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CBL & Associates Properties Reports Third Quarter 2012 Results

  CBL & Associates Properties Reports Third Quarter 2012 Results

Business Wire

CHATTANOOGA, Tenn. -- November 06, 2012

CBL & Associates Properties, Inc. (NYSE:CBL):

  *FFO per diluted share increased 12.5% to $0.54 for the third quarter 2012,
    compared with $0.48 for the prior-year period.
  *Same-store sales increased 4.2% to $344 per square foot for mall tenants
    10,000 square feet or less for stabilized malls for the rolling twelve
    months ended September30,2012.
  *Same-center NOI, excluding lease termination fees, increased 1.2% in the
    third quarter 2012, over the prior-year period.
  *Portfolio occupancy at September 30, 2012, increased 170 basis points to
    93.0%, from 91.3% for the prior-year period.
  *Average gross rent for stabilized mall leases signed in the third quarter
    2012 increased 9.2% over the prior gross rent per square foot.
  *Increasing the aggregate capacity of two major credit facilities to $1.2
    billion and converting the facilities to unsecured.

CBL & Associates Properties, Inc. (NYSE:CBL) announced results for the third
quarter ended September 30, 2012. A description of each non-GAAP financial
measure and the related reconciliation to the comparable GAAP measure is
located at the end of this news release.

                            Three Months Ended        Nine Months Ended
                               September 30,               September 30,
                               2012         2011         2012       2011
                                                                        ^(1)
       Funds from
       Operations              $0.54        $0.48        $1.55      $1.45
       (“FFO”) per
       diluted share
       
       FFO for the nine-months ended September 30, 2011, excludes the gain on
^(1)   extinguishment of debt of $0.17 per share recorded in the first quarter
       2011.
       

“Strong performance from our portfolio of market dominant malls led to another
solid quarter of NOI and FFO growth as well as year-over-year improvement in
sales, occupancy and rental spreads,” said Stephen Lebovitz, CBL’s president
and chief executive officer. “The positive trends we’ve experienced throughout
the year show continued retailer demand for space at our properties. We are
taking advantage of the improved trends through an active pipeline of new
growth opportunities which most recently yielded the grand opening of
Waynesville Commons (Waynesville, NC) in October and the second phase of The
Outlet Shoppes at Oklahoma City in November. The redevelopments of Southpark
Mall (Richmond, VA) and Northgate Mall (Chattanooga, TN) and the construction
start of The Crossings at Marshalls Creek (Stroudsburg, PA), will provide a
solid foundation for growth in 2013.”

“We are also pleased with the enhancements to our capital structure realized
through the successful Series E preferred offering, the Series C preferred
redemption and the completion of all our 2012 mortgage maturities. In
addition, today we announced the extension, upsizing and conversion of our
secured credit facilities into new unsecured lines of credit with aggregate
capacity of $1.2 billion at a reduced interest rate, improving our financial
flexibility and positioning CBL to pursue additional opportunities to enhance
our portfolio’s growth profile.”

FFO allocable to common shareholders for the third quarter of 2012 was
$84,957,000, or $0.54 per diluted share, compared with $70,987,000, or $0.48
per diluted share, for the third quarter of 2011. FFO of the operating
partnership for the third quarter of 2012 was $101,652,000, compared with
$91,091,000, for the third quarter 2011.

Third quarter 2012 included a $21,654,000 loss on impairment of real estate
from continuing operations and an $8,466,000 loss on impairment of real estate
from discontinued operations, related to several properties where a sale is
anticipated or has occurred. These dispositions further the Company’s strategy
of enhancing the portfolio by selling non-core properties. These properties
include Hickory Hollow Mall and The Courtyard at Hickory Hollow in Antioch,
TN; Towne Mall in Franklin, OH and Willowbrook Plaza, a community center in
Houston, TX. As a result of these impairments, CBL reported a net loss
attributable to common shareholders for the third quarter of 2012 of
$2,520,000, or $0.02 per diluted share, compared with net loss of $27,320,000,
or $0.18 per diluted share for the third quarter of 2011.

