

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                    FORM 10-Q

          QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
                              EXCHANGE ACT OF 1934

                  FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2005

                           COMMISSION FILE NO. 1-12494


                        CBL & ASSOCIATES PROPERTIES, INC.
             (Exact Name of registrant as specified in its charter)

            DELAWARE                                 62-1545718
(State or other jurisdiction of         (I.R.S. Employer Identification Number)
incorporation or organization)

        2030 Hamilton Place Blvd., Suite 500, Chattanooga, TN 37421-6000
           (Address of principal executive office, including zip code)

        Registrant's telephone number, including area code (423) 855-0001

                                       N/A
              (Former name, former address and former fiscal year,
                          if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding twelve (12) months (or for such shorter period that the Registrant
was required to file such reports) and (2) has been subject to such filing
requirements for the past ninety (90) days.

                     YES      |X|            NO       |_|

Indicate by check mark whether the registrant is an accelerated filer (as
defined in Exchange Act Rule 12b-2).

                     YES      |X|            NO       |_|


As of August 1, 2005, there were 63,380,944 shares of common stock, par value
$0.01 per share, outstanding.


                                       1
<PAGE>

                        CBL & Associates Properties, Inc.


PART I - FINANCIAL INFORMATION

ITEM 1:   Financial Statements................................................3

          Consolidated Balance Sheets.........................................4

          Consolidated Statements of Operations...............................5

          Consolidated Statements of Cash Flows...............................6

          Notes to Unaudited Consolidated Financial Statements................7

ITEM 2:  Management's Discussion and Analysis of Financial
         Condition and Results of Operations.................................17

ITEM 3:  Quantitative and Qualitative Disclosures About Market Risk..........30

ITEM 4:  Controls and Procedures.............................................31


   PART II - OTHER INFORMATION...............................................31


ITEM 1:     Legal Proceedings................................................31

ITEM 2:     Unregistered Sales of Equity Securities and Use of Proceeds......31

ITEM 3:     Defaults Upon Senior Securities..................................32

ITEM 4:     Submission of Matters to a Vote of Security Holders..............32

ITEM 5:     Other Information................................................32

ITEM 6:     Exhibits.........................................................32


   SIGNATURE.................................................................34




                                       2
<PAGE>



                        CBL & Associates Properties, Inc.



ITEM 1:   Financial Statements

     The accompanying  financial  statements are unaudited;  however,  they have
been prepared in accordance with accounting principles generally accepted in the
United States of America for interim  financial  information  and in conjunction
with the  rules and  regulations  of the  Securities  and  Exchange  Commission.
Accordingly,  they do not include all of the disclosures  required by accounting
principles  generally  accepted  in the United  States of America  for  complete
financial statements. In the opinion of management,  all adjustments (consisting
solely of normal  recurring  matters)  necessary for a fair  presentation of the
financial  statements for these interim periods have been included.  The results
for the interim periods ended June 30, 2005, are not  necessarily  indicative of
the results to be obtained for the full fiscal year.

     These  financial  statements  should  be read  in  conjunction  with  CBL &
Associates  Properties,  Inc.'s audited  financial  statements and notes thereto
included in the CBL & Associates Properties, Inc. Annual Report on Form 10-K for
the year ended December 31, 2004.

                                       3
<PAGE>



                        CBL & Associates Properties, Inc.

                           Consolidated Balance Sheets
                        (In thousands, except share data)
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                                   June 30,              December 31,
                                                                                     2005                    2004
                                                                               ----------------        ---------------
ASSETS
Real estate assets:
<S>                                                                            <C>                     <C>
  Land..............................................................           $      666,681          $     659,782
  Buildings and improvements........................................                4,820,211              4,670,462
                                                                               ----------------        ---------------
                                                                                    5,486,892              5,330,244
    Less accumulated depreciation...................................                (651,614)              (575,464)
                                                                               ----------------        ---------------
                                                                                    4,835,278              4,754,780
  Real estate assets held for sale, net.............................                       --                 61,607
  Developments in progress..........................................                  170,131                 78,393
                                                                               ----------------        ---------------
    Net investment in real estate assets............................                5,005,409              4,894,780
Cash and cash equivalents...........................................                   37,888                 25,766
Receivables:
  Tenant, net of allowance for doubtful accounts of $3,237 in
     2005 and 2004..................................................                   35,326                 38,409
  Other.............................................................                   10,216                 13,706
Mortgage and other notes receivable.................................                   18,301                 27,804
Investments in unconsolidated affiliates............................                   98,737                 84,782
Other assets........................................................                  119,047                119,253
                                                                               ----------------        ---------------
                                                                               $    5,324,924          $   5,204,500
                                                                               ================        ===============

LIABILITIES AND SHAREHOLDERS' EQUITY
Mortgage and other notes payable....................................           $    3,458,841          $   3,359,466
Mortgage notes payable on real estate assets held for sale..........                       --                 12,213
Accounts payable and accrued liabilities............................                  222,894                212,064
                                                                               ----------------        ---------------
  Total liabilities.................................................                3,681,735              3,583,743
                                                                               ----------------        ---------------
Commitments and contingencies (Notes 2, 3, and 8) ..................
Minority interests..................................................                  577,115                566,606
                                                                               ----------------        ---------------
Shareholders' equity:
  Preferred stock, $.01 par value, 15,000,000 shares authorized:
  8.75% Series B Cumulative Redeemable Preferred Stock,
        2,000,000 shares outstanding in 2005 and 2004...............                       20                     20
  7.75% Series C Cumulative Redeemable Preferred Stock,
         460,000 shares outstanding in 2005 and 2004................                        5                      5
  7.375% Series D Cumulative Redeemable Preferred Stock,
         700,000 shares outstanding in 2005 and 2004................                        7                      7
  Common stock, $.01 par value, 180,000,000 shares authorized,
         63,334,742 and 62,667,104 shares issued and outstanding
         in 2005 and 2004, respectively.............................                      633                    626
  Additional paid - in capital......................................                1,049,974              1,025,479
  Deferred compensation.............................................                 (10,570)                (3,081)
  Retained earnings.................................................                   26,005                 31,095
                                                                               ----------------        ---------------
    Total shareholders' equity......................................                1,066,074              1,054,151
                                                                               ----------------        ---------------
                                                                               $    5,324,924          $   5,204,500
                                                                               ================        ===============
<FN>
The accompanying notes are an integral part of these balance sheets.
</FN>
</TABLE>

                                       4
<PAGE>



                        CBL & Associates Properties, Inc.

                      Consolidated Statements of Operations
                      (In thousands, except per share data)
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                             Three Months Ended          Six Months Ended
                                                                                  June 30,                   June 30,
                                                                         -------------------------  --------------------------
                                                                            2005           2004         2005          2004
                                                                         -----------    ----------   ----------    -----------
REVENUES:
<S>                                                                        <C>           <C>          <C>            <C>
Minimum rents.........................................................     $127,378      $113,487     $257,809       $221,937
Percentage rents......................................................        1,758         1,472        9,857          8,157
Other rents...........................................................        2,795         2,456        5,920          5,242
Tenant reimbursements.................................................       58,315        50,523      119,101         98,519
Management, development and leasing fees..............................        3,773         1,716        6,818          3,511
Other.................................................................        4,977         5,849       10,396         10,296
                                                                         -----------    ----------   ----------    -----------
  Total revenues......................................................      198,996       175,503      409,901        347,662
                                                                         -----------    ----------   ----------    -----------
EXPENSES:
Property operating....................................................       28,361        26,350       60,026         53,995
Depreciation and amortization.........................................       43,339        32,878       84,625         65,434
Real estate taxes.....................................................       15,892        14,095       31,343         27,176
Maintenance and repairs...............................................       11,926        10,174       24,271         20,367
General and administrative............................................        9,234         7,992       18,420         16,225
Loss on impairment of real estate assets..............................           --            --          262             --
Other.................................................................        3,057         4,923        6,487          7,955
                                                                         -----------    ----------   ----------    -----------
  Total expenses......................................................      111,809        96,412      225,434        191,152
                                                                         -----------    ----------   ----------    -----------
Income from operations................................................       87,187        79,091      184,467        156,510
Interest income.......................................................        2,594           706        4,277          1,586
Interest expense......................................................     (50,255)      (42,798)     (99,176)       (83,232)
Loss on extinguishment of debt........................................           --            --        (884)             --
Gain on sales of real estate assets...................................        4,382         4,955        7,096         24,780
Equity in earnings of unconsolidated affiliates.......................        2,683         2,682        5,774          5,546
Minority interest in earnings:
  Operating partnership...............................................     (16,895)      (17,840)     (37,721)       (42,874)
  Shopping center properties..........................................      (1,178)       (1,819)      (2,575)        (3,058)
                                                                         -----------    ----------   ----------    -----------
Income before discontinued operations.................................       28,518        24,977       61,258         59,258
Operating income (loss) of discontinued operations....................         (39)           622          266            951
Gain (loss) on discontinued operations................................         (54)           525         (86)            520
                                                                         -----------    ----------   ----------    -----------
Net income............................................................       28,425        26,124       61,438         60,729
Preferred dividends...................................................      (7,642)       (4,416)     (15,284)        (8,832)
                                                                         -----------    ----------   ----------    -----------
Net income available to common shareholders...........................     $ 20,783      $ 21,708     $ 46,154       $ 51,897
Basic per share data:
    Income before discontinued operations,
        net of preferred dividends....................................     $  0.33       $  0.34      $  0.73        $   0.83
    Discontinued operations...........................................          --          0.02         0.01            0.02
                                                                         -----------    ----------   ----------    -----------
    Net income available to common shareholders.......................     $  0.33       $  0.35      $  0.74        $   0.85
                                                                         ===========    ==========   ==========    ===========
    Weighted average common shares outstanding......................        62,685        61,200       62,567          60,928
Diluted per share data:
    Income before discontinued operations,
       net of preferred dividends.....................................     $  0.32       $  0.32      $  0.71         $  0.80
    Discontinued operations...........................................          --          0.02           --            0.02
                                                                         -----------    ----------   ----------    -----------
    Net income available to common shareholders.......................     $  0.32       $  0.34      $  0.71         $  0.82
                                                                         ===========    ==========   ==========    ===========
Weighted average common and potential
       dilutive common shares outstanding.............................      65,004        63,510       64,895          63,372
<FN>
The accompanying notes are an integral part of these statements.
</FN>
</TABLE>

                                       5
<PAGE>


                        CBL & Associates Properties, Inc.

