Forest City Enterprises, Inc.

Supplemental Package

Three and Six Months Ended July 31, 2007 and 2006

Forest City Enterprises, Inc. and Subsidiaries
Three Months Ended July 31, 2007 and 2006
Supplemental Package

NYSE: FCEA, FCEB

Index

Corporate Overview	2
Supplemental Operating Information Occupancy Data	4
Comparable Net Operating Income (NOI)	5
Comparable NOI Detail	6-7
Reconciliation of NOI to Net Earnings	8-9
Lease Expirations Schedules	10-11
Schedules of Significant Tenants	12-13
Development Pipeline	14-16
Supplemental Financial Information Mortgage Financings	17
Scheduled Maturities Table	18-19
Consolidated Balance Sheet Information	20-21
Consolidated Earnings Information	22-25
Investments in and Advances to Affiliates	26-27
Real Estate and Related Nonrecourse Mortgage Debt	28-29
Results of Operations Summary	30-32
Reconciliation of Net Earnings to EBDT	33-34
Summary of EBDT	35-46

This Supplemental Package, together with other statements and information publicly disseminated by us, contains “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. Such statements reflect management’s current views with respect to financial results related to future events and are based on assumptions and expectations which may not be realized and 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 results, financial or otherwise, may differ from the results discussed in the forward-looking statements. Risk factors discussed in Item 1A of our Form 10-K for the year ended January 31, 2007 and other factors that might cause differences, some of which could be material, include, but are not limited to, general real estate development and investment risks including lack of satisfactory financing, construction and lease-up delays and cost overruns, the effect of economic and market conditions on a nationwide basis as well as in our primary markets, downturns in the housing market, competition, illiquidity of real estate investments, bankruptcy or insolvency of tenants, dependence on rental income from real property, reliance on major tenants, the impact of terrorist acts, our substantial debt leverage and the ability to obtain and service debt, the impact of restrictions imposed by our credit facility, the level and volatility of interest rates, the continued availability of tax-exempt government financing, conflicts of interest, risks associated with developing and managing properties in partnership with others, effects of uninsured losses, environmental liabilities, risks associated with an investment in and operation of a professional sports franchise, the ability to maintain effective internal controls, compliance with governmental regulations, litigation risks, as well as other risks listed from time to time in our reports filed with the United States Securities and Exchange Commission. We have no obligation to revise or update any forward-looking statements, other than imposed by law, as a result of future events or new information. Readers are cautioned not to place undue reliance on such forward-looking statements.

1

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Operating Information

Corporate Overview

We principally engage in the ownership, development, management and acquisition of commercial and residential real estate and land throughout the United States. We operate through three strategic business units. The Commercial Group, our largest business unit, owns, develops, acquires and operates regional malls, specialty/urban retail centers, office and life science buildings, hotels and mixed-use projects. The Residential Group owns, develops, acquires and operates residential rental property, including upscale and middle-market apartments and adaptive re-use developments. Additionally, the Residential Group develops for-sale condominium projects and also owns, develops and manages military family housing. New York City operations are part of the Commercial Group or Residential Group depending on the nature of the operations. The Land Development Group acquires and sells both land and developed lots to residential, commercial and industrial customers. It also owns and develops land into master-planned communities and mixed-use projects. Real Estate Groups are the combined Commercial, Residential and Land Development Groups. The Nets, a franchise of the National Basketball Association (“NBA”) in which we account for our investment on the equity method of accounting, is a reportable segment of the Company.

We have approximately $9.5 billion of assets in 25 states and the District of Columbia at July 31, 2007. Our core markets include New York City/Philadelphia metropolitan area, Denver, Boston, Greater Washington D.C./Baltimore metropolitan area, Chicago and California. As a result of an ongoing effort to increase property concentration in the core markets, these markets now account for approximately 77 percent of the cost of our real estate portfolio at July 31, 2007. We have offices in Boston, Chicago, Denver, London (England), Los Angeles, New York City, San Francisco, Washington, D.C., and our corporate headquarters are in Cleveland, Ohio.

SUPPLEMENTAL FINANCIAL AND OPERATING INFORMATION

We recommend that this supplemental package be read in conjunction with our Form 10-Q for the three and six months ended July 31, 2007. This supplemental package contains certain measures prepared in accordance with generally accepted accounting principles (“GAAP”) under the full consolidation accounting method, and certain measures prepared under the pro-rata consolidation method, a non-GAAP measure. Along with net earnings, we use an additional measure, Earnings before Depreciation, Amortization and Deferred Taxes (“EBDT”), to report operating results. EBDT is a non-GAAP measure and may not be directly comparable to similarly-titled measures reported by other companies. The non-GAAP financial measures presented under the pro-rata consolidation method, comparable net operating income (“NOI”) and EBDT, provide supplemental information about our operations. Although these measures are not presented in accordance with GAAP, we believe they are necessary to understand our business and operating results, along with net earnings and other GAAP measures. Our investors can use these non-GAAP measures as supplementary information to evaluate our business. Our non-GAAP measures are not intended to be performance measures that should be regarded as alternatives to, or more meaningful than, our GAAP measures.

Consolidation Methods

We present certain financial amounts under the pro-rata consolidation method because we believe this information is useful to investors as this method reflects the manner in which we operate our business. In line with industry practice, we have made a large number of investments in which our economic ownership is less than 100% as a means of procuring opportunities and sharing risk. Under the pro-rata consolidation method, we generally present our investments proportionate to our economic share of ownership. Under GAAP, the full consolidation method is used to report partnership assets and liabilities consolidated at 100% if deemed to be under our control or if we are deemed to be the primary beneficiary of the variable interest entity (“VIE”), even if our ownership is not 100%. We provide reconciliations from the full consolidation method to the pro-rata consolidation method throughout our supplemental package. Please refer to our property listing for the detail of our consolidated and non-consolidated properties in our supplemental package for the year ended January 31, 2007 on pages 56-66.

EBDT

We believe that EBDT, along with net earnings, provides additional information about our core operations. While property dispositions, acquisitions or other factors can affect net earnings in the short-term, we believe EBDT presents a more consistent view of the overall financial performance of our business from period-to-period. EBDT is used by the chief operating decision maker and management to assess performance and resource allocations by strategic business unit and on a consolidated basis. EBDT is similar to Funds From Operations (“FFO”), a measure of performance used by publicly traded Real Estate Investment Trusts (“REIT”), but may not be directly comparable to similarly titled measures reported by other companies. (See pages 32-34 for additional discussion of EBDT as well as a reconciliation of EBDT to net earnings.)

2

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Operating Information

Supplemental Operating Information

The operating information contained in this document includes: occupancy data, comparable NOI, reconciliation of NOI to net earnings, retail and office lease expirations, significant retail and office tenant listings, and our development pipeline. We believe this information will give interested parties a better understanding and more information about our operating performance. The term “comparable,” which is used throughout this document, is generally defined as including properties that were open and operated in both the three and six months ended July 31, 2007 and 2006.

We believe occupancy rates, retail and office lease expirations, base rent, and significant retail and office tenant listings represent meaningful operating statistics about us. This information will give interested parties a better understanding and more information about our operating performance.

Comparable NOI is useful because it measures the performance of the same properties on a period-to-period basis and, along with EBDT (as discussed beginning on page 32), is used to assess operating performance and resource allocation of our strategic business units. While property dispositions, acquisitions or other factors can impact net earnings in the short term, we believe comparable NOI gives a more consistent view of our overall performance from quarter-to-quarter and year-to-year. A reconciliation of net earnings, the most comparable financial measure calculated in accordance with GAAP, to NOI and reconciliation from NOI to comparable NOI are provided on pages 6-9 of this document. A reconciliation of NOI to net earnings for each strategic business unit can be found on pages 35-46.

Corporate Headquarters

Forest City Enterprises, Inc.
Terminal Tower
50 Public Square, Suite 1100
Cleveland, Ohio 44113

Annual Report on Form 10-K

A copy of the Annual Report on Form 10-K for the fiscal year ended January 31, 2007 as filed with the Securities and Exchange Commission can be found on our website or may be obtained without charge upon written request to:

Thomas T. Kmiecik
Assistant Treasurer
tomkmiecik@forestcity.net

Website

www.forestcity.net
The information contained on this website is not incorporated herein by reference and does not constitute a part of this supplemental package.

Investor Relations

Thomas G. Smith
Executive Vice President,
Chief Financial Officer and Secretary

Transfer Agent and Registrar

National City Bank
Stock Transfer Department
P.O. Box 92301
Cleveland, OH 44193-0900
(800) 622-6757
www.shareholder.inquiries@nationalcity.com

Stock Exchange Listing

NYSE: FCEA and FCEB

Dividend Reinvestment and Stock Purchase Plan

We offer our stockholders the opportunity to purchase additional shares of common stock through the Forest City Enterprises, Inc. Dividend Reinvestment and Stock Purchase Plan (the “Plan”) at 97% of current market value. A copy of the Plan prospectus and an enrollment card may be obtained by contacting National City Bank at (800) 622-6757.

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Forest City Enterprises, Inc. and Subsidiaries
Supplemental Operating Information

Occupancy Data — July 31, 2007 and 2006

We analyze our occupancy percentages by each of our major product lines as follows:

				Average						Average
	Occupancy			Occupancy			Occupancy			Occupancy
	As of			Year-to-Date			As of			Year-to-Date
	July 31, 2007			July 31, 2007			July 31, 2006			July 31, 2006
Retail
Comparable		94.7	%		94.7	%		94.4	%		94.4	%
Total		92.1	%		92.9	%		93.9	%		94.0	%
Office
Comparable		92.9	%		93.3	%		93.1	%		92.9	%
Total		88.5	%		89.7	%		93.0	%		92.8	%
Residential
Comparable		94.7	%		95.6	%		96.0	%		95.3	%
Total		92.8	%		93.3	%		93.0	%		90.8	%
Hotels
Comparable and Total (1)					76.7	%					66.4	%
Comparable ADR and Total ADR (1)				$	157.06					$	140.00

Retail and office occupancy as of July 31, 2007 and 2006 is based on square feet leased at the end of the fiscal quarter. Average Occupancy Year-to-Date as of July 31, 2007 and 2006 for retail and office is calculated by dividing the sum of leased square feet at the beginning and end of the period by two. Residential occupancy as of July 31, 2007 and 2006 represents total units occupied divided by total units available. Average residential occupancy year-to-date for 2007 and 2006 is calculated by dividing gross potential rent less vacancy by gross potential rent. Average Daily Rate (“ADR”) is calculated by dividing revenue by the number of rooms sold for the six months ended July 31, 2007 and 2006.

(1) Total Hotel Average Occupancy Year-to-Date and Total ADR for July 31, 2006 have been restated to exclude Embassy Suites Hotel which was sold during the year ended January 31, 2007.

4

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

We use NOI, along with EBDT as discussed on page 2, to assess operating performance. Comparable NOI is defined as NOI from properties opened and operated in both three months and six months ended July 31, 2007 and 2006. The following schedules on pages 6-7 present comparable NOI for each of our major product lines, as well as strategic business unit under which these product lines operate. A reconciliation of NOI to the most comparable GAAP measure, net earnings, is presented on pages 8-9. A reconciliation of NOI to net earnings for each strategic business unit can be found on pages 35-46.

Comparable Net Operating Income (NOI) (% change over same period, prior year)

	Three Months Ended July 31, 2007						Six Months Ended July 31, 2007
	Full			Pro-Rata			Full			Pro-Rata
	Consolidation			Consolidation			Consolidation			Consolidation
Retail		6.1	%		3.1	%		8.1	%		5.6	%
Office		5.2	%		2.7	%		1.7	%		1.9	%
Hotel		20.6	%		21.2	%		28.9	%		26.4	%
Residential		5.7	%		6.4	%		2.8	%		4.8	%
Total		6.3	%		4.5	%		5.3	%		4.8	%

5

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Operating Information

	Net Operating Income (dollars in thousands)
	Three Months Ended July 31, 2007														Three Months Ended July 31, 2006												% Change
							Plus													Plus
	Full			Less			Unconsolidated			Plus		Pro-Rata			Full			Less		Unconsolidated		Plus		Pro-Rata			Full			Pro-Rata
	Consolidation			Minority			Investments at			Discontinued		Consolidation			Consolidation			Minority		Investments at		Discontinued		Consolidation			Consolidation			Consolidation
	(GAAP)			Interest			Pro-Rata			Operations		(Non-GAAP)			(GAAP)			Interest		Pro-Rata		Operations		(Non-GAAP)			(GAAP)			(Non-GAAP)
Commercial Group
Retail
Comparable	$	52,246		$	6,186		$	2,481		$	—	$	48,541		$	49,258		$	5,063	$	2,898	$	—	$	47,093			6.1	%		3.1	%
Total		62,429			5,010			5,102			—		62,521			51,167			5,590		3,210		763		49,550
Office Buildings
Comparable		47,559			6,424			962			—		42,097			45,195			5,312		1,091		—		40,974			5.2	%		2.7	%
Total		48,527			3,391			1,738			—		46,874			44,652			5,444		1,091		93		40,392
Hotels
Comparable		5,997			—			613			—		6,610			4,971			—		484		—		5,455			20.6	%		21.2	%
Total		5,913			—			613			—		6,526			4,938			—		484		5,438		10,860
Earnings from Commercial Land Sales		(316	)		—			—			—		(316	)		918			162		—		—		756
Other		(2,882	)		1,346			(197	)		—		(4,425	)		(8,053	)		11		19		—		(8,045	)
Total Commercial Group
Comparable		105,802			12,610			4,056			—		97,248			99,424			10,375		4,473		—		93,522			6.4	%		4.0	%
Total		113,671			9,747			7,256			—		111,180			93,622			11,207		4,804		6,294		93,513
Residential Group Apartments
Comparable		23,276			745			7,327			—		29,858			22,025			663		6,713		—		28,075			5.7	%		6.4	%
Total		26,568			1,348			13,373			626		39,219			18,388			717		7,846		6,127		31,644
Military Housing
Comparable		—			—			—			—		—			—			—		—		—		—
Total		1,493			(89	)		375			—		1,957			2,141			—		50		—		2,191
Sale of Residential Development Project		10,090			—			—			—		10,090			—			—		—		—		—
Total Residential Group
Comparable		23,276			745			7,327			—		29,858			22,025			663		6,713		—		28,075			5.7	%		6.4	%
Total		38,151			1,259			13,748			626		51,266			20,529			717		7,896		6,127		33,835
Total Rental Properties
Comparable		129,078			13,355			11,383			—		127,106			121,449			11,038		11,186		—		121,597			6.3	%		4.5	%
Total		151,822			11,006			21,004			626		162,446			114,151			11,924		12,700		12,421		127,348
Land Development Group		6,873			303			83			—		6,653			19,792			1,434		105		—		18,463
The Nets		(2,226	)		—			429			—		(1,797	)		(4,041	)		—		1,296		—		(2,745	)
Corporate Activities		(9,515	)		—			—			—		(9,515	)		(10,695	)		—		—		—		(10,695	)
Grand Total	$	146,954		$	11,309		$	21,516		$	626	$	157,787		$	119,207		$	13,358	$	14,101	$	12,421	$	132,371

6

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Operating Information

	Net Operating Income (dollars in thousands)
	Six Months Ended July 31, 2007														Six Months Ended July 31, 2006												% Change
							Plus													Plus
	Full			Less			Unconsolidated			Plus		Pro-Rata			Full			Less		Unconsolidated		Plus		Pro-Rata			Full			Pro-Rata
	Consolidation			Minority			Investments at			Discontinued		Consolidation			Consolidation			Minority		Investments at		Discontinued		Consolidation			Consolidation			Consolidation
	(GAAP)			Interest			Pro-Rata			Operations		(Non-GAAP)			(GAAP)			Interest		Pro-Rata		Operations		(Non-GAAP)			(GAAP)			(Non-GAAP)
Commercial Group
Retail
Comparable	$	104,130		$	11,638		$	4,846		$	—	$	97,338		$	96,284		$	9,940	$	5,795	$	—	$	92,139			8.1	%		5.6	%
Total		117,969			8,805			11,565			—		120,729			99,379			8,682		6,206		1,330		98,233
Office Buildings
Comparable		91,382			10,866			2,178			—		82,694			89,872			10,780		2,095		—		81,187			1.7	%		1.9	%
Total		94,954			6,251			3,046			—		91,749			88,188			11,286		2,095		18		79,015
Hotels
Comparable		8,024			—			1,062			—		9,086			6,224			—		962		—		7,186			28.9	%		26.4	%
Total		8,084			—			1,062			—		9,146			6,175			—		962		7,229		14,366
Earnings from Commercial Land Sales		2,064			434			—			—		1,630			10,549			158		—		—		10,391
Other		(9,073	)		3,210			(296	)		—		(12,579	)		(9,370	)		4,033		50		—		(13,353	)
Total Commercial Group
Comparable		203,536			22,504			8,086			—		189,118			192,380			20,720		8,852		—		180,512			5.8	%		4.8	%
Total		213,998			18,700			15,377			—		210,675			194,921			24,159		9,313		8,577		188,652
Residential Group Apartments
Comparable		43,808			1,405			14,842			—		57,245			42,601			1,327		13,367		—		54,641			2.8	%		4.8	%
Total		50,781			2,660			21,892			4,078		74,091			47,681			1,576		15,559		11,873		73,537
Military Housing
Comparable		—			—			—			—		—			—			—		—		—		—
Total		4,859			(89	)		560			—		5,508			3,619			—		99		—		3,718
Sale of Residential Development Project		10,090			—			—			—		10,090			—			—		—		—		—
Total Residential Group
Comparable		43,808			1,405			14,842			—		57,245			42,601			1,327		13,367		—		54,641			2.8	%		4.8	%
Total		65,730			2,571			22,452			4,078		89,689			51,300			1,576		15,658		11,873		77,255
Total Rental Properties
Comparable		247,344			23,909			22,928			—		246,363			234,981			22,047		22,219		—		235,153			5.3	%		4.8	%
Total		279,728			21,271			37,829			4,078		300,364			246,221			25,735		24,971		20,450		265,907
Land Development Group		10,096			734			199			—		9,561			37,977			1,979		489		—		36,487
The Nets		(5,477	)		—			762			—		(4,715	)		(12,742	)		—		2,332		—		(10,410	)
Corporate Activities		(23,342	)		—			—			—		(23,342	)		(18,296	)		—		—		—		(18,296	)
Grand Total	$	261,005		$	22,005		$	38,790		$	4,078	$	281,868		$	253,160		$	27,714	$	27,792	$	20,450	$	273,688

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Forest City Enterprises, Inc. and Subsidiaries
Supplemental Operating Information

Reconciliation of Net Operating Income (non-GAAP) to Net Earning (GAAP) (in thousands):

