## Report to Shareholders 

• Enhance Profitability of the Core Portfolio 

• Generate Supplemental Revenues 

• Develop High Quality Retail Real Estate 

• Acquire High Quality Retail Real Estate 

• Selectively Expand Our International Presence 

## GROWTH STRATEGY 

W e had a very busy and productive year in  . We completed three significant acquisitions; partnered with the leading Italian retail real estate developer; launched four new development projects; and continued to increase real estate cash flow and asset value through our redevelopment and expansion program. We also sold  non-core assets, realizing net proceeds of   million. We continued to finance the Company in a prudent manner and completed a   million bond issuance at industry-leading interest rates. We once again posted solid operational and financial results. 

## CASH DIVIDEND INCREASE 

Due to our excellent performance in  and our positive outlook for the future, we raised the common stock div- idend by  .  % in February of   to an annual rate of $  .   per share. Our an- nual dividend has increased by  % over the last two years, from  .   per share in   to  .   per share in  . 

## SHAREHOLDER RETURNS 

We delivered a strong total return of  % for our shareholders in  comprised of a  % increase in the price of our common stock plus cash dividends of $  .  per share. We significantly outperformed the S&P 500 which delivered a total return of  % in  . Since our IPO in  , our investors have enjoyed a total return, including the reinvestment of dividends of  %. 

## FINANCIAL RESULTS 

Revenues increased in   by  .  % to  .   billion. Operating income rose  .  % to $  million. Diluted funds from operations (FFO) gained  .  % to  .   per common share from  .  per common share in  . FFO is a widely recognized measure of the performance of real estate investment trusts. 

Net income available to common shareholders decreased  .  % to  million, or  .  per diluted common share, from  million, or  .  per diluted common share, due primarily to the sale of certain joint venture interests in real estate in  . In  , we recorded a net gain of   million, or  .   per share, as a result of the disposition of real estate or interests in real estate, as compared to a net gain of   million, or  .   per share, in  . 

## SIMON GROWTH STRATEGY 

Our growth strategy has five major components: 

● Enhance Profitability of the Core Portfolio 

● Generate Supplemental Revenues 

● Develop High Quality Retail Real Estate 

● Acquire High Quality Retail Real Estate 

● Selectively Expand Our International Presence 

