 10,000 22,880 30,028 24,145 30,187 31,690 12,567 10,000 22,268 15,661 10,000 18,160 25,487 39,263 14,380 60,890 39,000 15,708 25,000 106 LOCATION PORTFOLIO ACQUIRED YEAR DEVELOPED OR LEASABLE AREA (SQ.FT.) PERCENT LEASED (1) TENANT NAME GLA TENANT NAME GLA TENANT NAME MAJOR LEASES Exhibit 99.1 ORANGEVALE PACIFICA PACIFICA PLEASANTON POWAY RANCHO CUCAMONGA REDWOOD CITY RIVERSIDE ROSEVILLE ROSEVILLE SACRAMENTO SAN DIEGO SAN DIEGO SAN DIEGO SAN DIEGO SAN DIEGO SAN DIEGO SAN DIEGO SAN DIEGO SAN DIEGO SAN DIMAS SAN JOSE SAN LEANDRO SAN LUIS OBISPO SAN RAMON SANTA ANA SANTA CLARITA SANTA ROSA SANTEE SIGNAL HILL TEMECULA TEMECULA TEMECULA TORRANCE TORRANCE TRUCKEE TRUCKEE TURLOCK TUSTIN TUSTIN TUSTIN TUSTIN UPLAND VALENCIA VISALIA VISTA WALNUT CREEK WESTMINSTER WINDSOR WINDSOR YORBA LINDA COLORADO AURORA AURORA AURORA COLORADO SPRINGS DENVER ENGLEWOOD FORT COLLINS GREELEY GREENWOOD VILLAGE HIGHLANDS HIGHLANDS RANCH LAKEWOOD LITTLETON CONNECTICUT BRANFORD ENFIELD FARMINGTON HAMDEN NORTH HAVEN WATERBURY WILTON DELAWARE ELSMERE WILMINGTON FLORIDA ALTAMONTE SPRINGS ALTAMONTE SPRINGS BOCA RATON BONITA SPRINGS BIG KIF PRU OJV PRU BIG UBS PRU KIR CPP PRU UBS UBS OJV PRU PRU PRU KIR PRU OJV BIG KIR CPP BIG KIR BIG UBS PRU OJV OJV PRU PRU PRU PRU OJV PRU PRU PRU BIG BIG OJV KIR KIR OJV KIF UBS 2010 2004 2006 2007 2005 2006 2009 2008 2010 2007 2006 2000 2010 2009 2006 2007 2007 2007 2012 2007 2006 2006 2006 2005 1999 1998 2006 2005 2003 2010 1999 2010 2010 2000 2010 2006 2007 2006 2007 2003 2006 2006 2006 2006 2007 2006 2006 2006 2010 2010 2012 1998 1998 1998 1998 1998 1998 2000 2012 2003 2011 2011 1998 2011 2000 2000 1998 1973 1998 1993 2012 1979 2004 1995 1998 1967 2006 160,811 168,871 104,281 175,000 125,194 56,019 49,429 86,108 188,493 81,171 188,874 117,410 412,674 35,000 210,579 49,369 57,411 59,414 108,741 225,919 154,000 183,180 95,255 173,996 41,913 134,400 96,662 41,565 311,498 154,750 342,336 417,252 139,130 268,814 66,958 30,433 41,149 111,558 687,590 108,413 193,415 137,963 271,867 143,070 228,769 122,563 114,733 208,660 107,769 126,187 160,773 154,055 44,097 152,282 107,310 18,405 80,330 115,862 138,818 201,322 123,454 30,397 82,581 190,104 190,738 148,517 184,959 345,196 331,919 141,443 92.4 SAVE MART 93.1 SAFEWAY 89.6 SAVE MART 100.0 MACY'S 98.8 STEIN MART 91.3 CVS 100.0 ORCHARD SUPPLY HARDWARE 100.0 BURLINGTON COAT FACTORY 97.7 SPORTS AUTHORITY 100.0 SAFEWAY 88.4 SEAFOOD CITY 100.0 24 HOUR FITNESS 100.0 COSTCO 100.0 CLAIM JUMPER 89.1 TJ MAXX 97.6 NAMASTE PLAZA SUPERMARKET 98.6 94.9 100.0 ALBERTSONS 100.0 NORDSTROM 95.5 STEIN MART 89.3 WALMART 92.4 ROSS DRESS FOR LESS 87.6 VONS 91.0 PETCO 100.0 HOME DEPOT 89.5 ALBERTSONS 100.0 ACE HARDWARE 97.5 24 HOUR FITNESS 98.8 HOME DEPOT 95.0 KMART 100.0 WALMART 96.8 ALBERTSONS 100.0 SEARS 79.7 ACE HARDWARE 79.3 78.9 98.1 RALEY'S 94.4 TARGET 100.0 KMART 87.8 VONS 91.6 RALPHS 91.7 HOME DEPOT 93.9 RALPHS 54.7 REGAL SEQUOIA MALL 12 91.6 ALBERTSONS 92.7 CENTURY THEATRES 97.4 PAVILIONS 78.0 RALEY'S 92.4 SAFEWAY 100.0 DICK'S SPORTING GOODS 78.4 ROSS DRESS FOR LESS 57.4 70.7 ALBERTSONS 24.1 DOLLAR TREE 100.0 SAVE-A-LOT 97.0 HOBBY LOBBY 100.0 KOHL'S 100.0 BED BATH & BEYOND HOME DEPOT 100.0 98.1 ACE HARDWARE 86.8 91.7 SAFEWAY 92.6 KING SOOPERS 100.0 KOHL'S 100.0 KOHL'S 97.8 SPORTS AUTHORITY 97.2 WALMART 97.1 HOME DEPOT 100.0 RAYMOUR & FLANIGAN FURNITURE 62,000 CVS 45,892 ROSS DRESS FOR LESS 29,200 RITE AID 175,000 40,000 HOME GOODS 21,415 49,429 67,104 43,373 SPROUTS FARMERS MARKET 55,146 53,842 SD MART 66,851 SPORTS AUTHORITY 153,095 PRICE SELF STORAGE 10,600 31,152 HOME GOODS 10,150 31,180 U.S. POSTAL SERVICE 24,246 RITE AID 23,064 26,210 OFFICE DEPOT 36,041 ROSS DRESS FOR LESS 51,639 BIG 5 SPORTING GOODS 38,359 120,962 COSTCO 30,619 CVS 66,284 225,919 30,000 ROSS DRESS FOR LESS 101,500 WALGREENS 26,706 MICHAELS 52,071 MICHAELS 10,000 134,400 40,751 12,100 36,000 BED BATH & BEYOND 103,423 PETSMART 86,479 FOOD 4 LESS 221,639 KOHL'S 49,770 CVS 43,595 UFC GYMS 11,910 27,200 PETCO 14,000 19,020 21,006 CVS 30,000 TJ MAXX 26,550 52,640 TRISTONE THEATRES 88,728 ROSS DRESS FOR LESS 17,800 40,635 MARSHALLS 60,114 DECHINA 1 BUFFET 134,639 AMC THEATERS 108,413 41,430 RITE AID 36,400 CVS (6) 98,064 STAPLES 45,579 CVS 31,663 MARSHALLS 46,819 CVS 57,017 COST PLUS 69,445 HOWARD'S APPLIANCES 56,477 52,610 CVS 50,000 BED BATH & BEYOND 10,625 68,159 WHOLE FOODS MARKET 19,072 GOODWILL BOUTIQUE 23,250 MICHAELS 24,133 CRUNCH 25,500 30,000 BED BATH & BEYOND 22,154 19,044 17,962 19,950 43,000 MICHAELS 30,187 TJ MAXX 28,140 SPACE AGE FEDERAL CU 41,896 DOLLAR TREE 12,000 18,405 50,690 OLD COUNTRY BUFFET 105,862 GUITAR CENTER 27,974 MICHAELS 193,676 14,301 KEY BANK 10,000 10,000 21,323 SPROUTS FARMERS MARKET 33,450 TJ MAXX 30,000 OFFICEMAX 49,788 64,532 OFFICE DEPOT 86,830 BIG Y 88,000 BEST BUY 50,000 NORDSTROM RACK 89,750 BON-TON 111,500 COSTCO 69,490 STOP & SHOP 25,267 BIG LOTS 46,669 30,048 35,834 LA FITNESS 58,604 BOB'S STORES 109,920 XPECT DISCOUNT 66,663 GLA 15,771 19,085 21,912 27,471 10,000 50,000 30,000 15,000 16,854 28,000 29,650 30,138 27,000 60,550 11,000 22,364 18,000 25,000 23,923 11,047 11,250 21,236 23,500 19,831 33,320 49,133 36,875 90,860 100.0 STOP & SHOP 105,368 165,805 100.0 BJ'S WHOLESALE CLUB 100.0 SHOPRITE 46,764 85,188 58,236 SPORTS AUTHORITY 42,456 RAYMOUR & FLANIGAN FURNITURE 36,000 60,191 100.0 AARON'S FINE FURNITURE 33,238 AARON'S FINE FURNITURE 26,953 221,137 84.0 BAER'S FURNITURE 60,000 DSW SHOE WAREHOUSE 23,990 PETCO 15,250 73,549 79,676 89.3 WINN DIXIE (6) 90.3 PUBLIX 38,614 54,376 107 LOCATION PORTFOLIO ACQUIRED YEAR DEVELOPED OR LEASABLE AREA (SQ.FT.) PERCENT LEASED (1) TENANT NAME GLA TENANT NAME GLA TENANT NAME GLA MAJOR LEASES Exhibit 99.1 103,479 ALBERTSONS 42,112 TJ MAXX 40,000 ROSS DRESS FOR LESS 51,195 25,020 JO-ANN FABRICS 25,106 YOUFIT HEALTH CLUBS BOYNTON BEACH BRADENTON BRANDON CAPE CORAL CAPE CORAL CLEARWATER CORAL SPRINGS CORAL SPRINGS CORAL WAY DELRAY BEACH EAST ORLANDO FORT LAUDERDALE HOLLYWOOD HOLLYWOOD HOMESTEAD HOMESTEAD JACKSONVILLE JACKSONVILLE JACKSONVILLE (2) JENSEN BEACH KEY LARGO LAKELAND LAKELAND LARGO LARGO LAUDERHILL LEESBURG MARGATE MELBOURNE MERRITT ISLAND MIAMI MIAMI MIAMI (5) MIAMI MIAMI MIAMI MIAMI MIAMI MIAMI MIAMI MIAMI MIDDLEBURG MIRAMAR (2) MOUNT DORA NORTH LAUDERDALE NORTH MIAMI BEACH OCALA ORANGE PARK ORLANDO ORLANDO ORLANDO ORLANDO ORLANDO OVIEDO PENSACOLA PLANTATION POMPANO BEACH SANFORD SARASOTA SARASOTA ST. PETERSBURG TALLAHASSEE TAMPA TAMPA TAMPA TAMPA WEST PALM BEACH (5) WEST PALM BEACH (5) WEST PALM BEACH WEST PALM BEACH WEST PALM BEACH WINTER HAVEN YULEE GEORGIA ALPHARETTA ATLANTA ATLANTA AUGUSTA AUGUSTA DULUTH FLOWERY BRANCH SAVANNAH KIR KIR UBS UBS OJV UBS OJV CPP OJV UBS KIR UBS OJV OJV OJV UBS UBS OTH PRU OJV KIR UBS OJV KIR OIP OJV OJV OIP KIR UBS 1999 1998 2001 2006 2006 2005 1994 1997 2003 2006 1971 2009 2002 2010 1972 1972 2006 2010 2005 1994 2000 2001 2006 1968 1992 1978 2008 1993 1968 2006 1968 1965 1986 1998 1998 2009 2006 2007 2007 2011 1995 2005 2005 1997 2007 1985 1997 2003 2000 2008 1996 2009 2011 2006 2011 1974 2012 1989 2008 1989 1968 1998 2001 1997 2004 2007 2009 1967 1997 1995 2009 1973 2003 2008 2008 2007 2001 1995 2006 2011 1993 194,924 162,997 143,785 42,030 125,108 212,388 55,089 86,342 88,205 50,906 131,981 241,076 49,543 898,538 205,614 3,600 72,840 257,020 116,000 173,292 207,365 241,196 54,434 149,472 215,916 181,576 13,468 264,037 168,737 60,103 107,000 79,273 69,380 29,166 17,117 293,001 63,563 60,280 349,826 112,423 63,604 59,218 156,000 120,430 250,209 96.8 BEALLS 82.0 PUBLIX 94.8 BED BATH & BEYOND 90.4 100.0 PUBLIX 100.0 HOME DEPOT 96.3 BIG LOTS 100.0 TJ MAXX 100.0 WINN DIXIE 97.6 PUBLIX 64.7 FLORIDA CAREER COLLEGE 95.0 REGAL CINEMAS 100.0 MICHAELS 99.2 HOME DEPOT 100.0 PUBLIX 100.0 92.3 PUBLIX 87.4 STEIN MART 76.1 HHGREGG 70.7 HOBBY LOBBY 94.3 KMART 95.3 HOBBY LOBBY 100.0 SPORTS AUTHORITY 94.5 WALMART 86.3 PUBLIX 81.9 BABIES R US 100.0 44,684 ROSS DRESS FOR LESS 100,200 JO-ANN FABRICS 33,517 29,500 