HIGHLIGHTS

  *Portfolio same-center net operating income (“NOI”), excluding lease
    termination fees, for the quarter ended September 30, 2012, increased 1.2%
    compared with an increase of 2.3% for the prior-year period. Same-center
    NOI, excluding lease terminations fees, for the nine months ended
    September 30, 2012, increased 2.0% compared with an increase of 1.6% for
    the prior-year period.
  *Average gross rent on stabilized mall leases signed during the third
    quarter of 2012 for tenants 10,000 square feet or less increased 9.2% over
    the prior gross rent per square foot.
  *Same-store sales per square foot for mall tenants 10,000 square feet or
    less for stabilized malls for the rolling twelve months ended September
    30, 2012, increased 4.2% to $344 per square foot compared with $330 per
    square foot in the prior-year period. Same-store sales per square foot for
    mall tenants 10,000 square feet or less for stabilized malls year-to-date
    through September 30, 2012, increased 4.1%.
  *Consolidated and unconsolidated variable rate debt of $1,008,815,000, as
    of September 30, 2012, represented 10.0% of the total market
    capitalization for the Company, compared with 14.8% in the prior-year
    period, and 18.6% of the Company’s share of total consolidated and
    unconsolidated debt, compared with 21.8% in the prior-year period.

PORTFOLIO OCCUPANCY

                                           September 30,
                                              2012                 2011
       Portfolio occupancy                    93.0%                  91.3%
       Mall portfolio                         93.1%                  91.2%
       Stabilized malls                       93.0%                  91.2%
       Non-stabilized malls ^(1)              100.0%                 90.5%
       Associated centers                     94.0%                  93.7%
       Community centers                      91.5%                  90.9%
       
       Represents occupancy for The Outlet Shoppes at Oklahoma City in 2012,
^(1)   as well as, The Outlet Shoppes at Oklahoma City and Pearland Town
       Center in 2011.
       

CAPITAL MARKETS ACTIVITY

On October 5, 2012, CBL closed on an underwritten public offering of 6,900,000
depositary shares, each representing 1/10th of a share of its newly designated
6.625% Series E Cumulative Redeemable Preferred Stock (“Series E Shares”) with
a liquidation preference of $25.00 per depositary share, including 900,000
depositary shares sold pursuant to the underwriters’ exercise of their option
to purchase additional depositary shares. The offering generated net proceeds
to the Company of approximately $166.6 million, after deducting the
underwriting discount and estimated offering expenses.

On November 5, 2012, CBL completed the redemption of 460,000 outstanding
shares of 7.75% Series C Cumulative Redeemable Preferred Stock (“Series C
Shares”), and all outstanding depositary shares (“Depositary Shares”), each
representing 1/10th of a Series C Share (NYSE: CBLPrC - CUSIP No.:
124830-50-6). The aggregate amount paid to effect the redemption of the Series
C Shares (including the Depositary Shares) was approximately $115.9 million,
which was funded with a portion of the net proceeds from CBL’s recent issuance
of Series E Shares. The Company will record a charge of $3.8 million as
additional preferred dividends in the fourth quarter 2012 in connection with
the redemption of the Series C Shares to write off direct issuance costs that
were recorded as a reduction of additional paid-in capital when the Series C
Shares were issued.

FINANCING ACTIVITY

On November 6, 2012, CBL announced that it had received fully executed loan
commitments to modify and extend its two major credit facilities, increasing
the aggregate capacity by $155.0 million to $1.2 billion. CBL will convert
both facilities from secured to unsecured, increasing the capacity of each
facility to $600 million, extending the terms and reducing the average
borrowing rate by 60 basis points. The outstanding balances on the two
facilities will bear interest at an annual rate equal to LIBOR plus a range of
155 to 210 basis points, depending on the Company’s leverage ratio. The
closing is anticipated in mid-November.

The maturities of both facilities will be extended by three years with the
first $600 million facility maturing November 2015, with an option to extend
the maturity for one additional year to November 2016 (subject to continued
compliance with the terms of the facility). The maturity of the second $600
million facility will be extended to November 2016 with an option to extend
the maturity for one additional year to November 2017 (subject to continued
compliance with the terms of the facility).

DISPOSITION ACTIVITY

Subsequent to the quarter end, CBL completed the sale of Hickory Hollow Mall
in Antioch, TN and Towne Mall in Franklin, OH to two separate buyers,
generating aggregate proceeds of $2.0 million.

OUTLOOK AND GUIDANCE

Based on third quarter results and today’s outlook, the Company is providing a
2012 FFO guidance range of $2.00 - $2.10 per share. While the guidance is
consistent with the previously issued range, it was effectively increased to
offset the $3.8 million preferred redemption charge that will be recorded in
the fourth quarter 2012. Full-year guidance assumes same-center NOI growth in
a range of 1.0% - 2.0%, $3.0 million to $5.0 million of outparcel sales and a
100 - 150 basis point increase in year-end occupancy as compared with the
prior year. The guidance excludes the impact of any future unannounced
acquisitions or dispositions. The Company expects to update its annual
guidance after each quarter’s results.