	Three Months Ended July 31, 2007															Three Months Ended July 31, 2006
							Plus															Plus
	Full			Less			Unconsolidated			Plus			Pro-Rata			Full			Less			Unconsolidated			Plus			Pro-Rata
	Consolidation			Minority			Investments at			Discontinued			Consolidation			Consolidation			Minority			Investments at			Discontinued			Consolidation
	(GAAP)			Interest			Pro-Rata			Operations			(Non-GAAP)			(GAAP)			Interest			Pro-Rata			Operations			(Non-GAAP)
Revenues from real estate operations	$	287,586		$	15,329		$	96,040		$	12,397		$	380,694		$	250,829		$	25,055		$	75,331		$	30,128		$	331,233
Exclude straight-line rent adjustment (1)		(7,158	)		—			—			—			(7,158	)		(3,377	)		—			—			(15	)		(3,392	)
Adjusted revenues		280,428			15,329			96,040			12,397			373,536			247,452			25,055			75,331			30,113			327,841
Operating expenses		177,186			4,853			62,399			11,883			246,615			149,566			12,923			49,221			18,194			204,058
Add back non-Real Estate depreciation and amortization (b)		2,022			—			638			—			2,660			347			—			1,334			—			1,681
Add back amortization of mortgage procurement costs for non-Real Estate Groups (d)		—			—			10			—			10			98			—			151			—			249
Exclude straight-line rent adjustment (2)		(3,688	)		—			—			—			(3,688	)		(1,186	)		—			—			(306	)		(1,492	)
Exclude preference payment		(936	)		—			—			—			(936	)		—			—			—			—			—
Adjusted operating expenses		174,584			4,853			63,047			11,883			244,661			148,825			12,923			50,706			17,888			204,496
Add interest income and other income		23,423			601			6,228			112			29,162			7,870			1,226			265			196			7,105
Add equity in earnings of unconsolidated entities		7,773			232			(7,791	)		—			(250	)		6,310			—			(4,389	)		—			1,921
Remove gain on disposition recorded on equity method		—			—			—			—			—			(7,662	)		—			7,662			—			—
Add back provision for decline recorded on equity method		—			—			—			—			—			400			—			(400	)		—			—
Add back equity method depreciation and amortization expense (see below)		9,914			—			(9,914	)		—			—			13,662			—			(13,662	)		—			—
Net Operating Income		146,954			11,309			21,516			626			157,787			119,207			13,358			14,101			12,421			132,371
Interest expense, including early extinguishment of debt		(74,348	)		(4,391	)		(16,482	)		(2,363	)		(88,802	)		(71,692	)		(6,830	)		(14,101	)		(4,640	)		(83,603	)
Gain on disposition of equity method rental properties (e)		—			—			—			—			—			7,662			—			—			—			7,662
Gain on disposition of rental properties and other investments		431			—			—			106,318			106,749			—			—			—			10,035			10,035
Preferred return on dispostion		—			—			(5,034	)		—			(5,034	)		—			—			—			—			—
Provision for decline in real estate		—			—			—			—			—			(1,923	)		—			—			—			(1,923	)
Provision for decline in real estate of equity method rental properties		—			—			—			—			—			(400	)		—			—			—			(400	)
Depreciation and amortization — Real Estate Groups (a)		(53,719	)		(1,138	)		(8,988	)		(921	)		(62,490	)		(41,224	)		(3,665	)		(13,384	)		(3,442	)		(54,385	)
Amortization of mortgage procurement costs — Real Estate Groups (c)		(2,839	)		(261	)		(926	)		(34	)		(3,538	)		(2,342	)		(286	)		(278	)		(112	)		(2,446	)
Straight-line rent adjustment (1) + (2)		3,470			—			—			—			3,470			2,191			—			—			(291	)		1,900
Preference payment		(936	)		—			—			—			(936	)		—			—			—			—			—
Equity method depreciation and amortization expense (see above)		(9,914	)		—			9,914			—			—			(13,662	)		—			13,662			—			—
Earnings (loss) before income taxes		9,099			5,519			—			103,626			107,206			(2,183	)		2,577			—			13,971			9,211
Income tax provision		609			—			—			(40,040	)		(39,431	)		3,679			—			—			(5,398	)		(1,719	)
Earnings (loss) before minority interest and discontinued operations		9,708			5,519			—			63,586			67,775			1,496			2,577			—			8,573			7,492
Minority interest		(5,519	)		(5,519	)		—			—			—			(2,577	)		(2,577	)		—			—			—
Earnings (loss) from continuing operations		4,189			—			—			63,586			67,775			(1,081	)		—			—			8,573			7,492
Discontinued operations, net of tax and minority interest:
Operating earnings (loss) from rental properties		(3,596	)		—			—			3,596			—			2,415			—			—			(2,415	)		—
Gain on disposition of rental properties		67,182			—			—			(67,182	)		—			6,158			—			—			(6,158	)		—
		63,586			—			—			(63,586	)		—			8,573			—			—			(8,573	)		—
Net earnings	$	67,775		$	—		$	—		$	—		$	67,775		$	7,492		$	—		$	—		$	—		$	7,492
(a) Depreciation and amortization — Real Estate Groups	$	53,719		$	1,138		$	8,988		$	921		$	62,490		$	41,224		$	3,665		$	13,384		$	3,442		$	54,385
(b) Depreciation and amortization — Non-Real Estate		2,022			—			638			—			2,660			347			—			1,334			—			1,681
Total depreciation and amortization	$	55,741		$	1,138		$	9,626		$	921		$	65,150		$	41,571		$	3,665		$	14,718		$	3,442		$	56,066
(c) Amortization of mortgage procurement costs — Real Estate Groups	$	2,839		$	261		$	926		$	34		$	3,538		$	2,342		$	286		$	278		$	112		$	2,446
(d) Amortization of mortgage procurement costs — Non-Real Estate		—			—			10			—			10			98			—			151			—			249
Total amortization of mortgage procurement costs	$	2,839		$	261		$	936		$	34		$	3,548		$	2,440		$	286		$	429		$	112		$	2,695

(e) Properties accounted for on the equity method do not meet the definition of a component of an entity under SFAS No. 144; therefore, are reported in continuing operations when sold. For the three months ended July 31, 2006, one equity method property was sold, Midtown Plaza, resulting in a tax gain on disposition of $7,662.

8

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Operating Information

Reconciliation of Net Operating Income (non-GAAP) to Net Earning (GAAP) (in thousands):

	Six Months Ended July 31, 2007															Six Months Ended July 31, 2006
							Plus															Plus
	Full			Less			Unconsolidated			Plus			Pro-Rata			Full			Less			Unconsolidated			Plus			Pro-Rata
	Consolidation			Minority			Investments at			Discontinued			Consolidation			Consolidation			Minority			Investments at			Discontinued			Consolidation
	(GAAP)			Interest			Pro-Rata			Operations			(Non-GAAP)			(GAAP)			Interest			Pro-Rata			Operations			(Non-GAAP)
Revenues from real estate operations	$	555,951		$	30,645		$	173,222		$	24,599		$	723,127		$	512,564		$	51,072		$	145,108		$	60,972		$	667,572
Exclude straight-line rent adjustment (1)		(13,000	)		—			—			—			(13,000	)		(6,071	)		—			—			(31	)		(6,102	)
Adjusted revenues		542,951			30,645			173,222			24,599			710,127			506,493			51,072			145,108			60,941			661,470
Operating expenses		345,778			10,648			112,953			20,730			468,813			297,713			25,229			97,636			41,913			412,033
Add back non-Real Estate depreciation and amortization (b)		4,019			—			2,517			—			6,536			696			—			7,524			—			8,220
Add back amortization of mortgage procurement costs for non-Real Estate Groups (d)		—			—			33			—			33			190			—			298			—			488
Exclude straight-line rent adjustment (2)		(5,380	)		—			—			—			(5,380	)		(2,353	)		—			—			(718	)		(3,071	)
Exclude preference payment		(1,834	)		—			—			—			(1,834	)		—			—			—			—			—
Adjusted operating expenses		342,583			10,648			115,503			20,730			468,168			296,246			25,229			105,458			41,195			417,670
Add interest income and other income		34,822			1,424			6,851			209			40,458			22,717			1,871			358			704			21,908
Add equity in earnings of unconsolidated entities		9,134			584			(9,099	)		—			(549	)		6,689			—			1,291			—			7,980
Remove gain on disposition recorded on equity method		(2,106	)		—			2,106			—			—			(7,662	)		—			7,662			—			—
Add back provision for decline recorded on equity method		—			—			—			—			—			400			—			(400	)		—			—
Add back equity method depreciation and amortization expense (see below)		18,787			—			(18,787	)		—			—			20,769			—			(20,769	)		—			—
Net Operating Income		261,005			22,005			38,790			4,078			281,868			253,160			27,714			27,792			20,450			273,688
Interest expense, including early extinguishment of debt		(153,691	)		(9,692	)		(33,756	)		(3,971	)		(181,726	)		(138,091	)		(13,504	)		(27,792	)		(9,899	)		(162,278	)
Gain on disposition of equity method rental properties (e)		2,106			—			—			—			2,106			7,662			—			—			—			7,662
Gain on disposition of rental properties and other investments		431			—			—			106,318			106,749			—			—			—			85,333			85,333
Preferred return on dispostion		—			—			(5,034	)		—			(5,034	)		—			—			—			—			—
Provision for decline in real estate		—			—			—			—			—			(1,923	)		—			—			—			(1,923	)
Provision for decline in real estate of equity method rental properties		—			—			—			—			—			(400	)		—			—			—			(400	)
Depreciation and amortization — Real Estate Groups (a)		(111,509	)		(3,825	)		(17,381	)		(1,934	)		(126,999	)		(81,163	)		(6,864	)		(20,202	)		(7,084	)		(101,585	)
Amortization of mortgage procurement costs — Real Estate Groups (c)		(5,403	)		(421	)		(1,406	)		(69	)		(6,457	)		(5,142	)		(589	)		(567	)		(235	)		(5,355	)
Straight-line rent adjustment (1) + (2)		7,620			—			—			—			7,620			3,718			—			—			(687	)		3,031
Preference payment		(1,834	)		—			—			—			(1,834	)		—			—			—			—			—
Equity method depreciation and amortization expense (see above)		(18,787	)		—			18,787			—			—			(20,769	)		—			20,769			—			—
Earnings (loss) before income taxes		(20,062	)		8,067			—			104,422			76,293			17,052			6,757			—			87,878			98,173
Income tax provision		14,649			—			—			(40,348	)		(25,699	)		(3,468	)		—			—			(33,955	)		(37,423	)
Earnings (loss) before minority interest and discontinued operations		(5,413	)		8,067			—			64,074			50,594			13,584			6,757			—			53,923			60,750
Minority interest		(8,067	)		(8,067	)		—			—			—			(6,757	)		(6,757	)		—			—			—
Earnings (loss) from continuing operations		(13,480	)		—			—			64,074			50,594			6,827			—			—			53,923			60,750
Discontinued operations, net of tax and minority interest:
Operating earnings (loss) from rental properties		(3,108	)		—			—			3,108			—			1,562			—			—			(1,562	)		—
Gain on disposition of rental properties		67,182			—			—			(67,182	)		—			52,361			—			—			(52,361	)		—
		64,074			—			—			(64,074	)		—			53,923			—			—			(53,923	)		—
Net earnings	$	50,594		$	—		$	—		$	—		$	50,594		$	60,750		$	—		$	—		$	—		$	60,750
(a) Depreciation and amortization — Real Estate Groups	$	111,509		$	3,825		$	17,381		$	1,934		$	126,999		$	81,163		$	6,864		$	20,202		$	7,084		$	101,585
(b) Depreciation and amortization — Non-Real Estate		4,019			—			2,517			—			6,536			696			—			7,524			—			8,220
Total depreciation and amortization	$	115,528		$	3,825		$	19,898		$	1,934		$	133,535		$	81,859		$	6,864		$	27,726		$	7,084		$	109,805
(c) Amortization of mortgage procurement costs — Real Estate Groups	$	5,403		$	421		$	1,406		$	69		$	6,457		$	5,142		$	589		$	567		$	235		$	5,355
(d) Amortization of mortgage procurement costs — Non-Real Estate		—			—			33			—			33			190			—			298			—			488
Total amortization of mortgage procurement costs	$	5,403		$	421		$	1,439		$	69		$	6,490		$	5,332		$	589		$	865		$	235		$	5,843

(e) Properties accounted for on the equity method do not meet the definition of a component of an entity under SFAS No 144; therefore, are reported in continuing operations when sold. For the six months ended July 31, 2007, one equity method property was sold, White Acres, resulting in a pre-tax gain on disposition of $2,106. For the six months ended July 31, 2006, one equity method property was sold, Midtown Plaza, resulting in a pre-tax gain on disposition of $7,662.

9

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Operating Information

Retail Lease Expirations as of July 31, 2007

													AVERAGE
													BASE
	NUMBER OF		SQUARE FEET		PERCENTAGE			NET		PERCENTAGE			RENT PER
EXPIRATION	EXPIRING		OF EXPIRING		OF TOTAL			BASE RENT		OF TOTAL			SQUARE FEET
YEAR	LEASES		LEASES (3)		LEASED GLA (1)			EXPIRING (2)		BASE RENT			EXPIRING (3)
2007		123		428,957		3.36	%	$	6,927,896		2.52	%	$	20.18
2008		190		675,091		5.28			14,236,313		5.18			26.93
2009		261		879,158		6.88			17,861,318		6.50			25.10
2010		234		694,686		5.43			16,474,717		5.99			28.68
2011		338		1,360,029		10.64			33,635,169		12.24			27.96
2012		166		801,392		6.27			18,958,024		6.90			28.13
2013		143		574,165		4.49			16,590,435		6.04			30.74
2014		166		677,854		5.30			15,686,906		5.71			27.60
2015		175		749,087		5.86			19,459,471		7.08			29.58
2016		267		1,299,464		10.17			36,320,286		13.21			38.67
2017		109		933,134		7.30			18,916,346		6.88			22.33
Thereafter		99		3,709,765		29.02			59,822,219		21.75			17.93
Total		2,271		12,782,782		100.00	%	$	274,889,100		100.00	%	$	25.46

(1)	GLA = Gross Leasable Area.
(2)	Net base rent expiring is an operating statistic and is not comparable to rental revenue, a GAAP financial measure. The primary differences arise because net base rent is determined using the tenant’s contractual rental agreements at the Company’s ownership share of the base rental income from expiring leases as determined within the rent agreement and it does not include adjustments such as the impact of straight-line rent and contingent rental payments, which are not reasonably estimatable.
(3)	Square feet of expiring leases and average base rent per square feet are operating statistics that represent 100% of the square footage and base rental income per square foot from expiring leases.

10

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Operating Information

Office Lease Expirations as of July 31, 2007

													AVERAGE
													BASE
	NUMBER OF		SQUARE FEET		PERCENTAGE			NET		PERCENTAGE			RENT PER
EXPIRATION	EXPIRING		OF EXPIRING		OF TOTAL			BASE RENT		OF TOTAL			SQUARE FEET
YEAR	LEASES		LEASES (3)		LEASED GLA (1)			EXPIRING (2)		BASE RENT			EXPIRING (3)
2007		55		349,076		3.59	%	$	6,110,465		2.68	%	$	20.41
2008		92		678,373		6.99			12,422,983		5.45			21.11
2009		67		532,783		5.49			10,613,506		4.66			24.31
2010		61		1,220,314		12.57			22,167,401		9.73			22.95
2011		46		577,293		5.95			11,724,625		5.14			27.34
2012		30		903,972		9.31			26,435,760		11.60			30.41
2013		27		786,179		8.10			17,573,686		7.71			24.49
2014		13		561,763		5.79			12,846,283		5.64			28.42
2015		5		189,840		1.96			2,381,720		1.05			19.73
2016		13		392,245		4.04			7,355,087		3.23			21.26
2017		8		135,296		1.38			2,558,497		1.11			20.54
Thereafter		33		3,383,327		34.83			95,710,604		42.00			30.91
Total		450		9,710,461		100.00	%	$	227,900,617		100.00	%	$	26.81

(1)	GLA = Gross Leasable Area.
(2)	Net base rent expiring is an operating statistic and is not comparable to rental revenue, a GAAP financial measure. The primary differences arise because net base rent is determined using the tenant’s contractual rental agreements at the Company’s ownership share of the base rental income from expiring leases as determined within the rent agreement and it does not include adjustments such as the impact of straight-line rent and contingent rental payments, which are not reasonably estimatable.
(3)	Square feet of expiring leases and average base rent per square feet are operating statistics that represent 100% of the square footage and base rental income per square foot from expiring leases.

11

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Operating Information

Schedule of Significant Retail Tenants as of July 31, 2007

(Based on net base rent 1% or greater of the Company’s ownership share)

	NUMBER		LEASED		PERCENTAGE OF
	OF		SQUARE		TOTAL RETAIL
TENANT	LEASES		FEET		SQUARE FEET
Bass Pro Shops, Inc.		3		510,855		4.00	%
AMC Entertainment, Inc.		5		462,863		3.62
Regal Entertainment Group		5		379,072		2.97
The Gap		23		305,212		2.39
The Home Depot		2		282,000		2.21
The Limited		43		281,646		2.20
TJX Companies		8		272,554		2.13
Dick’s Sporting Goods		3		226,408		1.77
Abercrombie & Fitch Stores, Inc.		28		210,663		1.65
Circuit City Stores, Inc.		6		199,107		1.56
Footlocker, Inc.		41		150,431		1.18
Pathmark Stores, Inc.		2		123,500		0.96
Ahold USA (Stop & Shop)		2		115,861		0.90
Subtotal		171		3,520,172		27.54
All Others		2,100		9,262,610		72.46
Total		2,271		12,782,782		100.00	%

12

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Operating Information

Schedule of Significant Office Tenants as of July 31, 2007

(Based on net base rent 2% or greater of the Company’s ownership share)

	LEASED		PERCENTAGE OF
	SQUARE		TOTAL OFFICE
TENANT	FEET		SQUARE FEET
City of New York		890,185		9.17	%
Millennium Pharmaceuticals, Inc.		693,743		7.14
U.S. Government		594,913		6.13
Morgan Stanley & Co.		444,685		4.58
Securities Industry Automation Corp.		433,971		4.47
Wellchoice, Inc.		392,514		4.04
Keyspan Energy		335,318		3.45
Forest City Enterprises, Inc. (1)		333,046		3.43
Bank of New York		323,043		3.33
Bear Stearns		292,142		3.01
Alkermes, Inc.		210,248		2.17
Partners Health Care System, Inc.		136,150		1.40
University of Pennsylvania		121,630		1.25
Subtotal		5,201,588		53.57
All Others		4,508,873		46.43
Total		9,710,461		100.00	%

(1)    All intercompany rental income is eliminated in consolidation.