ANNA'S LINENS 55,944 STAPLES 44,840 44,000 C-TOWN 52,936 LA FITNESS 25,104 HOME GOODS 142,280 B.J.'S WHOLESALE CLUB 56,077 MARSHALLS 44,840 36,000 SEARS 30,030 52,973 DOLLAR TREE 108,842 PUBLIX 53,271 STEIN MART 43,994 CHUCK E CHEESE 101,900 ALDI 42,112 AMC THEATERS 44,450 STAPLES 89.2 WINN DIXIE 82.7 GSI COMMERCE CALL CENTER 100.0 PUBLIX 100.0 HOME DEPOT 96.0 BABIES R US 95.9 PUBLIX 100.0 LEHMAN TOYOTA 100.0 LEHMAN TOYOTA 82.6 KMART 56,000 SAM ASH MUSIC 69,900 WALGREENS 44,840 105,154 40,214 FIRESTONE TIRE 31,200 WALGREENS 29,166 17,117 114,000 MARSHALLS 93.4 PUBLIX 100.0 PUBLIX 97.6 PUBLIX 96.4 WINN DIXIE 100.0 PETCO 65.7 DOLLAR TREE 40.4 24 HOUR FITNESS 97.5 KMART 92.3 HOME DEPOT 44,271 45,600 56,000 BUY BUY BABY 34,890 LITTLE VILLAGE LEARNING CENTER 22,418 PARTY CITY 10,000 36,025 100,850 110,410 CHANCELLOR ACADEMY 108,795 95.9 PUBLIX 51,420 WALGREENS 260,419 50,299 179,065 180,156 132,856 154,356 86,321 78,093 101,377 60,414 80,917 158,687 102,455 129,700 118,574 105,871 340,541 205,634 197,181 99,640 36,505 55.9 BEST BUY 100.0 BED BATH & BEYOND 95.8 KMART 80.9 24 HOUR FITNESS 100.0 ROSS DRESS FOR LESS 97.2 MARSHALLS 99.1 THE FRESH MARKET 100.0 PUBLIX 95.9 PUBLIX 100.0 WHOLE FOODS MARKET 100.0 87.9 ROSS DRESS FOR LESS 96.1 TJ MAXX 93.4 SWEETBAY 100.0 KASH N' KARRY 100.0 STEIN MART 100.0 BEST BUY 97.8 AMERICAN SIGNATURE 99.2 LOWE'S HOME CENTER 94.9 PUBLIX 87.3 FLORIDA SCHOOL FOR DANCE 30,038 SERVICE MERCHANDISE 25,978 MICHAELS 101,665 PUBLIX 49,875 TJ MAXX 43,611 BIG LOTS 30,027 OFF BROADWAY SHOES 18,400 44,270 61,389 28,320 WHOLE FOODS MARKET 30,165 ALDI 29,825 OFFICEMAX 46,295 ACE HARDWARE 45,871 TJ MAXX (6) 31,920 HOME GOODS 46,121 JO-ANN FABRICS 49,106 STAPLES 167,000 55,000 23,350 32,265 STAPLES 49,865 STAPLES 15,000 PARTY CITY 24,202 23,145 48,479 OFFICE DEPOT 24,439 119,419 KMART 29,575 OFFICEMAX 28,020 TJ MAXX 10,078 48,555 39,500 ROSS DRESS FOR LESS 10,440 20,800 30,267 OFFICE DEPOT 23,500 PARTY CITY 25,460 OFFICE DEPOT 15,525 GOODWILL INDUSTRIES 12,063 11,880 27,808 NAVARRO DISCOUNT PHARMACY 29,953 OFFICE DEPOT 10,000 10,000 46,531 15,930 PUBLIX 29,618 JO-ANN FABRICS 24,321 55,000 26,843 ORLANDO HEALTH 25,375 ALDI 24,991 GOLFSMITH GOLF CENTER 13,120 24,725 ICHIGO ICHIE SUPREME BUFFET 23,800 DOLLAR TREE 15,000 AARON'S 29,958 YOUFIT HEALTH CLUBS 24,471 45,965 BED BATH & BEYOND 27,000 ROSS DRESS FOR LESS 15,000 15,000 20,347 17,055 12,000 24,887 114,764 23,500 25,200 30,846 25,506 12,700 25,117 12,430 23,500 24,840 39,795 25,304 24,787 24,700 20,179 10,356 19,700 10,000 15,595 40,852 26,250 37,640 76.7 3,787 79,904 357,537 95,188 59,426 130,515 313,737 175,835 532,945 112,537 78,025 92,985 186,526 100.0 90.8 BABIES R US (6) 98.6 KMART 95.8 BIG LOTS 91.1 PETCO 89.8 KROGER 88.0 DAYS INN 82.7 MARSHALLS 96.9 HOBBY LOBBY 97.5 TJ MAXX 97.6 WHOLE FOODS MARKET 90.2 PUBLIX 98.7 BED BATH & BEYOND 108 40,960 123,011 WINN DIXIE 41,200 JO-ANN FABRICS 15,335 DOLLAR TREE 62,000 93,634 KROGER 36,598 OFF BROADWAY SHOE WAREHOUSE 65,864 SPORTS AUTHORITY 35,200 ROSS DRESS FOR LESS 70,125 54,340 35,005 TJ MAXX 53,291 ROSS DRESS FOR LESS 12,375 BUDDY'S HOME FURNISHINGS 10,220 28,102 10,225 56,647 PLANET FITNESS 23,500 THOMASVILLE FURNITURE 44,118 HHGREGG 30,187 RUGGED WEARHOUSE 33,067 MARSHALLS 19,838 14,348 44,000 11,920 31,000 LOCATION PORTFOLIO ACQUIRED YEAR DEVELOPED OR LEASABLE AREA (SQ.FT.) PERCENT LEASED (1) TENANT NAME GLA TENANT NAME GLA TENANT NAME MAJOR LEASES 197,957 311,093 175,396 96.0 HHGREGG 97.9 KOHL'S 100.0 LOWE'S HOME CENTER 32,026 ROSS DRESS FOR LESS 86,584 BELK 169,896 30,187 COST PLUS 58,416 HHGREGG 17,897 76.0 20,000 75.0 STEVENS-HENAGER COLLEGE 15,000 KIR OJV KIR OJV KIR UBS OJV OJV KIR KIR KIF SAVANNAH SNELLVILLE VALDOSTA HAWAII KIHEI IDAHO NAMPA ILLINOIS AURORA BATAVIA BELLEVILLE BLOOMINGTON BLOOMINGTON BRADLEY CALUMET CITY CHAMPAIGN CHAMPAIGN CHICAGO CHICAGO COUNTRYSIDE CRYSTAL LAKE DOWNERS GROVE DOWNERS GROVE DOWNERS GROVE ELGIN FAIRVIEW HEIGHTS FOREST PARK GENEVA KILDEER LAKE ZURICH MATTESON MOUNT PROSPECT MUNDELIEN NAPERVILLE NORRIDGE OAK LAWN OAKBROOK TERRACE ORLAND PARK PEORIA ROCKFORD ROLLING MEADOWS (5) ROUND LAKE BEACH SKOKIE STREAMWOOD VERNON HILLS WAUKEGAN WOODRIDGE INDIANA GREENWOOD INDIANAPOLIS SOUTH BEND SOUTH BEND IOWA CLIVE COUNCIL BLUFFS DAVENPORT DES MOINES DUBUQUE SOUTHEAST DES MOINES WATERLOO KANSAS EAST WICHITA OVERLAND PARK WICHITA KENTUCKY BELLEVUE FLORENCE LEXINGTON LOUISIANA BATON ROUGE HARVEY LAFAYETTE LAFAYETTE LAKE CHARLES SHREVEPORT SHREVEPORT MAINE BANGOR S. PORTLAND 2008 2001 2004 2006 2005 1998 2002 1998 1972 2003 1996 1997 2001 1998 1997 1997 1997 1998 1998 1999 1997 1972 1998 1997 1996 2013 2005 1997 1997 1998 1997 1997 1997 2001 1997 1997 2008 2003 2005 1997 1998 2012 2005 1998 1970 1964 2003 1998 1996 2006 1997 1999 1997 1996 1996 1996 2006 1998 1976 2004 1993 1997 2008 1997 2010 2010 2010 2010 2001 2008 Exhibit 99.1 GLA 21,000 34,000 34,624 22,192 26,040 24,123 12,618 12,000 15,726 10,000 13,500 17,375 29,368 27,619 13,000 89,138 274,282 98,860 188,250 73,705 80,535 162,174 111,720 111,985 102,011 86,894 3,500 80,624 100,000 141,578 141,702 183,239 175,699 98,371 104,688 167,477 9,029 150,045 192,547 89,692 102,327 116,914 183,893 176,263 15,535 162,442 89,047 - 27,947 58,455 81,000 192,690 5,883 146,220 168,577 165,255 271,335 81,668 90,000 234,591 91,035 148,954 82,979 111,847 100.0 CERMAK PRODUCE AURORA 98.5 KOHL'S 82.4 KMART 96.2 SCHNUCK MARKETS 100.0 JEWEL-OSCO 100.0 CARSON PIRIE SCOTT 100.0 MARSHALLS 100.0 BEST BUY 100.0 HOBBY LOBBY 100.0 BURLINGTON COAT FACTORY 100.0 KMART 100.0 100.0 HOBBY LOBBY 100.0 HOME DEPOT EXPO (6) 88.6 SHOP & SAVE MARKET 100.0 TJ MAXX 98.7 ELGIN MALL 100.0 KMART 100.0 KMART 100.0 GANDER MOUNTAIN 96.6 BED BATH & BEYOND 100.0 100.0 SPORTS AUTHORITY 100.0 KOHL'S 100.0 BURLINGTON COAT FACTORY 100.0 BURLINGTON COAT FACTORY 100.0 KMART 100.0 KMART 100.0 HOME DEPOT 100.0 83.7 KMART 98.0 BEST BUY - 89,138 86,584 HOBBY LOBBY 81,490 68,800 TOYS R US 65,028 80,535 30,557 BIG LOTS 45,350 DICK'S SPORTING GOODS 70,695 CARLE CLINIC 75,623 RAINBOW SHOPS 86,894 65,502 MONKEY JOE'S 100,000 42,610 DOLLAR TREE 54,850 BEST BUY 81,550 ELGIN FARMERS PRODUCTS 113,127 OFFICEMAX 96,871 104,688 35,000 MICHAELS 38,655 MARSHALLS 101,097 HOBBY LOBBY 87,547 100,200 116,914 140,580 CHUCK E CHEESE BIG LOTS 121,903 122,605 45,760 ROSS DRESS FOR LESS 100.0 GOODWILL INDUSTRIES 100.0 MARSHALLS 100.0 VALUE CITY 93.2 DICK'S SPORTING GOODS 100.0 21,000 30,406 OLD NAVY 81,000 54,997 PETSMART 51,214 BUY BUY BABY 46,070 BARNES & NOBLE 28,400 ROSS DRESS FOR LESS 30,247 MICHAELS 41,290 13,770 BEAUTY ONE 15,122 15,808 WALGREENS 54,400 OLD NAVY 31,358 AARON SALES & LEASE OWNERSHIP 27,932 PETCO 31,578 OLD NAVY 31,156 ROSS DRESS FOR LESS 56,596 TRUE VALUE 15,934 30,000 LOYOLA UNIV. MEDICAL CENTER 34,000 28,049 27,518 CHUCK E. CHEESE'S 14,040 94.3 HOLLYWOOD BLVD CINEMA 48,118 SHOE CARNIVAL 15,000 100.0 BABY SUPERSTORE 79.4 KROGER 87.4 BED BATH & BEYOND 100.0 MENARD 100.0 KMART 98.8 HOBBY LOBBY 100.0 KMART 83.4 BEST BUY 100.0 SHOPKO 100.0 HOME DEPOT 49,426 TOYS R US 63,468 CVS 28,000 TJ MAXX 81,668 90,000 55,000 TJ MAXX 91,035 35,280 OFFICEMAX 82,979 111,847 47,000 TJ MAXX 12,800 DOLLAR GENERAL 28,000 DSW SHOE WAREHOUSE 25,160 BED BATH & BEYOND 24,428 PETSMART 20,830 10,686 26,069 20,400 22,646 104,074 100.0 HOBBY LOBBY 65,045 TJ MAXX 29,029 SHOE CARNIVAL 10,000 96,011 120,164 133,771 53,695 99,578 223,135 349,857 174,362 244,768 29,405 134,844 93,669 78,771 100.0 DICK'S SPORTING GOODS 97.7 HOME DEPOT BEST BUY 100.0 48,933 GORDMANS 113,969 45,300 TJ MAXX 47,078 30,000 NORTHERN TOOL & EQUIPMENT 100.0 KROGER 97.8 DICK'S SPORTING GOODS 100.0 BEST BUY 45,695 60,250 CHRISTMAS TREE SHOPS 45,750 BED BATH & BEYOND 32,138 43,072 TOYS R US 93.7 BURLINGTON COAT FACTORY 96.8 BEST BUY 100.0 STEIN MART 92.1 100.0 MARSHALLS 98.3 OFFICEMAX 89.3 MICHAELS 80,450 STEIN MART 45,733 MICHAELS 37,736 HOME FURNITURE COMPANY 40,000 K&G MEN'S COMPANY 24,626 BARNES & NOBLE 36,000 TJ MAXX 30,000 ROSS DRESS FOR LESS 