                                                 Low           High
Expected diluted earnings per common share           $0.42         $0.52
Adjust to fully converted shares from common         (0.09 )       (0.11 )
shares
Expected earnings per diluted, fully converted         0.33            0.41
common share
Add: depreciation and amortization                     1.58            1.58
Add: noncontrolling interest in earnings of          0.09         0.11  
Operating Partnership
Expected FFO per diluted, fully converted            $2.00        $2.10 
common share
                                                                             

INVESTOR CONFERENCE CALL AND SIMULCAST

CBL & Associates Properties, Inc. will conduct a conference call at 11:00 a.m.
ET on Wednesday, November7,2012, to discuss its third quarter results. The
numbers to call for this interactive teleconference are (800) 734-8592 or
(212)231-2900. A seven-day replay of the conference call will be available by
dialing (402)977-9140 and entering the passcode 21544169. A transcript of the
Company’s prepared remarks will be furnished on a Form 8-K following the
conference call.

To receive the CBL & Associates Properties, Inc., third quarter earnings
release and supplemental information please visit our website at
cblproperties.com or contact Investor Relations at 423-490-8312.

The Company will also provide an online web simulcast and rebroadcast of its
2012 third quarter earnings release conference call. The live broadcast of the
quarterly conference call will be available online at cblproperties.com on
Wednesday, November 7, 2012, beginning at 11:00 a.m. ET. The online replay
will follow shortly after the call and continue through November 14, 2012.

CBL is one of the largest and most active owners and developers of malls and
shopping centers in the United States. CBL owns, holds interests in or manages
163 properties, including 93 regional malls/open-air centers. The properties
are located in 28 states and total 91.4 million square feet including 9.4
million square feet of non-owned shopping centers managed for third parties.
Headquartered in Chattanooga, TN, CBL has regional offices in Boston
(Waltham), MA, Dallas (Irving), TX, and St. Louis, MO. Additional information
can be found at cblproperties.com.

NON-GAAP FINANCIAL MEASURES

Funds From Operations

FFO is a widely used measure of the operating performance of real estate
companies that supplements net income (loss) determined in accordance with
GAAP. The National Association of Real Estate Investment Trusts (“NAREIT”)
defines FFO as net income (loss) (computed in accordance with GAAP) excluding
gains or losses on sales of operating properties, plus depreciation and
amortization, and after adjustments for unconsolidated partnerships and joint
ventures and noncontrolling interests. Adjustments for unconsolidated
partnerships and joint ventures and noncontrolling interests are calculated on
the same basis. In October 2011, NAREIT clarified that FFO should exclude the
impact of losses on impairment of depreciable properties. The Company has
calculated FFO for all periods presented in accordance with this
clarification. The Company defines FFO allocable to its common shareholders as
defined above by NAREIT less dividends on preferred stock. The Company’s
method of calculating FFO allocable to its common shareholders may be
different from methods used by other REITs and, accordingly, may not be
comparable to such other REITs.

The Company believes that FFO provides an additional indicator of the
operating performance of its properties without giving effect to real estate
depreciation and amortization, which assumes the value of real estate assets
declines predictably over time. Since values of well-maintained real estate
assets have historically risen with market conditions, the Company believes
that FFO enhances investors’ understanding of its operating performance. The
use of FFO as an indicator of financial performance is influenced not only by
the operations of the Company’s properties and interest rates, but also by its
capital structure. The Company presents both FFO of its operating partnership
and FFO allocable to its common shareholders, as it believes that both are
useful performance measures. The Company believes FFO of its operating
partnership is a useful performance measure since it conducts substantially
all of its business through its operating partnership and, therefore, it
reflects the performance of the properties in absolute terms regardless of the
ratio of ownership interests of the Company’s common shareholders and the
noncontrolling interest in the operating partnership. The Company believes FFO
allocable to its common shareholders is a useful performance measure because
it is the performance measure that is most directly comparable to net income
(loss) attributable to its common shareholders.

In the reconciliation of net income attributable to the Company’s common
shareholders to FFO allocable to its common shareholders, located in this
earnings release, the Company makes an adjustment to add back noncontrolling
interest in income (loss) of its operating partnership in order to arrive at
FFO of its operating partnership. The Company then applies a percentage to FFO
of its operating partnership to arrive at FFO allocable to its common
shareholders. The percentage is computed by taking the weighted average number
of common shares outstanding for the period and dividing it by the sum of the
weighted average number of common shares and the weighted average number of
operating partnership units outstanding during the period.