13

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Operating Information

Development Pipeline
July 31, 2007
2007 Openings and Acquisitions (9)

														Cost at FCE
			Date				Pro-Rata			Cost at Full		Total Cost		Pro-Rata Share		Sq. ft./			Gross
		Dev (D)	Opened /	FCE Legal			FCE % (h)			Consolidation		at 100%		(Non-GAAP) (b)		No. of			Leasable
Property	Location	Acq (A)	Acquired	Ownership % (h)			(1)			(GAAP) (a)		(2)		(1) X (2)		Units			Area
										(in millions)
Retail Centers:
Promenade Bolingbrook	Bolingbrook, IL	D	Q1-07		100.0	%		100.0	%	$	148.0	$	148.0	$	148.0		755,000			429,000	(f)
Victoria Gardens — Bass Pro	Rancho Cucamonga, CA	D	Q2-07		80.0	%		80.0	%		41.2		41.2		33.0		180,000			180,000
										$	189.2	$	189.2	$	181.0		935,000			609,000
Office:
Colorado Studios	Denver, CO	A	Q1-07		90.0	%		90.0	%	$	2.0	$	2.0	$	1.8		75,000
Commerce Court	Pittsburgh, PA	A	Q1-07		70.0	%		100.0	%		26.5		26.5		26.5		378,000
Illinois Science and Technology Park — Building Q	Skokie, IL	A/D	Q1-07		100.0	%		100.0	%		49.1		49.1		49.1		160,000
Richmond Office Park	Richmond, VA	A	Q2-07		100.0	%		100.0	%		115.0		115.0		115.0		571,000	(i)
										$	192.6	$	192.6	$	192.4		1,184,000
Residential:
Stapleton Town Center — Botanica Phase II	Denver, CO	D	Q2-07		90.0	%		90.0	%	$	26.3	$	26.3	$	23.7		154
Tobacco Row — Cameron Kinney	Richmond, VA	A	Q2-07		100.0	%		100.0	%		31.0		31.0		31.0		259
										$	57.3	$	57.3	$	54.7		413
																			Units Sold
Residential:																			at 7/31/2007
Mercury (c)	Los Angeles, CA	D	Q2-07		50.0	%		50.0	%	$	0.0	$	156.3	$	78.2		238			59
Total Openings (d)										$	439.1	$	595.4	$	506.3
LESS: Above properties to be sold as Condominiums										$	0.0	$	156.3	$	78.2
Openings and Acquisitions less Condominiums										$	439.1	$	439.1	$	428.1
Residential Phased-In Units (c) (e):														Opened in ‘07 / Total
Arbor Glenn	Twinsburg, OH	D	2004-07		50.0	%		50.0	%	$	0.0	$	18.4	$	9.2		48/288
Pine Ridge Expansion	Willoughby Hills, OH	D	2005-07		50.0	%		50.0	%		0.0		16.4		8.2		40/162
Cobblestone Court	Painesville, OH	D	2006-08		50.0	%		50.0	%		0.0		24.6		12.3		24/304
Total (g)										$	0.0	$	59.4	$	29.7		112/754

See attached July 31, 2007 footnotes.

14

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Operating Information

Development Pipeline
July 31, 2007
Under Construction (17)

														Cost at FCE
							Pro-Rata			Cost at Full		Total Cost		Pro-Rata Share		Sq. ft./			Gross
		Dev (D)	Anticipated	FCE Legal			FCE % (h)			Consolidation		at 100%		(Non-GAAP) (b)		No. of			Leasable			Pre-
Property	Location	Acq (A)	Opening	Ownership % (h)			(1)			(GAAP) (a)		(2)		(1) X (2)		Units			Area			Leased %
										(in millions)
Retail Centers:
Orchard Town Center	Westminster, CO	D	Q1-08		100.0	%		100.0	%	$	158.5	$	158.5	$	158.5		968,000	(l)		554,000			60	%
Shops at Wiregrass (c)	Tampa, FL	D	Q3-08		50.0	%		66.7	%		0.0		142.9		95.3		646,000			356,000			66	%
East River Plaza (c)	Manhattan, NY	D	Q1-09		35.0	%		50.0	%		0.0		380.0		190.0		514,000			514,000			64	%
White Oak Village	Richmond, VA	D	Q3-08		50.0	%		100.0	%		70.1		70.1		70.1		796,000			290,000			56	%
Village at Gulfstream (c)	Hallandale, FL	D	Q3-08		50.0	%		100.0	%		0.0		155.6		155.6		392,000			392,000	(m)		17	%
Promenade at Temecula Expansion	Temecula, CA	D	Q1-09		75.0	%		75.0	%		106.2		106.2		79.7		144,000			144,000			31	%
Ridge Hill Retail	Yonkers, NY	D	Q4-09		70.0	%		100.0	%		669.0		669.0		669.0		1,244,000			1,244,000	(n)		13	%
										$	1,003.8	$	1,682.5	$	1,418.2		4,704,000			3,494,000
Office:
New York Times	Manhattan, NY	D	Q3-07		70.0	%		79.5	%	$	517.5	$	517.5	$	411.4		737,000	(o)					86	%
Johns Hopkins — 855 North Wolfe Street	East Baltimore, MD	D	Q2-08		76.6	%		76.6	%		104.7		104.7		80.2		278,000	(p)					36	%
										$	622.2	$	622.2	$	491.6		1,015,000
Residential:
Lucky Strike	Richmond, VA	D	Q1-08		100.0	%		100.0	%	$	39.5	$	39.5	$	39.5		131
Uptown Apartments (c)	Oakland, CA	D	Q4-07/Q4-08		50.0	%		50.0	%		0.0		202.3		101.2		665
Ohana Military Communities, Hawaii Increment I (c)(e)	Honolulu, HI	D	2005-2008		10.0	%		10.0	%		0.0		316.5		31.7		1,952
Dallas Mercantile	Dallas, TX	D	Q1-08/Q3-08		100.0	%		100.0	%		136.1		136.1		136.1		366	(q)
Military Housing — Navy Midwest (c)(e)	Chicago, IL	D	2006-2009		25.0	%		25.0	%		0.0		264.7		66.2		1,658
Air Force Academy (c)(e)	Colorado Springs, CO	D	2007-2009		50.0	%		50.0	%		0.0		82.5		41.3		427
Military Housing — Marines, Hawaii Increment II (c)(e)	Honolulu, HI	D	2007-2010		10.0	%		10.0	%		0.0		338.8		33.9		1,175
Military Housing — Navy, Hawaii Increment III (c)(e)	Honolulu, HI	D	2007-2010		10.0	%		10.0	%		0.0		614.6		61.5		2,519
										$	175.6	$	1,995.0	$	511.4		8,893
Total Under Construction (j)										$	1,801.6	$	4,299.5	$	2,421.2
Residential Phased-In Units (c) (e):																			Under Const. / Total
Cobblestone Court	Painesville, OH	D	2006-08		50.0	%		50.0	%	$	0.0	$	24.6	$	12.3					168/304
Sutton Landing	Brimfield, OH	D	2007-08		50.0	%		50.0	%		0.0		15.9		8.0					216/216
Stratford Crossing	Wadsworth, OH	D	2007-09		50.0	%		50.0	%		0.0		25.3		12.7					108/348
Total (k)										$	0.0	$	65.8	$	33.0					492/868

See attached July 31, 2007 footnotes.

Note: Sterling Glen of Roslyn, which was reported as Under Construction at April 30, 2007, was sold on July 2, 2007 prior to its opening.

15

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Operating Information

Development Pipeline

July 31, 2007 Footnotes

(a)	Amounts are presented on the full consolidation method of accounting, a GAAP measure. Under full consolidation, costs are reported as consolidated at 100 percent if we are deemed to have control or to be the primary beneficiary of our investments in the variable interest entity (“VIE”).
(b)	Cost at pro-rata share represents Forest City’s share of cost, based on the Company’s pro-rata ownership of each property (a non-GAAP measure). Under the pro-rata consolidation method of accounting the Company determines its pro-rata share by multiplying its pro-rata ownership by the total cost of the applicable property.
(c)	Reported under the equity method of accounting. This method represents a GAAP measure for investments in which the Company is not deemed to have control or to be the primary beneficiary of our investments in a VIE.
(d)	The difference between the full consolidation cost amount (GAAP) of $439.1 million to the Company’s pro-rata share (a non-GAAP measure) of $506.3 million consists of a reduction to full consolidation for minority interest of $11.0 million of cost and the addition of its share of cost for unconsolidated investments of $78.2 million.
(e)	Phased-in openings. Costs are representative of the total project.
(f)	Includes 39,000 square feet of office space.
(g)	The difference between the full consolidation cost amount (GAAP) of $0.0 million to the Company’s pro-rata share (a non-GAAP measure) of $29.7 million consists of the Company’s share of cost for unconsolidated investments of $29.7 million.
(h)	As is customary within the real estate industry, the Company invests in certain real estate projects through joint ventures. For some of these projects, the Company provides funding at percentages that differ from the Company’s legal ownership.
(i)	Includes 11 office buildings.
(j)	The difference between the full consolidation cost amount (GAAP) of $1,801.6 million to the Company’s pro-rata share (a non-GAAP measure) of $2,421.2 million consists of a reduction to full consolidation for minority interest of $157.1 million of cost and the addition of its share of cost for unconsolidated investments of $776.7 million.
(k)	The difference between the full consolidation amount (GAAP) of $0.0 million to the Company’s pro-rata share (a non-GAAP measure) of $33.0 million consists of Forest City’s share of cost for unconsolidated investments of $33.0 million.
(l)	Includes 177,000 square feet for Target and 97,000 square feet for JCPenney that opened in Q3-06, as well as 16,000 square feet of office space.
(m)	Includes 67,000 square feet of office space.
(n)	Includes 156,000 square feet of office space.
(o)	Includes 23,000 square feet of retail space. At July 31, 2007, this property is included in Completed Rental Properties on the Company’s balance sheet since construction is substantially complete and certain tenants control their space while completing their custom improvements.
(p)	Project includes 19,000 square feet of retail space.
(q)	Project includes 18,000 square feet of retail space.

16

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Mortgage Financings

Our primary capital strategy seeks to isolate the financial risk at the property level to maximize returns and reduce risk on and of our equity capital. Our mortgage debt is nonrecourse, including our construction loans, with each property separately financed. We do not cross-collateralize our mortgage debt. We operate as a C-corporation and retain substantially all of our internally generated cash flows. We recycle this cash flow, together with refinancing and property sale proceeds to fund new development and acquisitions that drive favorable returns for our shareholders. This strategy has historically provided us with the necessary liquidity to take advantage of investment opportunities.

We use taxable and tax-exempt nonrecourse debt for our real estate projects. For those projects financed with taxable debt, we generally seek long-term, fixed-rate financing for those real estate project loans which mature within the next 12 months, as well as those real estate projects which are projected to open and achieve stabilized operations during that same time frame. For real estate projects financed with tax-exempt debt, we generally utilize variable-rate debt. For construction loans, we generally pursue variable-rate financings with maturities ranging from two to five years.

We are actively working to extend the maturities and/or refinance the nonrecourse debt that is coming due in 2007 and 2008. During the six months ended July 31, 2007, we completed the following financings:

					Plus
					Unconsolidated
	Full		Less Minority		Investments at		Pro-Rata
Purpose of Financing	Consolidation		Interest		Pro-Rata		Consolidation
			(in thousands)
Loan extensions/additional fundings	$	486,730	$	18,490	$	18,522	$	486,762
Development projects and acquisitions (1)		223,092		—		109,925		333,017
Refinancings		210,703		17,750		87,300		280,253
	$	920,525	$	36,240	$	215,747	$	1,100,032

(1) $157,575 of the $223,092 relates to development projects and represents the full amount available to be drawn on the loan.

17

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Scheduled Maturities Table: Nonrecourse Mortgage Debt (dollars in thousands)
As of July 31, 2007

	Period Ending January 31, 2008												Period Ending January 31, 2009
							Plus												Plus
				Less			Unconsolidated									Less			Unconsolidated
	Full			Minority			Investments at			Pro-Rata			Full			Minority			Investments at			Pro-Rata
	Consolidation			Interest			Pro-Rata			Consolidation			Consolidation			Interest			Pro-Rata			Consolidation
Fixed:
Fixed-rate debt	$	106,344		$	16,400		$	59,272		$	149,216		$	73,319		$	4,492		$	87,040		$	155,867
Weighted average rate		6.75	%		6.76	%		7.56	%		7.07	%		6.53	%		6.83	%		6.76	%		6.65	%
Variable:
Variable-rate debt		358,376			28,823			66,044			395,597			525,467			9,653			27,891			543,705
Weighted average rate		7.07	%		7.70	%		8.00	%		7.18	%		7.03	%		8.15	%		6.99	%		7.01	%
Tax-Exempt		146,970			2,900			6,971			151,041			45,400			—			—			45,400
Weighted average rate		4.83	%		4.43	%		4.52	%		4.82	%		4.06	%		—			—			4.06	%
Total variable-rate debt		505,346			31,723			73,015			546,638			570,867			9,653			27,891			589,105
Total Nonrecourse Mortgage Debt	$	611,690		$	48,123		$	132,287		$	695,854		$	644,186		$	14,145		$	114,931		$	744,972
Weighted Average Rate		6.47	%		7.18	%		7.62	%		6.64	%		6.77	%		7.73	%		6.82	%		6.76	%

	Period Ending January 31, 2010												Period Ending January 31, 2011
							Plus												Plus
				Less			Unconsolidated									Less			Unconsolidated
	Full			Minority			Investments at			Pro-Rata			Full			Minority			Investments at			Pro-Rata
	Consolidation			Interest			Pro-Rata			Consolidation			Consolidation			Interest			Pro-Rata			Consolidation
Fixed:
Fixed-rate debt	$	328,819		$	15,199		$	35,900		$	349,520		$	174,277		$	16,031		$	20,687		$	178,933
Weighted average rate		6.92	%		7.05	%		6.68	%		6.89	%		6.81	%		2.53	%		7.21	%		7.24	%
Variable:
Variable-rate debt		37,027			—			141,892			178,919			48,258			—			12,339			60,597
Weighted average rate		7.19	%		—			7.82	%		7.69	%		5.77	%		—			7.11	%		6.04	%
Tax-Exempt		124,435			7,400			120,000			237,035			87,486			—			—			87,486
Weighted average rate		4.17	%		4.16	%		4.21	%		4.19	%		4.24	%		—			—			4.24	%
Total variable-rate debt		161,462			7,400			261,892			415,954			135,744			—			12,339			148,083
Total Nonrecourse Mortgage Debt	$	490,281		$	22,599		$	297,792		$	765,474		$	310,021		$	16,031		$	33,026		$	327,016
Weighted Average Rate		6.25	%		6.10	%		6.23	%		6.24	%		5.92	%		2.53	%		7.17	%		6.22	%

18

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Scheduled Maturities Table: Nonrecourse Mortgage Debt (dollars in thousands) (continued)
As of July 31, 2007

	Period Ending January 31, 2012												Thereafter
							Plus												Plus
				Less			Unconsolidated									Less			Unconsolidated
	Full			Minority			Investments at			Pro-Rata			Full			Minority			Investments at			Pro-Rata
	Consolidation			Interest			Pro-Rata			Consolidation			Consolidation			Interest			Pro-Rata			Consolidation
Fixed:
Fixed-rate debt	$	361,495		$	19,166		$	34,610		$	376,939		$	2,813,829		$	156,453		$	649,195		$	3,306,571
Weighted average rate		7.11	%		7.25	%		6.93	%		7.09	%		5.76	%		5.94	%		5.68	%		5.74	%
Variable:
Variable-rate debt		3,137			—			5,637			8,774			59,192			—			55,280			114,472
Weighted average rate		5.75	%		—			7.11	%		6.62	%		5.56	%		—			6.08	%		5.81	%
Tax-Exempt		26,509			—			29,500			56,009			232,024			9,880			63,999			286,143
Weighted average rate		4.16	%		—			4.68	%		4.43	%		4.67	%		4.43	%		4.58	%		4.66	%
Total variable-rate debt		29,646			—			35,137			64,783			291,216			9,880			119,279			400,615
Total Nonrecourse Mortgage Debt	$	391,141		$	19,166		$	69,747		$	441,722		$	3,105,045		$	166,333		$	768,474		$	3,707,186
Weighted Average Rate		6.90	%		7.25	%		6.00	%		6.74	%		5.68	%		5.85	%		5.66	%		5.66	%
	Total
							Plus
				Less			Unconsolidated
	Full			Minority			Investments at			Pro-Rata
	Consolidation			Interest			Pro-Rata			Consolidation
Fixed:
Fixed-rate debt	$	3,858,083		$	227,741		$	886,704		$	4,517,046
Weighted average rate		6.08	%		5.96	%		6.04	%		6.07	%
Variable:
Variable-rate debt		1,031,457			38,476			309,083			1,302,064
Weighted average rate		6.90	%		7.81	%		7.43	%		7.00	%
Tax-Exempt		662,824			20,180			220,470			863,114
Weighted average rate		4.49	%		4.33	%		4.39	%		4.47	%
Total variable-rate debt		1,694,281			58,656			529,553			2,165,178
Total Nonrecourse Mortgage Debt	$	5,552,364		$	286,397		$	1,416,257		$	6,682,224
Weighted Average Rate		6.04	%		6.09	%		6.08	%		6.05	%

19

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

As discussed on page 2, we present certain financial amounts under the pro-rata consolidation method (a non-GAAP measure). This information is useful to our investors because we believe that it more accurately reflects the manner in which we operate our business. This is because, in line with industry practice, we have a large number of investments in which our economic ownership is less than 100% as a means of procuring opportunities and sharing risk. The tables below present amounts for both full consolidation, a GAAP measure, and pro-rata consolidation, providing a reconciliation of the difference between the two methods. Under the pro-rata consolidation method, we present our partnership investments proportionate to our share of ownership for each line item of our consolidated financial statements. Under full consolidation, partnership assets and liabilities are reported as consolidated at 100% if deemed to be under our control or if we are deemed to be the primary beneficiary for our investments in a VIE. Partnership assets and liabilities are reported on the equity or cost method of accounting if we do not have control, or, in the case of investments in VIEs, we are not deemed the primary beneficiary.