                      Consolidated Statements of Cash Flows
                                 (In thousands)
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                              Six Months Ended
                                                                                                  June 30,
                                                                                         ------------------------------
                                                                                             2005              2004
                                                                                         -------------    -------------
CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                                                        <C>               <C>
Net income....................................................................             $   61,438        $   60,729
Adjustments to reconcile net income to net cash provided by operating activities:
  Depreciation................................................................                 65,986            47,063
  Amortization ...............................................................                 22,038            22,114
  Amortization of debt premiums...............................................                 (3,584)           (2,057)
  Amortization of above and below market leases...............................                 (2,838)           (1,171)
  Gain on sales of real estate assets.........................................                 (7,096)          (24,780)
  Gain (loss) on disposal of discontinued operations..........................                     86              (520)
  Issuance of stock under incentive plan......................................                    771             1,268
  Abandoned development projects..............................................                    138             1,685
  Amortization of deferred compensation.......................................                    669               257
  Accrual of deferred compensation............................................                    252               230
  Loss on extinguishment of debt..............................................                    884                --
  Loss on impairment of real estate assets....................................                    262                --
  Minority interest in earnings...............................................                 40,296            45,932
Changes in:
  Tenant and other receivables................................................                  5,853            (4,362)
  Other assets................................................................                   (209)           (6,585)
  Accounts payable and accrued liabilities....................................                (12,950)           10,335
                                                                                         -------------    -------------
          Net cash provided by operating activities...........................                171,996           150,138
                                                                                         -------------    -------------
CASH FLOWS FROM INVESTING ACTIVITIES:
    Additions to real estate assets...........................................               (106,898)         (339,676)
    Acquisitions of real estate assets and other assets.......................                 (2,783)          (40,260)
    Other capital expenditures................................................                (38,876)          (33,601)
    Capitalized interest......................................................                 (2,560)           (2,051)
    Additions to other assets.................................................                 (2,795)           (1,750)
    Reduction of cash in escrow ..............................................                     --            78,476
    Proceeds from sales of real estate assets.................................                 58,207           103,980
    Additions to mortgage notes receivable....................................                   (859)             (225)
    Payments received on mortgage notes receivable............................                 12,988             8,839
    Additional investments in and advances to unconsolidated affiliates.......                (12,912)          (13,043)
    Distributions in excess of equity in earnings of unconsolidated affiliates                  2,526             9,784
                                                                                         -------------    -------------
          Net cash used investing activities..................................                (93,962)         (229,527)
                                                                                         -------------    -------------
CASH FLOWS FROM FINANCING ACTIVITIES:
    Proceeds from mortgage and other notes payable............................                122,889           341,290
    Principal payments on mortgage and other notes payable....................                (81,208)         (164,665)
    Additions to deferred financing costs.....................................                   (773)           (1,681)
    Proceeds from issuance of common stock....................................                    300               274
    Costs related to issuance of preferred stock..............................                   (193)               --
    Proceeds from exercise of stock options...................................                  5,384             9,968
    Prepayment penalties on extinguishment of debt............................                   (852)               --
    Purchase of minority interest in the Operating Partnership................                   (254)           (4,143)
    Distributions to minority interests.......................................                (44,300)          (38,898)
    Dividends paid to holders of preferred stock..............................                (15,929)           (8,831)
    Dividends paid to common shareholders.....................................                (50,976)          (44,215)
                                                                                         -------------    -------------
          Net cash provided by (used in) financing activities.................                (65,912)           89,099
                                                                                         -------------    -------------
NET CHANGE IN CASH AND CASH EQUIVALENTS.......................................                 12,122             9,710
CASH AND CASH EQUIVALENTS, beginning of period                                                 25,766            20,332
                                                                                         -------------    -------------
CASH AND CASH EQUIVALENTS, end of period......................................            $    37,888       $    30,042
                                                                                         =============    =============
SUPPLEMENTAL INFORMATION:
  Cash paid for interest, net of amounts capitalized..........................            $    98,886       $    81,460
                                                                                         =============    =============
<FN>
The accompanying notes are an integral part of these statements.
</FN>
</TABLE>


                                       6
<PAGE>

                        CBL & Associates Properties, Inc.

              Notes to Unaudited Consolidated Financial Statements
                      (In thousands, except per share data)

Note 1 - Organization and Basis of Presentation

     CBL & Associates  Properties,  Inc. ("CBL"), a Delaware  corporation,  is a
self-managed,  self-administered,  fully integrated real estate investment trust
("REIT") that is engaged in the ownership,  development,  acquisition,  leasing,
management and operation of regional shopping malls and community centers. CBL's
shopping  center  properties  are  located in 29 states,  but  primarily  in the
southeastern and midwestern United States.

     CBL conducts  substantially  all of its  business  through CBL & Associates
Limited  Partnership  (the  "Operating  Partnership").  At June  30,  2005,  the
Operating  Partnership  owned  controlling  interests in 65 regional  malls,  26
associated  centers (each adjacent to a regional  shopping mall), four community
centers  and  CBL's  corporate  office  building.   The  Operating   Partnership
consolidates  the  financial  statements  of  all  entities  in  which  it has a
controlling financial interest.  The Operating Partnership owned non-controlling
interests  in six  regional  malls,  two  associated  centers  and 54  community
centers. Because major decisions such as the acquisition, sale or refinancing of
principal  partnership  assets  must be  approved  by one or  more of the  other
partners,  the Operating  Partnership does not control these  partnerships  and,
accordingly,  accounts  for these  investments  using  the  equity  method.  The
Operating  Partnership had five mall expansions,  two open-air shopping centers,
two community  centers and one community center expansion under  construction at
June 30, 2005. The Operating  Partnership  also holds options to acquire certain
development properties owned by third parties.

     CBL is the 100% owner of two qualified REIT  subsidiaries,  CBL Holdings I,
Inc. and CBL Holdings II, Inc. At June 30, 2005,  CBL Holdings I, Inc., the sole
general  partner of the  Operating  Partnership,  owned a 1.6%  general  partner
interest in the Operating  Partnership  and CBL Holdings II, Inc.  owned a 53.4%
limited partner interest for a combined interest held by CBL of 55.0%.

     The minority interest in the Operating Partnership is held primarily by CBL
& Associates,  Inc. and its affiliates (collectively "CBL's Predecessor") and by
affiliates of The Richard E. Jacobs Group,  Inc.  ("Jacobs").  CBL's Predecessor
contributed their interests in certain real estate properties and joint ventures
to the Operating Partnership in exchange for a limited partner interest when the
Operating  Partnership  was formed in November 1993.  Jacobs  contributed  their
interests in certain real estate  properties and joint ventures to the Operating
Partnership  in  exchange  for  limited  partner  interests  when the  Operating
Partnership  acquired the  majority of Jacobs'  interests  in 23  properties  in
January  2001 and the balance of such  interests in February  2002.  At June 30,
2005, CBL's Predecessor  owned a 15.2% limited partner interest,  Jacobs owned a
20.7% limited  partner  interest and third parties owned a 9.1% limited  partner
interest in the Operating Partnership.  CBL's Predecessor also owned 5.7 million
shares of CBL's common stock at June 30, 2005,  for a total  combined  effective
interest of 20.2% in the Operating Partnership.

     The  Operating   Partnership   conducts  CBL's   property   management  and
development   activities  through  CBL  &  Associates   Management,   Inc.  (the
"Management  Company")  to comply  with  certain  requirements  of the  Internal
Revenue Code of 1986, as amended (the "Code").  The Operating  Partnership  owns
100% of both of the Management Company's preferred stock and common stock.

     CBL, the Operating  Partnership and the Management Company are collectively
referred to herein as "the Company".

     At the  Company's  Annual  Meeting  of  Shareholders  on May 9,  2005,  the
Company's  shareholders  approved an increase  in the  authorized  shares of the
common  stock  under  the  Company's   amended  and  restated   certificate   of


                                       7
<PAGE>

incorporation to 180,000,000 shares from 95,000,000 shares. On May 10, 2005, the
Company's Board of Directors approved a two-for-one stock split of the Company's
common  stock,  which was effected in the form of a stock  dividend.  The record
date for the stock split was June 1, 2005,  and the  distribution  date was June
15, 2005. The Company  retained the current par value of $0.01 per share for all
shares of common stock.