23,500 BARNES & NOBLE 23,885 DOLLAR TREE 29,975 BED BATH & BEYOND 23,100 OLD NAVY 12,000 18,040 41,900 32,723 23,000 32,556 20,000 15,000 86,422 98,940 100.0 BURLINGTON COAT FACTORY 89.9 DSW SHOE WAREHOUSE 86,422 25,000 DOLLAR TREE 15,450 GUITAR CENTER 12,236 109 LOCATION PORTFOLIO ACQUIRED YEAR DEVELOPED OR LEASABLE AREA (SQ.FT.) PERCENT LEASED (1) TENANT NAME GLA TENANT NAME GLA TENANT NAME GLA MAJOR LEASES Exhibit 99.1 MARYLAND BALTIMORE BALTIMORE BALTIMORE BALTIMORE BALTIMORE BALTIMORE BALTIMORE BEL AIR CLARKSVILLE CLINTON CLINTON COLUMBIA COLUMBIA COLUMBIA COLUMBIA COLUMBIA COLUMBIA (5) COLUMBIA COLUMBIA COLUMBIA DISTRICT HEIGHTS EASTON ELLICOTT CITY ELLICOTT CITY ELLICOTT CITY FREDRICK COUNTY GAITHERSBURG GAITHERSBURG HUNT VALLEY LAUREL LAUREL LINTHICUM NORTH EAST OWINGS MILLS PASADENA PERRY HALL PERRY HALL PIKESVILLE TIMONIUM TIMONIUM TOWSON TOWSON WALDORF WALDORF MASSACHUSETTS GREAT BARRINGTON HYANNIS MARLBOROUGH PITTSFIELD QUINCY SHREWSBURY STURBRIDGE MICHIGAN CANTON TWP. CLARKSTON CLAWSON CLINTON TWP. FARMINGTON KALAMAZOO LIVONIA MUSKEGON OKEMOS TAYLOR WALKER MINNESOTA ARBOR LAKES EDEN PRAIRIE MAPLE GROVE MINNETONKA ROSEVILLE MISSISSIPPI HATTIESBURG JACKSON MISSOURI CRYSTAL CITY ELLISVILLE INDEPENDENCE JOPLIN JOPLIN KANSAS CITY KIRKWOOD LEMAY SEB SEB UBS SEB KIF OIP OIP OIP SEB UBS UBS SEB UBS OIP SEB KIF UBS KIF PRU BIG SEB OJV KIF SEB KIF KIF OJV KIF OIP UBS OJV KIR KIR OJV KIR MANCHESTER KIR SPRINGFIELD SPRINGFIELD SPRINGFIELD ST. CHARLES 2007 2007 2005 2007 2004 2004 2013 2004 2007 2003 2003 2012 2006 2006 2007 2006 2002 2002 2011 2005 2010 2004 2006 2004 2007 2003 1999 2010 2008 1964 1972 2003 2007 2005 2003 2003 2004 2011 2007 2003 2004 2012 2003 2003 1994 2004 2004 2004 2005 2000 2006 2005 1996 1993 2005 1993 2002 1968 1985 2005 1993 1993 2006 2005 2001 1998 2005 2004 2002 1997 1970 1998 1998 1998 1997 1990 1974 1998 1994 2002 1998 1998 152,834 114,045 58,879 77,287 76,197 90,903 90,830 129,927 105,907 26,412 2,544 50,000 73,230 100,803 98,399 91,165 31,082 15,376 99,350 6,780 90,929 113,330 86,456 139,898 433,467 86,968 88,277 71,329 94,653 75,924 81,550 1,926 80,190 14,564 38,727 173,475 65,059 105,530 59,799 187,561 88,405 679,843 26,128 4,500 131,102 231,546 104,125 72,014 80,510 109,250 230,740 36,601 151,358 130,424 19,042 96,915 273,917 33,121 79,215 19,451 141,549 387,210 474,657 18,411 466,647 120,231 28,148 100.0 KMART 97.7 SAFEWAY 88.8 CORT FURNITURE RENTAL 100.0 WEIS MARKETS 98.8 GIANT FOOD 100.0 GIANT FOOD 89.7 GIANT FOOD 90.3 SAFEWAY 100.0 GIANT FOOD - 100.0 100.0 MICHAELS 100.0 OLD NAVY 99.2 GIANT FOOD 100.0 HARRIS TEETER 100.0 SAFEWAY 97.1 100.0 DAVID'S NATURAL MARKET 100.0 NORDSTROM RACK 100.0 92.0 GIANT FOOD 97.3 GIANT FOOD 100.0 GIANT FOOD 94.3 SAFEWAY 100.0 TARGET 96.2 GIANT FOOD 93.2 GREAT BEGINNINGS 100.0 RUGGED WEARHOUSE 91.5 GIANT FOOD 100.0 VILLAGE THRIFT STORE 100.0 100.0 100.0 FOOD LION 100.0 RITE AID 76.7 86.1 BRUNSWICK BOWLING 100.0 GIANT FOOD 89.9 GIANT FOOD 81.7 AMERICAN RADIOLOGY 91.3 GIANT FOOD 100.0 SAFEWAY 100.0 WALMART 100.0 FAIR LANES WALDORF 100.0 100.0 KMART 93.2 SHAW'S SUPERMARKET 79.8 BEST BUY 92.3 STOP & SHOP 100.0 HANNAFORD 93.6 BOB'S STORES 91.4 STOP & SHOP 100.0 ABC WAREHOUSE 73.5 NEIMAN'S FAMILY MARKET 88.5 STAPLES 100.0 GOLFSMITH 37.7 FITNESS 19 100.0 HOBBY LOBBY 89.1 CVS 65.2 PLUMB'S FOOD 100.0 DOLLAR TREE 100.0 KOHL'S 99.0 RUBLOFF DEVELOPMENT 99.3 LOWE'S HOME CENTER 65.2 DOLLAR TREE 98.6 BYERLY'S 100.0 TOYS R US 100.0 GOLFSMITH 295,848 93.4 ASHLEY FURNITURE HOMESTORE 50,000 100.0 MICHAELS 100,724 118,080 184,870 155,416 80,524 150,381 251,775 79,747 89,305 282,619 84,916 209,650 8,000 100.0 KMART 89.0 SHOP N SAVE 100.0 KMART 100.0 ASHLEY FURNITURE HOMESTORE 100.0 JOPLIN SCHOOLS 97.9 HOME DEPOT 100.0 HOBBY LOBBY 98.7 SHOP N SAVE 100.0 KOHL'S 100.0 BEST BUY 100.0 BED BATH & BEYOND 97.6 KMART 100.0 110 95,932 SALVO AUTO PARTS 54,200 RITE AID 14,856 58,187 55,108 56,892 43,136 55,032 CVS 62,943 26,706 HOME GOODS 16,000 57,994 56,905 55,164 11,627 40,750 TJ MAXX 12,000 11,868 DOLLAR TREE 10,000 10,125 DOLLAR TREE 10,000 23,294 30,600 BOOKS-A-MILLION 28,000 64,333 64,885 DOLLAR TREE 55,000 50,093 PETCO 146,773 KOHL'S 56,166 60,102 MATTRESS & FURNITURE MART 12,000 HANCOCK FABRICS 55,330 21,000 DOLLAR TREE 10,000 12,400 106,889 SAFEWAY 10,026 11,950 OLD COUNTRY BUFFET 55,164 10,000 13,253 SEAFOOD PALACE BUFFET 12,709 38,372 14,564 40,544 RITE AID 56,848 63,529 13,573 61,941 STAPLES 59,180 AAA MID-ATLANTIC 154,828 TARGET 26,128 21,250 ACE HARDWARE 18,704 15,000 11,500 CVS 132,608 WEIS MARKETS 52,486 PRICE CHOPPER 54,712 TOYS R US 45,000 DSW SHOE WAREHOUSE 61,935 55,087 RITE AID 40,982 BED BATH & BEYOND 57,769 MARSHALLS 44,667 46,932 HOME GOODS 22,362 14,247 32,767 STAPLES 30,000 CINEMAGIC THEATERS 23,000 PETCO 45,092 OFFICE DEPOT 24,000 ALDI 19,042 10,250 56,455 VALUE CITY 13,810 34,332 12,200 93,310 BABIES R US 156,366 KOHL'S 137,933 DICK'S SPORTING GOODS 12,000 55,043 BEST BUY 61,369 GOLFSMITH GOLF CENTER 18,480 13,601 19,605 CVS 16,498 RITE AID 46,549 MARSHALLS 37,459 PARTY AMERICA 104,508 STAR THEATRE 51,182 MARSHALLS 45,953 JO-ANN FABRICS 25,775 45,000 ROSS DRESS FOR LESS 30,187 BED BATH & BEYOND 23,065 25,969 MARSHALLS 24,031 100,724 80,000 131,677 THE TILE SHOP 36,412 ROSS DRESS FOR LESS 26,682 OFFICE DEPOT 29,108 OFFICEMAX 80,524 113,969 THE LEATHER COLLECTION 26,692 64,876 BURLINGTON COAT FACTORY 58,400 SPORTS AUTHORITY 56,198 DOLLAR GENERAL 89,305 58,155 JCPENNEY 30,050 MARSHALLS 122,306 OFFICE DEPOT 46,144 TJ MAXX 29,400 ROSS DRESS FOR LESS 28,000 PACE-BATTLEFIELD, LLC 10,500 24,075 23,500 35,764 31,275 25,466 26,000 10,125 55,452 24,904 18,689 29,000 10,624 14,564 34,151 10,780 74,211 33,335 45,940 LOCATION PORTFOLIO ACQUIRED YEAR DEVELOPED OR LEASABLE AREA (SQ.FT.) PERCENT LEASED (1) TENANT NAME GLA TENANT NAME GLA TENANT NAME GLA MAJOR LEASES Exhibit 99.1 ST. CHARLES ST. LOUIS ST. LOUIS ST. LOUIS ST. LOUIS ST. LOUIS ST. LOUIS ST. PETERS NEBRASKA OMAHA NEVADA HENDERSON HENDERSON LAS VEGAS LAS VEGAS LAS VEGAS LAS VEGAS LAS VEGAS RENO RENO RENO RENO RENO RENO SPARKS SPARKS NEW HAMPSHIRE MILFORD NASHUA SALEM NEW JERSEY BAYONNE BRICKTOWN BRIDGEWATER BRIDGEWATER BRIDGEWATER CHERRY HILL CHERRY HILL CHERRY HILL CHERRY HILL CINNAMINSON DELRAN DELRAN DEPTFORD EAST WINDSOR EDGEWATER HILLSBOROUGH HOLMDEL HOLMDEL HOWELL LITTLE FERRY MOORESTOWN NORTH BRUNSWICK PISCATAWAY RIDGEWOOD SEA GIRT UNION WAYNE WESTMONT NEW MEXICO ALBUQUERQUE ALBUQUERQUE ALBUQUERQUE NEW YORK AMHERST BAYSHORE BELLMORE BRIDGEHAMPTON BRONX BROOKLYN BROOKLYN BROOKLYN BROOKLYN BROOKLYN HEIGHTS BUFFALO CENTEREACH CENTEREACH COMMACK COMMACK COPIAGUE ELMONT ELMONT PRU PRU BIG BIG BIG BIG PRU UBS UBS UBS UBS KIF KIR SEB KIR KIR OJV PRU OJV OJV OJV OJV KIR OJV OJV KIR OJV 1998 1998 1972 1998 1997 1997 1997 1997 2005 1999 2006 2006 2010 2010 2010 2010 2006 2006 2006 2007 2007 2007 2007 2007 2008 2004 1994 2004 2005 1998 2001 2005 1985 1996 2007 2011 1996 2000 2005 2008 2008 2007 2005 2007 2007 2005 2008 2009 1994 1998 1994 2005 2007 2009 1994 1998 1998 1998 2009 2006 2004 2009 1990 2000 2003 2004 2004 2012 2009 1993 2006 1998 2007 1998 2004 2005 130,773 77,650 361,486 111,245 228,279 158,394 31,616 36,619 113,376 146,082 104,319 119,871 119,601 113,743 148,002 176,148 344,976 23,901 5,589 136,570 241,997 21,555 124,750 129,809 209,185 256,099 123,388 77,583 37,308 58,000 249,029 423,315 55,552 299,723 234,557 30,000 146,222 201,351 442,554 97,348 24,280 20,485 98,193 331,528 173,259 37,442 183,738 59,722 101,066 176,831 24,802 283,782 230,046 80,708 10,000 29,671 40,373 7,200 141,466 379,937 105,851 261,685 24,617 163,999 27,078 12,900 27,000 18,442 24,500 20,022 25,000 30,000 10,352 24,900 37,491 25,287 17,000 30,000 35,000 37,344 25,482 52,440 49,132 14,800 84,460 113,781 129,093 176,273 169,982 172,165 128,765 176,804 100.0 KOHL'S 100.0 KOHL'S 97.0 SHOP N SAVE 100.0 BURLINGTON COAT FACTORY 84,460 92,870 CLUB FITNESS 68,307 80,000 BIG LOTS 100.0 HOME DEPOT 100.0 KMART 100.0 KMART 100.0 HOBBY LOBBY 