FFO does not represent cash flows from operations as defined by accounting
principles generally accepted in the United States, is not necessarily
indicative of cash available to fund all cash flow needs and should not be
considered as an alternative to net income (loss) for purposes of evaluating
the Company’s operating performance or to cash flow as a measure of liquidity.

During 2011, the Company recorded a gain on extinguishment of debt from
discontinued operations. Considering the significance and nature of this item,
the Company believes that it is important to identify the impact of the change
on its FFO measures for a reader to have a complete understanding of the
Company’s results of operations. Therefore, the Company has also presented its
FFO measures excluding this item.

Same-Center Net Operating Income

NOI is a supplemental measure of the operating performance of the Company’s
shopping centers. The Company defines NOI as operating revenues (rental
revenues, tenant reimbursements and other income) less property operating
expenses (property operating, real estate taxes and maintenance and repairs).

Similar to FFO, the Company computes NOI based on its pro rata share of both
consolidated and unconsolidated properties. The Company’s definition of NOI
may be different than that used by other companies and, accordingly, the
Company’s NOI may not be comparable to that of other companies. A
reconciliation of same-center NOI to net income is located at the end of this
earnings release.

Since NOI includes only those revenues and expenses related to the operations
of its shopping center properties, the Company believes that same-center NOI
provides a measure that reflects trends in occupancy rates, rental rates and
operating costs and the impact of those trends on the Company’s results of
operations. Additionally, there are instances when tenants terminate their
leases prior to the scheduled expiration date and pay the Company one-time,
lump-sum termination fees. These one-time lease termination fees may distort
same-center NOI trends and may result in same-center NOI that is not
indicative of the ongoing operations of the Company’s shopping center
properties. Therefore, the Company believes that presenting same-center NOI,
excluding lease termination fees, is useful to investors.

Pro Rata Share of Debt

The Company presents debt based on its pro rata ownership share (including the
Company’s pro rata share of unconsolidated affiliates and excluding
noncontrolling interests’ share of consolidated properties) because it
believes this provides investors a clearer understanding of the Company’s
total debt obligations which affect the Company’s liquidity. A reconciliation
of the Company’s pro rata share of debt to the amount of debt on the Company’s
consolidated balance sheet is located at the end of this earnings release.

Information included herein contains “forward-looking statements” within the
meaning of the federal securities laws. Such statements are inherently subject
to risks and uncertainties, many of which cannot be predicted with accuracy
and some of which might not even be anticipated. Future events and actual
events, financial and otherwise, may differ materially from the events and
results discussed in the forward-looking statements. The reader is directed to
the Company’s various filings with the Securities and Exchange Commission,
including without limitation the Company’s Annual Report on Form 10-K, and the
“Management’s Discussion and Analysis of Financial Condition and Results of
Operations” included therein, for a discussion of such risks and
uncertainties.

                                                             
CBL & Associates Properties, Inc.
Consolidated Statements of Operations
(Unaudited; in thousands, except per share amounts)
                                                                  
                                                                  
                       Three Months Ended          Nine Months Ended
                       September 30,               September 30,
                       2012          2011          2012           2011
REVENUES:
Minimum rents          $ 168,887     $ 172,973     $ 495,557      $ 510,250
Percentage rents         3,113         3,001         8,321          8,786
Other rents              3,786         4,175         13,735         13,686
Tenant                   72,793        76,796        214,193        229,550
reimbursements
Management,
development and          3,139         1,909         7,574          4,814
leasing fees
Other                   7,895       8,409       23,894       26,362   
Total revenues          259,613     267,263     763,274      793,448  
                                                                  
