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2004 ICSC Investor/Analyst Seminar May 24, 2004

2004 ICSC Investor/Analyst Seminar May 24, 2004. Retail Centers. Comp Tenant Sales $439 psf. Occupancy 93%. Retail Centers NOI Growth. 2004 growth from comparable properties 2.5% - 3%. 2004 growth from the total retail segment 8%. Retail Centers Net Operating Income. Millions.

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2004 ICSC Investor/Analyst Seminar May 24, 2004

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  1. 2004 ICSC Investor/Analyst Seminar May 24, 2004

  2. Retail Centers Comp Tenant Sales $439 psf Occupancy 93%

  3. Retail Centers NOI Growth 2004 growth from comparable properties 2.5% - 3% 2004 growth from the total retail segment 8%

  4. Retail Centers Net Operating Income Millions

  5. Rouse Regional CentersKey Performance Measures Regional Centers 1 2004 AverageOccupancy % 2004 NetOperating Income 2004 Sales per Square Foot 2 Center Ranking A+ or A B C $ 489 $ 357 $ 286 94 % 94 % 91 % 73 % 24 % 3 % 1 Excludes urban centers, projects with less than two anchors, and centers open less than two years 2 Comparable tenants, excluding spaces >10,000 s.f.

  6. Retail Centers Base Rent Growth New Rents in 2000: New Rents in 2004, YTD: $40.00 psf $50.86 psf 27% Growth 6% on compound basis

  7. San Antonio Shops at La Cantera San Antonio, Texas

  8. Shops at La Cantera Neiman Marcus Nordstrom Future Expansion Site Foley’s Dillard’s

  9. Retail Centers

  10. Community Development Summerlin

  11. Community Development Columbia

  12. Community Development The Woodlands

  13. Bridgelands

  14. Community Development NOI Millions $123.9 $125 $86.2 $78.0 $69.9 $51.6 $49.2 $48.0 $0 1997 1998 1999 2000 2001 2002 2003

  15. Community Development Pricing Growth Columbia, Maryland Average price per acre in 1998: Average price per acre in 2003: $349,000 $739,000 112% Growth 16% on compound basis

  16. Community Development Pricing Growth Summerlin, Nevada Average price per acre in 1998: Average price per acre in 2003: $155,000 $484,000 212% Growth 26% on compound basis

  17. Community Development Pricing Growth Fairwood, Maryland Average price per acre in 2002: Average price per acre in 2003: $294,000 $405,000 38% Growth

  18. The Woodlands

  19. Bridgelands

  20. 2004 ICSC Investor/Analyst Seminar May 24, 2004

  21. Reconciliation of cash from operations available for reinvestment, net proceeds from capital transactions and net capital redeployments to Statement of Cash Flows Millions Net cash provided by operating activities Expenditures for the acquisition of Bridgelands included in land acquisition expenditures Expenditures for improvements to existing properties Dividends paid Cash from operations available for reinvestment Proceeds from capital transactions Proceeds from the disposition of properties to PREIT, Kravco and other properties Proceeds from the disposition of interests in properties Expenditures for acquisition of Christiana netted with proceeds from dispositions Proceeds from the exercise of stock options Net proceeds from the issuance and repayment of debt, excluding construction loan draws Net other investing and other financing activities Net proceeds from capital transactions Capital redeployments Total expenditures for acquisitions of interests in properties and other assets Expenditures for acquisitions of interests in properties and other assets Expenditures for acquisition of Christiana netted with proceeds from dispositions Purchase of Parent Company-obligated mandatorily redeemable preferred securities Repurchases of common stock Expenditures for the acquisition of Bridgelands included in land acquisition expenditures Equity in development Expenditures for properties in development Expenditures for investments in unconsolidated real estate ventures in development Proceeds from borrowings on construction loans Net capital redeployments Net change in cash 356 40 (397) (40) (168) (27) 98 Year ended 12/31/2003 $ 376 22 (71) (162) 165 396 110 95 (4) 597 (437) (57) (72) (22) (97) (685) $ 77

  22. Payout Ratio Affords Substantial Flexibility For the year ended December 31, 2003 Millions Net cash provided by operating activities Acquisition of Bridgelands (included in land acquisition expenditures) Improvements to existing properties Dividends paid Common 150 Preferred 12 Cash from operations available for reinvestment $ 376 22 (71) (162) $ 165

  23. Cash from Operations Supplemented byCapital Raising/Recycling For the year ended December 31, 2003 Millions Cash from operations available for reinvestment Proceeds from the disposition of properties to PREIT, Kravco and other properties Proceeds from exercise of stock options Net borrowings (note 1) Other, net Net proceeds from capital transactions Total capital transactions and cash from operations $ 165 396 110 95 (4) $ 597 $ 762 Note 1 Net proceeds from the issuance and repayment of debt, excluding construction loan draws.