122,540 OFFICE DEPOT 135,504 K&G MEN'S COMPANY 128,765 57,028 SPORTS AUTHORITY 178,686 82.2 MARSHALLS 176,081 82.8 COLLEEN'S CLASSIC CONSIGNMENT 33,000 BIG LOTS 40,745 BIG LOTS 20,911 35,040 SOCIETY OF ST. VINCENT DE PAUL 27,000 NAPA AUTO PARTS 27,000 40,418 OFFICE DEPOT 28,760 OFFICEMAX 30,000 SAVERS 74.6 ALBERTSONS 93.9 ALBERTSONS 87.5 WALMART 49,100 58,050 114,513 COLLEEN'S CLASSICS CONSIGNMENT 40,728 MARSHALLS 36,800 DOLLAR TREE 40,013 OFFICEMAX 21,578 CYCLE GEAR 30,000 BARNES & NOBLE 78.6 OPPORTUNITY VILLAGE 81.7 AMC RAINBOW PROMENADE 10 86.0 SAVERS 80.0 100.0 PIER 1 IMPORTS 81.0 SCOLARI'S WAREHOUSE MARKET 81.0 BED BATH & BEYOND 90.5 RALEY'S 98.8 RALEY'S 94.1 SAFEWAY 93.3 RALEY'S 39,641 OFFICEMAX 21,050 DOLLAR DISCOUNT CENTER 17,325 10,542 50,451 35,185 WILD OATS MARKETS (6) 65,519 61,570 SHELL OIL 56,061 CVS 63,476 28,788 COST PLUS 18,665 10,000 18,990 94.9 SHAW'S SUPERMARKET 98.7 MICHAELS 100.0 KOHL'S 71,000 RITE AID 24,300 MODELL'S 91,282 SHAW'S SUPERMARKET 17,050 21,319 TRADER JOE'S 51,507 BOB'S STORES 13,800 43,905 102,302 HAR SUPERMARKETS 135,198 SPORTS AUTHORITY 134,202 BURLINGTON COAT FACTORY 80,542 MARSHALLS 38,000 42,173 23,901 136,570 40,415 MARSHALLS 21,555 62,532 RETROFITNESS 96,629 PLANET FITNESS 86,770 SPORTS AUTHORITY 71,676 ROSS DRESS FOR LESS 85,440 HIBACHI GRILL & SUPREME BUFFET 20,443 OFFICE DEPOT (6) 15,000 25,300 126,200 GENUARDI'S (6) 113,156 PATHMARK 56,021 MARSHALLS 37,500 BEST BUY 30,000 54,100 24,280 16,285 60,000 BEST BUY 147,350 LACKLAND STORAGE 48,142 SUPER FITNESS 21,336 27,883 ROSS DRESS FOR LESS 24,184 101,066 45,499 TOYS R US 24,802 89,935 KING KULLEN 58,860 FOOD BAZAAR 58,200 WALGREENS 10,000 10,300 15,638 CAREMORE 84,000 PETSMART 151,067 BIG LOTS 63,459 ACE HARDWARE 63,296 KING KULLEN 14,137 112,000 LA FITNESS (6) 14,028 12,900 39,562 BABIES R US 37,355 10,366 22,320 40,000 BABIES R US 30,076 JO-ANN FABRICS 19,412 ACME MARKETS (6) 20,006 52,869 TJ MAXX 63,966 TJ MAXX 48,833 LA FITNESS 30,109 MICHAELS 30,225 67,766 SPORTS AUTHORITY 15,000 JO-ANN FABRICS 26,250 HANCOCK FABRICS 12,000 43,123 HARBOR FREIGHT TOOLS 61,892 TJ MAXX 51,680 UNITED STATES OF AMERICA 11,050 20,965 33,800 10,330 13,424 PC RICHARD & SON 11,311 20,165 CITI TRENDS 33,600 MODELL'S 25,000 60,216 SPORTS AUTHORITY 11,186 20,315 42,970 35,492 100.0 DOLLAR TREE 100.0 100.0 COSTCO 100.0 BED BATH & BEYOND 100.0 CREME DE LA CREME 80.3 STOP & SHOP (6) 100.0 KOHL'S 93.8 KOHL'S 80.1 SHOPRITE 100.0 SPEED RACEWAY 100.0 PETSMART 76.3 DOLLAR TREE 43.6 GENERAL CINEMA 100.0 TARGET 98.4 TARGET - 87.1 A&P 100.0 BEST MARKET 100.0 BEST BUY 98.7 VALUE FAIR S.C. LLC 88.1 LOWE'S HOME CENTER 100.0 WALMART 93.3 SHOPRITE 100.0 WHOLE FOODS MARKET 100.0 STAPLES 100.0 WHOLE FOODS MARKET 88.5 COSTCO 93.6 SUPER FRESH 100.0 PETSMART 78.0 MOVIES WEST 60.1 PAGE ONE BOOKS 100.0 TOPS SUPERMARKET 96.3 BEST BUY 100.0 RITE AID 99.4 KMART 80.6 NATIONAL AMUSEMENTS 100.0 HOME DEPOT 100.0 RITE AID 100.0 DUANE READE 100.0 DUANE READE 100.0 97.9 TOPS SUPERMARKET 97.5 WALMART 95.1 PATHMARK 100.0 BABIES R US 100.0 DEAL$ 100.0 HOME DEPOT 100.0 DUANE READE 100.0 CVS 111 LOCATION PORTFOLIO ACQUIRED YEAR DEVELOPED OR LEASABLE AREA (SQ.FT.) PERCENT LEASED (1) TENANT NAME GLA TENANT NAME GLA TENANT NAME MAJOR LEASES Exhibit 99.1 UBS KIR KIR KIR UBS KIR OJV KIR KIR KIR BIG KIR KIR KIR SEB SEB OIP KIR KIR KIR KIR OJV KIR FARMINGDALE FLUSHING FRANKLIN SQUARE FREEPORT FREEPORT GLEN COVE HAMPTON BAYS HARRIMAN HICKSVILLE HUNTINGTON STATION JERICHO JERICHO JERICHO JERICHO KEW GARDENS HILLS LATHAM LEVITTOWN LITTLE NECK LONG ISLAND CITY MANHASSET MASPETH MERRICK MIDDLETOWN MINEOLA MUNSEY PARK NESCONSET NORTH MASSAPEQUA PLAINVIEW POUGHKEEPSIE SELDEN (5) STATEN ISLAND STATEN ISLAND STATEN ISLAND STATEN ISLAND STATEN ISLAND STATEN ISLAND SYOSSET VALLEY STREAM WHITE PLAINS WOODSIDE YONKERS YONKERS NORTH CAROLINA ASHEVILLE CARY CARY CARY CHARLOTTE CHARLOTTE CHARLOTTE CHARLOTTE CORNELIUS DAVIDSON DURHAM DURHAM GREENSBORO KNIGHTDALE KNIGHTDALE MOORESVILLE MORRISVILLE PINEVILLE RALEIGH RALEIGH RALEIGH RALEIGH WINSTON-SALEM OHIO BEAVERCREEK CINCINNATI CINCINNATI COLUMBUS COLUMBUS COLUMBUS DAYTON HUBER HEIGHTS KENT NORTH OLMSTED SHARONVILLE SPRINGDALE OKLAHOMA OKLAHOMA CITY OKLAHOMA CITY 2006 2007 2004 2000 2000 2000 1989 2007 2004 2011 2007 2007 2007 2007 2012 1999 2006 2003 2012 1999 2004 2000 2000 2007 2000 2009 2004 1969 1972 2011 2000 1989 1997 2005 2006 2005 1967 2012 2004 2012 1995 2005 2012 2001 2000 1998 1968 1986 2012 2012 2011 2012 2002 1996 2011 2011 2011 2007 2008 2003 1993 2006 2003 2011 1969 1986 2000 2005 2002 1988 1998 1984 1999 1988 1988 1977 2000 1997 1998 437,105 22,416 17,789 13,905 173,031 49,059 70,990 227,939 35,581 52,950 63,998 57,013 2,085 105,851 10,790 617,810 47,199 48,275 6,065 180,678 22,500 108,296 80,000 26,747 72,748 55,968 29,610 88,222 167,668 227,457 198,430 268,466 100,977 100,641 356,267 47,270 32,124 27,924 22,220 7,500 43,560 10,329 153,820 315,797 86,015 102,787 110,300 233,812 73,230 136,685 77,600 79,084 408,292 116,186 215,193 184,244 136,955 165,798 169,901 270,494 362,945 9,800 97,103 136,203 132,190 142,547 409,960 10,900 269,201 129,008 98.4 HOME DEPOT 100.0 FRUIT VALLEY PRODUCE 100.0 PETCO 100.0 WALGREENS 100.0 STOP & SHOP 90.9 STAPLES 100.0 MACY'S 85.8 KOHL'S 100.0 DUANE READE 100.0 BEST MARKET 96.2 WHOLE FOODS MARKET 94.7 W.R. GRACE 100.0 100.0 MILLERIDGE INN 100.0 98.8 SAM'S CLUB 100.0 SPORTS AUTHORITY 100.0 100.0 100.0 MARSHALLS 100.0 DUANE READE 100.0 WALDBAUMS 100.0 BEST BUY 100.0 NORTH SHORE FARMS 100.0 BED BATH & BEYOND 100.0 PETSMART 83.8 DUANE READE 100.0 FAIRWAY STORES 96.6 STOP & SHOP 89.5 HOME DEPOT 100.0 STOP & SHOP 99.8 TARGET 100.0 LA FITNESS 100.0 KOHL'S 95.9 KMART 100.0 STAPLES 91.1 NEW YORK SPORTS CLUB 100.0 KEY FOOD 100.0 DUANE READE 100.0 100.0 SHOPRITE 100.0 ADVANCE AUTO PARTS 100.0 TJ MAXX 96.8 BJ'S WHOLESALE CLUB 100.0 BED BATH & BEYOND 87.6 LOWES FOOD 100.0 BURLINGTON COAT FACTORY 74.6 ROSS DRESS FOR LESS 100.0 HARRIS TEETER 86.2 HOME DEPOT 92.3 HARRIS TEETER 97.1 HARRIS TEETER 99.0 WALMART 92.1 TJ MAXX 98.0 KOHL'S 100.0 ROSS DRESS FOR LESS 98.9 DICK'S SPORTING GOODS 96.1 BEST BUY 97.3 CARMIKE CINEMAS 97.5 KMART 90.4 GOLFSMITH GOLF & TENNIS 100.0 80.4 FOOD LION 99.0 OFFICE DEPOT 93.2 HARRIS TEETER 98.4 KROGER 99.6 WALMART 100.0 EDDIE MERLOT'S 96.8 LOWE'S HOME CENTER 100.0 KOHL'S 116,790 DAVE & BUSTER'S 60,000 SUNRISE CREDIT SERVICES 15,200 11,857 13,905 46,753 TOYS R US 24,880 ANNIE SEZ 50,000 PETCO 86,584 STAPLES 18,300 DOLLAR TREE RITE AID 30,700 36,504 33,600 105,851 37,328 MARSHALLS 13,360 11,890 24,106 MICHAELS 10,481 11,010 134,900 WALMART 30,164 DSW SHOE WAREHOUSE 116,097 HOME DEPOT 115,436 17,035 40,114 KING KULLEN 22,500 44,478 HOME GOODS 45,000 CHRISTMAS TREE SHOPS 10,000 41,393 WHOLE FOODS MARKET 28,916 BOB'S DISCOUNT FURNITURE 17,943 37,570 NORDSTROM RACK 24,836 ANNIE SEZ 35,000 20,000 27,052 55,162 69,449 BIG LOTS 102,220 KING KULLEN 55,380 TJ MAXX 147,295 PATHMARK 33,180 100,641 103,823 PATHMARK 47,270 16,664 27,924 14,450 43,560 10,329 45,189 ROSS DRESS FOR LESS 108,532 KOHL'S 43,015 DICK'S SPORTING GOODS 48,214 BRIDAL BOUTIQUE 48,000 TJ MAXX 32,003 K&G MEN'S COMPANY 50,627 85,600 CORT FURNITURE RENTAL 57,260 48,000 149,929 BEST BUY 31,303 JO-ANN FABRICS 87,110 HARRIS TEETER 30,144 BED BATH & BEYOND 45,000 BEST BUY 30,000 BED BATH & BEYOND 60,124 FOOD LION 105,015 STEIN MART 59,719 BED BATH & BEYOND 38,273 ACE HARDWARE 22,391 02 FITNESS 60,279 DOLLAR TREE 122,697 180,879 HOBBY LOBBY 10,900 131,644 KROGER 99,408 GRANT/RIVERSIDE METHODIST HOSP PATEL BROTHERS INDIAN GROCERS 32,640 DOLLAR TREE 52,250 34,798 MICHAELS 48,377 OLD NAVY 59,809 TOYS R US 28,223 HHGREGG 86,584 PETSMART 43,000 12,000 31,954 CVS 31,577 SPORTS & FITNESS 27,700 45,000 BUY BUY BABY 16,051 HIBACHI GRILL & SUPREME BUFFET 47,452 RITE AID 22,941 MICHAELS 30,000 TJ MAXX 28,000 STAPLES 36,427 STEIN MART 36,000 TJ MAXX 35,335 ROSS DRESS FOR LESS 16,593 20,006 ACE HARDWARE 14,849 78,314 24,400 11,060 50,545 CARDINAL FITNESS 80,731 