OPERATING EXPENSES:
Property operating       37,437        38,601        110,632        112,788
Depreciation and         67,186        70,720        198,123        209,925
amortization
Real estate taxes        23,109        23,506        69,464         72,635
Maintenance and          13,922        13,661        40,079         43,075
repairs
General and              10,171        10,092        35,964         33,133
administrative
Loss on impairment       21,654        51,304        21,654         51,304
of real estate
Other                   5,871       7,446       19,188       22,795   
Total operating         179,350     215,330     495,104      545,655  
expenses
Income from              80,263        51,933        268,170        247,793
operations
Interest and other       822           595           3,193          1,752
income
Interest expense         (62,433 )     (70,133 )     (183,687 )     (208,216 )
Gain on
extinguishment of        178           -             178            581
debt
Gain on sales of         1,659         2,890         1,753          3,602
real estate assets
Equity in earnings
of unconsolidated        2,062         989           5,401          4,222
affiliates
Income tax              (1,195  )    (4,653  )    (1,234   )    1,770    
(provision) benefit
Income (loss) from
continuing               21,356        (18,379 )     93,774         51,504
operations
Operating income
(loss) of                (8,952  )     90            (6,321   )     23,495
discontinued
operations
Gain (loss) on
discontinued            88          (31     )    983          121      
operations
Net income (loss)        12,492        (18,320 )     88,436         75,120
Net (income) loss
attributable to
noncontrolling
interests in:
Operating                1,776         7,760         (7,783   )     (5,443   )
partnership
Other consolidated      (6,194  )    (6,166  )    (17,139  )    (18,708  )
subsidiaries
Net income (loss)
attributable to the      8,074         (16,726 )     63,514         50,969
Company
Preferred dividends     (10,594 )    (10,594 )    (31,782  )    (31,782  )
Net income (loss)
attributable to        $ (2,520  )   $ (27,320 )   $ 31,732      $ 19,187   
common shareholders
                                                                  
                                                                  
Basic per share data
attributable to
common shareholders:
Income (loss) from
continuing             $ 0.03        $ (0.18   )   $ 0.24         $ 0.01
operations, net of
preferred dividends
Discontinued            (0.05   )    -           (0.03    )    0.12     
operations
Net income (loss)
attributable to        $ (0.02   )   $ (0.18   )   $ 0.21        $ 0.13     
common shareholders
Weighted average
common shares            158,689       148,363       152,721        148,264
outstanding
                                                                  
Diluted earnings per
share data
attributable to
common shareholders:
Income (loss) from
continuing             $ 0.03        $ (0.18   )   $ 0.24         $ 0.01
operations, net of
preferred dividends
Discontinued            (0.05   )    -           (0.03    )    0.12     
operations
Net income (loss)
attributable to        $ (0.02   )   $ (0.18   )   $ 0.21        $ 0.13     
common shareholders
Weighted average
common and potential     158,731       148,405       152,765        148,310
dilutive common
shares outstanding
                                                                  
Amounts attributable
to common
shareholders:
Income (loss) from
continuing             $ 4,876       $ (27,366 )   $ 36,019       $ 793
operations, net of
preferred dividends
Discontinued            (7,396  )    46          (4,287   )    18,394   
operations
Net income (loss)
attributable to        $ (2,520  )   $ (27,320 )   $ 31,732      $ 19,187   
common shareholders
                                                                  

                                                               
The Company's
calculation of
FFO allocable
to its
shareholders is
as follows:
(in thousands,
except per                        
share data)
                   Three Months Ended                Nine Months Ended
                   September 30,                     September 30,
                   2012              2011            2012          2011
                                                                   
Net income
(loss)
attributable to    $  (2,520   )     $  (27,320  )   $ 31,732      $ 19,187
common
shareholders
Noncontrolling
interest in
income (loss)         (1,776   )        (7,760   )     7,783         5,443
of operating
partnership
Depreciation
and
amortization
expense of:
Consolidated          67,186            70,720         198,123       209,925
properties
Unconsolidated        10,828            7,020          32,947        21,132
affiliates
Discontinued          114               684            576           1,657
operations
Non-real estate       (478     )        (732     )     (1,366  )     (1,959  )
assets
Noncontrolling
interests'
share of              (1,208   )        (214     )     (3,537  )     (516    )
depreciation
and
amortization
Loss on
impairment of
real estate,          29,773            51,068         29,969        56,070
net of tax
benefit
Gain on
depreciable           -                 (2,406   )     (493    )     (2,406  )
property
(Gain) loss on
discontinued         (89      )       31           (644    )    (86     )
operations, net
of taxes
Funds from
operations of         101,830           91,091         295,090       308,447
the operating
partnership
Gain on
extinguishment       (178     )       -            (178    )    (32,015 )
of debt
Funds from
operations of
the operating      $  101,652       $  91,091      $ 294,912    $ 276,432 
partnership, as
adjusted
                                                                   
Funds from
operations per     $  0.54           $  0.48         $ 1.55        $ 1.62
diluted share
Gain on
extinguishment       -               -            -           (0.17   )
of debt^(1)
Funds from
operations, as     $  0.54          $  0.48        $ 1.55       $ 1.45    
adjusted, per
diluted share
Weighted
average common
and potential
dilutive common
shares                190,236           190,422        190,226       190,366
outstanding
with operating
partnership
units fully
converted
                                                                   