     The Operating  Partnership  currently  has common units and special  common
units of limited  partner  interest  outstanding  that may be exchanged by their
holders,  under  certain  circumstances,   for  shares  of  common  stock  on  a
one-for-one  basis.  These common units and special common units were also split
on a two-for-one basis so that they continue to be exchangeable on a one-for-one
basis into shares of the Company's  common stock.  All  references to numbers of
common  shares and per share  data in the  accompanying  consolidated  financial
statements  and notes thereto have been adjusted to reflect the stock split on a
retroactive  basis.  Shareholders'  equity  reflects  the stock split  through a
reclassification  of $313 from Additional Paid-In Capital to Common Stock, which
represents  the par  value of the  additional  shares  resulting  from the stock
split.

Note 2 - Joint Ventures

Investment in Unconsolidated Affiliates

     At June 30,  2005,  the  Company  had  investments  in the  following  nine
partnerships and joint ventures, which are accounted for using the equity method
of accounting:
<TABLE>
<CAPTION>
                                                                                  Company's
Joint Venture                      Property Name                                  Interest
-------------------------------------------------------------------------------------------------------
<S>                                <C>                                             <C>
Governor's Square IB               Governor's Plaza                                50.0%
Governor's Square Company          Governor's Square                               47.5%
Imperial Valley Mall L.P.          Imperial Valley Mall                            60.0%
Kentucky Oaks Mall Company         Kentucky Oaks Mall                              50.0%
Mall of South Carolina L.P.        Coastal Grand-Myrtle Beach                      50.0%
Mall of South Outparcel L.P.       Coastal Grand-Myrtle Beach (vacant land)        50.0%
Mall Shopping Center Company       Plaza del Sol                                   50.6%
Parkway Place L.P.                 Parkway Place                                   45.0%
Galileo America, LLC               Portfolio of 54 community centers                8.4%
</TABLE>

     Condensed combined financial  statement  information for the unconsolidated
affiliates is as follows:
<TABLE>
<CAPTION>
                                                                                 Company's Share for the
                                              Total for the Three Months               Three Months
                                                    Ended June 30,                    Ended June 30,
                                             ------------------------------    ------------------------------
                                                  2005             2004             2005             2004
                                             --------------   -------------    -------------    -------------
<S>                                               <C>              <C>              <C>            <C>
Revenues                                          $39,104          $26,575          $9,952         $ 7,443
Depreciation and amortization                      (9,332)          (6,352)         (2,210)         (1,547)
Interest expense                                  (11,676)          (6,437)         (3,538)         (1,658)
Other operating expenses                          (11,552)          (7,446)         (3,214)         (2,212)
Discontinued operations                               499              321              41              30
Gain on sales of real estate assets                 2,289            2,414           1,652             626
                                             --------------   -------------    -------------    -------------
Net income                                         $9,332          $ 9,075          $2,683         $ 2,682
                                             ==============   =============    =============    =============
</TABLE>

                                       8
<PAGE>
<TABLE>
<CAPTION>
                                                                                 Company's Share for the
                                              Total for the Six Months                  Six Months
                                                    Ended June 30,                    Ended June 30,
                                             ------------------------------    ------------------------------
                                                  2005             2004             2005             2004
                                             --------------   -------------    -------------    -------------
<S>                                               <C>              <C>              <C>            <C>
Revenues                                          $74,941         $ 51,407         $18,742         $13,777
Depreciation and amortization                     (17,509)         (11,499)         (3,920)         (2,743)
Interest expense                                  (20,733)         (12,306)         (6,060)         (3,077)
Other operating expenses                          (20,406)         (13,236)         (5,607)         (3,663)
Discontinued operations                                60              378               5              35
Gain on sales of real estate assets                 4,718            3,589           2,614           1,217
                                             --------------   -------------    -------------    -------------
Net income                                        $21,071          $18,333         $ 5,774         $ 5,546
                                             ==============   =============    =============    =============
</TABLE>

     The third phase of the  Company's  joint venture  transaction  with Galileo
America,  Inc. closed on January 5, 2005, when the Company sold its interests in
two power centers,  one community  center and one community  center expansion to
the joint venture,  Galileo America LLC ("Galileo America"),  for $58,600, which
consisted of $42,529 in cash, the joint venture's assumption of $12,141 of debt,
$3,596  representing the Company's interest in Galileo America and closing costs
of $334.  The real  estate  assets and  related  mortgage  notes  payable of the
properties  in the third phase were  reflected as held for sale as of January 1,
2004,  the date that it was  determined  these  assets  met the  criteria  to be
reflected as held for sale. The Company did not record any depreciation  expense
on these assets during the six months ended June 30, 2005 and 2004.  The Company
recognized a loss on impairment of real estate assets of $1,947 in December 2004
and an  additional  loss on  impairment of real estate assets of $262 during the
six months ended June 30, 2005 related to the  properties  included in the third
phase.

     The Company has entered into master lease  agreements  with Galileo America
on  certain  of the  properties  that have been sold to  Galileo  America  since
October  2003.  The  remaining  aggregate  obligation  under these  master lease
agreements  was $3,971 at June 30, 2005. The master lease  arrangements  are for
various terms of up to fifteen years.

     The results of operations of the properties included in the Galileo America
transaction are not reflected as discontinued  operations  since the Company has
continuing  involvement  through its ownership  interest and the agreement under
which the Company is the exclusive manager of the properties.

     See  Note  5 to  the  consolidated  financial  statements  included  in the
Company's Annual Report on Form 10-K for the year ended December 31, 2004, for a
more complete  description of the Galileo  America  transaction.  See Note 13 in
this  quarterly  report for a description  of a subsequent  event related to the
sale of the Company's interest in the Galileo America joint venture.

Other
-----

     In April 2005,  the Company  formed a joint  venture with Jacobs to develop
Gulf Coast Town  Center in Lee County  (Ft.  Myers/Naples),  Florida.  Under the
terms of the joint venture agreement, the Company has contributed  approximately
$40,335 for a 50% interest in the joint venture, the proceeds of which were used
to refund the aggregate  acquisition and development costs incurred with respect
to the  project  that were  previously  paid by Jacobs.  The  Company  will also
provide any additional equity necessary to fund the development of the property,
as well as to fund up to an aggregate  of $30,000 of  operating  deficits of the
joint  venture.  The  Company  will  receive  a  preferred  return of 11% on its
invested  capital in the joint venture and will, after payment of such preferred
return and  repayment of the  Company's  invested  capital,  share  equally with
Jacobs in the joint venture's profits.

     The joint  venture  arrangement  provides the Company with the right to put
its 50%  ownership  interest  to Jacobs if  certain  approvals  of  tenants  and
government  entities  that are required  for the  continued  development  of the
project  are  not  obtained  by the  second  anniversary  of the  joint  venture
agreement.  The put right  provides  that Jacobs will acquire the  Company's 50%


                                       9
<PAGE>

ownership  interest for an amount equal to the total unreturned equity funded by
the Company plus any accrued and unpaid preferred return on that equity.

     Based on its evaluation of the provisions of Financial Accounting Standards
Board Interpretation No. 46(R), Consolidation of Variable Interest Entities, the
Company has determined  that the joint venture is a variable  interest entity in
which it is the primary beneficiary. Therefore, the joint venture is included in
the Company's consolidated financial statements

Note 3 - Mortgage and Other Notes Payable

     Mortgage and other notes  payable  consisted  of the  following at June 30,
2005 and December 31, 2004, respectively:
<TABLE>
<CAPTION>
                                                        June 30, 2005                   December 31, 2004
                                                -----------------------------    ------------------------------
                                                                   Weighted                          Weighted
                                                                    Average                          Average
                                                                   Interest                          Interest
                                                   Amount           Rate(1)          Amount          Rate(1)
                                                --------------  -------------    ---------------  -------------
Fixed-rate debt:
<S>                                               <C>                <C>           <C>                <C>
   Non-recourse loans on operating properties     $ 2,778,311        6.39%         $  2,688,186       6.38%
                                                --------------                   ---------------
Variable-rate debt:
   Recourse term loans on operating properties        189,150        4.25%              207,500       3.45%
   Construction loans                                  25,095        4.52%               14,593       3.94%
   Lines of credit                                    466,285        4.26%              461,400       3.37%
                                                --------------                   ---------------
   Total variable-rate debt                           680,530        4.27%              683,493       3.41%
                                                --------------                   ---------------
Total                                             $ 3,458,841        5.97%         $  3,371,679       5.78%
                                                ==============                   ===============
<FN>
(1)  Weighted-average  interest rate including the effect of debt premiums,  but
     excluding amortization of deferred financing costs.
</FN>
</TABLE>

Unsecured Line of Credit
------------------------

     The Company has a $400,000 unsecured credit facility,  which bears interest
at the London Interbank Offered Rate ("LIBOR") plus a margin of 100 to 145 basis
points based on the Company's leverage, as defined in the agreement.  The credit
facility matures in August 2006 and has three one-year extension options,  which
are at the Company's election.  At June 30, 2005, the outstanding  borrowings of
$1,000 under the unsecured  credit facility had a weighted average interest rate
of 4.35%.