Consolidated Balance Sheet Information – July 31, 2007 (unaudited)

							Plus
	Full			Less			Unconsolidated			Pro-Rata
	Consolidation			Minority			Investments at			Consolidation
	(GAAP)			Interest			Pro-Rata			(Non-GAAP)
				(in thousands)
Assets
Real Estate
Completed rental properties	$	7,420,280		$	330,998		$	1,205,202		$	8,294,484
Projects under development		1,064,854			108,970			449,064			1,404,948
Land held for development or sale		181,010			5,910			90,059			265,159
Total Real Estate		8,666,144			445,878			1,744,325			9,964,591
Less accumulated depreciation		(1,160,269	)		(70,965	)		(289,619	)		(1,378,923	)
Real Estate, net		7,505,875			374,913			1,454,706			8,585,668
Cash and equivalents		238,261			25,748			11,254			223,767
Restricted cash		365,300			9,474			175,450			531,276
Notes and accounts receivable, net		291,666			12,661			59,379			338,384
Investments in and advances to affiliates		413,427			55,013			(166,568	)		191,846
Other assets		743,494			22,041			118,737			840,190
Total Assets	$	9,558,023		$	499,850		$	1,652,958		$	10,711,131
Liabilities and Shareholders’ Equity
Liabilities
Mortgage debt, nonrecourse	$	5,552,364		$	286,397		$	1,416,257		$	6,682,224
Notes payable		112,643			1,134			85,265			196,774
Bank revolving credit facility		235,000			—			—			235,000
Senior and subordinated debt		886,900			—			—			886,900
Accounts payable and accrued expenses		832,283			35,658			151,608			948,233
Deferred income taxes		502,800			—			—			502,800
Total Liabilities		8,121,990			323,189			1,653,130			9,451,931
Minority Interest		375,478			176,661			(172	)		198,645
Total Shareholders’ Equity		1,060,555			—			—			1,060,555
Total Liabilities and Shareholders’ Equity	$	9,558,023		$	499,850		$	1,652,958		$	10,711,131

20

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Consolidated Balance Sheet Information – January 31, 2007 (unaudited)

							Plus
	Full			Less			Unconsolidated			Pro-Rata
	Consolidation			Minority			Investments at			Consolidation
	(GAAP)			Interest			Pro-Rata			(Non-GAAP)
				(in thousands)
Assets
Real Estate
Completed rental properties	$	6,659,054		$	346,323		$	1,207,591		$	7,520,322
Projects under development		1,396,083			126,660			298,665			1,568,088
Land held for development or sale		174,136			6,032			78,578			246,682
Total Real Estate		8,229,273			479,015			1,584,834			9,335,092
Less accumulated depreciation		(1,085,978	)		(70,863	)		(286,054	)		(1,301,169	)
Real Estate, net		7,143,295			408,152			1,298,780			8,033,923
Cash and equivalents		254,213			24,545			32,997			262,665
Restricted cash		292,461			25,028			168,062			435,495
Notes and accounts receivable, net		287,615			26,619			9,458			270,454
Investments in and advances to affiliates		333,782			—			(95,710	)		238,072
Other assets		670,238			29,260			95,834			736,812
Total Assets	$	8,981,604		$	513,604		$	1,509,421		$	9,977,421
Liabilities and Shareholders’ Equity
Liabilities
Mortgage debt, nonrecourse	$	5,338,372		$	320,270		$	1,308,209		$	6,326,311
Notes payable		96,127			1,167			88,244			183,204
Bank revolving credit facility		—			—			—			—
Senior and subordinated debt		886,900			—			—			886,900
Accounts payable and accrued expenses		772,964			15,711			112,968			870,221
Deferred income taxes		486,329			—			—			486,329
Total Liabilities		7,580,692			337,148			1,509,421			8,752,965
Minority Interest		375,101			176,456			—			198,645
Total Shareholders’ Equity		1,025,811			—			—			1,025,811
Total Liabilities and Shareholders’ Equity	$	8,981,604		$	513,604		$	1,509,421		$	9,977,421

21

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Consolidated Earnings Information – Three Months Ended July 31, 2007 (unaudited)

							Plus
	Full			Less			Unconsolidated			Plus			Pro-Rata
	Consolidation			Minority			Investments at			Discontinued			Consolidation
	(GAAP)			Interest			Pro-Rata			Operations			(Non-GAAP)
	(in thousands)
Revenues from real estate operations	$	287,586		$	15,329		$	96,040		$	12,397		$	380,694
Expenses
Operating expenses		177,186			4,853			62,399			11,883			246,615
Depreciation and amortization		55,741			1,138			9,626			921			65,150
		232,927			5,991			72,025			12,804			311,765
Interest expense, including early extinguishment of debt		(74,348	)		(4,391	)		(16,482	)		(2,363	)		(88,802	)
Amortization of mortgage procurement costs		(2,839	)		(261	)		(936	)		(34	)		(3,548	)
Interest and other income		23,423			601			6,228			112			29,162
Equity in earnings (loss) of unconsolidated entities		7,773			232			(7,791	)		—			(250	)
Gain on disposition of rental properties and other investments		431			—			(5,034	)		106,318			101,715
Earnings before income taxes		9,099			5,519			—			103,626			107,206
Income tax expense (benefit)
Current		1,771			—			—			5,682			7,453
Deferred		(2,380	)		—			—			34,358			31,978
		(609	)		—			—			40,040			39,431
Earnings before minority interest and discontinued operations		9,708			5,519			—			63,586			67,775
Minority interest		(5,519	)		(5,519	)		—			—			—
Earnings from continuing operations		4,189			—			—			63,586			67,775
Discontinued operations, net of tax and minority interest:
Operating loss from rental properties		(3,596	)		—			—			3,596			—
Gain on disposition of rental properties		67,182			—			—			(67,182	)		—
		63,586			—			—			(63,586	)		—
Net earnings	$	67,775		$	—		$	—		$	—		$	67,775

22

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Consolidated Earnings Information – Six Months Ended July 31, 2007 (unaudited)

							Plus
	Full			Less			Unconsolidated			Plus			Pro-Rata
	Consolidation			Minority			Investments at			Discontinued			Consolidation
	(GAAP)			Interest			Pro-Rata			Operations			(Non-GAAP)
	(in thousands)
Revenues from real estate operations	$	555,951		$	30,645		$	173,222		$	24,599		$	723,127
Expenses
Operating expenses		345,778			10,648			112,953			20,730			468,813
Depreciation and amortization		115,528			3,825			19,898			1,934			133,535
		461,306			14,473			132,851			22,664			602,348
Interest expense, including early extinguishment of debt		(153,691	)		(9,692	)		(33,756	)		(3,971	)		(181,726	)
Amortization of mortgage procurement costs		(5,403	)		(421	)		(1,439	)		(69	)		(6,490	)
Interest and other income		34,822			1,424			6,851			209			40,458
Equity in earnings (loss) of unconsolidated entities (Note 1)		9,134			584			(9,099	)		—			(549	)
Gain on disposition of rental properties and other investments		431			—			(2,928	)		106,318			103,821
Earnings (loss) before income taxes		(20,062	)		8,067			—			104,422			76,293
Income tax expense (benefit)
Current		79			—			—			5,740			5,819
Deferred		(14,728	)		—			—			34,608			19,880
		(14,649	)		—			—			40,348			25,699
Earnings (loss) before minority interest and discontinued operations		(5,413	)		8,067			—			64,074			50,594
Minority interest		(8,067	)		(8,067	)		—			—			—
Earnings (loss) from continuing operations (Note 1)		(13,480	)		—			—			64,074			50,594
Discontinued operations, net of tax and minority interest:
Operating loss from rental properties		(3,108	)		—			—			3,108			—
Gain on disposition of rental properties		67,182			—			—			(67,182	)		—
		64,074			—			—			(64,074	)		—
Net earnings	$	50,594		$	—		$	—		$	—		$	50,594

Note 1) Properties accounted for on the equity method do not meet the definition of a component of an entity under SFAS No. 144 “Accounting for the Impairment or Disposal of Long-Lived Assets,” and therefore are reported in continuing operations when sold. For the six months ended July 31, 2007, one equity method investment was sold, White Acres. A pre-tax gain of $2,106 ($1,292 net of tax) has been reported in equity in earnings of unconsolidated entities in the Consolidated Statements of Earnings, and therefore is included in earnings from continuing operations.

23

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Consolidated Earnings Information – Three Months Ended July 31, 2006 (unaudited)

							Plus
	Full			Less			Unconsolidated			Plus			Pro-Rata
	Consolidation			Minority			Investments at			Discontinued			Consolidation
	(GAAP)			Interest			Pro-Rata			Operations			(Non-GAAP)
	(in thousands)
Revenues from real estate operations	$	250,829		$	25,055		$	75,331		$	30,128		$	331,233
Expenses
Operating expenses		149,566			12,923			49,221			18,194			204,058
Depreciation and amortization		41,571			3,665			14,718			3,442			56,066
Provision for decline in real estate		1,923			—			400			—			2,323
		193,060			16,588			64,339			21,636			262,447
Interest expense, including early extinguishment of debt		(71,692	)		(6,830	)		(14,101	)		(4,640	)		(83,603	)
Amortization of mortgage procurement costs		(2,440	)		(286	)		(429	)		(112	)		(2,695	)
Interest and other income		7,870			1,226			265			196			7,105
Equity in earnings (loss) of unconsolidated entities (Note 1)		6,310			—			(4,389	)		—			1,921
Gain on disposition of rental properties		—			—			7,662			10,035			17,697
(Loss) earnings before income taxes		(2,183	)		2,577			—			13,971			9,211
Income tax expense (benefit)
Current		(5,860	)		—			—			1,405			(4,455	)
Deferred		2,181			—			—			3,993			6,174
		(3,679	)		—			—			5,398			1,719
Earnings before minority interest and discontinued operations		1,496			2,577			—			8,573			7,492
Minority interest		(2,577	)		(2,577	)		—			—			—
Earnings (loss) from continuing operations (Note 1)		(1,081	)		—			—			8,573			7,492
Discontinued operations, net of tax and minority interest:
Operating earnings from rental properties		2,415			—			—			(2,415	)		—
Gain on disposition of rental properties		6,158			—			—			(6,158	)		—
		8,573			—			—			(8,573	)		—
Net earnings	$	7,492		$	—		$	—		$	—		$	7,492

Note  1) Properties accounted for on the equity method do not meet the definition of a component of an entity under SFAS No. 144 “Accounting for the Impairment or Disposal of Long-Lived Assets,” and therefore are reported in continuing operations when sold. For the three months ended July 31, 2006, one equity method investment was sold, Midtown Plaza. A pre-tax gain of $7,662 ($4,700 net of tax) has been reported in equity in earnings of unconsolidated entities in the Consolidated Statements of Earnings, and therefore is included in earnings from continuing operations.

24

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Consolidated Earnings Information – Six Months Ended July 31, 2006 (unaudited)

							Plus
	Full			Less			Unconsolidated			Plus			Pro-Rata
	Consolidation			Minority			Investments at			Discontinued			Consolidation
	(GAAP)			Interest			Pro-Rata			Operations			(Non-GAAP)
	(in thousands)
Revenues from real estate operations	$	512,564		$	51,072		$	145,108		$	60,972		$	667,572
Expenses
Operating expenses		297,713			25,229			97,636			41,913			412,033
Depreciation and amortization		81,859			6,864			27,726			7,084			109,805
Provision for decline in real estate		1,923			—			400			—			2,323
		381,495			32,093			125,762			48,997			524,161
Interest expense, including early extinguishment of debt		(138,091	)		(13,504	)		(27,792	)		(9,899	)		(162,278	)
Amortization of mortgage procurement costs		(5,332	)		(589	)		(865	)		(235	)		(5,843	)
Interest and other income		22,717			1,871			358			704			21,908
Equity in earnings (loss) of unconsolidated entities (Note 1)		6,689			—			1,291			—			7,980
Gain on disposition of rental properties		—			—			7,662			85,333			92,995
Earnings before income taxes		17,052			6,757			—			87,878			98,173
Income tax expense (benefit)
Current		(6,217	)		—			—			703			(5,514	)
Deferred		9,685			—			—			33,252			42,937
		3,468			—			—			33,955			37,423
Earnings before minority interest and discontinued operations		13,584			6,757			—			53,923			60,750
Minority interest		(6,757	)		(6,757	)		—			—			—
Earnings from continuing operations (Note 1)		6,827			—			—			53,923			60,750
Discontinued operations, net of tax and minority interest:
Operating earnings from rental properties		1,562			—			—			(1,562	)		—
Gain on disposition of rental properties		52,361			—			—			(52,361	)		—
		53,923			—			—			(53,923	)		—
Net earnings	$	60,750		$	—		$	—		$	—		$	60,750

Note  1) Properties accounted for on the equity method do not meet the definition of a component of an entity under SFAS No. 144 “Accounting for the Impairment or Disposal of Long-Lived Assets,” and therefore are reported in continuing operations when sold. For the six months ended July 31, 2006, one equity method investment was sold, Midtown Plaza. A pre-tax gain of $7,662 ($4,700 net of tax) has been reported in equity in earnings of unconsolidated entities in the Consolidated Statements of Earnings, and therefore is included in earnings from continuing operations.

25

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

The following schedules present information on investments in and advances to affiliates.

Investments in and Advances to Affiliates

Included in Investments in and Advances to Affiliates in the Consolidated Balance Sheet Information tables are unconsolidated investments in entities which we do not control and/or are not the primary beneficiary, and which are accounted for under the equity method of accounting, as well as advances to partners and other affiliates.

Following is a reconciliation of members’ and partners’ equity to our carrying value in the accompanying Consolidated Balance Sheet Information:

	July 31,		January 31,
	2007		2007
	(in thousands)
Members’ and partners’ equity as below	$	741,266	$	592,681
Equity of other members and partners		574,698		496,971
Company’s investment in partnerships	$	166,568	$	95,710
Company’s proportionate share of advances to and on behalf of other affiliates		191,846		238,072
Minority interest in advances to and on behalf of other affiliates (1)		55,013		—
Total Investments in and Advances to Affiliates	$	413,427	$	333,782

(1) Primarily represents the minority interest portion of advances to other affiliates included in the fully consolidated presentation. Previously, a portion of these amounts were recorded in pro-rata accounts payable or receivable.

Summarized financial information for the equity method investments is as follows:

	Combined (100%)						Pro-Rata Share
	(GAAP)						(Non-GAAP)
	July 31, 2007			January 31, 2007			July 31, 2007			January 31, 2007
	(in thousands)						(in thousands)
Balance Sheet:
Completed rental properties	$	2,803,619		$	2,697,454		$	1,205,202		$	1,207,591
Projects under development		1,098,900			777,419			449,064			298,665
Land held for development or sale		201,634			160,296			90,059			78,578
Accumulated depreciation		(585,778	)		(554,910	)		(289,619	)		(286,054	)
Restricted cash		1,345,097			1,432,636			175,450			168,062
Other assets		573,839			526,142			189,370			138,289
Total Assets	$	5,437,311		$	5,039,037		$	1,819,526		$	1,605,131
Mortgage debt, nonrecourse	$	4,047,069		$	3,834,085		$	1,416,257		$	1,308,209
Other liabilities		648,976			612,271			236,873			201,212
Minority interest		—			—			(172	)		—
Members’ and partners’ equity		741,266			592,681			166,568			95,710
Total Liabilities and Members’/Partners’ Equity	$	5,437,311		$	5,039,037		$	1,819,526		$	1,605,131

26

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Investments in and Advances to Affiliates (continued)

	Combined (100%)						Pro-Rata Share
	(GAAP)						(Non-GAAP)
Three Months Ended July 31,	2007			2006			2007			2006
	(in thousands)						(in thousands)
Operations:
Revenues	$	234,704		$	164,684		$	96,040		$	74,413
Equity in earnings of unconsolidated entities on a pro-rata basis		—			—			(250	)		1,921
Operating expenses		(156,653	)		(109,476	)		(62,399	)		(48,853	)
Interest expense		(48,538	)		(33,100	)		(16,482	)		(13,742	)
Provision for decline in real estate		—			(1,000	)		—			(400	)
Depreciation and amortization		(37,389	)		(23,577	)		(10,562	)		(15,030	)
Interest income		9,363			3,670			1,194			260
Minority interest		—			—			232			—
Income (loss) from continuing operations		1,487			1,201			7,773			(1,431	)
Discontinued operations:
Gain on disposition of rental properties (1)		—			15,325			—			7,662
Operating earnings from rental properties		—			160			—			79
	$	—		$	15,485		$	—		$	7,741
Net earnings (Pre-tax)	$	1,487		$	16,686		$	7,773		$	6,310

	Combined (100%)						Pro-Rata Share
	(GAAP)						(Non-GAAP)
Six Months Ended July 31,	2007			2006			2007			2006
	(in thousands)						(in thousands)
Operations:
Revenues	$	452,164		$	331,624		$	172,967		$	143,815
Equity in earnings of unconsolidated entities on a pro-rata basis		—			—			(549	)		7,980
Operating expenses		(311,434	)		(232,276	)		(112,901	)		(96,956	)
Interest expense		(102,581	)		(65,479	)		(33,715	)		(27,370	)
Provision for decline in real estate		—			(1,000	)		—			(400	)
Depreciation and amortization		(75,133	)		(60,995	)		(21,467	)		(28,446	)
Interest income		28,552			6,716			1,817			352
Minority interest		—			—			584			—
Income (loss) from continuing operations		(8,432	)		(21,410	)		6,736			(1,025	)
Discontinued operations:
Gain on disposition of rental properties (1)		4,212			15,325			2,106			7,662
Operating earnings from rental properties		584			103			292			52
	$	4,796		$	15,428		$	2,398		$	7,714
Net earnings (loss) (Pre-tax)	$	(3,636	)	$	(5,982	)	$	9,134		$	6,689

(1) The following table shows the detail of gain on disposition of rental properties that were held by equity method investments:

	Combined (100%)				Pro-Rata Share				Combined (100%)				Pro-Rata Share
	(GAAP)				(Non-GAAP)				(GAAP)				(Non-GAAP)
	Three Months Ended July 31,								Six Months Ended July 31,
	2007		2006		2007		2006		2007		2006		2007		2006
	(in thousands)				(in thousands)				(in thousands)				(in thousands)
White Acres (Apartments) (Richmond Hts., Ohio)	$	—	$	—	$	—	$	—	$	4,212	$	—	$	2,106	$	—
Midtown Plaza (Specialty Retail Center) (Parma, Ohio)		—		15,325		—		7,662		—		15,325		—		7,662
Total gain on dispostion of equity method rental properties	$	—	$	15,325	$	—	$	7,662	$	4,212	$	15,325	$	2,106	$	7,662

27

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Real Estate and Related Nonrecourse Mortgage Debt