  24. How Did We Spend It ? For the year ended December 31, 2003 Millions Net capital redeployed Acquisitions of interests in properties and other assets Acquisitions of Christiana/Staten Island/ Mizner Park / Other Acquisition of interest in Woodlands 9.25% QUIPS (preferred securities) retired Repurchase of shares --- Hughes participation Bridgelands acquisition Equity in development (note 1) $ 437 57 72 22 97 253 184 Net capital redeployments $ 685 Note 1 Includes expenditures for properties in development and investments in joint ventures in development, net of construction loan draws.

  25. For the year ended December 31, 2003 Millions Cash from operations available for reinvestment Net proceeds from capital transactions Net capital redeployments $ 165 $ 597 $ 762 $ 685 $77

  26. Other Provisions, Impairment Losses & Net Gains on Dispositions / 2002, 2003 and 1st Q 2004 January 2002 - March 2004 Provisions Gains onDispositions Millions Pension curtailment & settlement losses Organizational changes / early retirements Losses (gains) on early extinguishment of debt Impairment provisions Total $ 30 22 (8) 61 $ 105 $ 228 $ 228 * * * $75 million included in earnings from continuing operations, primarily dispositions of interests in Christiana Mall and Franklin Park, and $153 million included in discontinued operations.

  27. Pension Curtailment /Settlement Losses • $30 million through March 31, 2004 • $35 million estimate for the remainder of 2004 • Acceleration of expense recognition that would otherwise be recognized under GAAP over the remaining average years of service of pension beneficiaries. No more pension plan, no more service years. Everything gets recognized currently, regardless of when cash was invested. • During 2004, quarterly expense recognition is tied to the pace at which people retire or leave -- but the impact to annual guidance remains at $0.35/share. What do the charges represent ?

  28. What does this mean for shareholders going forward? • Meaningful future cash savings without additional current investment. Millions Contributed • Eliminates reporting complexity - cash and earnings diverge in pension accounting.

  29. Organization Changes /Early Retirements January 1, 2002 –December 31, 2004 January 1, 2002 - March 31, 2004 Millions SAVINGS Provision for personnel changes (Includes $11 M for retirements of two Vice Chairmen & CFO) $ 22 $22* *Assumes 1/1/02 internal cost structure grows at CAGR of 4% and includes 2004 projected internal costs/savings.

  30. Impairment Provisions 2002, 2003 and 1st Q 2004 Millions Merchant Wired Impairments - Operating properties Echelon Westdale Other Total $ 12 39 7 3 $ 61 • Non-recourse financing protected shareholders • Relieved of mortgage debt exceeding market value

  31. $ 4 1 (36) 19 4 $ (8) Losses (Gains) on Early Extinguishment of Debt: $8 Million Net Benefit Millions 2002, 2003 and 1st Q 2004 Loss / (Gain) Redeemed $137 million of 9.25% preferred – • Annualized savings of $12.9 million • Approximately $700,000 in expense savings in 2005 Refinanced $240 million Fashion Show construction loan - • Saving 130 bp vs prior mortgage debt • Mortgage debt replaced with unsecured debt Echelon - Net gain on non-recourse debt relief Property dispositions - PREIT, Inglewood, other Other Net gains

  32. Columbia Land Sales vs. 30 Year Fixed Rate Mortgage Columbia Land Sales (Millions) 30 Year Fixed Rate Mortgage *Revenue figures include builder participation

  33. Building Permits vs. 30 Year Fixed Rate Mortgage Building Permits (000’s) Interest Rate

  34. Urbanization Columbia Town Center

  35. Urbanization Woodlands Town Center

  36. Urbanization

  37. Columbia Town Center

  38. Columbia Town Center

  39. Columbia Town Center • Retention of parking fields • Utilization of shared parking • Strategic utilization of ground leases • Ongoing ownership of operating properties

  40. Columbia Town Center

  41. Summerlin

  42. Summerlin

  43. The Woodlands

  44. Woodbridge Center Beachwood Place

  45. Oakbrook Center Willowbrook Mall

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