Secured Lines of Credit
-----------------------

     The  Company  has  four   secured   lines  of  credit  that  are  used  for
construction,  acquisition, and working capital purposes. Each of these lines is
secured by  mortgages  on certain of the  Company's  operating  properties.  The
following summarizes certain information about the secured lines of credit as of
June 30, 2005:
<TABLE>
<CAPTION>
   Total             Total          Maturity
 Available        Outstanding         Date
-------------------------------------------------
<S>                <C>            <C>
$  373,000         $  368,150     February 2006
   100,000             67,135       June 2007
    20,000             20,000      March 2007
    10,000             10,000      April 2006
----------------------------------
$  503,000         $  465,285
==================================
</TABLE>

     Borrowings  under  the  secured  lines of  credit  had a  weighted  average
interest rate of 4.26% at June 30, 2005.

                                       10
<PAGE>

Letters of Credit
-----------------

     At June 30, 2005, the Company had additional secured lines of credit with a
total commitment of $27,123 that can only be used for issuing letters of credit.
The total outstanding  amount under these lines of credit was $8,885 at June 30,
2005.

Covenants and Restrictions
--------------------------

     Twenty  malls,  five  associated  centers,  two  community  centers and the
corporate  office  building  are  owned by  special  purpose  entities  that are
included in the Company's consolidated  financial statements.  The sole business
purpose of the special purpose entities is to own and operate these  properties,
each of which is encumbered by a commercial-mortgage-backed-securities loan. The
real  estate  and other  assets  owned by these  special  purpose  entities  are
restricted  under the loan  agreements  in that they are not available to settle
other debts of the Company. However, so long as the loans are not under an event
of  default,  as  defined  in the loan  agreements,  the cash  flows  from these
properties, after payments of debt service, operating expenses and reserves, are
available for distribution to the Company.

     The weighted average remaining term of the Company's  consolidated debt was
4.3 years at June 30, 2005 and 4.7 years at December 31,  2004.  Of the $597,329
of debt that will mature before June 30, 2006, the Company has extension options
that will  extend the  maturity  date of  $557,300  of that debt beyond June 30,
2006.  Of the  remaining  $40,029 of debt  maturing  before June 30,  2006,  the
Company obtained an extension for $10,000  subsequent to June 30, 2005, and will
either retire or obtain new financing for the remaining $30,029 of debt.

Note 4 - Acquisitions

     Effective June 1, 2005, the Company  acquired a 70% joint venture  interest
in Laurel Park Place, a regional mall in Livonia,  MI, at a negotiated  purchase
price of  $82,200.  This  purchase  price  consisted  of  $2,687  in  cash,  the
assumption of $50,654 of  nonrecourse  debt that bears interest at a stated rate
of 8.50% and matures in December 2012 and the issuance of 571,700 special common
units in the Operating  Partnership  at a negotiated  economic  value of $28,859
($50.48  per  special  common  unit).  The  Company  recorded a debt  premium of
$10,552,  computed using an estimated  market interest rate of 5.00%,  since the
debt  assumed was at an  above-market  interest  rate  compared to similar  debt
instruments at the date of acquisition.

     The Company  recorded the purchase of the 70% joint venture  interest based
on a purchase price of $80,318.  The difference  between the announced  purchase
price  and the  price  at which  the  acquisition  was  recorded  for  financial
reporting  purposes  reflects  an  additional  $96 of  transaction  costs  and a
reduction of the value of the special  common units from $28,859 to $26,881,  or
$47.02 per special common unit.  The reduction  reflects an adjustment to record
the issuance of the special  common units at their  estimated  fair value on the
date of issuance rather than the economic value negotiated between the parties.

     The special  common  units issued in the  acquisition  of Laurel Park Place
receive a minimum  distribution of $3.03 per unit per year. If the  distribution
on the common  units  exceeds  $3.03 per unit per year for any period,  then the
special common units will receive a distribution equal to the amount paid on the
common  units.  Upon  the  earlier  to  occur  of June  1,  2020,  or  when  the
distribution  on the common units  exceeds  $3.03 per unit for four  consecutive
calendar   quarters,   the  special  common  units  will  thereafter  receive  a
distribution equal to the amount paid on the common units.

     The Company may elect to acquire the remaining  30%  ownership  interest in
the joint venture,  or a portion thereof,  at anytime  following the acquisition
date for a purchase price of $14,000, which will be paid through the issuance of
common units of limited partner  interest in the Operating  Partnership.  If the


                                       11
<PAGE>

Company exercises its right to acquire the remaining 30% joint venture interest,
or a portion  thereof,  prior to December 2012, the common units issued will not
be entitled to receive  distributions  until after December 2012. If the Company
does not exercise its right to acquire the remaining 30% joint venture interest,
then the joint  venture  partner  owning that  interest will receive a preferred
return equal to the greater of 12% or the 10-year  treasury  rate plus 800 basis
points  on the  portion  of its  joint  venture  interest  that has not yet been
acquired by the Company.  The $14,000 value of the minority  partner's  interest
has been recorded in Accounts Payable and Accrued Liabilities.

     The results of  operations  of Laurel Park Place have been  included in the
consolidated  financial  statements  since  the date of  acquisition.  Pro forma
financial  information  reflecting the  acquisition of Laurel Park Place has not
been  provided  because  the  acquisition  is  not  individually  material.  The
following table  summarizes the estimated fair values of the assets acquired and
liabilities assumed as of the acquisition date:
<TABLE>
<CAPTION>
<S>                                                                <C>
Land                                                               $   17,633
Buildings and improvements                                             84,988
Above-market leases                                                     7,754
In-place leases                                                         3,307
                                                                 --------------
   Total assets                                                       113,682
Mortgage note payables assumed                                        (50,654)
Premiums on mortgage note payables assumed                            (10,552)
Below-market leases                                                    (8,951)
Future purchase obligation                                            (14,000)
                                                                 --------------
Net assets acquired                                                 $  29,525
                                                                 ==============
</TABLE>

Note 5 - Segment Information

     The Company  measures  performance  and  allocates  resources  according to
property  type,  which is determined  based on certain  criteria such as type of
tenants,  capital  requirements,  economic risks,  leasing terms, and short- and
long-term  returns on  capital.  Rental  income and tenant  reimbursements  from
tenant leases provide the majority of revenues from all segments. Information on
the Company's reportable segments is presented as follows:



<TABLE>
<CAPTION>
                                                        Associated       Community
Three Months Ended June 30, 2005            Malls         Centers         Centers          All Other        Total
--------------------------------------   -----------   ------------     -----------       -----------    -----------
<S>                                      <C>             <C>            <C>               <C>            <C>
Revenues                                 $  180,397      $   8,529      $    2,420        $    7,650     $  198,996
Property operating expenses (1)             (57,557)        (2,007)           (743)            4,128        (56,179)
Interest expense                            (44,849)        (1,175)           (703)           (3,528)       (50,255)
Other expense                                     -              -               -            (3,057)        (3,057)
Gain on sales of real estate assets              21              -              93             4,268          4,382
                                         -----------   ------------     -----------       -----------    -----------
Segment profit and loss                   $  78,012      $   5,347      $    1,067        $    9,461         93,887
                                         ===========   ============     ===========       ===========
Depreciation and amortization expense                                                                       (43,339)
General and administrative expense                                                                           (9,234)
Interest income                                                                                               2,594
Equity in earnings of unconsolidated
      affiliates                                                                                              2,683
Minority interest in earnings                                                                               (18,073)
                                                                                                         -----------
Income before discontinued operations                                                                    $   28,518
                                                                                                         ===========
Capital expenditures (2)                  $ 147,162      $   4,163      $      370        $   65,522     $  217,217
</TABLE>


                                       12
<PAGE>

<TABLE>
<CAPTION>
                                                        Associated       Community
Three Months Ended June 30, 2004            Malls         Centers         Centers          All Other        Total
--------------------------------------   -----------   ------------     -----------       -----------    -----------
<S>                                      <C>             <C>            <C>               <C>            <C>
Revenues                                 $  159,220      $   6,797      $    4,142        $    5,344     $  175,503
Property operating expenses (1)             (51,469)        (1,534)         (1,386)            3,770        (50,619)
Interest expense                            (39,405)        (1,251)           (778)           (1,364)       (42,798)
Other expense                                     -              -               -            (4,923)        (4,923)
Gain on sales of real estate assets             479              -           4,487               (11)         4,955
                                         -----------   ------------     -----------       -----------    -----------
Segment profit and loss                   $  68,825      $   4,012      $    6,465        $    2,816         82,118
                                         ===========   ============     ===========       ===========
Depreciation and amortization expense                                                                       (32,878)
General and administrative expense                                                                           (7,992)
Interest income                                                                                                 706
Equity in earnings of unconsolidated
   affiliates                                                                                                 2,682
Minority interest in earnings                                                                               (19,659)
                                                                                                         -----------
Income before discontinued operations                                                                     $  24,977
                                                                                                         ===========
Capital expenditures (2)                  $ 301,532      $      47      $    1,203        $   22,345      $ 325,127
</TABLE>