	July 31, 2007
			Less				Nonrecourse
			Accumulated				Mortgage
	Total Cost		Depreciation		Net Cost		Debt
	(in thousands)
Full Consolidation
Completed rental properties
Residential	$	1,591,856	$	214,450	$	1,377,406	$	1,032,582
Commercial
Retail centers		2,795,440		362,729		2,432,711		2,224,632
Office and other buildings		3,022,683		578,541		2,444,142		1,999,279
Corporate and other equipment		10,301		4,549		5,752		—
		7,420,280		1,160,269		6,260,011		5,256,493
Projects under development
Residential
Under construction		72,320		—		72,320		9,355
In development		518,903		—		518,903		160,677
Commercial
Retail centers
Under construction		101,759		—		101,759		29,452
In development		138,775		—		138,775		—
Office and other buildings
Under construction		98,986		—		98,986		17,214
In development		134,111		—		134,111		11,711
		1,064,854		—		1,064,854		228,409
Land held for development or sale		181,010		—		181,010		67,462
Total — Full Consolidation	$	8,666,144	$	1,160,269	$	7,505,875	$	5,552,364
Less Minority Interest
Completed rental properties
Residential	$	33,993	$	5,321	$	28,672	$	25,467
Commercial
Retail centers		104,479		8,770		95,709		102,899
Office and other buildings		192,526		56,874		135,652		124,205
Corporate and other equipment		—		—		—		—
		330,998		70,965		260,033		252,571
Projects under development
Residential
Under construction		—		—		—		—
In development		95,007		—		95,007		26,174
Commercial
Retail centers
Under construction		739		—		739		—
In development		—		—		—		—
Office and other buildings
Under construction		13,224		—		13,224		4,032
In development		—		—		—		—
		108,970		—		108,970		30,206
Land held for development or sale		5,910		—		5,910		3,620
Total — Minority Interest	$	445,878	$	70,965	$	374,913	$	286,397

28

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Real Estate and Related Nonrecourse Mortgage Debt (continued)

	July 31, 2007
			Less				Nonrecourse
			Accumulated				Mortgage
	Total Cost		Depreciation		Net Cost		Debt
	(in thousands)
Plus Unconsolidated Investments at Pro-Rata
Completed rental properties
Residential	$	608,513	$	179,157	$	429,356	$	508,370
Commercial
Retail centers		412,329		45,201		367,128		435,747
Office and other buildings		184,359		65,261		119,098		110,732
Corporate and other equipment		1		—		1		—
		1,205,202		289,619		915,583		1,054,849
Projects under development
Residential
Under construction		130,948		—		130,948		151,193
In development		7,772		—		7,772		804
Commercial
Retail centers
Under construction		128,654		—		128,654		79,631
In development		44,124		—		44,124		1,051
Office and other buildings
Under construction		160		—		160		—
In development		137,406		—		137,406		86,471
		449,064		—		449,064		319,150
Land held for development or sale		90,059		—		90,059		42,258
Total — Unconsolidated Investments at Pro-Rata	$	1,744,325	$	289,619	$	1,454,706	$	1,416,257
Pro-Rata Consolidation
Completed rental properties
Residential	$	2,166,376	$	388,286	$	1,778,090	$	1,515,485
Commercial
Retail centers		3,103,290		399,160		2,704,130		2,557,480
Office and other buildings		3,014,516		586,928		2,427,588		1,985,806
Corporate and other equipment		10,302		4,549		5,753		—
		8,294,484		1,378,923		6,915,561		6,058,771
Projects under development
Residential
Under construction		203,268		—		203,268		160,548
In development		431,668		—		431,668		135,307
Commercial
Retail centers
Under construction		229,674		—		229,674		109,083
In development		182,899		—		182,899		1,051
Office and other buildings
Under construction		85,922		—		85,922		13,182
In development		271,517		—		271,517		98,182
		1,404,948		—		1,404,948		517,353
Land held for development or sale		265,159		—		265,159		106,100
Total — Pro-Rata Consolidation	$	9,964,591	$	1,378,923	$	8,585,668	$	6,682,224

29

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Results of Operations

Net Earnings — Net earnings for the three months ended July 31, 2007 was $67,775,000 versus $7,492,000 for the three months ended July 31, 2006. Although we have substantial recurring revenue sources from our properties, we also enter into significant one-time transactions, which could create substantial variances in net earnings between periods. This variance to the prior year is primarily attributable to the following increases, which are net of tax and minority interest:

• $67,182,000 ($106,318,000, pre-tax) related to the 2007 gains on disposition of Landings of Brentwood, a consolidated apartment community in Nashville, Tennessee and the following six consolidated supported-living apartment communities: Sterling Glen of Bayshore, in Bayshore, New York, Sterling Glen of Center City, in Philadelphia, Pennsylvania, Sterling Glen of Darien, in Darien, Connecticut, Sterling Glen of Forest Hills, in Forest Hills, New York, Sterling Glen of Plainview, in Plainview, New York, and Sterling Glen of Stamford, in Stamford, Connecticut;

• $6,191,000 ($10,090,000, pre-tax) related to the 2007 net gain recognized in other income on the sale of Sterling Glen of Roslyn, a consolidated supported-living apartment community under construction in Roslyn, New York;

• $5,686,000 ($9,267,000, pre-tax) in 2007 related to the increase in fair market value between the comparable periods of certain of our 10-year forward swaps which were marked to market through interest expense as a result of the derivatives not qualifying for hedge accounting;

• $1,024,000 ($1,669,000, pre-tax) related to the amortization to straight-line rent of above and below market leases, which were recorded as a component of the purchase price allocation for the acquisition, in November 2006, of 30 retail, office and residential operating properties in New York City (“New York portfolio transaction”);

• $782,000 ($1,815,000, pre-tax) related to the decrease in our allocation of losses from our equity investment in the New Jersey Nets basketball team; and

• $545,000 ($888,000, pre-tax) related to income recognition on federal Historic Preservation Tax Credits.

These increases were partially offset by the following decreases, net of tax and minority interest:

• $6,158,000 ($10,035,000, pre-tax) primarily related to the 2006 gain on disposition of Providence at Palm Harbor, a consolidated apartment community located in Tampa, Florida;

• $6,126,000 ($9,738,000, pre-tax) related to decreased earnings in 2007 reported in the Land Development Group primarily due to a decrease in land sales at Stapleton, in Denver, Colorado and Chestnut Commons in Elyria, Ohio;

• $4,700,000 ($7,662,000, pre-tax) related to the 2006 gain on disposition of one equity method Commercial property, Midtown Plaza, a specialty retail center located in Parma, Ohio;

• $1,762,000 ($2,872,000, pre-tax) related to increased write-offs of abandoned development projects in 2007;

• $1,481,000 ($2,414,000, pre-tax) related to an increase in depreciation and amortization for amounts recorded as tangible and intangible assets, which were a result of the purchase price allocation for the New York portfolio transaction that closed in November 2006;

• $1,124,000 ($1,832,000, pre-tax) in 2007 related to the early extinguishment of nonrecourse mortgage debt primarily at the Landings of Brentwood due to the sale of the property; and

• $658,000 ($1,072,000, pre-tax) related to decreases in Commercial Group outlot land sales in 2007 primarily at Antelope Valley Mall in Palmdale, California.

Net earnings for the six months ended July 31, 2007 was $50,594,000 versus $60,750,000 for the six months ended July 31, 2006. This variance to the prior year is primarily attributable to the following decreases, which are net of tax and minority interest:

• $52,361,000 ($85,333,000, pre-tax) related to the 2006 gains on disposition of three consolidated properties, Providence at Palm Harbor, Hilton Times Square, a 444-room hotel located in Manhattan, New York, and G Street, a specialty retail center located in Philadelphia, Pennsylvania;

30

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

• $15,565,000 ($25,236,000, pre-tax) related to decreased earnings in 2007 reported in the Land Development Group primarily due to a decrease in land sales at Stapleton, Waterbury in North Ridgeville, Ohio, Chestnut Commons and Tangerine Crossing in Tucson, Arizona;

• $5,376,000 ($8,761,000, pre-tax) related to decreases in Commercial Group outlot land sales in 2007 primarily at Simi Valley in Simi Valley, California, and Antelope Valley Mall, which was partially offset by an increase in land sales in 2007 at Victoria Gardens in Rancho Cucamonga, California;

• $4,809,000 ($7,837,000, pre-tax) related to management’s approved plan to demolish two buildings owned by us adjacent to Ten MetroTech Center, an office building located in Brooklyn, New York, to clear the land for a residential project named 80 DeKalb Avenue. Due to this new development plan, the estimated useful lives of the two adjacent buildings were adjusted to expire at the scheduled demolition date in April 2007 resulting in accelerated depreciation expense;

• $4,700,000 ($7,662,000, pre-tax) related to the 2006 gain on disposition of Midtown Plaza, an equity method Commercial property;

• $4,333,000 ($7,062,000, pre-tax) related to income recognition on state and federal Historic Preservation Tax Credits in 2006 that did not recur at the same level;

• $3,112,000 ($5,072,000, pre-tax) related to an increase in depreciation and amortization for amounts recorded as tangible and intangible assets, which were a result of the purchase price allocation for the New York portfolio transaction that closed in November 2006;

• $2,928,000 ($4,773,000, pre-tax) related to increased write-offs of abandoned development projects in 2007; and

• $1,889,000 ($3,078,000, pre-tax) in 2007 related to the early extinguishment of nonrecourse mortgage debt primarily at Columbia Park Center, a specialty retail center located in North Bergen, New Jersey in order to secure more favorable financing terms and at the Landings of Brentwood due to the sale of the property.

These decreases were partially offset by the following increases, net of tax and minority interest:

• $67,182,000 ($106,318,000, pre-tax) related to the 2007 gains on disposition of Landings of Brentwood, Sterling Glen of Bayshore, Sterling Glen of Center City, Sterling Glen of Darien, Sterling Glen of Forest Hills, Sterling Glen of Plainview, and Sterling Glen of Stamford;

• $6,191,000 ($10,090,000, pre-tax) related to the 2007 net gain recognized in other income on the sale of Sterling Glen of Roslyn;

• $4,798,000 ($7,820,000, pre-tax) in 2007 related to the increase in fair market value between the comparable periods of certain of our 10-year forward swaps which were marked to market through interest expense as a result of the derivatives not qualifying for hedge accounting;

• $4,107,000 ($7,265,000, pre-tax) related to the decrease in our allocation of losses from our equity investment in the New Jersey Nets basketball team;

• $2,167,000 ($3,531,000, pre-tax) related to the amortization to straight-line rent of above and below market leases, which were recorded as a component of the purchase price allocation for the New York portfolio transaction; and

• $1,292,000 ($2,106,000, pre-tax) related to the 2007 gain on disposition of one equity method Residential property, White Acres, an apartment community located in Richmond Heights, Ohio.

Net Operating Income (NOI) from Real Estate Groups — NOI, a non-GAAP measure, is defined as revenues (excluding straight-line rent adjustments) less operating expenses (including non-real estate depreciation and amortization) plus interest and other income plus equity in earnings of unconsolidated entities (excluding gain on disposition of equity method operating properties) plus equity method depreciation and amortization. We believe NOI provides us, as well as our investors, additional information about our core business operations and, along with earnings, is necessary to understand our business and operating results. Under the full consolidation method (GAAP), NOI from the combination of the Commercial Group and the Residential Group (“Rental Properties”) for the three months ended July 31, 2007 was $151,822,000 compared to $114,151,000 for the three months ended July 31, 2006, a 33.0% increase. NOI for the six months ended July 31, 2007 was $279,728,000 compared to $246,221,000 for the six months ended

31

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

July 31, 2006, a 13.6% increase. A reconciliation of NOI to the most comparable GAAP measure, net earnings, is presented on pages 8-9. A reconciliation of NOI to net earnings for each strategic business unit can be found on pages 35-46.

Management also analyzes property NOI using the pro-rata consolidation method because it provides operating data at our ownership share, and we publicly disclose and discuss our performance using this method of consolidation to complement our GAAP disclosures. Under the pro-rata consolidation method, NOI from the Rental Properties for the three months ended July 31, 2007 was $162,446,000 compared to $127,348,000 for the three months ended July 31, 2006, a 27.6% increase. NOI for the six months ended July 31, 2007 was $300,364,000 compared to $265,907,000 for the six months ended July 31, 2006, a 13.0% increase. Comparable NOI increased 4.5% for the three months ended July 31, 2007 compared to the prior year. Retail, office and hotel comparable NOI increased 3.0%, 2.7% and 21.2% respectively, from the prior year and our residential portfolio has generated an increase of 6.4%. Comparable NOI increased 4.8% for the six months ended July 31, 2007 compared to the prior year. Retail, office and hotel comparable NOI increased 5.6%, 1.9% and 26.4% respectively, from the prior year and our residential portfolio has generated an increase of 4.8%.

EBDT — We use an additional measure, along with net earnings, to report our operating results. This non-GAAP measure, referred to as Earnings Before Depreciation, Amortization and Deferred Taxes (“EBDT”), is not a measure of operating results or cash flows from operations as defined by GAAP and may not be directly comparable to similarly-titled measures reported by other companies.

We believe that EBDT provides additional information about our core operations and, along with net earnings, is necessary to understand our operating results. EBDT is used by the chief operating decision maker and management in assessing operating performance and to consider capital requirements and allocation of resources by segment and on a consolidated basis. We believe EBDT is important to investors because it provides another method for the investor to measure our long-term operating performance as net earnings can vary from year to year due to property dispositions, acquisitions and other factors that have a short-term impact.

EBDT is defined as net earnings excluding the following items: i) gain (loss) on disposition of rental properties, divisions and other investments (net of tax); ii) the adjustment to recognize rental revenues and rental expense using the straight-line method; iii) non-cash charges for real estate depreciation, amortization, amortization of mortgage procurement costs and deferred income taxes; iv) preferred payment classified as minority interest expense on our Consolidated Statement of Earnings; v) provision for decline in real estate (net of tax); vi) extraordinary items (net of tax); and vii) cumulative effect of change in accounting principle (net of tax). Unlike the real estate segments, EBDT for the Nets segment equals net earnings.

EBDT is reconciled to net earnings, the most comparable financial measure calculated in accordance with GAAP, on page 33. The adjustment to recognize rental revenues and rental expenses on the straight-line method is excluded because it is management’s opinion that rental revenues and expenses should be recognized when due from the tenants or due to the landlord. We exclude depreciation and amortization expense related to real estate operations from EBDT because we believe the values of our properties, in general, have appreciated over time in excess of their original cost. Deferred taxes from real estate operations, which are the result of timing differences of certain net expense items deducted in a future year for federal income tax purposes, are excluded until the year in which they are reflected in our current tax provision. The provision for decline in real estate is excluded from EBDT because it varies from year to year based on factors unrelated to our overall financial performance and is related to the ultimate gain on dispositions of operating properties. Our EBDT may not be directly comparable to similarly-titled measures reported by other companies.

Our EBDT for the three months ended July 31, 2007 increased by 25.7% to $71,206,000 from $56,665,000 for the three months ended July 31, 2006. This variance to the prior year is primarily attributable to the favorable change in fair market value between the comparable periods of $9,267,000 for certain of our 10-year forward swaps which were marked to market through interest expense, net gain of $5,037,000 recognized in other income on the sale of Sterling Glen of Roslyn, a consolidated supported-living apartment community under construction in Roslyn, New York, and approximately $11,000,000 of additional EBDT from operating activity in our Real Estate Groups. These increases were partially offset by decreased EBDT of $7,103,000 reported in the Land Development Group and $4,351,000 of increased interest expense reported in corporate activities, primarily related to the Puttable Equity-Linked Senior Notes issued in October 2006.

Our EBDT for the six months ended July 31, 2007 decreased by 11.9% to $105,735,000 from $120,004,000 for the six months ended July 31, 2006. This variance to the prior year is primarily attributable to decreased EBDT of $16,650,000 reported in the Land Development Group, decreased income recognized on state and federal Historic Preservation Tax Credits of $7,062,000 (primarily at Ashton Mill, an apartment community located in Cumberland, Rhode Island), decreased outlot land sales of $5,057,000 in the Commercial Group, primarily at Simi Valley in Simi Valley, California, and $8,020,000 of increased interest expense reported in corporate activities, primarily related to the Puttable Equity-Linked Senior Notes issued in October 2006. These decreases were partially offset by the favorable change in fair market value between the comparable periods of $7,820,000 for certain of our 10-year forward swaps which were marked to market through interest expense, the net gain of $5,037,000 recognized in other income on the sale of Sterling Glen of Roslyn, and approximately $12,300,000 of additional EBDT from operating activity in our Real Estate Groups.

32

Forest City Enterprises, Inc. and Subsidiaries

Supplemental Financial Information

Summary of EBDT — The information in the tables below, including pages 34-46, present amounts for both full consolidation and pro-rata consolidation, providing a reconciliation of the difference between the two methods, as well as reconciliation from NOI to EBDT to net earnings. Under the pro-rata consolidation method, we present our partnership investments proportionate to our pro-rata share for each line item of our consolidated financial statements. Under full consolidation, partnership assets and liabilities are reported as consolidated at 100% if deemed under our control or if we are deemed to be the primary beneficiary for investments in the VIEs, or on the equity method of accounting if we do not have control or are not the primary beneficiary for investments in VIEs.

Reconciliation of Net Earnings to Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT) ⁽²⁾

	Three Months Ended July 31,						Six Months Ended July 31,
	2007			2006			2007			2006
	(in thousands)						(in thousands)
Net earnings	$	67,775		$	7,492		$	50,594		$	60,750
Depreciation and amortization – Real Estate Groups (5)		62,490			54,385			126,999			101,585
Amortization of mortgage procurement costs – Real Estate Groups (5)		3,538			2,446			6,457			5,355
Deferred income tax expense – Real Estate Groups (6)		33,397			6,959			23,037			43,389
Deferred income tax expense — Non-Real Estate Groups: (6)
Gain on disposition of other investments		(57	)		—			(57	)		—
Current income tax expense on non-operating earnings: (6)
Gain on disposition of other investments		224			—			224			—
Gain on disposition included in discontinued operations		8,088			—			8,088			(29	)
Gain on disposition of equity method rental properties		—			2,657			—			2,657
Straight-line rent adjustment (3)		(3,470	)		(1,900	)		(7,620	)		(3,031	)
Preference payment (4)		936			—			1,834			—
Preferred return on disposition		5,034			—			5,034			—
Provision for decline in real estate, net of minority interest		—			1,923			—			1,923
Provision for decline in real estate of equity method rental properties		—			400			—			400
Gain on disposition of equity method rental properties		—			(7,662	)		(2,106	)		(7,662	)
Gain on disposition of other investments		(431	)		—			(431	)		—
Discontinued operations: (1)
Gain on disposition of rental properties		(106,318	)		(7,342	)		(106,318	)		(143,726	)
Minority interest – Gain on disposition		—			(2,693	)		—			58,393
Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT) (2)	$	71,206		$	56,665		$	105,735		$	120,004

(1)	Pursuant to the definition of a component of an entity of SFAS No. 144, assuming no significant continuing involvement, all earnings of properties which have been sold or are held for sale are reported as discontinued operations.
(2)	The Company uses an additional measure, along with net earnings, to report its operating results. This measure, referred to as Earnings Before Depreciation, Amortization and Deferred Taxes (“EBDT”), is not a measure of operating results as defined by generally accepted accounting principles and may not be directly comparable to similarly-titled measures reported by other companies. The Company believes that EBDT provides additional information about its operations, and along with net earnings, is necessary to understand its operating results. EBDT is defined as net earnings excluding the following items: i) gain (loss) on disposition of rental properties, divisions and other investments (net of tax); ii) the adjustment to recognize rental revenues and rental expense using the straight-line method; iii) non-cash charges for real estate depreciation, amortization, amortization of mortgage procurement costs and deferred income taxes; iv) preferred payment classified as minority interest expense on the Company’s Consolidated Statement of Earnings; v) provision for decline in real estate (net of tax); vi) extraordinary items (net of tax); and vii) cumulative effect of change in accounting principle (net of tax).
(3)	The Company recognizes minimum rents on a straight-line basis over the term of the related lease pursuant to the provision of SFAS No. 13, “Accounting for Leases.” The straight-line rent adjustment is recorded as an increase or decrease to revenue from Forest City Rental Properties Corporation, a wholly-owned subsidiary of Forest City Enterprises, Inc., with the applicable offset to either accounts receivable or accounts payable, as appropriate.
(4)	The Forest City Ratner Companies portfolio became a wholly-owned subsidiary of the Company on November 8, 2006 upon the issuance of the Class A Common Units in exchange for Bruce C. Ratner’s minority interests. For the first five years only, the Units that have not been exchanged are entitled to their proportionate share of an annual preferred payment of $2,500,000 plus an amount equal to the dividends paid on the same number of shares of the Company’s common stock. After five years, the Units that have not been exchanged are entitled to a payment equal to the dividends paid on an equivalent number of shares of the Company’s common stock. At July 31, 2007, the Company has recorded approximately $1,834,000 related to two quarter’s share of the annual preferred payment which is classified as minority interest expense on the Company’s Consolidated Statement of Earnings.
(5)	The following table provides detail of depreciation and amortization and amortization of mortgage procurement costs. The Company’s Real Estate Groups are engaged in the ownership, development, acquisition and management of real estate projects, including apartment complexes, regional malls and retail centers, hotels, office buildings and mixed-use facilities, as well as large land development projects.