MARSHALLS 30,975 UNITED ART AND EDUCATION 31,968 GUITAR CENTER 58,835 DICK'S SPORTING GOODS 33,160 GLA 34,821 27,540 24,008 34,257 15,038 11,100 17,573 15,000 42,025 26,488 26,040 10,722 24,928 31,999 11,200 11,606 21,545 26,297 20,388 36,000 30,000 30,187 12,000 14,862 29,500 19,467 15,750 45,753 112,862 70.3 PIER 1 IMPORTS 12,015 206,031 318,327 106,500 99,862 121,105 84.6 VICTORIA'S SECRET 99.2 ELDER BEERMAN 97.2 TOPS SUPERMARKET (6) 100.0 TOPS SUPERMARKET GABRIEL BROTHERS 99.1 94,350 KROGER 101,840 KOHL'S 103,500 99,862 55,103 KROGER 252,110 81.0 WALMART (6) 125,469 HHGREGG 103,027 233,797 100.0 ACADEMY SPORTS & OUTDOORS 100.0 HOME DEPOT 97,527 102,962 GORDMANS 50,000 BEST BUY 112 LOCATION PORTFOLIO ACQUIRED YEAR DEVELOPED OR LEASABLE AREA (SQ.FT.) PERCENT LEASED (1) TENANT NAME GLA TENANT NAME GLA TENANT NAME GLA MAJOR LEASES Exhibit 99.1 OREGON ALBANY CANBY CLACKAMAS GRESHAM GRESHAM GRESHAM HILLSBORO HILLSBORO MEDFORD MILWAUKIE PORTLAND SPRINGFIELD PENNSYLVANIA ARDMORE BLUE BELL BROOKHAVEN CARLISLE CHAMBERSBURG SPRINGFIELD CHAMBERSBURG CHIPPEWA DEVON EAGLEVILLE EAST NORRITON EAST STROUDSBURG EASTWICK EXTON EXTON EXTON FEASTERVILLE GETTYSBURG GREENSBURG HAMBURG HARRISBURG HAVERTOWN HORSHAM MONROEVILLE MONTGOMERY MORRISVILLE NEW KENSINGTON PHILADELPHIA (5) PHILADELPHIA (5) PHILADELPHIA PHILADELPHIA PHILADELPHIA PHILADELPHIA PHILADELPHIA PITTSBURGH PITTSBURGH QUAKERTOWN RICHBORO SCOTT TOWNSHIP SHREWSBURY SPRINGFIELD UPPER DARBY WEST MIFFLIN WHITEHALL WHITEHALL YORK PUERTO RICO BAYAMON CAGUAS CAROLINA MANATI MAYAGUEZ PONCE TRUJILLO ALTO RHODE ISLAND CRANSTON PROVIDENCE SOUTH CAROLINA CHARLESTON CHARLESTON FLORENCE GREENVILLE GREENVILLE GREENVILLE GREENVILLE TENNESSEE CHATTANOOGA MADISON MEMPHIS MEMPHIS NASHVILLE NASHVILLE OJV PRU PRU BIG PRU PRU PRU UBS OJV UBS UBS KIR OJV OJV OJV OJV OIP CPP OIP OJV OJV KIR 2006 2009 2007 2006 2009 2009 2010 2008 2009 2007 2006 2009 2007 1996 2005 2005 2008 2009 2006 2000 2012 2008 1984 1973 1997 1999 1996 2005 1996 1986 2002 2000 1972 1996 2005 2005 2002 1996 1986 1983 1998 1995 1996 2005 2005 2006 2010 2007 2011 1986 1999 2004 1983 1996 1986 2005 1996 1986 2006 2006 2006 2006 2006 2006 2006 1998 2003 1978 1995 1997 1997 2009 2010 2012 1973 1978 2001 1998 1998 1998 22,700 115,701 236,672 264,765 208,276 107,583 260,954 210,941 335,043 185,760 115,673 96,027 320,383 120,211 6,300 90,289 131,623 96,027 273,104 215,206 68,935 82,636 131,794 168,218 36,511 60,685 85,184 3,600 87,160 14,584 50,000 15,400 175,917 80,938 71,737 143,200 257,565 2,437 108,950 51,010 20,841 332,583 82,345 19,137 9,343 292,878 148,661 166,687 266,085 107,432 69,288 94,706 165,296 28,102 84,279 151,418 84,524 35,500 186,434 599,123 570,610 69,640 354,830 191,680 199,513 100.0 GROCERY OUTLET 93.1 SAFEWAY 98.6 SPORTS AUTHORITY 84.8 MADRONA WATUMULL (6) 90.1 MARSHALLS 100.0 WALMART 97.1 SAFEWAY 94.9 SAFEWAY 82.0 SEARS 98.4 ALBERTSONS 86.3 SAFEWAY 93.0 SAFEWAY 89.0 MACY'S 100.0 KOHL'S 100.0 95.0 GIANT FOOD 90.4 GIANT FOOD 93.0 SAFEWAY 100.0 KOHL'S 100.0 KMART 100.0 WHOLE FOODS MARKET 24.9 DOLLAR TREE 98.6 SHOPRITE KMART 80.8 100.0 MERCY HOSPITAL 100.0 ACME MARKETS 100.0 KOHL'S 100.0 100.0 IMPACT THRIFT STORE 100.0 RITE AID 100.0 TJ MAXX 100.0 LEHIGH VALLEY HEALTH 81.8 GANDER MOUNTAIN 100.0 KOHL'S 100.0 GIANT FOOD 96.3 PETSMART 98.8 GIANT FOOD - 97.8 GIANT EAGLE TOYS R US 100.0 - 97.2 TARGET 100.0 KOHL'S 100.0 CVS 100.0 98.3 SEARS 86.2 WHOLE FOODS MARKET 98.1 HHGREGG 96.3 BJ'S WHOLESALE CLUB 100.0 SUPER FRESH 100.0 WALMART 100.0 GIANT FOOD 94.1 GIANT FOOD 100.0 PRISM CAREER INSTITUTE 100.0 BIG LOTS 86.0 GIANT FOOD 100.0 KOHL'S 100.0 GIANT FOOD 98.4 AMIGO SUPERMARKET 99.2 SAM'S CLUB 95.7 KMART 52.2 100.0 HOME DEPOT 96.6 2000 CINEMA CORP. 100.0 KMART 189,554 186,740 113,922 148,532 297,928 118,736 51,672 50,588 175,593 40,000 167,243 111,460 172,078 96.4 HARRIS TEETER 83.3 TJ MAXX 95.8 HAMRICKS 59.7 BABIES R US 97.2 INGLES MARKETS 100.0 ACADEMY SPORTS & OUTDOORS 79.0 THE FRESH MARKET 65.8 SAVE-A-LOT 99.5 OLD TIME POTTERY 100.0 BED BATH & BEYOND 66.8 TOYS R US (6) 90.3 TREES N TRENDS 79.6 HHGREGG 113 22,700 46,293 RITE AID (6) 45,121 NORDSTROM RACK 55,120 ROSS DRESS FOR LESS 27,500 OFFICE DEPOT 60,000 CASCADE ATHLETIC CLUB 46,114 STAPLES 53,000 RITE AID 77,347 TINSELTOWN 42,630 RITE AID 48,000 DOLLAR TREE 47,019 99,725 BANANA REPUBLIC 93,444 HOME GOODS 71,441 67,521 WINE & SPIRITS SHOPPE 47,019 88,782 GIANT FOOD 107,806 HOME DEPOT 33,504 WINE & SPIRITS SHOPPE 10,263 66,506 RETRO FITNESS 102,763 33,000 60,685 85,184 66,485 STAPLES 14,584 26,775 MICHAELS 15,400 83,777 AMERICAN SIGNATURE 80,938 48,820 29,650 BED BATH & BEYOND 67,179 BED BATH & BEYOND 27,465 CANBY ACE HARDWARE 27,766 OLD NAVY 26,832 PETSMART 26,706 BIG LOTS 21,633 24,500 RITE AID 27,465 DSW SHOE WAREHOUSE 57,273 THE MEDFORD CLUB 31,472 JO-ANN FABRICS 11,660 14,785 20,400 21,600 25,000 23,714 19,949 34,749 13,775 10,180 26,767 11,309 68,000 MICHAELS 21,479 107,400 10,394 18,025 JO-ANN FABRICS 12,250 20,675 23,225 48,884 OLD COUNTRY BUFFET 11,200 25,312 MICHAELS 32,037 HHGREGG 23,629 28,892 101,750 33,000 HIBACHI GRILL & SUPREME BUFFET 12,700 137,000 PATHMARK 66,703 PEP BOYS 20,800 82,345 12,900 237,151 33,233 RITE AID 31,296 TJ MAXX 85,188 BEST BUY 55,537 69,288 54,785 66,825 STAPLES 23,294 84,279 48,800 JO-ANN FABRICS 84,524 30,500 35,588 OFFICEMAX 138,622 COSTCO 118,242 HOME DEPOT 15,000 30,000 STAPLES 30,720 PETSMART 23,884 20,245 26,535 EMPIRE BEAUTY SCHOOL 11,472 31,000 PARTY CITY 10,000 18,100 CHUCK E CHEESE 134,881 JCPENNEY 109,800 ECONO RIAL 109,800 SAM'S CLUB 60,000 SUPERMERCADOS MAXIMO 80,100 PUEBLO SUPERMARKET 100,408 CARIBBEAN CINEMA 35,651 PETSMART 26,869 ANNA'S LINENS 28,000 TONI & GUY HAIRDRESSING ACAD 37,000 PETCO 29,096 BARNES & NOBLE 20,000 HIBACHI GRILL & SUPREME BUFFET 52,334 STEIN MART 31,220 OFFICE DEPOT 40,704 PLANET FITNESS 35,621 65,000 THE RUSH FITNESS COMPLEX 89,510 TRADER JOE'S 35,000 TJ MAXX 12,836 13,600 98,348 56,372 45,126 13,279 11,895 12,020 15,314 25,389 17,568 30,300 20,550 25,168 99,400 WALMART 40,000 46,000 KIDS R US (6) 26,000 OAK FACTORY OUTLET 40,075 BED BATH & BEYOND 39,687 15,312 FAMILY DOLLAR 23,500 OLD COUNTRY BUFFET 25,715 DOLLAR GENERAL 14,976 10,161 15,361 125,747 96.4 BOB'S STORES 41,114 MARSHALLS 71,735 92.3 STOP & SHOP (6) 55,985 LOCATION PORTFOLIO ACQUIRED YEAR DEVELOPED OR LEASABLE AREA (SQ.FT.) PERCENT LEASED (1) TENANT NAME GLA TENANT NAME GLA TENANT NAME GLA MAJOR LEASES Exhibit 99.1 TEXAS ALLEN AMARILLO AMARILLO ARLINGTON AUSTIN AUSTIN AUSTIN AUSTIN AUSTIN AUSTIN AUSTIN AUSTIN AUSTIN BAYTOWN BEAUMONT BROWNSVILLE BURLESON COLLEYVILLE COPPELL CORPUS CHRISTI CORPUS CHRISTI DALLAS DALLAS EAST PLANO EL PASO FORT WORTH FRISCO GEORGETOWN GRAND PRAIRIE HARRIS COUNTY HOUSTON HOUSTON HOUSTON HOUSTON HOUSTON LAKE JACKSON LEWISVILLE LEWISVILLE LEWISVILLE LUBBOCK MESQUITE MESQUITE N. BRAUNFELS NORTH CONROE PASADENA PASADENA PLANO RICHARDSON SOUTHLAKE SUGARLAND TEMPLE WEBSTER UTAH OGDEN VERMONT MANCHESTER VIRGINIA ALEXANDRIA BURKE COLONIAL HEIGHTS DUMFRIES FAIRFAX FAIRFAX FAIRFAX FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG OJV KIR KIR OJV OJV OJV OJV OJV KIR OJV PRU OJV OJV KIR PRU OJV OJV OJV UBS OIP UBS OIP KIR KIR KIR UBS KIF OIP KIR PRU OIP OIP OIP OIP OIP OIP OIP OIP OIP OIP OIP OIP OIP OIP OIP OIP OIP OIP OIP 2006 1997 2003 1997 2011 2011 2011 2011 2011 1998 1998 2003 2007 1996 2005 2005 2011 2006 2006 1997 2011 1998 2007 1996 2010 2012 2006 2011 2006 2005 2004 2005 2006 2006 1996 2012 1998 1998 1998 1998 1974 2006 2003 2006 1999 2001 2011 1998 2008 2012 2005 2006 1967 2004 2005 2004 1999 2005 1998 2007 2007 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 21,162 343,875 142,647 96,127 54,651 88,829 40,000 131,039 207,614 191,760 157,852 108,028 213,768 105,133 9,600 225,959 280,430 20,188 20,425 99,154 60,175 83,867 171,143 100,598 637,272 291,222 230,710 114,598 214,164 144,055 113,831 42,015 237,634 350,836 96,500 34,969 74,837 123,560 93,668 108,326 79,550 209,766 86,479 289,322 169,190 