<TABLE>
<CAPTION>
                                                        Associated       Community
Six Months Ended June 30, 2005              Malls         Centers         Centers          All Other        Total
--------------------------------------   -----------   ------------     -----------       -----------    -----------
<S>                                      <C>             <C>            <C>               <C>            <C>
Revenues                                 $  373,903      $  17,018      $    4,093        $   14,887     $  409,901
Property operating expenses (1)            (118,718)        (3,955)         (1,036)            8,069       (115,640)
Interest expense                            (88,337)        (2,467)         (1,418)           (6,954)       (99,176)
Other expense                                     -              -               -            (6,487)        (6,487)
Gain on sales of real estate assets              21              -           1,156             5,919          7,096
                                         -----------   ------------     -----------       -----------    -----------
Segment profit and loss                  $  166,869      $  10,596      $    2,795        $   15,434        195,694
                                         ===========   ============     ===========       ===========
Depreciation and amortization expense                                                                       (84,625)
General and administrative expense                                                                          (18,420)
Loss on impairment of real estate
    assets                                                                                                     (262)
Interest income                                                                                               4,277
Loss on extinguishment of debt                                                                                 (884)
Equity in earnings of unconsolidated
      affiliates                                                                                              5,774
Minority interest in earnings                                                                               (40,296)
                                                                                                         -----------
Income before discontinued operations                                                                    $   61,258
                                                                                                         ===========
Total assets                             $4,742,545      $ 279,178      $   88,653        $  214,548     $5,324,924
Capital expenditures (2)                 $  180,990      $  10,125      $    1,107        $   80,231     $  272,453
</TABLE>


<TABLE>
<CAPTION>
                                                        Associated       Community
Six Months Ended June 30, 2004              Malls         Centers         Centers          All Other        Total
--------------------------------------   -----------   ------------     -----------       -----------    -----------
<S>                                      <C>             <C>            <C>               <C>            <C>
Revenues                                 $  314,042     $   14,988      $    6,849        $   11,783     $  347,662
Property operating expenses (1)            (104,733)        (3,092)         (2,251)            8,538       (101,538)
Interest expense                            (76,671)        (2,514)         (1,518)           (2,529)       (83,232)
Other expense                                     -              -               -            (7,955)        (7,955)
Gain on sales of real estate assets           1,026              -          23,563               191         24,780
                                         -----------   ------------     -----------       -----------    -----------
Segment profit and loss                  $  133,664      $   9,382      $   26,643        $   10,028        179,717
                                         ===========   ============     ===========       ===========
Depreciation and amortization expense                                                                       (65,434)
General and administrative expense                                                                          (16,225)
Interest income                                                                                               1,586
Equity in earnings of unconsolidated
   affiliates                                                                                                 5,546
Minority interest in earnings                                                                               (45,932)
                                                                                                         -----------
Income before discontinued operations                                                                    $   59,258
                                                                                                         ===========
Total assets                             $4,184,680      $ 214,492      $  160,226        $  108,649     $4,668,047
Capital expenditures (2)                 $  523,655      $     433      $    5,605        $   41,053     $  570,746
<FN>
(1)  Property  operating  expenses include  property  operating  expenses,  real
     estate taxes and maintenance and repairs.

(2)  Amounts  include  acquisitions  of real estate  assets and  investments  in
     unconsolidated affiliates. Developments in progress are included in the All
     Other category.
</FN>
</TABLE>

                                       13
<PAGE>

Note 6- Earnings Per Share

     Basic  earnings  per share  ("EPS")  is  computed  by  dividing  net income
available to common shareholders by the weighted-average  number of unrestricted
common shares  outstanding  for the period.  Diluted EPS assumes the issuance of
common stock for all potential dilutive common shares  outstanding.  The limited
partners' rights to convert their minority interest in the Operating Partnership
into shares of common  stock are not  dilutive.  The  following  summarizes  the
impact of potential  dilutive common shares on the  denominator  used to compute
earnings per share:
<TABLE>
<CAPTION>
                                                       Three Months Ended June 30,        Six Months Ended June 30,
                                                       ---------------------------       --------------------------
                                                          2005             2004             2005             2004
                                                       ----------       ----------       ----------      ----------
<S>                                                      <C>              <C>              <C>             <C>
Weighted average shares outstanding                      62,987           61,488           62,878          61,222
Effect of nonvested stock awards                           (302)            (288)            (311)           (294)
                                                       ----------       ----------       ----------      ----------
Denominator - basic earnings per share                   62,685           61,200           62,567          60,928
Effect of  dilutive  stock  options,  nonvested
   stock  awards and deemed  shares  related to
   deferred compensation plans                            2,319            2,310            2,328           2,444
                                                       ----------       ----------       ----------      ----------
Denominator - diluted earnings per share                 65,004           63,510           64,895          63,372
                                                       ==========       ==========       ==========      ==========
</TABLE>

Note 7- Comprehensive Income

     Comprehensive  income includes all changes in  shareholders'  equity during
the  period,  except  those  resulting  from  investments  by  shareholders  and
distributions to shareholders.  Comprehensive income was equal to net income for
the three months ended June 30, 2005 and 2004, and the six months ended June 30,
2005 and 2004.

Note 8- Contingencies

     The Company is currently  involved in certain litigation that arises in the
ordinary  course  of  business.  It is  management's  opinion  that the  pending
litigation  will not  materially  affect the  financial  position  or results of
operations of the Company.

     Based on environmental  studies completed to date,  management believes any
potential  exposure related to environmental  cleanup will not materially affect
the Company's financial position or results of operations.

     The  Company  has  guaranteed  50% of the debt of Parkway  Place  L.P.,  an
unconsolidated  affiliate in which the Company owns a 45%  interest,  which owns
Parkway Place in Huntsville,  AL. The total amount outstanding at June 30, 2005,
was $53,200,  of which the Company has  guaranteed  $26,600.  The guaranty  will
expire when the related debt matures in June 2008.

     The  Company  has  guaranteed  100% of the  construction  debt  incurred by
Imperial Valley Mall L.P., an unconsolidated affiliate in which the Company owns
a 60% interest, to develop Imperial Valley Mall. The total amount outstanding at
June 30, 2005, was $54,628.  The total commitment under the construction loan is
$63,405.

     The Company has issued  various  bonds that it would have to satisfy in the
event of  non-performance.  At June 30, 2005,  the total amount  outstanding  on
these bonds was $18,623.

Note 9 - Stock-Based Compensation

     Historically,  the Company accounted for its stock-based compensation plans
under the recognition and measurement  principles of Accounting Principles Board
Opinion  No. 25  "Accounting  for Stock  Issued to  Employees"  (APB No. 25) and
related Interpretations. Effective January 1, 2003, the Company elected to begin


                                       14
<PAGE>

recording the expense  associated  with stock  options  granted after January 1,
2003, on a prospective  basis in accordance  with the fair value and  transition
provisions  of SFAS No.  123,  "Accounting  for Stock  Based  Compensation",  as
amended by SFAS No. 148,  "Accounting for Stock-Based  Compensation - Transition
and  Disclosure - An Amendment of FASB  Statement  No. 123." The Company has not
granted  any  stock  options  since  January  1,  2003.   The  Company   records
compensation  expense for awards of common  stock based on the fair value of the
common stock on the date of grant and the related vesting period, if any.

     No stock-based  compensation expense related to stock options granted prior
to January 1, 2003, has been  reflected in net income since all options  granted
had an exercise  price equal to the fair value of the Company's  common stock on
the date of grant. Therefore,  stock-based  compensation expense included in net
income available to common  shareholders in the three months ended June 30, 2005
and 2004,  and the six months  ended June 30,  2005 and 2004,  is less than that
which would have been  recognized  if the fair value  method had been applied to
all  stock-based  awards since the effective date of SFAS No. 123. The following
table illustrates the effect on net income and earnings per share if the Company
had  applied  the fair  value  recognition  provisions  of SFAS  No.  123 to all
outstanding and unvested awards in each period:
<TABLE>
<CAPTION>
                                                             Three Months Ended June 30,     Six Months Ended June 30,
                                                             ---------------------------    -------------------------
                                                                 2005           2004            2005           2004
                                                             ------------    -----------    -----------    ----------
<S>                                                             <C>            <C>            <C>             <C>
Net income available to common shareholders, as reported        $20,783        $21,708        $46,154         $51,897
Stock-based  compensation  expense  included in reported
     net income available to common shareholders                    794            192          1,936           1,185
Total stock-based compensation expense determined under
     fair value method                                             (914)          (320)        (2,161)         (1,440)
                                                              ------------    -----------    -----------    ----------
Pro forma net income available to common shareholders           $20,663        $21,580        $45,929         $51,642
                                                              ============    ===========    ===========    ==========
Net income available to common shareholders per share:
   Basic, as reported                                            $ 0.33        $  0.35        $  0.74         $  0.85
                                                              ============    ===========    ===========    ==========
   Basic, pro forma                                              $ 0.33        $  0.36        $  0.73         $  0.85
                                                              ============    ===========    ===========    ==========
   Diluted, as reported                                          $ 0.32        $  0.34        $  0.71         $  0.82
                                                              ============    ===========    ===========    ==========
   Diluted, pro forma                                            $ 0.32        $  0.34        $  0.71         $  0.82
                                                              ============    ===========    ===========    ==========
</TABLE>