	Depreciation and Amortization												Amortization of Mortgage Procurement Costs
	Three Months Ended						Six Months Ended						Three Months Ended						Six Months Ended
	July 31,						July 31,						July 31,						July 31,
	2007			2006			2007			2006			2007			2006			2007			2006
Full Consolidation	$	55,741		$	41,571		$	115,528		$	81,859		$	2,839		$	2,440		$	5,403		$	5,332
Non-Real Estate		(2,022	)		(347	)		(4,019	)		(696	)		—			(98	)		—			(190	)
Real Estate Groups Full Consolidation		53,719			41,224			111,509			81,163			2,839			2,342			5,403			5,142
Real Estate Groups related to minority interest		(1,138	)		(3,665	)		(3,825	)		(6,864	)		(261	)		(286	)		(421	)		(589	)
Real Estate Groups Equity Method		8,988			13,384			17,381			20,202			926			278			1,406			567
Real Estate Groups Discontinued Operations		921			3,442			1,934			7,084			34			112			69			235
Real Estate Groups Pro-Rata Consolidation	$	62,490		$	54,385		$	126,999		$	101,585		$	3,538		$	2,446		$	6,457		$	5,355

33

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Reconciliation of Net Earnings to Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT) ⁽²⁾ (continued)

(6) The following table provides detail of Income Tax Expense (Benefit):

	Three Months Ended July 31,						Six Months Ended July 31,
	2007			2006			2007			2006
	(in thousands)						(in thousands)
(A) Operating earnings
Current	$	1,547		$	(8,517	)	$	(145	)	$	(8,874	)
Deferred		(2,323	)		2,774			(15,485	)		10,278
		(776	)		(5,743	)		(15,630	)		1,404
(B) Provision for decline in real estate
Deferred		—			(743	)		—			(743	)
Deferred — equity method investment		—			(155	)		—			(155	)
		—			(898	)		—			(898	)
(C) Gain on disposition of other investments
Current — Non-Real Estate Groups		224			—			224			—
Deferred — Non-Real Estate Groups		(57	)		—			(57	)		—
		167			—			167			—
(D) Gain on disposition of equity method rental properties
Current		—			2,657			—			2,657
Deferred		—			305			814			305
		—			2,962			814			2,962
Subtotal (A) (B) (C) (D)
Current		1,771			(5,860	)		79			(6,217	)
Deferred		(2,380	)		2,181			(14,728	)		9,685
Income tax expense		(609	)		(3,679	)		(14,649	)		3,468
(E) Discontinued operations
Operating earnings
Current		(2,406	)		1,405			(2,348	)		732
Deferred		3,310			116			3,560			251
		904			1,521			1,212			983
Gain on disposition of rental properties
Current		8,088			—			8,088			(29	)
Deferred		31,048			3,877			31,048			33,001
		39,136			3,877			39,136			32,972
		40,040			5,398			40,348			33,955
Grand Total (A) (B) (C) (D) (E)
Current		7,453			(4,455	)		5,819			(5,514	)
Deferred		31,978			6,174			19,880			42,937
	$	39,431		$	1,719		$	25,699		$	37,423
Recap of Grand Total
Real Estate Groups
Current	$	10,728		$	1,134		$	12,974		$	2,445
Deferred		33,397			6,959			23,037			43,389
		44,125			8,093			36,011			45,834
Non-Real Estate Groups
Current		(3,275	)		(5,589	)		(7,155	)		(7,959	)
Deferred		(1,419	)		(785	)		(3,157	)		(452	)
		(4,694	)		(6,374	)		(10,312	)		(8,411	)
Grand Total	$	39,431		$	1,719		$	25,699		$	37,423

34

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Summary of Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT) — Three Months Ended July 31, 2007 (in thousands)

	Commercial Group 2007														Residential Group 2007
							Plus													Plus
	Full			Less			Unconsolidated			Plus		Pro-Rata			Full			Less		Unconsolidated			Plus			Pro-Rata
	Consolidation			Minority			Investments at			Discontinued		Consolidation			Consolidation			Minority		Investments at			Discontinued			Consolidation
	(GAAP)			Interest			Pro-Rata			Operations		(Non-GAAP)			(GAAP)			Interest		Pro-Rata			Operations			(Non-GAAP)
Revenues from real estate operations	$	210,726		$	11,256		$	29,743		$	—	$	229,213		$	62,254		$	3,270	$	56,565		$	12,397		$	127,946
Exclude straight-line rent adjustment		(7,140	)		—			—			—		(7,140	)		(18	)		—		—			—			(18	)
Adjusted revenues		203,586			11,256			29,743			—		222,073			62,236			3,270		56,565			12,397			127,928
Operating expenses, including depreciation and amortization, and amortization of mortgage procurement costs for non-Real Estate Groups		110,181			1,825			15,776			—		124,132			45,122			2,275		38,920			11,883			93,650
Exclude straight-line rent adjustment		(3,688	)		—			—			—		(3,688	)		—			—		—			—			—
Exclude preference payment		(936	)		—			—			—		(936	)		—			—		—			—			—
Adjusted operating expenses		105,557			1,825			15,776			—		119,508			45,122			2,275		38,920			11,883			93,650
Add interest and other income		8,295			334			677			—		8,638			11,785			14		5,497			112			17,380
Add equity in earnings of unconsolidated entities		3,746			(18	)		(3,787	)		—		(23	)		3,055			250		(3,197	)		—			(392	)
Add back equity method depreciation and amortization expense		3,601			—			(3,601	)		—		—			6,197			—		(6,197	)		—			—
Net operating income		113,671			9,747			7,256			—		111,180			38,151			1,259		13,748			626			51,266
Interest expense, including early extinguishment of debt		44,218			3,796			7,256			—		47,678			13,104			648		8,714			2,363			23,533
Income tax expense (benefit)		3,440			—			—			—		3,440			4,062			—		—			(2,406	)		1,656
Preferred return on disposition		—			—			—			—		—			5,034			—		(5,034	)		—			—
Minority interest in earnings before depreciation and amortization		5,951			5,951			—			—		—			611			611		—			—			—
Add: EBDT from discontinued operations		—			—			—			—		—			669			—		—			(669	)		—
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	60,062		$	—		$	—		$	—	$	60,062		$	26,077		$	—	$	—		$	—		$	26,077
Reconciliation to net earnings:
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	60,062		$	—		$	—		$	—	$	60,062		$	26,077		$	—	$	—		$	—		$	26,077
Depreciation and amortization — Real Estate Groups		(41,920	)		—			—			—		(41,920	)		(19,469	)		—		—			(921	)		(20,390	)
Amortization of mortgage procurement costs — Real Estate Groups		(2,089	)		—			—			—		(2,089	)		(1,269	)		—		—			(34	)		(1,303	)
Deferred taxes — Real Estate Group		(4,084	)		—			—			—		(4,084	)		2,735			—		—			(3,310	)		(575	)
Straight-line rent adjustment		3,452			—			—			—		3,452			18			—		—			—			18
Preference payment		(936	)		—			—			—		(936	)		—			—		—			—			—
Preferred return on disposition		—			—			—			—		—			(5,034	)		—		—			—			(5,034	)
Gain on disposition of rental properties, net of tax		—			—			—			—		—			—			—		—			67,182			67,182
Discontinued operations, net of tax and minority interest:
Depreciation and amortization — Real Estate Groups		—			—			—			—		—			(921	)		—		—			921			—
Amortization of mortgage procurement costs — Real Estate Groups		—			—			—			—		—			(34	)		—		—			34			—
Deferred taxes — Real Estate Groups		—			—			—			—		—			(3,310	)		—		—			3,310			—
Gain on disposition of rental properties		—			—			—			—		—			67,182			—		—			(67,182	)		—
Net earnings (loss)	$	14,485		$	—		$	—		$	—	$	14,485		$	65,975		$	—	$	—		$	—		$	65,975

35

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Summary of Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT) — Three Months Ended July 31, 2007 (in thousands) (continued)

	Land Development Group 2007														The Nets 2007
							Plus													Plus
	Full			Less			Unconsolidated			Plus		Pro-Rata			Full			Less		Unconsolidated		Plus		Pro-Rata
	Consolidation			Minority			Investments at			Discontinued		Consolidation			Consolidation			Minority		Investments at		Discontinued		Consolidation
	(GAAP)			Interest			Pro-Rata			Operations		(Non-GAAP)			(GAAP)			Interest		Pro-Rata		Operations		(Non-GAAP)
Revenues from real estate operations	$	14,606		$	803		$	7,636		$	—	$	21,439		$	—		$	—	$	2,096	$	—	$	2,096
Exclude straight-line rent adjustment		—			—			—			—		—			—			—		—		—		—
Adjusted revenues		14,606			803			7,636			—		21,439			—			—		2,096		—		2,096
Operating expenses, including depreciation and amortization, and amortization of mortgage procurement costs for non-Real Estate Groups		14,015			753			4,471			—		17,733			—			—		3,880		—		3,880
Exclude straight-line rent adjustment		—			—			—			—		—			—			—		—		—		—
Exclude preference payment		—			—			—			—		—			—			—		—		—		—
Adjusted operating expenses		14,015			753			4,471			—		17,733			—			—		3,880		—		3,880
Add interest and other income		2,968			253			40			—		2,755			—			—		14		—		14
Add equity in earnings of unconsolidated entities		3,198			—			(3,006	)		—		192			(2,226	)		—		2,199		—		(27	)
Add back equity method depreciation and amortization expense		116			—			(116	)		—		—			—			—		—		—		—
Net operating income		6,873			303			83			—		6,653			(2,226	)		—		429		—		(1,797	)
Interest expense, including early extinguishment of debt		68			(53	)		83			—		204			—			—		429		—		429
Income tax expense (benefit)		2,971			—			—			—		2,971			(807	)		—		—		—		(807	)
Preferred return on disposition		—			—			—			—		—			—			—		—		—		—
Minority interest in earnings before depreciation and amortization		356			356			—			—		—			—			—		—		—		—
Add: EBDT from discontinued operations		—			—			—			—		—			—			—		—		—		—
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	3,478		$	—		$	—		$	—	$	3,478		$	(1,419	)	$	—	$	—	$	—	$	(1,419	)
Reconciliation to net earnings:
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	3,478		$	—		$	—		$	—	$	3,478		$	(1,419	)	$	—	$	—	$	—	$	(1,419	)
Depreciation and amortization — Real Estate Groups		(180	)		—			—			—		(180	)		—			—		—		—		—
Amortization of mortgage procurement costs — Real Estate Groups		(146	)		—			—			—		(146	)		—			—		—		—		—
Deferred taxes — Real Estate Group		476			—			—			—		476			—			—		—		—		—
Straight-line rent adjustment		—			—			—			—		—			—			—		—		—		—
Preference payment		—			—			—			—		—			—			—		—		—		—
Preferred return on disposition		—			—			—			—		—			—			—		—		—		—
Gain on disposition of rental properties, net of tax		—			—			—			—		—			—			—		—		—		—
Discontinued operations, net of tax and minority interest:
Depreciation and amortization — Real Estate Groups		—			—			—			—		—			—			—		—		—		—
Amortization of mortgage procurement costs — Real Estate Groups		—			—			—			—		—			—			—		—		—		—
Deferred taxes — Real Estate Groups		—			—			—			—		—			—			—		—		—		—
Gain on disposition of rental properties		—			—			—			—		—			—			—		—		—		—
Net earnings (loss)	$	3,628		$	—		$	—		$	—	$	3,628		$	(1,419	)	$	—	$	—	$	—	$	(1,419	)

36

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Summary of Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT) — Three Months Ended July 31, 2007 (in thousands) (continued)

	Corporate Activities 2007												Total 2007
						Plus												Plus
	Full			Less		Unconsolidated		Plus		Pro-Rata			Full			Less		Unconsolidated			Plus			Pro-Rata
	Consolidation			Minority		Investments at		Discontinued		Consolidation			Consolidation			Minority		Investments at			Discontinued			Consolidation
	(GAAP)			Interest		Pro-Rata		Operations		(Non-GAAP)			(GAAP)			Interest		Pro-Rata			Operations			(Non-GAAP)
Revenues from real estate operations	$	—		$	—	$	—	$	—	$	—		$	287,586		$	15,329	$	96,040		$	12,397		$	380,694
Exclude straight-line rent adjustment		—			—		—		—		—			(7,158	)		—		—			—			(7,158	)
Adjusted revenues		—			—		—		—		—			280,428			15,329		96,040			12,397			373,536
Operating expenses, including depreciation and amortization, and amortization of mortgage procurement costs for non-Real Estate Groups		9,890			—		—		—		9,890			179,208			4,853		63,047			11,883			249,285
Exclude straight-line rent adjustment		—			—		—		—		—			(3,688	)		—		—			—			(3,688	)
Exclude preference payment		—			—		—		—		—			(936	)		—		—			—			(936	)
Adjusted operating expenses		9,890			—		—		—		9,890			174,584			4,853		63,047			11,883			244,661
Add interest and other income		375			—		—		—		375			23,423			601		6,228			112			29,162
Add equity in earnings of unconsolidated entities		—			—		—		—		—			7,773			232		(7,791	)		—			(250	)
Add back equity method depreciation and amortization expense		—			—		—		—		—			9,914			—		(9,914	)		—			—
Net operating income		(9,515	)		—		—		—		(9,515	)		146,954			11,309		21,516			626			157,787
Interest expense, including early extinguishment of debt		16,958			—		—		—		16,958			74,348			4,391		16,482			2,363			88,802
Income tax expense (benefit)		(9,481	)		—		—		—		(9,481	)		185			—		—			(2,406	)		(2,221	)
Preferred return on disposition		—			—		—		—		—			5,034			—		(5,034	)		—			—
Minority interest in earnings before depreciation and amortization		—			—		—		—		—			6,918			6,918		—			—			—
Add: EBDT from discontinued operations		—			—		—		—		—			669			—		—			(669	)		—
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	(16,992	)	$	—	$	—	$	—	$	(16,992	)	$	71,206		$	—	$	—		$	—		$	71,206
Reconciliation to net earnings:
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	(16,992	)	$	—	$	—	$	—	$	(16,992	)	$	71,206		$	—	$	—		$	—		$	71,206
Depreciation and amortization — Real Estate Groups		—			—		—		—		—			(61,569	)		—		—			(921	)		(62,490	)
Amortization of mortgage procurement costs — Real Estate Groups		—			—		—		—		—			(3,504	)		—		—			(34	)		(3,538	)
Deferred taxes — Real Estate Groups		1,834			—		—		—		1,834			961			—		—			(3,310	)		(2,349	)
Straight-line rent adjustment		—			—		—		—		—			3,470			—		—			—			3,470
Preference payment		—			—		—		—		—			(936	)		—		—			—			(936	)
Preferred return on disposition		—			—		—		—		—			(5,034	)		—		—			—			(5,034	)
Gain on disposition of rental properties, net of tax		264			—		—		—		264			264			—		—			67,182			67,446
Discontinued operations, net of tax and minority interest:
Depreciation and amortization — Real Estate Groups		—			—		—		—		—			(921	)		—		—			921			—
Amortization of mortgage procurement costs — Real Estate Groups		—			—		—		—		—			(34	)		—		—			34			—
Deferred taxes — Real Estate Groups		—			—		—		—		—			(3,310	)		—		—			3,310			—
Gain on disposition of rental properties		—			—		—		—		—			67,182			—		—			(67,182	)		—
Net earnings (loss)	$	(14,894	)	$	—	$	—	$	—	$	(14,894	)	$	67,775		$	—	$	—		$	—		$	67,775

37

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Summary of Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT) — Six Months Ended July 31, 2007 (in thousands)