Reconciliation
of FFO of the
operating
partnership to
FFO allocable
to common
shareholders:
Funds from
operations of      $  101,830        $  91,091       $ 295,090     $ 308,447
the operating
partnership
Percentage
allocable to
common               83.43    %       77.93    %    80.30   %    77.90   %
shareholders
^(2)
Funds from
operations
allocable to       $  84,957        $  70,987      $ 236,957    $ 240,280 
common
shareholders
                                                                   
Funds from
operations of
the operating      $  101,652        $  91,091       $ 294,912     $ 276,432
partnership, as
adjusted
Percentage
allocable to
common               83.43    %       77.93    %    80.30   %    77.90   %
shareholders
^(2)
Funds from
operations
allocable to       $  84,808        $  70,987      $ 236,814    $ 215,341 
common
shareholders,
as adjusted
                                                                   
^(1) Diluted per share amounts presented for reconciliation purposes may
differ from actual diluted per share amounts due to rounding.
^(2) Represents the weighted average number of common shares outstanding for
the period divided by the sum of the weighted average number of common shares
and the weighted average number of operating partnership units outstanding
during the period. See the reconciliation of shares and operating partnership
units outstanding on page 9.
                                                                   
SUPPLEMENTAL
FFO
INFORMATION:
Lease
termination        $  815            $  463          $ 2,973       $ 2,702
fees
Lease
termination        $  -              $  -            $ 0.02        $ 0.01
fees per share
                                                                   
Straight-line      $  2,181          $  2,052        $ 4,403       $ 3,737
rental income
Straight-line
rental income      $  0.01           $  0.01         $ 0.02        $ 0.02
per share
                                                                   
Gains on           $  2,275          $  30           $ 5,128       $ 2,023
outparcel sales
Gains on
outparcel sales    $  0.01           $  -            $ 0.03        $ 0.01
per share
                                                                   
Net
amortization of
acquired above-    $  795            $  877          $ 1,575       $ 2,083
and
below-market
leases
Net
amortization of
acquired above-
and                $  -              $  -            $ 0.01        $ 0.01
below-market
leases per
share
                                                                   
Net
amortization of    $  652            $  603          $ 1,707       $ 1,960
debt premiums
(discounts)
Net
amortization of
debt premiums      $  -              $  -            $ 0.01        $ 0.01
(discounts) per
share
                                                                   
Income tax
(provision)        $  (1,195   )     $  (4,653   )   $ (1,234  )   $ 1,770
benefit
Income tax
(provision)        $  (0.01    )     $  (0.02    )   $ (0.01   )   $ 0.01
benefit per
share
                                                                   
Loss on
impairment of
real estate        $  (21,654  )     $  (51,304  )   $ (21,654 )   $ (51,304 )
from continuing
operations
Loss on
impairment of
real estate        $  (0.11    )     $  (0.27    )   $ (0.11   )   $ (0.27   )
from continuing
operations per
share
                                                                   
Loss on
impairment of
real estate        $  (8,466   )     $  -            $ (8,759  )   $ (6,696  )
from
discontinued
operations
Loss on
impairment of
real estate
from               $  (0.04    )     $  -            $ (0.05   )   $ (0.04   )
discontinued
operations per
share
                                                                   
Gain on
extinguishment
of debt from       $  -              $  -            $ -           $ 31,434
discontinued
operations
Gain on
extinguishment
of debt from       $  -              $  -            $ -           $ 0.17
discontinued
operations per
share
                                                                   

                                                              
Same-Center Net
Operating Income
(Dollars in thousands)
                                                                   
                         Three Months Ended          Nine Months Ended
                         September 30,               September 30,
                         2012          2011          2012          2011
                                                                   
Net income (loss)
attributable to the      $ 8,074       $ (16,726 )   $ 63,514      $ 50,969
Company
                                                                   