240,881 149,343 115,579 37,447 96,623 262,799 365,086 100.0 CREME DE LA CREME 89.5 HOME DEPOT 96.2 ROSS DRESS FOR LESS 100.0 HOBBY LOBBY 100.0 CONN'S 100.0 BARNES & NOBLE 100.0 DAVE & BUSTER'S 90.3 24 HOUR FITNESS 95.8 ACADEMY SPORTS & OUTDOORS 78.1 BABIES R US 90.1 HEB GROCERY 100.0 FRY'S ELECTRONICS 99.3 BED BATH & BEYOND 100.0 HOBBY LOBBY 84.0 97.8 BURLINGTON COAT FACTORY 99.6 KOHL'S 100.0 CREME DE LA CREME 100.0 CREME DE LA CREME 100.0 BEST BUY 92.4 BED BATH & BEYOND 100.0 ROSS DRESS FOR LESS 93.4 CVS 100.0 HOME DEPOT EXPO (6) 98.0 LOWE'S HOME CENTER 94.6 MARSHALLS 90.3 HOBBY LOBBY / MARDELS 87.8 DOLLAR TREE 89.6 24 HOUR FITNESS 100.0 BEST BUY 77.8 DD'S DISCOUNTS 92.9 MICHAELS 98.5 TJ MAXX 97.0 MARSHALLS 100.0 BURLINGTON COAT FACTORY 91.0 58.5 TALBOTS OUTLET BABIES R US 97.6 67.9 DSW SHOE WAREHOUSE 95.4 PETSMART 96.2 KROGER 86.8 BURLINGTON COAT FACTORY 100.0 KOHL'S 99.4 ASHLEY FURNITURE HOMESTORE 100.0 PETSMART 100.0 BEST BUY 100.0 HOME DEPOT 54.1 OFFICEMAX 82.9 95.7 KROGER 91.6 HOBBY LOBBY 97.6 HOBBY LOBBY 21,162 109,800 KOHL'S 30,187 BED BATH & BEYOND 96,127 26,650 24,685 PETCO 40,000 29,678 GATTILAND 61,452 PACIFIC RESOURCES ASSOCIATES 55,000 BED BATH & BEYOND 64,310 BROKERS NATIONAL LIFE 108,028 42,098 BUY BUY BABY 63,328 ROSS DRESS FOR LESS 80,274 TJ MAXX 86,584 ROSS DRESS FOR LESS 20,188 20,425 47,616 ROSS DRESS FOR LESS 26,300 MICHAELS 28,160 OFFICEMAX 16,799 VITAMIN COTTAGE NATURAL FOOD 94,680 PETSMART 30,000 JO-ANN FABRICS 12,350 23,345 DOLLAR TREE GOLD'S GYM 46,690 44,846 WORLD MARKET 20,337 28,730 ROSS DRESS FOR LESS 30,108 28,460 MICHAELS 30,187 TJ MAXX 34,000 SHOE CARNIVAL 24,800 23,500 BIG LOTS 11,110 ULTA 3 97,798 179,421 KOHL'S 38,032 ROSS DRESS FOR LESS 81,392 HEMISPHERES 13,250 CVS 30,000 ROSS DRESS FOR LESS 45,614 HOME GOODS 27,865 PALAIS ROYAL 21,970 32,000 ROSS DRESS FOR LESS 30,382 BED BATH & BEYOND 96,500 12,000 $6 FASHION OUTLETS BED BATH & BEYOND 42,420 20,000 CHARMING CHARLIE 25,448 OFFICEMAX 51,000 75,953 ASHLEY FURNITURE HOMESTORE 86,479 48,000 TJ MAXX 26,027 OFFICEMAX 36,896 ROSS DRESS FOR LESS 149,343 30,676 FOX & HOUND 64,842 56,125 ROSS DRESS FOR LESS 100,086 BEL FURNITURE 86,800 ROSS DRESS FOR LESS 30,079 OFFICE DEPOT 50,000 SPROUTS FARMERS MARKET 10,080 29,931 MARSHALLS 31,620 BARNES & NOBLE 24,500 30,187 BED BATH & BEYOND 26,535 OFFICEMAX 10,150 34,030 BROYHILL HOME COLLECTIONS 12,600 23,500 CITY OF LUBBOCK 52,984 HANCOCK FABRICS 32,000 ROSS DRESS FOR LESS 23,500 MICHAELS 30,187 MARSHALLS 20,000 25,416 30,000 14,326 30,000 19,089 26,250 21,447 28,000 17,538 18,007 10,800 33,419 20,000 26,043 28,000 25,001 30,049 23,500 19,865 18,000 15,000 30,183 22,491 30,000 30,187 MARSHALLS 58,842 BED BATH & BEYOND 28,000 53,829 142,628 100.0 COSTCO 54,322 76.7 PRICE CHOPPERS 142,628 15,686 28,800 53,495 CVS 39,903 BOOKS-A-MILLION 139,658 HOME DEPOT 40,000 TJ MAXX 12,380 21,006 126,290 SPORTS AUTHORITY 44,209 27,888 10,578 33,179 10,125 10,125 10,125 32,000 10,002 28,800 124,148 60,909 1,702 343,099 101,332 52,946 10,578 5,020 3,000 33,179 7,000 10,125 10,125 7,200 7,993 10,125 4,842 32,000 2,454 3,650 4,261 3,000 10,002 8,000 5,126 100.0 THE ROOF CENTER 100.0 SAFEWAY 100.0 ASHLEY HOME STORES 100.0 100.0 COSTCO 100.0 WALGREENS 87.1 100.0 CHUCK E CHEESE 100.0 100.0 100.0 HHGREGG 100.0 100.0 CVS 100.0 CVS 100.0 100.0 100.0 SHONEY'S 100.0 100.0 BASSETT FURNITURE 100.0 100.0 100.0 100.0 100.0 CRACKER BARREL 100.0 100.0 114 LOCATION PORTFOLIO ACQUIRED YEAR DEVELOPED OR LEASABLE AREA (SQ.FT.) PERCENT LEASED (1) TENANT NAME GLA TENANT NAME GLA TENANT NAME GLA MAJOR LEASES Exhibit 99.1 FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG FREDERICKSBURG HARRISONBURG LEESBURG MANASSAS PENTAGON CITY RICHMOND RICHMOND RICHMOND ROANOKE ROANOKE STAFFORD STAFFORD STAFFORD STAFFORD STAFFORD STERLING STERLING WOODBRIDGE WOODBRIDGE WASHINGTON AUBURN BELLEVUE BELLINGHAM BELLINGHAM FEDERAL WAY KENT KENT LAKE STEVENS MILL CREEK OLYMPIA OLYMPIA OLYMPIA SEATTLE SILVERDALE SILVERDALE SPOKANE TACOMA TUKWILA WEST VIRGINIA CHARLES TOWN CANADA ALBERTA BRENTWOOD CALGARY CALGARY CALGARY CALGARY EDMONTON EDMONTON EDMONTON GRANDE PRAIRIE HINTON BRITISH COLUMBIA 100 MILE HOUSE ABBOTSFORD ABBOTSFORD CHILLIWACK GIBSONS KAMLOOPS LANGLEY LANGLEY LANGLEY MISSION NORTH VANCOUVER PORT ALBERNI PRINCE GEORGE OIP OIP OIP OIP OIP OIP OIP OIP OIP OIP OIP OIP OIP OIP OIP OIP OIP OIP OIP SEB PRU UBS CPP OIP SEB OIP UBS OIP OIP OIP UBS OJV KIR OJV KIR PRU KIR PRU BIG OIP BIG PRU PRU PRU UBS PRU KIR UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2007 2007 2005 2010 1999 1995 2005 2007 2004 2005 2005 2005 2005 2005 2008 2006 1973 1998 2007 2004 1998 2007 2000 2006 2010 2012 2010 2010 2006 2012 2006 2012 2006 2005 2006 2003 1985 2002 2002 2002 2005 2005 2002 2007 2012 2002 2005 2005 2002 2001 2011 2005 2005 2003 2002 2005 2001 2005 2005 2001 6,818 4,800 2,909 6,000 11,097 7,200 8,027 6,100 5,540 7,241 3,076 5,892 7,256 4,828 3,822 3,028 4,352 2,170 1,762 190,484 319,886 107,233 331,229 84,683 128,612 3,060 299,536 81,789 101,042 331,280 4,211 4,400 7,310 361,050 799,442 186,079 11,097 100.0 100.0 100.0 100.0 100.0 NTB TIRES 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 96.0 KOHL'S 94.9 SHOPPERS FOOD 94.7 BURLINGTON COAT FACTORY 95.8 COSTCO 100.0 ROOMS TO GO 100.0 BURLINGTON COAT FACTORY 100.0 91.6 MICHAELS 100.0 DICK'S SPORTING GOODS 100.0 GIANT FOOD 100.0 SHOPPERS FOOD 100.0 100.0 100.0 97.1 TOYS R US 100.0 WALMART 79.2 REGENCY FURNITURE 88,248 MARTIN'S 63,168 BIG LOTS 69,960 AUTOZONE 169,452 MARSHALLS 84,683 121,550 40,002 MARSHALLS 47,700 HHGREGG 61,500 STAPLES 67,995 TJ MAXX 45,210 MICHAELS 209,613 LOWE'S HOME CENTER THE SALVATION ARMY 73,882 496,303 99.6 SHOPPERS FOOD 63,971 DICK'S SPORTING GOODS 73,396 36,958 STEIN MART 10,852 42,142 BEST BUY 35,134 ROSS DRESS FOR LESS 34,089 23,942 PETCO 30,545 ROSS DRESS FOR LESS 35,333 HHGREGG 135,197 SAM'S CLUB 17,070 WEDGEWOOD ANTIQUES & AUCTION 57,437 LA FITNESS 173,746 94.4 ALBERTSONS (6) 51,696 OFFICE DEPOT 23,070 RITE AID 510,050 188,885 376,023 200,126 86,909 67,468 195,474 96,671 167,117 69,212 6,243 86,060 170,406 67,287 129,785 134,839 458,752 94.3 TARGET 98.6 MACY'S 92.1 KMART 88.1 QFC 85.8 ROSS DRESS FOR LESS 86.7 RITE AID 92.6 SAFEWAY 88.4 SAFEWAY 81.8 ALBERTSONS 100.0 BARNES & NOBLE 100.0 92.4 SAFEWAY 100.0 SAFEWAY 82.2 ROSS DRESS FOR LESS 100.0 BED BATH & BEYOND 100.0 TJ MAXX 93.9 MACY'S 101,495 WALMART 40,000 BEST BUY 103,950 COSTCUTTER SUPERMARKET 55,069 JO-ANN FABRICS 27,200 23,380 61,000 SPORTS AUTHORITY 55,275 54,736 ROSS DRESS FOR LESS 20,779 PETCO 39,556 BARTELL DRUGS 55,003 JO-ANN FABRICS 29,020 36,692 ROSS DRESS FOR LESS 25,160 DESTINY CITY CHURCH 48,670 BEST BUY 76,207 NORDSTROM RACK 30,000 BED BATH & BEYOND 67,070 JO-ANN FABRICS 43,506 BARNES & NOBLE 45,364 BARTELL DRUGS 21,287 16,459 TRADER JOE'S 13,327 29,903 RITE AID 25,000 RITE AID 23,228 OFFICE DEPOT 45,884 SPORTS AUTHORITY 208,888 100.0 WALMART 144,298 STAPLES 15,642 269,909 305,808 163,015 122,842 127,777 430,368 236,575 143,948 63,413 137,571 69,145 219,701 188,262 87,730 117,203 128,478 228,245 151,802 34,832 271,462 36,041 34,518 372,724 100.0 SEARS WHOLE HOME 100.0 WINNERS 100.0 TARGET (ZELLERS) 97.4 WINNERS APPAREL 99.0 BEST BUY 100.0 THE BRICK 93.1 T&T SUPERMARKET (LOBLAWS) 89.8 SOBEYS 100.0 MICHAELS 98.3 WAL-MART CANADA 46,043 BED BATH & BEYOND 34,740 SPORT CHEK 122,616 34,227 HOMESENSE 36,726 HOMESENSE 45,803 HOME OUTFITTERS 47,496 LONDON DRUGS 34,606 24,180 WINNERS 60,346 CANADA SAFEWAY 31,420 DOLLAR TREE 115,407 WINNERS 55,724 GOODLIFE FITNESS 59,648 26,422 SUPER VALU 45,500 JYSK 34,175 MICHAELS 34,983 HOMESENSE 37,809 LONDON DRUGS 33,265 BUSINESS DEPOT (STAPLES) 28,600 DOLLAR TREE 26,792 PETSMART 40,539 LONDON DRUGS 36,115 BED, BATH & BEYOND 23,505 JYSK LINEN 29,586 13,164 51,982 PETSMART 25,359 STAPLES 23,420 CHEVRON 18,500 23,754 FUTURE SHOP 24,986 CHAPTERS 60,679 FAMOUS PLAYERS 57,802 LONDON DRUGS 22,834 111,500 SAVE ON FOODS 44,602 LONDON DRUGS 32,428 96.3 SAVE-ON-FOODS 99.4 TARGET 99.4 