	Commercial Group 2007														Residential Group 2007
							Plus													Plus
	Full			Less			Unconsolidated			Plus		Pro-Rata			Full			Less		Unconsolidated			Plus			Pro-Rata
	Consolidation			Minority			Investments at			Discontinued		Consolidation			Consolidation			Minority		Investments at			Discontinued			Consolidation
	(GAAP)			Interest			Pro-Rata			Operations		(Non-GAAP)			(GAAP)			Interest		Pro-Rata			Operations			(Non-GAAP)
Revenues from real estate operations	$	413,753		$	23,683		$	58,293		$	—	$	448,363		$	116,859		$	5,784	$	100,139		$	24,599		$	235,813
Exclude straight-line rent adjustment		(12,979	)		—			—			—		(12,979	)		(22	)		—		—			—			(22	)
Adjusted revenues		400,774			23,683			58,293			—		435,384			116,837			5,784		100,139			24,599			235,791
Operating expenses, including depreciation and amortization, and amortization of mortgage procurement costs for non-Real Estate Groups		216,989			5,629			31,053			—		242,413			82,313			3,836		67,809			20,730			167,016
Exclude straight-line rent adjustment		(5,380	)		—			—			—		(5,380	)		—			—		—			—			—
Exclude preference payment		(1,834	)		—			—			—		(1,834	)		—			—		—			—			—
Adjusted operating expenses		209,775			5,629			31,053			—		235,199			82,313			3,836		67,809			20,730			167,016
Add interest and other income		10,233			664			943			—		10,512			15,629			21		5,791			209			21,608
Add equity in earnings of unconsolidated entities		5,213			(18	)		(5,253	)		—		(22	)		6,627			602		(6,719	)		—			(694	)
Remove gain on disposition of equity method rental properties		—			—			—			—		—			(2,106	)		—		2,106			—			—
Add back equity method depreciation and amortization expense		7,553			—			(7,553	)		—		—			11,056			—		(11,056	)		—			—
Net operating income		213,998			18,700			15,377			—		210,675			65,730			2,571		22,452			4,078			89,689
Interest expense, including early extinguishment of debt		94,131			8,277			15,377			—		101,231			26,386			1,288		17,418			3,971			46,487
Income tax expense (benefit)		4,581			—			—			—		4,581			6,983			—		—			(2,348	)		4,635
Preferred return on disposition		—			—			—			—		—			5,034			—		(5,034	)		—			—
Minority interest in earnings before depreciation and amortization		10,423			10,423			—			—		—			1,283			1,283		—			—			—
Add: EBDT from discontinued operations		—			—			—			—		—			2,455			—		—			(2,455	)		—
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	104,863		$	—		$	—		$	—	$	104,863		$	38,567		$	—	$	—		$	—		$	38,567
Reconciliation to net earnings:
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	104,863		$	—		$	—		$	—	$	104,863		$	38,567		$	—	$	—		$	—		$	38,567
Depreciation and amortization — Real Estate Groups		(88,346	)		—			—			—		(88,346	)		(36,425	)		—		—			(1,934	)		(38,359	)
Amortization of mortgage procurement costs — Real Estate Groups		(4,115	)		—			—			—		(4,115	)		(1,986	)		—		—			(69	)		(2,055	)
Deferred taxes — Real Estate Group		(3,614	)		—			—			—		(3,614	)		7,343			—		—			(3,560	)		3,783
Straight-line rent adjustment		7,599			—			—			—		7,599			22			—		—			—			22
Preference payment		(1,834	)		—			—			—		(1,834	)		—			—		—			—			—
Preferred return on disposition		—			—			—			—		—			(5,034	)		—		—			—			(5,034	)
Gain on disposition of rental properties and other investments, net of tax		—			—			—			—		—			—			—		1,292			67,182			68,474
Gain on disposition of equity method rental properties, net of tax		—			—			—			—		—			1,292			—		(1,292	)		—			—
Discontinued operations, net of tax and minority interest:
Depreciation and amortization — Real Estate Groups		—			—			—			—		—			(1,934	)		—		—			1,934			—
Amortization of mortgage procurement costs — Real Estate Groups		—			—			—			—		—			(69	)		—		—			69			—
Deferred taxes — Real Estate Groups		—			—			—			—		—			(3,560	)		—		—			3,560			—
Gain on disposition of rental properties		—			—			—			—		—			67,182			—		—			(67,182	)		—
Net earnings (loss)	$	14,553		$	—		$	—		$	—	$	14,553		$	65,398		$	—	$	—		$	—		$	65,398

38

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Summary of Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT) — Six Months Ended July 31, 2007 (in thousands) (continued)

	Land Development Group 2007													The Nets 2007
						Plus													Plus
	Full			Less		Unconsolidated			Plus		Pro-Rata			Full			Less		Unconsolidated		Plus		Pro-Rata
	Consolidation			Minority		Investments at			Discontinued		Consolidation			Consolidation			Minority		Investments at		Discontinued		Consolidation
	(GAAP)			Interest		Pro-Rata			Operations		(Non-GAAP)			(GAAP)			Interest		Pro-Rata		Operations		(Non-GAAP)
Revenues from real estate operations	$	25,339		$	1,178	$	8,784		$	—	$	32,945		$	—		$	—	$	6,006	$	—	$	6,006
Exclude straight-line rent adjustment		1			—		—			—		1			—			—		—		—		—
Adjusted revenues		25,340			1,178		8,784			—		32,946			—			—		6,006		—		6,006
Operating expenses, including depreciation and amortization, and amortization of mortgage procurement costs for non-Real Estate Groups		26,171			1,183		5,935			—		30,923			—			—		10,706		—		10,706
Exclude straight-line rent adjustment		—			—		—			—		—			—			—		—		—		—
Exclude preference payment		—			—		—			—		—			—			—		—		—		—
Adjusted operating expenses		26,171			1,183		5,935			—		30,923			—			—		10,706		—		10,706
Add interest and other income		7,978			739		94			—		7,333			—			—		23		—		23
Add equity in earnings of unconsolidated entities		2,771			—		(2,566	)		—		205			(5,477	)		—		5,439		—		(38	)
Remove gain on disposition of equity method rental properties		—			—		—			—		—			—			—		—		—		—
Add back equity method depreciation and amortization expense		178			—		(178	)		—		—			—			—		—		—		—
Net operating income		10,096			734		199			—		9,561			(5,477	)		—		762		—		(4,715	)
Interest expense, including early extinguishment of debt		2,374			127		199			—		2,446			—			—		762		—		762
Income tax expense (benefit)		6,334			—		—			—		6,334			(2,008	)		—		—		—		(2,008	)
Preferred return on disposition		—			—		—			—		—			—			—		—		—		—
Minority interest in earnings before depreciation and amortization		607			607		—			—		—			—			—		—		—		—
Add: EBDT from discontinued operations		—			—		—			—		—			—			—		—		—		—
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	781		$	—	$	—		$	—	$	781		$	(3,469	)	$	—	$	—	$	—	$	(3,469	)
Reconciliation to net earnings:
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	781		$	—	$	—		$	—	$	781		$	(3,469	)	$	—	$	—	$	—	$	(3,469	)
Depreciation and amortization — Real Estate Groups		(294	)		—		—			—		(294	)		—			—		—		—		—
Amortization of mortgage procurement costs — Real Estate Groups		(287	)		—		—			—		(287	)		—			—		—		—		—
Deferred taxes — Real Estate Group		3,661			—		—			—		3,661			—			—		—		—		—
Straight-line rent adjustment		(1	)		—		—			—		(1	)		—			—		—		—		—
Preference payment		—			—		—			—		—			—			—		—		—		—
Preferred return on disposition		—			—		—			—		—			—			—		—		—		—
Gain on disposition of rental properties and other investments, net of tax		—			—		—			—		—			—			—		—		—		—
Gain on disposition of equity method rental properties, net of tax		—			—		—			—		—			—			—		—		—		—
Discontinued operations, net of tax and minority interest:
Depreciation and amortization — Real Estate Groups		—			—		—			—		—			—			—		—		—		—
Amortization of mortgage procurement costs — Real Estate Groups		—			—		—			—		—			—			—		—		—		—
Deferred taxes — Real Estate Groups		—			—		—			—		—			—			—		—		—		—
Gain on disposition of rental properties		—			—		—			—		—			—			—		—		—		—
Net earnings (loss)	$	3,860		$	—	$	—		$	—	$	3,860		$	(3,469	)	$	—	$	—	$	—	$	(3,469	)

39

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Summary of Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT) — Six Months Ended July 31, 2007 (in thousands) (continued)

	Corporate Activities 2007												Total 2007
						Plus												Plus
	Full			Less		Unconsolidated		Plus		Pro-Rata			Full			Less		Unconsolidated			Plus			Pro-Rata
	Consolidation			Minority		Investments at		Discontinued		Consolidation			Consolidation			Minority		Investments at			Discontinued			Consolidation
	(GAAP)			Interest		Pro-Rata		Operations		(Non-GAAP)			(GAAP)			Interest		Pro-Rata			Operations			(Non-GAAP)
Revenues from real estate operations	$	—		$	—	$	—	$	—	$	—		$	555,951		$	30,645	$	173,222		$	24,599		$	723,127
Exclude straight-line rent adjustment		—			—		—		—		—			(13,000	)		—		—			—			(13,000	)
Adjusted revenues		—			—		—		—		—			542,951			30,645		173,222			24,599			710,127
Operating expenses, including depreciation and amortization, and amortization of mortgage procurement costs for non-Real Estate Groups		24,324			—		—		—		24,324			349,797			10,648		115,503			20,730			475,382
Exclude straight-line rent adjustment		—			—		—		—		—			(5,380	)		—		—			—			(5,380	)
Exclude preference payment		—			—		—		—		—			(1,834	)		—		—			—			(1,834	)
Adjusted operating expenses		24,324			—		—		—		24,324			342,583			10,648		115,503			20,730			468,168
Add interest and other income		982			—		—		—		982			34,822			1,424		6,851			209			40,458
Add equity in earnings of unconsolidated entities		—			—		—		—		—			9,134			584		(9,099	)		—			(549	)
Remove gain on disposition of equity method rental properties		—			—		—		—		—			(2,106	)		—		2,106			—			—
Add back equity method depreciation and amortization expense		—			—		—		—		—			18,787			—		(18,787	)		—			—
Net operating income		(23,342	)		—		—		—		(23,342	)		261,005			22,005		38,790			4,078			281,868
Interest expense, including early extinguishment of debt		30,800			—		—		—		30,800			153,691			9,692		33,756			3,971			181,726
Income tax expense (benefit)		(19,135	)		—		—		—		(19,135	)		(3,245	)		—		—			(2,348	)		(5,593	)
Remove pereferred return on disposition		—			—		—		—		—			5,034			—		(5,034	)		—			—
Minority interest in earnings before depreciation and amortization		—			—		—		—		—			12,313			12,313		—			—			—
Add: EBDT from discontinued operations		—			—		—		—		—			2,455			—		—			(2,455	)		—
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	(35,007	)	$	—	$	—	$	—	$	(35,007	)	$	105,735		$	—	$	—		$	—		$	105,735
Reconciliation to net earnings:
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	(35,007	)	$	—	$	—	$	—	$	(35,007	)	$	105,735		$	—	$	—		$	—		$	105,735
Depreciation and amortization — Real Estate Groups		—			—		—		—		—			(125,065	)		—		—			(1,934	)		(126,999	)
Amortization of mortgage procurement costs — Real Estate Groups		—			—		—		—		—			(6,388	)		—		—			(69	)		(6,457	)
Deferred taxes — Real Estate Group		4,995			—		—		—		4,995			12,385			—		—			(3,560	)		8,825
Straight-line rent adjustment		—			—		—		—		—			7,620			—		—			—			7,620
Preference payment		—			—		—		—		—			(1,834	)		—		—			—			(1,834	)
Preferred return on disposition		—			—		—		—		—			(5,034	)		—		—			—			(5,034	)
Gain on disposition of rental properties and other investments, net of tax		264			—		—		—		264			264			—		1,292			67,182			68,738
Gain on disposition of equity method rental properties, net of tax		—			—		—		—		—			1,292			—		(1,292	)		—			—
Discontinued operations, net of tax and minority interest:
Depreciation and amortization — Real Estate Groups		—			—		—		—		—			(1,934	)		—		—			1,934			—
Amortization of mortgage procurement costs — Real Estate Groups		—			—		—		—		—			(69	)		—		—			69			—
Deferred taxes — Real Estate Groups		—			—		—		—		—			(3,560	)		—		—			3,560			—
Gain on disposition of rental properties		—			—		—		—		—			67,182			—		—			(67,182	)		—
Net earnings (loss)	$	(29,748	)	$	—	$	—	$	—	$	(29,748	)	$	50,594		$	—	$	—		$	—		$	50,594

40

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Summary of Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT) — Three Months Ended July 31, 2006 (in thousands)

	Commercial Group 2006														Residential Group 2006
						Plus														Plus
	Full			Less		Unconsolidated			Plus			Pro-Rata			Full			Less		Unconsolidated			Plus			Pro-Rata
	Consolidation			Minority		Investments at			Discontinued			Consolidation			Consolidation			Minority		Investments at			Discontinued			Consolidation
	(GAAP)			Interest		Pro-Rata			Operations			(Non-GAAP)			(GAAP)			Interest		Pro-Rata			Operations			(Non-GAAP)
Revenues from real estate operations	$	181,142		$	21,000	$	24,947		$	14,634		$	199,723		$	47,593		$	2,052	$	31,319		$	15,494		$	92,354
Exclude straight-line rent adjustment		(3,369	)		—		—			(15	)		(3,384	)		(8	)		—		—			—			(8	)
Adjusted revenues		177,773			21,000		24,947			14,619			196,339			47,585			2,052		31,319			15,494			92,346
Operating expenses, including depreciation and amortization, and amortization of mortgage procurement costs for non-Real Estate Groups		93,147			10,607		14,247			8,715			105,502			33,410			1,349		18,075			9,479			59,615
Exclude straight-line rent adjustment		(1,186	)		—		—			(306	)		(1,492	)		—			—		—			—			—
Adjusted operating expenses		91,961			10,607		14,247			8,409			104,010			33,410			1,349		18,075			9,479			59,615
Add interest and other income		2,374			814		(47	)		84			1,597			1,303			14		210			112			1,611
Add equity in earnings of unconsolidated entities		9,902			—		(10,315	)		—			(413	)		(5,815	)		—		5,308			—			(507	)
Remove gain on disposition of equity method rental properties		(7,662	)		—		7,662			—			—			—			—		—						—
Add back provision for decline in real estate of equity method rental properties		400			—		(400	)		—			—			—			—		—						—
Add back equity method depreciation and amortization expense		2,796			—		(2,796	)		—			—			10,866			—		(10,866	)		—			—
Net operating income		93,622			11,207		4,804			6,294			93,513			20,529			717		7,896			6,127			33,835
Interest expense, including early extinguishment of debt		44,726			5,948		4,804			1,554			45,136			11,716			693		7,896			3,086			22,005
Income tax expense (benefit)		2,377			—		—			812			3,189			(2,640	)		—		—			593			(2,047	)
Minority interest in earnings before depreciation and amortization		5,259			5,259		—			—			—			24			24		—			—			—
Add: EBDT from discontinued operations		3,928			—		—			(3,928	)		—			2,448			—		—			(2,448	)		—
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	45,188		$	—	$	—		$	—		$	45,188		$	13,877		$	—	$	—		$	—		$	13,877
Reconciliation to net earnings:
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	45,188		$	—	$	—		$	—		$	45,188		$	13,877		$	—	$	—		$	—		$	13,877
Depreciation and amortization — Real Estate Groups		(30,336	)		—		—			(1,480	)		(31,816	)		(20,564	)		—		—			(1,962	)		(22,526	)
Amortization of mortgage procurement costs — Real Estate Groups		(1,751	)		—		—			(46	)		(1,797	)		(583	)		—		—			(66	)		(649	)
Deferred taxes — Real Estate Group		(4,927	)		—		—			(318	)		(5,245	)		1,769			—		—			202			1,971
Straight-line rent adjustment		2,183			—		—			(291	)		1,892			8			—		—			—			8
Gain on disposition of rental properties, net of tax		—					4,700			1,652			6,352			—								4,506			4,506
Provision for decline in real estate, net of tax and minority interest		(1,180	)		—		(245	)		—			(1,425	)		—			—		—			—			—
Gain on disposition of equity method rental properties, net of tax		4,700			—		(4,700	)		—			—			—			—		—			—			—
Provision for decline in real estate of equity method rental proeprties, net of tax		(245	)		—		245			—			—			—			—		—			—			—
Discontinued operations, net of tax and minority interest:
Depreciation and amortization — Real Estate Groups		(1,480	)		—		—			1,480			—			(1,962	)		—		—			1,962			—
Amortization of mortgage procurement costs — Real Estate Groups		(46	)		—		—			46			—			(66	)		—		—			66			—
Deferred taxes — Real Estate Groups		(318	)		—		—			318			—			202			—		—			(202	)		—
Straight-line rent adjustment		(291	)							291						—								—
Gain on disposition of rental properties		1,652			—		—			(1,652	)		—			4,506			—		—			(4,506	)		—
Net earnings (loss)	$	13,149		$	—	$	—		$	—		$	13,149		$	(2,813	)	$	—	$	—		$	—		$	(2,813	)

41

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Summary of Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT) — Three Months Ended July 31, 2006 (in thousands) (continued)

	Land Development Group 2006													The Nets 2006
						Plus													Plus
	Full			Less		Unconsolidated			Plus		Pro-Rata			Full			Less		Unconsolidated		Plus		Pro-Rata
	Consolidation			Minority		Investments at			Discontinued		Consolidation			Consolidation			Minority		Investments at		Discontinued		Consolidation
	(GAAP)			Interest		Pro-Rata			Operations		(Non-GAAP)			(GAAP)			Interest		Pro-Rata		Operations		(Non-GAAP)
Revenues from real estate operations	$	22,094		$	2,003	$	12,774		$	—	$	32,865		$	—		$	—	$	6,291	$	—	$	6,291
Exclude straight-line rent adjustment		—			—		—			—		—			—			—		—		—		—
Adjusted revenues		22,094			2,003		12,774			—		32,865			—			—		6,291		—		6,291
Operating expenses, including depreciation and amortization, and amortization of mortgage procurement costs for non-Real Estate Groups		12,632			967		9,317			—		20,982			—			—		9,067		—		9,067
Exclude straight-line rent adjustment		—			—		—			—		—			—			—		—		—		—
Adjusted operating expenses		12,632			967		9,317			—		20,982			—			—		9,067		—		9,067
Add interest and other income		4,066			398		59			—		3,727			—			—		43		—		43
Add equity in earnings of unconsolidated entities		6,264			—		(3,411	)		—		2,853			(4,041	)		—		4,029		—		(12	)
Remove gain on disposition of equity method rental properties		—			—		—			—		—			—			—		—		—
Add back provision for decline in real estate of equity method rental properties		—			—		—			—		—			—			—		—				—
Add back equity method depreciation and amortization expense		—			—		—			—		—			—			—		—		—		—
Net operating income		19,792			1,434		105			—		18,463			(4,041	)		—		1,296		—		(2,745	)
Interest expense, including early extinguishment of debt		2,643			189		105			—		2,559			—			—		1,296		—		1,296
Income tax expense (benefit)		5,323			—		—			—		5,323			(1,840	)		—		—		—		(1,840	)
Minority interest in earnings before depreciation and amortization		1,245			1,245		—			—		—			—			—		—		—		—
Add: EBDT from discontinued operations		—			—		—			—		—			—			—		—		—		—
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	10,581		$	—	$	—		$	—	$	10,581		$	(2,201	)	$	—	$	—	$	—	$	(2,201	)
Reconciliation to net earnings:
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	10,581		$	—	$	—		$	—	$	10,581		$	(2,201	)	$	—	$	—	$	—	$	(2,201	)
Depreciation and amortization — Real Estate Groups		(43	)		—		—			—		(43	)		—			—		—		—		—
Amortization of mortgage procurement costs — Real Estate Groups		—			—		—			—		—			—			—		—		—		—
Deferred taxes — Real Estate Group		(784	)		—		—			—		(784	)		—			—		—		—		—
Straight-line rent adjustment		—			—		—			—		—			—			—		—		—		—
Gain on disposition of rental properties, net of tax		—			—		—			—		—			—			—		—		—		—
Provision for decline in real estate, net of tax and minority interest		—			—		—			—		—			—			—		—		—		—
Gain on disposition of equity method rental properties, net of tax		—			—		—			—		—			—			—		—		—		—
Provision for decline in real estate of equity method rental proeprties, net of tax		—			—		—			—		—			—			—		—		—		—
Discontinued operations, net of tax and minority interest:
Depreciation and amortization — Real Estate Groups		—			—		—			—		—			—			—		—		—		—
Amortization of mortgage procurement costs — Real Estate Groups		—			—		—			—		—			—			—		—		—		—
Deferred taxes — Real Estate Groups		—			—		—			—		—			—			—		—		—		—
Straight-line rent adjustment
Gain on disposition of rental properties		—			—		—			—		—			—			—		—		—		—
Net earnings (loss)	$	9,754		$	—	$	—		$	—	$	9,754		$	(2,201	)	$	—	$	—	$	—	$	(2,201	)