Adjustments:
Depreciation and           67,186        70,720        198,123       209,925
amortization
Depreciation and
amortization from          10,828        7,020         32,947        21,132
unconsolidated
affiliates
Depreciation and
amortization from          114           684           576           1,657
discontinued
operations
Noncontrolling
interests' share of
depreciation and           (1,208  )     (214    )     (3,537  )     (516    )
amortization in other
consolidated
subsidiaries
Interest expense           62,433        70,133        183,687       208,216
Interest expense from
unconsolidated             11,022        7,195         33,289        21,655
affiliates
Interest expense from
discontinued               -             511           208           1,734
operations
Noncontrolling
interests' share of
interest expense in        (1,014  )     (300    )     (2,476  )     (800    )
other consolidated
subsidiaries
Abandoned projects         8             -             (115    )     51
expense
Gain on sales of real      (1,659  )     (2,890  )     (5,772  )     (3,602  )
estate assets
Gain on sales of real
estate assets of           (636    )     (81     )     (851    )     (1,327  )
unconsolidated
affiliates
Gain on extinguishment     (178    )     -             (178    )     (581    )
of debt
Gain on extinguishment
of debt from               -             -             -             (31,434 )
discontinued
operations
Writedown of mortgage      -             400           -             1,900
notes receivable
Loss on impairment of      21,654        51,304        21,654        51,304
real estate
Loss on impairment of
real estate from           8,466         -             8,759         6,696
discontinued
operations
Income tax provision       1,195         4,653         1,234         (1,770  )
(benefit)
Net income (loss)
attributable to
noncontrolling             (1,776  )     (7,760  )     7,783         5,443
interest in earnings
of operating
partnership
(Gain) loss on
discontinued              (88     )    31          (983    )    (121    )
operations
Operating
partnership's share of     184,421       184,680       537,862       540,531
total NOI
General and
administrative             10,171        10,092        35,964        33,133
expenses
Management fees and
non-property level        (7,030  )    (7,096  )    (19,233 )    (18,752 )
revenues
Operating
partnership's share of     187,562       187,676       554,593       554,912
property NOI
Non-comparable NOI        (9,229  )    (11,958 )    (21,712 )    (32,737 )
Total same-center NOI    $ 178,333    $ 175,718    $ 532,881    $ 522,175 
Total same-center NOI     1.5     %                  2.1     %
percentage change
                                                                   
Total same-center NOI    $ 178,333     $ 175,718    $ 532,881     $ 522,175
Less lease termination    (832    )    (385    )    (2,711  )    (2,401  )
fees
Total same-center NOI,
excluding lease          $ 177,501    $ 175,333    $ 530,170    $ 519,774 
termination fees
                                                                   
Malls                    $ 158,653     $ 158,146     $ 475,082     $ 466,411
Associated centers         8,192         7,673         24,478        23,262
Community centers          5,350         4,479         15,119        14,090
Offices and other         5,306       5,035       15,491      16,011  
Total same-center NOI,
excluding lease          $ 177,501    $ 175,333    $ 530,170    $ 519,774 
termination fees
                                                                   
Percentage Change:
Malls                      0.3     %                   1.9     %
Associated centers         6.8     %                   5.2     %
Community centers          19.4    %                   7.3     %
Offices and other         5.4     %                  -3.2    %
Total same-center NOI,
excluding lease           1.2     %                  2.0     %
termination fees
                                                                   

                                                                
Company's Share of
Consolidated and
Unconsolidated Debt
(Dollars in
thousands)
                                     As of September 30, 2012
                                     Fixed Rate      Variable Rate   Total
Consolidated debt                    $ 3,822,271     $ 879,119       $ 4,701,390
Noncontrolling
interests' share of                    (70,585   )     -               (70,585    )
consolidated debt
Company's share of
unconsolidated                        670,282       129,696       799,978    
affiliates' debt
Company's share of
consolidated and                     $ 4,421,968    $ 1,008,815    $ 5,430,783  
unconsolidated debt
Weighted average                      5.47      %    2.47      %    4.91       %
interest rate
                                                                     
                                     As of September 30, 2011
                                     Fixed Rate      Variable Rate   Total
Consolidated debt                    $ 4,125,280     $ 1,107,868     $ 5,233,148
Noncontrolling
interests' share of                    (15,486   )     (726      )     (16,212    )
consolidated debt
Company's share of
unconsolidated                        393,702       149,950       543,652    
affiliates' debt
Company's share of
consolidated and                     $ 4,503,496    $ 1,257,092    $ 5,760,588  
unconsolidated debt
Weighted average                      5.63      %    2.56      %    4.96       %
interest rate
                                                                     
                                                                     
Debt-To-Total-Market
Capitalization Ratio
as of September 30,
2012
(In thousands,                       Shares
except stock price)
                                     Outstanding     Stock Price     Value
                                                     (1)
Common stock and
operating                              190,194       $ 21.34         $ 4,058,740
partnership units
7.75% Series C
Cumulative                             460             250.00          115,000
Redeemable Preferred
Stock
7.375% Series D
Cumulative                             1,815           250.00         453,750    
Redeemable Preferred
Stock
Total market equity                                                    4,627,490
Company's share of                                                    5,430,783  
total debt
Total market                                                         $ 10,058,273 
capitalization
Debt-to-total-market                                                  54.0       %
capitalization ratio
                                                                     