Note 10 - Noncash Investing and Financing Activities

     The Company's  noncash  investing and financing  activities were as follows
for the six months ended June 30, 2005 and 2004:
<TABLE>
<CAPTION>
                                                                     Six Months Ended
                                                                         June 30,
                                                                   -----------------------
                                                                       2005        2004
                                                                   ----------- -----------
<S>                                                                <C>         <C>
Debt assumed to acquire property interests, including premiums     $   61,206  $  144,618
                                                                   =========== ===========
Debt consolidated from application of FASB Interpretation No. 46   $        -  $   38,417
                                                                   =========== ===========
Minority interest issued in acquisition of real estate assets      $   26,881  $        -
                                                                   =========== ===========
Debt assumed by buyer on sales of real estate assets               $   12,141  $        -
                                                                   =========== ===========
</TABLE>

Note 11 - Discontinued Operations

     In March 2005,  the Company  sold five  community  centers for an aggregate
sales price of $12,100.  The Company previously  recognized an aggregate loss on
impairment of real estate assets of $617 on these community  centers in December
2004 and  recognized  an  additional  loss on impairment of $32 during the three
months ended March 31, 2005. Total revenues for these community  centers were $4
and $919 for the three  months ended June 30, 2005 and 2004,  respectively,  and
$843 and $1,910 for the six months  ended June 30, 2005 and 2004,  respectively.
All prior  periods  presented  have been  restated to reflect the  operations of
these community centers as discontinued operations.


                                       15
<PAGE>

Note 12 - Recent Accounting Pronouncements

     In December  2004, the FASB released its final revised  standard,  SFAS No.
123 (Revised  2004),  "Share-Based  Payment."  SFAS No.  123(R)  requires that a
public  entity  measure the cost of equity  based  service  awards  based on the
grant-date fair value of the award. That cost will be recognized over the period
during  which an employee is  required  to provide  service in exchange  for the
award or the vesting  period.  No  compensation  cost is  recognized  for equity
instruments  for which employees do not render the requisite  service.  In April
2005, the Securities and Exchange  Commission  amended  Regulation S-X to modify
the  effective  date so that SFAS No. 123(R) can be adopted  beginning  with the
first interim  reporting period of the next fiscal year beginning after June 15,
2005 instead of the first  interim  period  beginning  after June 15, 2005.  The
Company   previously  adopted  the  fair  value  provisions  of  SFAS  No.  123,
"Accounting  for  Stock  Based  Compensation",  as  amended  by  SFAS  No.  148,
"Accounting  for  Stock-Based  Compensation  -  Transition  and  Disclosure - An
Amendment of FASB Statement No. 123" effective January 1, 2003. The Company does
not expect  the  adoption  of this  standard  to have a  material  effect on its
financial position or results of operations.

Note 13 - Subsequent Events

Galileo America Joint Venture
-----------------------------

     On July 19,  2005,  the Company  entered  into a  definitive  agreement  to
transfer its 8.4% ownership  interest in Galileo  America to Galileo  America in
exchange for Galileo  America's  interest in two community  centers:  Springdale
Center in Mobile,  AL, and  Wilkes-Barre  Township  Marketplace in  Wilkes-Barre
Township,  PA. The two properties have a fair value of $60,000. The Company will
have the right to put its  interest  in these two  properties  to Galileo at any
time for one  year  following  the  closing  for  $60,000  in  cash,  as well as
additional  property at Springdale  Center that the Company currently holds in a
ground lease for $3,000 in cash. The Company will recognize a gain of $41,300 on
the exchange of its interest in Galileo  America for the two community  centers,
which  represents  the  difference  between the fair value of the two  community
centers and the carrying value of the Company's investment in Galileo America.

     The  Company  has also  entered  into a  definitive  agreement  to sell all
management and advisory  contracts with Galileo America to New Plan Excel Realty
Trust, Inc. ("New Plan") for $22,000 in cash, of which the entire amount will be
recognized as gain on the sale of the contracts. New Plan also has the right, at
anytime  after  November 22,  2007,  to purchase the  Company's  management  and
advisory  rights in nine additional  properties  that were recently  acquired by
Galileo America from unrelated  parties for $7,000 in cash. The Company will pay
New Plan  $1,925  to  assume  the  remaining  obligations  of  $3,971  under the
Company's master lease arrangements with Galileo America, which will result in a
gain of $2,046.

     The Company will also receive from Galileo  America an  acquisition  fee of
$8,000  upon the closing of Galileo  America's  acquisition  of a  portfolio  of
properties from New Plan. Additionally, the Company will receive $1,000 per year
for the three years  following  the  closing  date for  advisory  services to be
provided to Galileo  America.  The Company will  recognize  fee income for these
amounts as they are earned.

     These  transactions  are expected to close in the quarter ending  September
30, 2005.

Acquisition
-----------

     On  July  14,  2005,  the  Company  purchased  The  Mall  of  Acadiana,   a
super-regional mall in Lafayette, LA, for a cash purchase price of $175,000. The
Company also entered into 10-year lease agreements for land adjacent to The Mall
of Acadiana, which provide the Company the right to purchase the land at anytime
during the lease term for a cash purchase price of $3,200.  After the first year
of the lease terms,  the seller may put the land to the Company for $3,200.  The
Company also obtained an option to acquire an additional  adjacent tract of land
for a cash purchase price of $3,200.

                                       16
<PAGE>

ITEM 2:  Management's Discussion and Analysis of Financial Condition and Results
         of Operations

     The following discussion and analysis of financial condition and results of
operations  should  be read  in  conjunction  with  the  consolidated  financial
statements and  accompanying  notes that are included in this Form 10-Q. In this
discussion,  the terms  "we",  "us",  "our",  and the  "Company"  refer to CBL &
Associates Properties, Inc. and its subsidiaries.

     Certain  statements made in this section or elsewhere in this report may be
deemed "forward looking statements" within the meaning of the federal securities
laws.  Although we believe the  expectations  reflected  in any  forward-looking
statements  are based on reasonable  assumptions,  we can give no assurance that
these expectations will be attained,  and it is possible that actual results may
differ materially from those indicated by these  forward-looking  statements due
to a variety of risks and uncertainties.  Such risks and uncertainties  include,
without limitation, general industry, economic and business conditions, interest
rate fluctuations,  costs of capital and capital  requirements,  availability of
real estate  properties,  inability  to  consummate  acquisition  opportunities,
competition  from other companies and retail  formats,  changes in retail rental
rates in the Company's markets,  shifts in customer demands, tenant bankruptcies
or store  closings,  changes  in  vacancy  rates at our  properties,  changes in
operating  expenses,  changes in applicable  laws,  rules and  regulations,  the
ability to obtain  suitable  equity  and/or  debt  financing  and the  continued
availability  of financing in the amounts and on the terms  necessary to support
our  future  business.  We  disclaim  any  obligation  to update  or revise  any
forward-looking  statements to reflect  actual results or changes in the factors
affecting the forward-looking information.

EXECUTIVE OVERVIEW

     We are a  self-managed,  self-administered,  fully  integrated  real estate
investment  trust  ("REIT")  that  is  engaged  in the  ownership,  development,
acquisition,  leasing,  management and operation of regional  shopping malls and
community centers.  Our shopping center properties are located in 29 states, but
primarily in the southeastern and midwestern United States.

     As of June 30, 2005, we owned  controlling  interests in 65 regional malls,
26  associated  centers  (each  adjacent  to a  regional  shopping  mall),  four
community  centers  and  our  corporate  office  building.  We  consolidate  the
financial  statements of all entities in which we have a  controlling  financial
interest.  As of June  30,  2005,  we  owned  non-controlling  interests  in six
regional malls, two associated centers and 54 community  centers.  Because major
decisions such as the acquisition,  sale or refinancing of principal partnership
or joint venture  assets must be approved by one or more of the other  partners,
we do not  control  these  partnerships  and joint  ventures  and,  accordingly,
account  for  these  investments  using  the  equity  method.  We had five  mall
expansions,  two  open-air  shopping  centers,  two  community  centers  and one
community  center  expansion  under  construction at June 30, 2005. We also hold
options to acquire certain development properties owned by third parties.

     The majority of our revenues is derived from leases with retail tenants and
generally includes base minimum rents,  percentage rents based on tenants' sales
volumes and  reimbursements  from tenants for expenditures,  including  property
operating  expenses,  real estate taxes and maintenance and repairs,  as well as
certain capital expenditures.  We also generate revenues from sales of outparcel
land at the properties and from sales of operating real estate assets when it is
determined  that we can realize the maximum  value of the assets.  Proceeds from
such sales are generally used to reduce borrowings on our credit facilities.

