DISPOSITIONS, DISCONTINUED OPERATIONS AND GAINS (LOSSES) ON DISPOSITIONS OF INTERESTS IN OPERATING PROPERTIES

6 Months Ended

Jun. 30, 2012

DISPOSITIONS, DISCONTINUED OPERATIONS AND GAINS (LOSSES) ON DISPOSITIONS OF INTERESTS IN OPERATING PROPERTIES

DISPOSITIONS, DISCONTINUED OPERATIONS AND GAINS (LOSSES) ON DISPOSITIONS OF INTERESTS IN OPERATING PROPERTIES

NOTE 4DISPOSITIONS, DISCONTINUED OPERATIONS AND GAINS (LOSSES) ON DISPOSITIONS OF INTERESTS IN OPERATING PROPERTIES

On March 2, 2012, we sold our interest in Village of Cross Keys for $25.0 million.  We received $8.0 million in cash and entered into a secured note receivable with the buyer for $17.0 million.

On February 21, 2012, we sold Grand Traverse Mall to RPI.  Prior to the sale, the lender forgave $18.9 million of the secured indebtedness, which was partially offset by the write-off of debt market rate adjustments of $9.0 million.  The net gain on extinguishment of debt, of $9.9 million, is included in discontinued operations in our Consolidated Statements of Operations and Comprehensive Income (Loss).  RPI assumed the remaining $62.0 million of debt on the property as consideration for the sale.

On January 12, 2012, we completed the spin-off of RPI, a 30-mall portfolio totaling approximately 21 million square feet.  The RPI Spin-off was accomplished through a special dividend of the common stock of RPI to holders of GGP common stock as of December 30, 2011.  Subsequent to the spin-off, we retained a 1% interest in RPI.

All of our 2012 and 2011 dispositions are included in discontinued operations in our Consolidated Statements of Operations and Comprehensive Income (Loss) and are summarized in the table below.  In the first quarter of 2012, we revised our intent with respect to four properties previously classified as held for sale.  As we no longer met the criteria for held for sale treatment, we reclassified these four properties as held for use in our Consolidated Balance Sheet and as continuing operations in our Consolidated Statements of Operations and Comprehensive Income (Loss  for all periods presented.  These properties have been measured at the lower of the carrying amount before the asset was classified as held for sale, adjusted for any depreciation and amortization expense that would have been recognized had the asset been continuously classified as held and used, and fair value at the date of decision not to sell.

The following table summarizes the operations of the properties included in discontinued operations.

	Three Months Ended June 30,						Six Months Ended June 30,
	2012			2011			2012			2011
	(In thousands)
Retail and other revenue	$	1,436		$	77,034		$	22,317		$	163,867
Retail and other operating expenses	(488		)	59,090			6,860			123,528
Provisions for impairment*	—			—			10,393			51
Total expenses	(488		)	59,090			17,253			123,579
Operating income	1,924			17,944			5,064			40,288
Interest expense, net	(71		)	(21,911		)	(4,618		)	(46,985		)
Net income (loss) from operations	1,853			(3,967		)	446			(6,697		)
Provision for income taxes	(7		)	(171		)	(23		)	(342		)
Allocation to noncontrolling interest	—			(41		)	—			(53		)
Loss on dispositions	(147		)	(690		)	(175		)	(546		)
Net income (loss) from discontinued operations	$	1,699		$	(4,869	)	$	248		$	(7,638	)

* Net of gain on debt extinguishment of $9.9 million during the six months ended June 30, 2012.