SAFEWAY 88.5 PRICESMART FOODS 97.0 LONDON DRUGS 99.1 WINNERS/HOMESENSE 100.0 WINNERS 95.5 SEARS 93.5 97.6 SAVE ON FOODS 100.0 100.0 BUY-LOW FOODS 92.6 THE BAY 115 36,900 36,532 29,826 12,000 30,179 33,000 135,193 16,700 47,328 21,875 41,258 28,000 28,000 24,987 17,622 12,593 23,470 23,293 22,880 40,000 25,250 25,914 10,913 16,602 32,787 24,989 15,728 22,583 24,688 16,694 23,559 23,782 31,743 LOCATION PORTFOLIO ACQUIRED YEAR DEVELOPED OR LEASABLE AREA (SQ.FT.) PERCENT LEASED (1) TENANT NAME GLA TENANT NAME GLA TENANT NAME GLA MAJOR LEASES Exhibit 99.1 PRINCE GEORGE PRINCE GEORGE SURREY SURREY SURREY VICTORIA TRAIL WESTBANK NOVA SCOTIA DARTMOUTH HALIFAX ONTARIO BELLEVILLE BROCKVILLE BURLINGTON CHATHAM FERGUS HAWKESBURY HAWKESBURY LONDON MISSISSAUGA MISSISSAUGA NEWMARKET NEWMARKET OTTAWA OTTAWA OTTAWA OTTAWA OTTAWA OTTAWA SUDBURY SUDBURY TORONTO TORONTO TORONTO TORONTO WHITBY WHITBY PRINCE EDWARD ISLAND CHARLOTTETOWN QUEBEC BOISBRIAND CHATEAUGUAY GATINEAU GREENFIELD PARK LAVAL LONGUEUIL BRAZIL RIO CLARO VALINHOS CHILE QUILICURA SANTIAGO SANTIAGO SANTIAGO SANTIAGO SANTIAGO SANTIAGO SANTIAGO SANTIAGO SANTIAGO (3) VINA DEL MAR (2) MEXICO BAJA CALIFORNIA MEXICALI MEXICALI ROSARITO TIJUANA TIJUANA TIJUANA CAMPECHE CIUDAD DEL CARMEN CHIAPAS TAPACHULA CHIHUAHUA JUAREZ JUAREZ COAHUILA CIUDAD ACUNA SABINAS SALTILLO SALTILLO PLAZA UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV 2005 2008 2002 2001 2005 2002 2005 2005 2008 2008 2008 2010 2002 2008 2008 2008 2008 2008 2004 2003 2002 2003 2002 2008 2002 2002 2004 2012 2002 2004 2002 2002 2002 2002 2002 2002 2002 2006 2002 2008 2002 2008 2002 2008 2008 2008 2008 2007 2008 2008 2007 2007 2008 2007 2008 2008 2006 2006 2007 2005 2007 2007 2007 2007 2003 2006 2007 2007 2005 2002 81,833 69,820 337,957 170,727 113,677 472,900 172,383 111,763 182,317 137,990 71,985 274,626 69,857 71,423 105,955 54,950 17,032 90,048 213,051 118,637 267,504 160,195 287,797 127,270 125,969 88,749 82,883 109,283 250,208 152,175 385,191 325,798 171,159 133,035 391,261 158,852 100.0 SAVE ON FOODS 94.9 BRICK WAREHOUSE 97.8 HOME DEPOT 96.1 SAFEWAY 89.1 SAFEWAY STORE 99.6 TARGET 89.8 ZELLERS 96.9 SAVE-ON-FOODS 39,068 SHOPPERS DRUG MART 29,808 103,879 CINEPLEX ODEON 52,174 LONDON DRUGS 55,159 NEW HOLLYWOOD THEATRE 120,684 SAFEWAY 66,740 NO FRILLS 38,874 SHOPPERS DRUG MART 97.3 SOBEYS 100.0 WALMART 75,694 SHOPPERS DRUG MART 132,192 15,898 52,000 WINNERS 27,894 11,806 55,720 FAMOUS PLAYERS 41,409 16,679 HOME HARDWARE 17,400 DOLLARAMA 30,927 55,568 10,035 12,818 20,000 SHOPPERS DRUG MART 18,040 89.6 METRO 81.4 SEARS 95.9 PRICE CHOPPER 100.0 FOOD BASICS 100.0 TARGET 76.3 PRICE CHOPPER (6) 100.0 PHARMAPRIX TALIZE 100.0 99.3 CANADIAN TIRE 100.0 WINNERS 100.0 WALMART (CANADA) 100.0 BED BATH & BEYOND 88.3 WAL MART 45,485 88,898 GALAXY 28,848 36,484 DOLLAR TREE 95,978 29,950 BINGO HALL 17,032 34,073 SHOPPERS DRUG MART 60,872 METRO 27,308 STAPLES (BUSINESS DEPOT) 67,604 METRO 27,937 MICHAELS 116,649 METRO 100.0 METRO 100.0 TARGET 100.0 WINNERS 96.3 FOOD BASICS 82.5 YOUR INDEPENDENT GROCER 100.0 SEARS 100.0 FAMOUS PLAYERS 97.2 CANADIAN TIRE 100.0 TARGET 98.1 WINNERS 40,265 BEST BUY 86,121 METRO 29,609 BOUCLAIR 35,134 MARK'S WORK WEARHOUSE 49,018 PHARMA PLUS 43,000 WINNERS 58,099 STAPLES (BUSINESS DEPOT) 114,577 NO FRILLS 134,845 METRO 31,896 MARK'S WORK WEARHOUSE (6) 100.0 CANADIAN TIRE 100.0 SEARS WHOLE HOME 98.1 PRICE CHOPPER 56,297 FUTURE SHOP 60,444 HOME OUTFITTERS 33,441 VALUE VILLAGE 10,500 12,000 18,163 HURON HOUSE RESTAURANT 53,768 SHOPPERS DRUG MART 20,038 SHOPPERS DRUG MART 49,112 SHOPPERS DRUG MART 21,563 PETSMART 42,108 CANADIAN NTL INSTITUTE OF HEALTH 37,076 HOMESENSE 27,170 14,644 DOLLARAMA 11,439 10,648 32,447 HOMESENSE 27,391 CHAPTERS 51,965 I.C.U. THEATERS 53,008 STAPLES (BUSINESS DEPOT) 13,984 SEARS APPLIANCE & MATTRESS 38,310 PETSMART 42,632 WINNERS 24,803 SHOPPERS DRUG MART 391,038 99.0 TARGET 107,806 WEST ROYALTY FITNESS 60,157 LOBLAWS 686,870 210,555 286,507 375,971 116,147 221,251 48,349 148,585 7,707 83,001 65,719 33,144 27,697 27,099 13,595 9,045 6,652 26,868 269,965 385,671 121,254 483,644 597,628 495,783 178,173 94.5 TARGET 92.5 SUPER C 100.0 WALMART 96.7 CINEMA MEGA-PLEX TASJEREAU 18 100.0 TARGET 85.2 GUZZO CINEMA 100.0 WALMART 86.3 RUSSI GROCERY 114,753 THE BRICK 48,198 LES AILES DE LA MODE 125,719 CANADIAN TIRE 91,000 H&C 116,147 47,732 IGA 48,000 45,208 93.7 99.4 SAITEC S.A. 98.2 CENCOSUD SUPERMERCADOS SA 38,757 BODY LINE 21,467 100.0 CENCOSUD S.A. 93.3 RENDIC HERMANOS S.A. 24,757 21,474 45,860 TOYS R US 20,296 DOLLARAMA 88,640 SUPER C 70,069 MAXI 31,848 VALUE VILLAGE 14,078 100.0 88.9 84.8 100.0 100.0 94.9 LIDER 81,688 SODIMAC 25,000 97.7 WALMART 98.4 CINEPOLIS 89.7 HOME DEPOT 95.7 WALMART 83.6 WALMART 89.0 COMERCIAL MEXICANA 106,441 CINEPOLIS 46,208 PETER PIPER PIZZA 95,183 CINEPOLIS 96,678 CINEMEX 124,343 CINEPOLIS 78,752 COPPEL 46,801 VIPS 12,912 OFFICE DEPOT 40,135 WALMART 55,142 SAM'S 40,097 HOME DEPOT 16,142 SERVICIO EL TRIÁNGULO 309,722 91.9 CHEDRAUI GROCERY 79,646 CINEMEX 38,951 SPORT BOOK Y YAK 10,029 13,989 16,339 23,306 15,293 14,900 28,604 10,558 23,665 24,532 16,774 25,500 11,589 23,767 35,094 23,782 35,513 41,352 10,679 52,300 44,732 23,747 20,945 17,582 109,403 96,180 95,334 11,836 19,486 347,546 96.2 WALMART 123,674 CINEPOLIS 41,469 CASINO MAGIC O CENTRAL 21,838 236,681 175,107 31,699 10,147 435,546 175,406 90.5 SORIANA 82.1 WALMART 100.0 COPPEL 100.0 WALDO'S 95.9 HEB 97.7 HEB 150,532 ELEKTRA 109,386 14,279 10,147 96,678 HOME DEPOT 81,002 CINEMARK 10,760 116,216 CINEPOLIS 23,919 55,517 116 LOCATION PORTFOLIO ACQUIRED YEAR DEVELOPED OR DURANGO DURANGO HIDALGO PACHUCA PACHUCA JALISCO GUADALAJARA GUADALAJARA (3) GUADALAJARA LAGOS DE MORENO PUERTO VALLARTA MEXICO HUEHUETOCA OJO DE AUGUA TECAMAC MEXICO CITY INTERLOMAS IXTAPALUCA TLALNEPANTLA MORELOS CUAUTLA NAYARIT NUEVO VALLARTA (2) NUEVO LEON ESCOBEDO MONTERREY MONTERREY MONTERREY OAXACA TUXTEPEC TUXTEPEC QUINTANA ROO CANCUN CANCUN (3) SONORA HERMOSILLO (3) LOS MOCHIS SAN JUAN SAN JUAN DEL RIO TAMAULIPAS ALTAMIRA MATAMOROS MATAMOROS MATAMOROS MATAMOROS NUEVO LAREDO NUEVO LAREDO NUEVO LAREDO REYNOSA REYNOSA REYNOSA RIO BRAVO RIO BRAVO (3) TAMPICO VERACRUZ MINATITLAN PERU LIMA (2) LIMA UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV UJV CJV 2007 2005 2005 2005 2006 2005 2007 2006 2004 2008 2006 2007 2007 2005 2006 2007 2006 2002 2006 2008 2005 2007 2007 2008 2008 2007 2006 2007 2007 2007 2007 2007 2007 2007 2006 2004 2007 2007 2007 2008 2007 2007 2012 2008 LEASABLE AREA (SQ.FT.) PERCENT LEASED (1) 11,911 100.0 TENANT NAME GLA TENANT NAME GLA TENANT NAME GLA MAJOR LEASES Exhibit 99.1 153,801 184,548 129,705 719,847 636,074 15,645 87,689 172,859 230,315 182,925 245,439 13,702 398,911 90.8 HOME DEPOT 90.0 WALMART 94.0 WALMART 64.3 WALMART 87.3 WALMART 100.0 99.1 SORIANA 95.1 WALMART 86.8 CHEDRAUI GROCERY 82.1 WALMART 118,360 OFFICE MAX 71,339 COPPEL 68,993 FAMSA 129,163 CINEPOLIS 130,457 CINEPOLIS 75,159 67,627 FAMSA 123,452 CINEMEX 67,321 FAMSA 96.3 COMERCIAL MEXICANA 29,324 CINEMEX 100.0 96.9 WALMART 121,639 CINEPOLIS 479,390 82.1 WALMART 124,810 CINEMEX 19,357 13,719 FAMSA 15,912 52,479 BEST BUY 57,060 SUBURBIA 25,848 POCKET 33,227 15,111 ELEKTRA 51,408 ZARA 63,060 SUBURBIA 45,590 SAM´S 267,339 80.8 WALMART 124,318 CINEPOLIS 27,108 348,388 273,484 381,077 141,428 96,913 138,971 286,816 254,697 75.6 HEB 98.7 HEB 78.7 HEB 77.3 HEB 96.5 WALMART 67.2 CINEMEX 78.8 SUBURBIA 84.5 CHEDRAUI GROCERY 385,580 77.9 SEARS 96,045 CINEMEX 98,142 CINEMEX 109,967 CINEMEX 69,449 63,164 30,128 SAMS 53,572 CINEPOLIS 127,596 CINEMEX 71,662 CINEPOLIS 140,963 80.8 WALMART 88,654 32,639 SUBURBIA 46,440 COPPEL 44,152 PLAY CITY 69,739 47,909 SANBORNS 31,492 52,078 CASINO CENTRAL O CASINO MAGICO 20,293 153,008 91.5 WALMART 78,038 CINEPOLIS 18,148 BANCO AHORA FAMSA 13,455 24,479 153,774 17,872 10,900 10,835 10,760 8,565 433,874 374,541 93,602 9,684 9,673 184,642 16,162 100.0 FAMSA 98.1 CINEPOLIS 100.0 WALDOS 100.0 WALDOS - WALDOS 100.0 WALDOS 100.0 