                                       17
<PAGE>

RESULTS OF OPERATIONS

     The following  significant  transactions  impact both the comparison of the
results of operations for the three months ended June 30, 2005 to the results of
operations  for the three months ended June 30, 2004 and the  comparison  of the
results of  operations  for the six months ended June 30, 2005 to the results of
operations for the six months ended June 30, 2004:

|X|  The acquisition of nine malls and two associated centers and the opening of
     two malls and one  associated  center since  January 1, 2004  (collectively
     referred to as the "New  Properties").  We do not consider a property to be
     one of the  Comparable  Properties  (defined  below) until the property has
     been  open  for one  complete  calendar  year.  The New  Properties  are as
     follows:
<TABLE>
<CAPTION>
     Project Name                             Location                            Date Acquired / Opened
     -------------------------------------    --------------------------------    ---------------------------
     Acquisitions:
     -------------
     <S>                                      <C>                                 <C>
     Honey Creek Mall                         Terre Haute, IN                     March 2004
     Volusia Mall                             Daytona Beach, FL                   March 2004
     Greenbrier Mall                          Chesapeake, VA                      April 2004
     Chapel Hill Mall                         Akron, OH                           May 2004
     Chapel Hill Suburban                     Akron, OH                           May 2004
     Park Plaza Mall                          Little Rock, AK                     June 2004
     Monroeville Mall                         Monroeville, PA                     July 2004
     Monroeville Annex                        Monroeville, PA                     July 2004
     Northpark Mall                           Joplin, MO                          November 2004
     Mall del Norte                           Laredo, TX                          November 2004
     Laurel Park Place                        Livonia, MI                         June 2005


     Developments:
     -------------
     Coastal Grand-Myrtle Beach (50/50        Myrtle Beach, SC                    March 2004
     joint venture)
     The Shoppes at Panama City               Panama City, FL                     March 2004
     Imperial Valley Mall (60/40 joint        El Centro, CA                       March 2005
     venture)
</TABLE>

|X|  In January 2005, two power centers,  one community center and one community
     center  expansion  were sold to Galileo  America LLC  ("Galileo  America").
     Since we have a continuing  involvement with these  properties  through our
     ownership interest in Galileo America and the agreement under which we will
     be the exclusive  manager of the  properties,  the results of operations of
     these  properties  have  not been  reflected  in  discontinued  operations.
     Therefore,  the  three  months  ended  June  30,  2005,  do not  include  a
     significant  amount of revenues and expenses  related to these  properties,
     whereas  the three  months  ended June 30,  2004  include a full  period of
     revenues and expenses related to these properties.

|X|  Properties  that were in  operation as of January 1, 2004 and June 30, 2005
     are referred to as the "Comparable Properties."

COMPARISON OF THE THREE MONTHS ENDED JUNE 30, 2005 TO THE THREE MONTHS ENDED
JUNE 30, 2004

Revenues

     The $23.5 million increase in revenues resulted primarily from increases of
$19.4  million  attributable  to the New  Properties  and $4.6  million from the
Comparable  Properties.  The increase in revenues from the Comparable Properties
was attributable to our achieving higher occupancy  combined with an increase in
average base rents from new and renewal leasing  activity,  percentage rents and
specialty income.

     Our cost recovery  ratio improved to 103.8% for the three months ended June
30,  2005,  compared to 99.8% for the three  months  ended June 30,  2004.  This
increase was driven by (i) an increase in total portfolio  occupancy to 91.9% at
June  30,  2005  compared  to  91.1%  at  June  30,  2004  and  (ii)   increased
profitability  related  to  utility  reimbursements  from  tenants  at  the  New
Properties and certain  existing malls due to the  implementation  of efficiency
optimizing utility systems.

                                       18
<PAGE>

     The increase in revenues  was offset  slightly by a decrease in revenues of
$1.7 million  related to the  properties  that were sold to the Galileo  America
joint venture in January 2005.

     Management,  development and leasing fees increased $2.1 million, primarily
as a result of an increase in  management,  leasing  and  acquisition  fees from
Galileo America,  which is directly  related to the growth in Galileo  America's
portfolio.

     Other  revenues  decreased  $0.9  million  as a result  of a  reduction  in
revenues of our taxable REIT subsidiary.

Expenses

     The $5.6 million increase in property  operating  expenses,  including real
estate  taxes and  maintenance  and repairs,  resulted  from an increase of $6.2
million  attributable to the New  Properties,  which was offset by a decrease of
$0.6 million from the  properties  that were sold to the Galileo  America  joint
venture in January 2005.

     The  $10.5  million  increase  in  depreciation  and  amortization  expense
resulted from increases of $6.3 million from the New Properties and $4.2 million
from the  Comparable  Properties.  The increase  attributable  to the Comparable
Properties is due to ongoing capital  expenditures for renovations,  expansions,
tenant allowances and deferred maintenance.

     General and  administrative  expenses increased $1.2 million primarily as a
result of annual increases in salaries and benefits of existing  personnel,  the
addition of new  personnel  to support our growth and  professional  fees.  As a
percentage  of  total  revenues,   general  and  administrative   expenses  were
relatively  flat at 4.6% of total  revenues for both the three months ended June
30, 2005 and 2004.

     Other expense  decreased  $1.9 million due to a decrease of $1.2 million in
write-offs of abandoned  development  projects and a decrease of $0.7 million in
the operating expenses of our taxable REIT subsidiary.

Other Income and Expenses

     The increase in interest  income of $1.9  million  results  primarily  from
interest  income on  advances  that were  made to the  joint  venture  that owns
Imperial Valley Mall for the purpose of funding development costs.

     Interest expense  increased by $7.5 million primarily due to the additional
debt  associated  with the New Properties as well as an increase in the weighted
average  interest rate of our  variable-rate  debt as compared to the comparable
period of the prior year.

Gain on Sales of Real Estate Assets

     Gain on sales of real  estate  assets of $4.4  million in the three  months
ended June 30, 2005 was related to sales of five  outparcels at Southaven  Towne
Center.  The gain on sales of $5.0  million in the three  months  ended June 30,
2004  related to (i) a $4.5  million  gain  related to our being  released  from
obligations  under our master lease arrangement with Galileo America as a result
of leasing  activity at community  centers that were sold to Galileo  America in
previous periods and (ii) $0.5 million on the sales of two outparcels.

                                       19
<PAGE>

Equity in Earnings of Unconsolidated Affiliates

     Equity  in  earnings  of  unconsolidated  affiliates  was flat in the three
months  ended June 30, 2005 as compared to the three months ended June 30, 2004.
The opening of Imperial  Valley  Mall,  along with  outparcel  sales at Imperial
Valley  Mall,  resulted in  increases  in equity in  earnings of  unconsolidated
affiliates during the three months ended June 30, 2005. However, these increases
were offset  primarily  by  reductions  in our share of the  earnings of Coastal
Grand-Myrtle  Beach due to the mortgage loan that was placed on that property in
September  2004,  which is at a fixed  interest  rate  that is  higher  than the
previous variable rate loan.

Discontinued Operations

     Discontinued  operations in the three months ended June 30, 2005  represent
the true up of estimated  expenses to actual amounts for properties  sold during
previous  periods.  Discontinued  operations  in the three months ended June 30,
2004 represent the results of operations for five community  centers  located in
Michigan  that were sold  during the first  quarter  of 2005 and the  true-up of
estimated  expenses  to actual  amounts  for  properties  sold  during  previous
periods.

COMPARISON OF THE SIX MONTHS ENDED JUNE 30, 2005 TO THE SIX MONTHS ENDED
JUNE 30, 2004

Revenues

     The $62.2 million increase in revenues resulted primarily from increases of
$48.0  million  attributable  to the New  Properties  and $14.4 million from the
Comparable  Properties.  The increase in revenues from the Comparable Properties
was attributable to our achieving higher occupancy  combined with an increase in
average base rents from new and renewal leasing  activity,  percentage rents and
specialty income.

     Our cost  recovery  ratio  improved to 103.0% for the six months ended June
30,  2005,  compared  to 97.0% for the six  months  ended  June 30,  2004.  This
increase was driven by (i) an increase in total portfolio  occupancy to 91.9% at
June 30, 2005 compared to 91.1% at June 30, 2004,  (ii) increased  profitability
related to utility reimbursements from tenants at the New Properties and certain
existing  malls  due to the  implementation  of  efficiency  optimizing  utility
systems and (iii) a $3.2  million  improvement  in bad debt  expenses  and other
charges against revenues,  as we recognized a net $0.3 million in the six months
ended June 30, 2005 for recoveries of accounts  receivable  that were previously
reserved for,  compared  with total bad debt expense and other  charges  against
revenues of $2.9 million in the six months ended June 30, 2004.

     The increase in revenues  was offset  slightly by a decrease in revenues of
$3.6 million  related to properties  that were sold to the Galileo America joint
venture in January 2005.

     Management,  development and leasing fees increased $3.3 million, primarily
as a result of an increase in management and leasing fees from Galileo  America,
which is directly related to the growth in Galileo America's portfolio.

     Other revenues  increased $0.1 million as a result of growth in our taxable
REIT subsidiary.

Expenses

     The $14.1 million increase in property operating  expenses,  including real
estate taxes and  maintenance  and repairs,  resulted  from an increase of $15.9
million  attributable  to the New  Properties,  which was offset by decreases of
$1.1 million from the  properties  that were sold to the Galileo  America  joint
venture in January 2005 and $0.7 million from the Comparable Properties.

                                       20
<PAGE>

     The  $19.2  million  increase  in  depreciation  and  amortization  expense
resulted  from  increases  of $13.5  million  from the New  Properties  and $5.7
million  from  the  Comparable  Properties.  The  increase  attributable  to the
Comparable  Properties is due to ongoing capital  expenditures  for renovations,
expansions, tenant allowances and deferred maintenance.