(1) Stock price for common stock and operating partnership units equals the closing
price of the common stock on September 28, 2012. The stock prices for the preferred
stocks represent the liquidation preference of each respective series.
                                                                     
                                                                     
                                                                     
Reconciliation of
Shares and Operating
Partnership Units
Outstanding
(In thousands)
                       Three Months Ended            Nine Months Ended
                       September 30,                 September 30,
2012:                  Basic         Diluted         Basic           Diluted
Weighted average         158,689       158,731         152,721         152,765
shares - EPS
Weighted average
operating               31,506      31,505        37,461        37,461     
partnership units
Weighted average        190,195     190,236       190,182       190,226    
shares- FFO
                                                                     
2011:
Weighted average         148,363       148,405         148,264         148,310
shares - EPS
Weighted average
operating               42,017      42,017        42,056        42,056     
partnership units
Weighted average        190,380     190,422       190,320       190,366    
shares- FFO
                                                                     
                                                                     
Dividend Payout        Three Months Ended            Nine Months Ended
Ratio
                       September 30,                 September 30,
                       2012          2011            2012            2011
Weighted average
cash dividend per      $ 0.22896     $ 0.22690       $ 0.68688       $ 0.66860
share
FFO per diluted,
fully converted        $ 0.54       $ 0.48         $ 1.55         $ 1.45       
share, as adjusted
Dividend payout         42.4    %    47.3      %    44.3      %    46.1       %
ratio
                                                                     

                                                             
Consolidated Balance Sheets
(Unaudited; in thousands, except share data)
                                                                
                                                                
                                               As of
                                               September 30,    December 31,
                                               2012             2011
ASSETS
Real estate assets:
Land                                           $ 872,171        $ 851,303
Buildings and improvements                      7,020,344      6,777,776  
                                                 7,892,515        7,629,079
Accumulated depreciation                        (1,920,906 )    (1,762,149 )
                                                 5,971,609        5,866,930
Held for sale                                    1,852            14,033
Developments in progress                        170,435        124,707    
Net investment in real estate assets             6,143,896        6,005,670
Cash and cash equivalents                        66,350           56,092
Receivables:
Tenant, net of allowance for doubtful
accounts of $2,004 and $1,760 in 2012 and        79,900           74,160
2011, respectively
Other, net of allowance for doubtful
accounts of $1,257 and $1,400 in 2012 and        12,916           11,592
2011, respectively
Mortgage and other notes receivable              26,007           34,239
Investments in unconsolidated affiliates         302,635          304,710
Intangible lease assets and other assets        258,612        232,965    
                                               $ 6,890,316     $ 6,719,428  
                                                                
LIABILITIES, REDEEMABLE NONCONTROLLING
INTERESTS AND EQUITY
Mortgage and other indebtedness                $ 4,701,390      $ 4,489,355
Accounts payable and accrued liabilities        337,926        303,577    
Total liabilities                               5,039,316      4,792,932  
Commitments and contingencies
Redeemable noncontrolling interests:
Redeemable noncontrolling partnership            40,929           32,271
interests
Redeemable noncontrolling preferred joint       423,834        423,834    
venture interest
Total redeemable noncontrolling interests       464,763        456,105    
Shareholders' equity:
Preferred stock, $.01 par value, 15,000,000
shares authorized:
7.75% Series C Cumulative Redeemable             5                5
Preferred Stock, 460,000 shares outstanding
7.375% Series D Cumulative Redeemable
Preferred Stock, 1,815,000 shares                18               18
outstanding
Common stock, $.01 par value, 350,000,000
shares authorized, 159,094,361 and               1,591            1,484
148,364,037 issued and outstanding in 2012
and 2011, respectively
Additional paid-in capital                       1,702,321        1,657,927
Accumulated other comprehensive income           4,387            3,425
Dividends in excess of cumulative earnings      (470,430   )    (399,581   )
Total shareholders' equity                       1,237,892        1,263,278
Noncontrolling interests                        148,345        207,113    
Total equity                                    1,386,237      1,470,391  
                                               $ 6,890,316     $ 6,719,428  

Contact:

CBL & Associates Properties, Inc.
Katie Reinsmidt, 423-490-8301
Senior Vice President - Investor Relations/Corporate Investments
katie_reinsmidt@cblproperties.com
 
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