88.8 WALMART 96.8 HEB 100.0 WALMART 100.0 100.0 61.0 HEB 61.6 19,847 100.0 WALDOS 36,979 13,312 77.1 ECONOMAX 100.0 10,276 40,296 SORIANA 11,782 10,900 10,835 10,760 110,225 HOME DEPOT 79,839 HOME DEPOT 70,586 39,554 OFFICE DEPOT 18,141 93,036 CINEPOLIS 95,118 CINEMEX 49,132 73,168 69,265 FAMSA 16,086 10,717 24,100 16,184 61,840 56,029 10,545 11,427 17,599 54,363 98,740 54,238 14,865 26,321 18,652 TOTAL 896 SHOPPING CENTER PROPERTY INTERESTS (4) 131,314,860 (1) (2) (3) (4) (5) (6) BIG CPP KIF KIR OIP OJV PRU SEB UBS UJV Percent leased information as of December 31, 2012. Denotes ground-up development project. This includes properties that are currently under construction and completed projects awaiting stabilization. The square footage shown represents the completed leaseable area and future development. Denotes operating property not yet in occupancy. Does not include 829 properties, primarily through the Company’s preferred equity investments, other real estate investments and non-retail properties, totaling approximately 26.6 million square feet of GLA. Denotes projects which exclude GLA of units being held for redevelopment Tenant is dark and paying Denotes property interest in BIG Shopping Centers. Denotes property interest in Canada Pension Plan. Denotes property interest in Kimco Income Fund. Denotes property interest in Kimco Income REIT. Denotes property interest in Other Institutional Programs. Denotes property interest in Other US Joint Ventures. Denotes property interest in Prudential Investment Program. Denotes property interest in SEB Immobilien. Denotes property interest in UBS Programs. Denotes property interest in Unconsolidated Joint Venture. 117 This page intentionally left blank. 118 Shareholder Information Kimco Realty Corporation and Subsidiaries Counsel Latham & Watkins LLP New York, NY Auditors PricewaterhouseCoopers LLP New York, NY Registrar and Transfer Agent Wells Fargo Bank, N.A. Shareowner Services P.O. Box 64874 St. Paul, MN 55164-0854 1-866-557-8695 Website: www.shareowneronline.com Offices Executive Offices 3333 New Hyde Park Road New Hyde Park, NY 11042 516-869-9000 www.kimcorealty.com Stock Listings NYSE—Symbols KIM, KIMprH, KIMprI KIMprJ, KIMprK On May 3, 2012 the Company’s Chief Executive Officer submitted to the New York Stock Exchange the annual certification required by Section 303A.12(a) of the NYSE Company Manual. In addition, the Company has filed with the Securities and Exchange Commission as exhibits to its Form 10-K for the fiscal year ended December 31, 2012, the certifications, required pursuant to Section 302 of the Sarbanes-Oxley Act, of its Chief Executive Officer and Chief Financial Officer relating to the quality of its public disclosure. Investor Relations A copy of the Company’s Annual Report to the U.S. Securities and Exchange Commission on Form 10-K may be obtained at no cost to stockholders by writing to: David F. Bujnicki Vice President, Investor Relations & Corporate Communications Kimco Realty Corporation 3333 New Hyde Park Road New Hyde Park, NY 11042 1-866-831-4297 E-mail: ir@kimcorealty.com Annual Meeting of Stockholders Stockholders of Kimco Realty Corporation are cordially invited to attend the Annual Meeting of Stockholders scheduled to be held at 10:00am on April 30th, at 277 Park Avenue, 2nd Floor, New York, NY. Regional Offices Mesa, AZ 480-461-0050 Daly City, CA 650-301-3000 Granite Bay, CA 916-791-0600 Irvine, CA 949-252-3880 Los Angeles, CA 310-284-6000 Vista, CA 760-727-1002 Hollywood, FL 954-923-8444 Sanford, FL 407-302-4400 Rosemont, IL 847-294-6400 Timonium, MD 410-684-2000 Charlotte, NC 704-367-0131 Raleigh, NC 919-791-3650 119 Annual Report to Stockholders Our Annual Report on Form 10-K filed with the Securities and Exchange Commission (SEC) is included in our mailing to stockholders and together with this 2012 Annual Report forms our annual report to stockholders within the meaning of SEC rules. Dividend Reinvestment and Common Stock Purchase Plan The Company’s Dividend Reinvestment and Common Stock Purchase Plan provides common and preferred stockholders with an opportunity to conveniently and economically acquire Kimco common stock. Stockholders may have their dividends automatically directed to our transfer agent to purchase common shares without paying any brokerage com- missions. Requests for booklets describing the Plan, enrollment forms and any corre- spondence or questions regarding the Plan should be directed to: Wells Fargo Bank, N.A. Shareowner Services P.O. Box 64874 St. Paul, MN 55164-0854 1-866-557-8695 Holders of Record Holders of record of the Company’s common stock, par value $.01 per share, totaled 2,794 as of March 1, 2013. Las Vegas, NV 702-258-4330 New York, NY 212-972-7456 Dayton, OH 937-434-5421 Portland, OR 503-574-3329 Ardmore, PA 610-896-7560 Dallas, TX 214-720-0559 Houston, TX 832-242-6913 San Antonio, TX 210-566-7610 Bellevue, WA 425-373-3500 Canada Toronto, Ontario 416-593-6358 Mexico Mexico City, CP 011 52 55 4162 5700 Corporate Directory Board of Directors R E A L T Y Milton Cooper Executive Chairman Kimco Realty Corporation Philip E. Coviello (1)(2)(3) Partner * Latham & Watkins LLP Richard G. Dooley (1)(2)(3v) Lead Independent Director Executive Vice President & Chief Investment Officer * Massachusetts Mutual Life Insurance Company Joe Grills (1)(2v)(3) Chief Investment Officer * IBM Retirement Fund David B. Henry Vice Chairman, President & Chief Executive Officer Kimco Realty Corporation F. Patrick Hughes (1v)(2)(3) President Hughes & Associates LLC Frank Lourenso Executive Vice President JPMorgan Chase & Co. Colombe M. Nicholas (2)(3) Consultant Financo Global Consulting Richard Saltzman (2)(3) President Colony Capital LLC * Retired (1) Audit Committee (2) Executive Compensation Committee (3) Nominating and Corporate Governance Committee v Chairman R E A L T Y Executive Management Milton Cooper Executive Chairman Corporate Management David F. Bujnicki Vice President, Investor Relations & Corporate Communications David B. Henry Vice Chairman, President & Chief Executive Officer Michael V. Pappagallo Executive Vice President & Chief Operating Officer Glenn G. Cohen Executive Vice President, Chief Financial Officer & Treasurer Adam M. Cohen Vice President, Tax Raymond Edwards Vice President, Retailer Services Fredrick Kurz Vice President & General Manager, Risk Management Leah Landro Vice President, Human Resources Scott G. Onufrey Senior Vice President, Acquisitions & Investment Management Bruce Rubenstein Senior Vice President, General Counsel & Secretary Thomas R. Taddeo Vice President, Chief Information Officer Paul Westbrook Vice President, Chief Accounting Officer U.S. Regional Management Conor Flynn President, Western Region Robert Nadler President, Central Region Paul D. Puma President, Florida/Southeast Region Wilbur “Tom” Simmons III President, Mid-Atlantic/Northeast Region International Management Michael Melson Managing Director, Latin America Kelly Smith Managing Director, Canada L ETT ER FROM THE C HAIRMAN 2 2012 O PERAT ING REVIEW FORM 10-K 14 21 SHA REHOLDER INFORMATION 119 A BOUT THE COMPA Ny Kimco Realty Corporation (NYSE: KIM) is a real estate investment trust (REIT) headquartered in New Hyde Park, N.Y., that owns and operates North America’s largest portfolio of neighborhood and community shopping centers. As of December 31, 2012, the company owned interests in 896 shopping centers comprising 131 million square feet of leasable space across 44 U.S. states, CORPORAT E DIRECTORy IBC Puerto Rico, Canada, Mexico and South America. 247947_KIM_Cvr_R3.indd 2 3/12/13 11:28 PM K i m c o R e a l t y • 2 0 1 2 A n n u a l R e p o r t R E A L T Y 3333 New Hyde Park Road New Hyde Park, NY 11042 Tel: 516-869-9000 blog.kimcorealty.com / kimcorealty.com R E A L T Y R E A L T Y 20 12 A nnua l R epo r t 247947KIM_Cvr_R1.indd 1 R E A L T Y 3/12/13 1:42 PM 

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