42

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Summary of Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT) — Three Months Ended July 31, 2006 (in thousands) (continued)

	Corporate Activities 2006												Total 2006
						Plus												Plus
	Full			Less		Unconsolidated		Plus		Pro-Rata			Full			Less		Unconsolidated			Plus			Pro-Rata
	Consolidation			Minority		Investments at		Discontinued		Consolidation			Consolidation			Minority		Investments at			Discontinued			Consolidation
	(GAAP)			Interest		Pro-Rata		Operations		(Non-GAAP)			(GAAP)			Interest		Pro-Rata			Operations			(Non-GAAP)
Revenues from real estate operations	$	—		$	—	$	—	$	—	$	—		$	250,829		$	25,055	$	75,331		$	30,128		$	331,233
Exclude straight-line rent adjustment		—			—		—		—		—			(3,377	)		—		—			(15	)		(3,392	)
Adjusted revenues		—			—		—		—		—			247,452			25,055		75,331			30,113			327,841
Operating expenses, including depreciation and amortization, and amortization of mortgage procurement costs for non-Real Estate Groups		10,822			—		—		—		10,822			150,011			12,923		50,706			18,194			205,988
Exclude straight-line rent adjustment		—			—		—		—		—			(1,186	)		—		—			(306	)		(1,492	)
Adjusted operating expenses		10,822			—		—		—		10,822			148,825			12,923		50,706			17,888			204,496
Add interest and other income		127			—		—		—		127			7,870			1,226		265			196			7,105
Add equity in earnings of unconsolidated entities		—			—		—		—		—			6,310			—		(4,389	)		—			1,921
Remove gain on disposition of equity method rental properties		—			—		—		—		—			(7,662	)		—		7,662			—			—
Add back provision for decline in real estate of equity method rental properties		—			—		—		—		—			400			—		(400	)		—			—
Add back equity method depreciation and amortization expense		—			—		—		—		—			13,662			—		(13,662	)		—			—
Net operating income		(10,695	)		—		—		—		(10,695	)		119,207			13,358		14,101			12,421			132,371
Interest expense, including early extinguishment of debt		12,607			—		—		—		12,607			71,692			6,830		14,101			4,640			83,603
Income tax expense (benefit)		(12,522	)		—		—		—		(12,522	)		(9,302	)		—		—			1,405			(7,897	)
Minority interest in earnings before depreciation and amortization		—			—		—		—		—			6,528			6,528		—			—			—
Add: EBDT from discontinued operations		—			—		—		—		—			6,376			—		—			(6,376	)		—
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	(10,780	)	$	—	$	—	$	—	$	(10,780	)	$	56,665		$	—	$	—		$	—		$	56,665
Reconciliation to net earnings:
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	(10,780	)	$	—	$	—	$	—	$	(10,780	)	$	56,665		$	—	$	—		$	—		$	56,665
Depreciation and amortization — Real Estate Groups		—			—		—		—		—			(50,943	)		—		—			(3,442	)		(54,385	)
Amortization of mortgage procurement costs — Real Estate Groups		—			—		—		—		—			(2,334	)		—		—			(112	)		(2,446	)
Deferred taxes — Real Estate Group		383			—		—		—		383			(3,559	)		—		—			(116	)		(3,675	)
Straight-line rent adjustment		—			—		—		—		—			2,191			—		—			(291	)		1,900
Gain on disposition of rental properties, net of tax		—			—		—		—		—			—			—		4,700			6,158			10,858
Provision for decline in real estate, net of tax and minority interest		—			—		—		—		—			(1,180	)		—		(245	)		—			(1,425	)
Gain on disposition of equity method rental properties, net of tax		—			—		—		—		—			4,700			—		(4,700	)		—			—
Provision for decline in real estate of equity method rental proeprties, net of tax		—			—		—		—		—			(245	)		—		245			—			—
Discontinued operations, net of tax and minority interest:
Depreciation and amortization — Real Estate Groups		—			—		—		—		—			(3,442	)		—		—			3,442			—
Amortization of mortgage procurement costs — Real Estate Groups		—			—		—		—		—			(112	)		—		—			112			—
Deferred taxes — Real Estate Groups		—			—		—		—		—			(116	)		—		—			116			—
Straight-line rent adjustment		—			—		—		—					(291	)		—		—			291
Gain on disposition of rental properties		—			—		—		—		—			6,158			—		—			(6,158	)		—
Net earnings (loss)	$	(10,397	)	$	—	$	—	$	—	$	(10,397	)	$	7,492		$	—	$	—		$	—		$	7,492

43

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Summary of Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT) — Six Months Ended July 31, 2006 (in thousands)

	Commercial Group 2006														Residential Group 2006
						Plus														Plus
	Full			Less		Unconsolidated			Plus			Pro-Rata			Full			Less		Unconsolidated			Plus			Pro-Rata
	Consolidation			Minority		Investments at			Discontinued			Consolidation			Consolidation			Minority		Investments at			Discontinued			Consolidation
	(GAAP)			Interest		Pro-Rata			Operations			(Non-GAAP)			(GAAP)			Interest		Pro-Rata			Operations			(Non-GAAP)
Revenues from real estate operations	$	377,481		$	44,160	$	47,596		$	30,380		$	411,297		$	92,173		$	4,062	$	62,116		$	30,592		$	180,819
Exclude straight-line rent adjustment		(6,053	)		—		—			(31	)		(6,084	)		(19	)		—		—			—			(19	)
Adjusted revenues		371,428			44,160		47,596			30,349			405,213			92,154			4,062		62,116			30,592			180,800
Operating expenses, including depreciation and amortization, and amortization of mortgage procurement costs for non-Real Estate Groups		191,879			21,125		27,589			23,023			221,366			62,037			2,502		35,913			18,890			114,338
Exclude straight-line rent adjustment		(2,353	)		—		—			(718	)		(3,071	)		—			—		—			—			—
Adjusted operating expenses		189,526			21,125		27,589			22,305			218,295			62,037			2,502		35,913			18,890			114,338
Add interest and other income		3,259			1,124		(156	)		533			2,512			11,192			16		321			171			11,668
Add equity in earnings of unconsolidated entities		11,420			—		(12,198	)		—			(778	)		(5,176	)		—		4,301			—			(875	)
Remove gain on disposition of equity method rental properties		(7,662	)		—		7,662			—			—			—			—		—			—			—
Add back provision for decline in real estate of equity method rental properties		400			—		(400	)		—			—			—			—		—						—
Add back equity method depreciation and amortization expense		5,602			—		(5,602	)		—			—			15,167			—		(15,167	)		—			—
Net operating income		194,921			24,159		9,313			8,577			188,652			51,300			1,576		15,658			11,873			77,255
Interest expense, including early extinguishment of debt		88,900			11,825		9,313			3,651			90,039			21,939			1,361		15,658			6,248			42,484
Income tax expense (benefit)		4,768			—		—			60			4,828			(3,593	)		—		—			672			(2,921	)
Minority interest in earnings before depreciation and amortization		12,334			12,334		—			—			—			215			215		—			—			—
Add: EBDT from discontinued operations		4,866			—		—			(4,866	)		—			4,953			—		—			(4,953	)		—
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	93,785		$	—	$	—		$	—		$	93,785		$	37,692		$	—	$	—		$	—		$	37,692
Reconciliation to net earnings:
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	93,785		$	—	$	—		$	—		$	93,785		$	37,692		$	—	$	—		$	—		$	37,692
Depreciation and amortization — Real Estate Groups		(59,844	)		—		—			(3,159	)		(63,003	)		(34,583	)		—		—			(3,925	)		(38,508	)
Amortization of mortgage procurement costs — Real Estate Groups		(3,717	)		—		—			(100	)		(3,817	)		(1,403	)		—		—			(135	)		(1,538	)
Deferred taxes — Real Estate Group		(11,509	)		—		—			(318	)		(11,827	)		(1,196	)		—		—			67			(1,129	)
Straight-line rent adjustment		3,700			—		—			(687	)		3,013			19			—		—			—			19
Gain on disposition of rental properties, net of tax		—			—		4,700			47,855			52,555			—			—		—			4,506			4,506
Provision for decline in real estate, net of tax and minority interest		(1,180	)		—		(245	)		—			(1,425	)		—			—		—			—			—
Gain on disposition of equity method rental properties, net of tax		4,700			—		(4,700	)		—			—			—			—		—			—			—
Provision for decline in real estate of equity method rental proeprties, net of tax		(245	)		—		245			—			—			—			—		—			—			—
Discontinued operations, net of tax and minority interest:
Depreciation and amortization — Real Estate Groups		(3,159	)		—		—			3,159			—			(3,925	)		—		—			3,925			—
Amortization of mortgage procurement costs — Real Estate Groups		(100	)		—		—			100			—			(135	)		—		—			135			—
Deferred taxes — Real Estate Groups		(318	)		—		—			318			—			67			—		—			(67	)		—
Straight-line rent adjustment		(687	)							687						—			—		—			—
Gain on disposition of rental properties		47,855			—		—			(47,855	)		—			4,506			—		—			(4,506	)		—
Net earnings (loss)	$	69,281		$	—	$	—		$	—		$	69,281		$	1,042		$	—	$	—		$	—		$	1,042

44

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Summary of Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT) — Six Months Ended July 31, 2006 (in thousands) (continued)

	Land Development Group 2006													The Nets 2006
						Plus													Plus
	Full			Less		Unconsolidated			Plus		Pro-Rata			Full			Less		Unconsolidated		Plus		Pro-Rata
	Consolidation			Minority		Investments at			Discontinued		Consolidation			Consolidation			Minority		Investments at		Discontinued		Consolidation
	(GAAP)			Interest		Pro-Rata			Operations		(Non-GAAP)			(GAAP)			Interest		Pro-Rata		Operations		(Non-GAAP)
Revenues from real estate operations	$	42,910		$	2,850	$	16,841		$	—	$	56,901		$	—		$	—	$	18,555	$	—	$	18,555
Exclude straight-line rent adjustment		1			—		—			—		1			—			—		—		—		—
Adjusted revenues		42,911			2,850		16,841			—		56,902			—			—		18,555		—		18,555
Operating expenses, including depreciation and amortization, and amortization of mortgage procurement costs for non-Real Estate Groups		25,733			1,602		12,924			—		37,055			—			—		29,032		—		29,032
Exclude straight-line rent adjustment		—			—		—			—		—			—			—		—		—		—
Adjusted operating expenses		25,733			1,602		12,924			—		37,055			—			—		29,032		—		29,032
Add interest and other income		7,612			731		81			—		6,962			—			—		112		—		112
Add equity in earnings of unconsolidated entities		13,187			—		(3,509	)		—		9,678			(12,742	)		—		12,697		—		(45	)
Remove gain on disposition of equity method rental properties		—			—		—			—		—			—			—		—		—
Add back provision for decline in real estate of equity method rental properties		—			—		—			—		—			—			—		—				—
Add back equity method depreciation and amortization expense		—			—		—			—		—			—			—		—		—		—
Net operating income		37,977			1,979		489			—		36,487			(12,742	)		—		2,332		—		(10,410	)
Interest expense, including early extinguishment of debt		4,472			318		489			—		4,643			—			—		2,332		—		2,332
Income tax expense (benefit)		14,413			—		—			—		14,413			(5,166	)		—		—		—		(5,166	)
Minority interest in earnings before depreciation and amortization		1,661			1,661		—			—		—			—			—		—		—		—
Add: EBDT from discontinued operations		—			—		—			—		—			—			—		—		—		—
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	17,431		$	—	$	—		$	—	$	17,431		$	(7,576	)	$	—	$	—	$	—	$	(7,576	)
Reconciliation to net earnings:
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	17,431		$	—	$	—		$	—	$	17,431		$	(7,576	)	$	—	$	—	$	—	$	(7,576	)
Depreciation and amortization — Real Estate Groups		(74	)		—		—			—		(74	)		—			—		—		—		—
Amortization of mortgage procurement costs — Real Estate Groups		—			—		—			—		—			—			—		—		—		—
Deferred taxes — Real Estate Group		2,069			—		—			—		2,069			—			—		—		—		—
Straight-line rent adjustment		(1	)		—		—			—		(1	)		—			—		—		—		—
Gain on disposition of rental properties, net of tax		—			—		—			—		—			—			—		—		—		—
Provision for decline in real estate, net of tax and minority interest		—			—		—			—		—			—			—		—		—		—
Gain on disposition of equity method rental properties, net of tax		—			—		—			—		—			—			—		—		—		—
Provision for decline in real estate of equity method rental proeprties, net of tax		—			—		—			—		—			—			—		—		—		—
Discontinued operations, net of tax and minority interest:
Depreciation and amortization — Real Estate Groups		—			—		—			—		—			—			—		—		—		—
Amortization of mortgage procurement costs — Real Estate Groups		—			—		—			—		—			—			—		—		—		—
Deferred taxes — Real Estate Groups		—			—		—			—		—			—			—		—		—		—
Straight-line rent adjustment
Gain on disposition of rental properties		—			—		—			—		—			—			—		—		—		—
Net earnings (loss)	$	19,425		$	—	$	—		$	—	$	19,425		$	(7,576	)	$	—	$	—	$	—	$	(7,576	)

45

Forest City Enterprises, Inc. and Subsidiaries
Supplemental Financial Information

Summary of Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT) — Six Months Ended July 31, 2006 (in thousands) (continued)

	Corporate Activities 2006												Total 2006
						Plus												Plus
	Full			Less		Unconsolidated		Plus		Pro-Rata			Full			Less		Unconsolidated			Plus			Pro-Rata
	Consolidation			Minority		Investments at		Discontinued		Consolidation			Consolidation			Minority		Investments at			Discontinued			Consolidation
	(GAAP)			Interest		Pro-Rata		Operations		(Non-GAAP)			(GAAP)			Interest		Pro-Rata			Operations			(Non-GAAP)
Revenues from real estate operations	$	—		$	—	$	—	$	—	$	—		$	512,564		$	51,072	$	145,108		$	60,972		$	667,572
Exclude straight-line rent adjustment		—			—		—		—		—			(6,071	)		—		—			(31	)		(6,102	)
Adjusted revenues		—			—		—		—		—			506,493			51,072		145,108			60,941			661,470
Operating expenses, including depreciation and amortization, and amortization of mortgage procurement costs for non-Real Estate Groups		18,950			—		—		—		18,950			298,599			25,229		105,458			41,913			420,741
Exclude straight-line rent adjustment		—			—		—		—		—			(2,353	)		—		—			(718	)		(3,071	)
Adjusted operating expenses		18,950			—		—		—		18,950			296,246			25,229		105,458			41,195			417,670
Add interest and other income		654			—		—		—		654			22,717			1,871		358			704			21,908
Add equity in earnings of unconsolidated entities		—			—		—		—		—			6,689			—		1,291			—			7,980
Remove gain on disposition of equity method rental properties		—			—		—		—		—			(7,662	)		—		7,662			—			—
Add back provision for decline in real estate of equity method rental properties		—			—		—		—		—			400			—		(400	)		—			—
Add back equity method depreciation and amortization expense		—			—		—		—		—			20,769			—		(20,769	)		—			—
Net operating income		(18,296	)		—		—		—		(18,296	)		253,160			27,714		27,792			20,450			273,688
Interest expense, including early extinguishment of debt		22,780			—		—		—		22,780			138,091			13,504		27,792			9,899			162,278
Income tax expense (benefit)		(19,748	)		—		—		—		(19,748	)		(9,326	)		—		—			732			(8,594	)
Minority interest in earnings before depreciation and amortization		—			—		—		—		—			14,210			14,210		—			—			—
Add: EBDT from discontinued operations		—			—		—		—		—			9,819			—		—			(9,819	)		—
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	(21,328	)	$	—	$	—	$	—	$	(21,328	)	$	120,004		$	—	$	—		$	—		$	120,004
Reconciliation to net earnings:
Earnings before depreciation, amortization and deferred taxes (EBDT)	$	(21,328	)	$	—	$	—	$	—	$	(21,328	)	$	120,004		$	—	$	—		$	—		$	120,004
Depreciation and amortization — Real Estate Groups		—			—		—		—		—			(94,501	)		—		—			(7,084	)		(101,585	)
Amortization of mortgage procurement costs — Real Estate Groups		—			—		—		—		—			(5,120	)		—		—			(235	)		(5,355	)
Deferred taxes — Real Estate Group		(94	)		—		—		—		(94	)		(10,730	)		—		—			(251	)		(10,981	)
Straight-line rent adjustment		—			—		—		—		—			3,718			—		—			(687	)		3,031
Gain on disposition of rental properties, net of tax		—			—		—		—		—			—			—		4,700			52,361			57,061
Provision for decline in real estate, net of tax and minority interest		—			—		—		—		—			(1,180	)		—		(245	)		—			(1,425	)
Gain on disposition of equity method rental properties, net of tax		—			—		—		—		—			4,700			—		(4,700	)		—			—
Provision for decline in real estate of equity method rental proeprties, net of tax		—			—		—		—		—			(245	)		—		245			—			—
Discontinued operations, net of tax and minority interest:
Depreciation and amortization — Real Estate Groups		—			—		—		—		—			(7,084	)		—		—			7,084			—
Amortization of mortgage procurement costs — Real Estate Groups		—			—		—		—		—			(235	)		—		—			235			—
Deferred taxes — Real Estate Groups		—			—		—		—		—			(251	)		—		—			251			—
Straight-line rent adjustment		—												(687	)		—		—			687
Gain on disposition of rental properties		—			—		—		—		—			52,361			—		—			(52,361	)		—
Net earnings (loss)	$	(21,422	)	$	—	$	—	$	—	$	(21,422	)	$	60,750		$	—	$	—		$	—		$	60,750

46