     General and  administrative  expenses increased $2.2 million primarily as a
result of annual  increases in salaries and benefits of existing  personnel  and
the addition of new personnel.

     Other expense  decreased  $1.5 million due to a decrease of $1.5 million in
write-offs of abandoned development projects.

Other Income and Expenses

     The increase in interest  income of $2.7  million  results  primarily  from
interest  income on  advances  that were  made to the  joint  venture  that owns
Imperial Valley Mall for the purpose of funding development costs.

     Interest expense increased by $15.9 million primarily due to the additional
debt  associated  with the New Properties as well as an increase in the weighted
average  interest rate of our  variable-rate  debt as compared to the comparable
period of the prior year.

Gain on Sales of Real Estate Assets

     Gain on sales of real estate assets of $7.1 million in the six months ended
June  30,  2005  was  related  to a gain of $6.1  million  from  sales  of seven
outparcels  and a gain of $1.0 million  from the  recognition  of deferred  gain
related to properties that were previously sold to Galileo America.  The gain on
sales of $24.8 million in the six months ended June 30, 2004 resulted  primarily
from the sale of community centers to Galileo America.

Equity in Earnings of Unconsolidated Affiliates

     Although Coastal Grand-Myrtle Beach and Imperial Valley Mall were opened in
March 2004 and March 2005,  respectively,  equity in earnings only  increased by
$0.2  million  because  the  increase  from  the  equity  in  earnings  of these
properties  was mostly  offset by interest  expense on the debt related to these
properties.  Prior to the  opening of these  properties,  interest  costs on the
related construction debt was capitalized rather than expensed.

Discontinued Operations

     Discontinued  operations  in the six months ended June 30, 2005 are related
to five community  centers located  throughout  Michigan that were sold in March
2005.  Discontinued  operations in the six months ended June 30, 2004  represent
the  results  of  operations  for the same  five  properties  and the true up of
estimated  expenses  to actual  amounts  for  properties  sold  during  previous
periods.

OPERATIONAL REVIEW

     The shopping  center  business is, to some extent,  seasonal in nature with
tenants  achieving the highest levels of sales during the fourth quarter because
of the holiday season.  Additionally,  the malls earn most of their  "temporary"
rents  (rents  from  short-term  tenants),  during  the  holiday  period.  Thus,
occupancy levels and revenue  production are generally the highest in the fourth
quarter of each year. Results of operations  realized in any one quarter may not
be indicative  of the results  likely to be  experienced  over the course of the
fiscal year.

                                       21
<PAGE>

     We  classify  our  regional  malls  into two  categories  - malls that have
completed their initial  lease-up are referred to as stabilized  malls and malls
that are in their  initial  lease-up  phase  and  have not been  open for  three
calendar years are referred to as non-stabilized malls. The non-stabilized malls
currently include Parkway Place in Huntsville, AL, which opened in October 2002;
Coastal  Grand-Myrtle Beach in Myrtle Beach, SC, which opened in March 2004; and
Imperial Valley Mall in El Centro, CA, which opened in March 2005.

     We derive a significant  amount of our revenues  from the mall  properties.
The sources of our revenues by property type were as follows:
<TABLE>
<CAPTION>
                                                 Six Months Ended June 30,
                                              ---------------------------------
                                                    2005             2004
                                              ----------------- ---------------
<S>                                                 <C>             <C>
Malls                                               91.0%           91.2%
Associated centers                                   4.2%            4.3%
Community centers                                    1.0%            2.0%
Mortgages, office building and other                 3.8%            2.5%
</TABLE>

Sales and Occupancy Costs

     Mall store sales (for those  tenants who occupy  10,000 square feet or less
and  have  reported  sales)  in the  stabilized  malls  increased  by  3.4% on a
comparable  per square foot basis for the six months ended June 30,  2005.  Mall
store sales  increased by 1.9% on a comparable  per square foot basis to $318.75
per square foot for the trailing twelve months ended June 30, 2005, from $312.81
per square foot for the trailing twelve months ended June 30, 2004.

     Occupancy  costs as a  percentage  of sales for the  stabilized  malls were
13.7% and 13.8% for the six months ended June 30, 2005 and 2004, respectively.

Occupancy

     The occupancy of the portfolio was as follows:
<TABLE>
<CAPTION>
                                                        At June 30,
                                           -------------------------------------
                                                  2005               2004
                                           ------------------ ------------------
<S>                                              <C>                 <C>
Total portfolio occupancy                        91.9%               91.1%
Total mall portfolio                             91.9%               91.1%
     Stabilized malls                            92.2%               91.4%
     Non-stabilized malls                        84.1%               85.1%
Associated centers                               93.8%               89.3%
Community centers*                               81.1%               92.6%
<FN>
*    Excludes the community centers that were contributed to the Galileo America
     joint venture Leasing
</FN>
</TABLE>

     Average annual base rents per square foot were as follows for each property
type:
<TABLE>
<CAPTION>
                                                         At June 30,
                                           -------------------------------------
                                                 2005               2004
                                           ------------------ ------------------
<S>                                              <C>                <C>
Stabilized malls                                 $25.62             $25.26
Non-stabilized malls                              28.04              27.01
Associated centers                                10.19               9.70
Community centers *                               14.70               7.99
<FN>
*    Excludes the community centers that were contributed to the Galileo America
     joint venture.
</FN>
</TABLE>

     The  following  table shows the positive  results we achieved in increasing
the initial and average base rents  through new and renewal  leasing  during the
second  quarter of 2005 for small shop spaces less than 20,000  square feet that
were previously occupied, excluding junior anchors:

                                       22
<PAGE>
<TABLE>
<CAPTION>
                                         Base Rent
                                            Per       Initial Base                 Average Base
                                        Square Foot      Rent Per                    Rent Per
                                        Prior Lease    Square Foot     % Change     Square Foot     % Change
                          Square Feet       (1)       New Lease (2)    Initial     New Lease (3)     Average
                          ------------- ------------  -------------    --------   --------------   -----------
Quarter:
<S>                           <C>           <C>           <C>            <C>           <C>             <C>
Stabilized Malls              472,356       $24.80        $27.70         11.7%         $28.46          14.8%
Associated centers             22,867        16.18         18.37         13.5%          18.63          15.1%
Community centers (4)          27,300        18.52         18.63          0.6%          18.63           0.6%
Other                               -            -             -             -              -              -
                              522,523       $24.09        $26.82         11.3%         $27.52          14.2%

Year-To-Date:
Stabilized Malls            1,160,662       $24.50        $25.86          5.5%         $26.49           8.1%
Associated centers             49,333        13.85         17.53         26.6%          17.86          29.0%
Community centers (4)          38,500        15.51         15.64          0.8%          15.67           1.0%
Other                           3,087        20.83         24.35         16.9%          24.97          19.9%
                            1,251,582       $23.80        $25.21          6.0%         $25.81           8.5%

<FN>
(1)  Represents the rent that was in place at the end of the lease term.
(2)  Represents  the rent in place at beginning of the lease terms.
(3)  Average base rent over the term of the new lease.
(4)  Excludes the community  centers that were sold to the Galileo America joint
     venture.
</FN>
</TABLE>

LIQUIDITY AND CAPITAL RESOURCES

     There was $37.9 million of cash and cash  equivalents  as of June 30, 2005,
an increase of $12.1 million from December 31, 2004.  Cash flows from operations
are  used to  fund  short-term  liquidity  and  capital  needs  such  as  tenant
construction  allowances,  capital  expenditures  and payments of dividends  and
distributions.  For  longer-term  liquidity  needs  such  as  acquisitions,  new
developments, renovations and expansions, we typically rely on property specific
mortgages  (which are  generally  non-recourse),  construction  and term  loans,
revolving  lines  of  credit,  common  stock,  preferred  stock,  joint  venture
investments and a minority interest in the Operating Partnership.

Cash Flows

     Cash provided by operating  activities increased by $21.9 million to $172.0
million,  which  was  primarily  due to the  incremental  operations  of the New
Properties plus improvements in the operations of the Comparable Properties.

Debt

     During the six months ended June 30, 2005, we borrowed $122.9 million under
mortgage and other notes  payable and paid $81.2  million to reduce  outstanding
borrowings  under  mortgage  and other  notes  payable.  We also  assumed  $61.2
million,  including a debt  premium of $10.6  million,  in  connection  with the
acquisition of Laurel Park Place.

     The following  tables  summarize debt based on our pro rata ownership share
(including  our pro  rata  share  of  unconsolidated  affiliates  and  excluding
minority investors' share of shopping center properties) because we believe this
provides  investors a clearer  understanding  of our total debt  obligations and
liquidity (in thousands):

                                       23
<PAGE>
<TABLE>
<CAPTION>
                                                                                                             Weighted
                                                                                                             Average
                                                              Minority      Unconsolidated                   Interest
                                              Consolidated     Interests       Affiliates       Total         Rate(1)
                                              ------------- ---------------- --------------- ------------- ---------------
<S>                                             <C>            <C>            <C>             <C>             <C>
June 30, 2005:
Fixed-rate debt:
     Non-recourse loans on operating
         properties                             $2,778,311     $ (52,436)     $  121,715      $2,847,590      6.36%
                                              ------------- ---------------- --------------- ------------- ---------------
Variable-rate debt:
     Recourse term loans on operating
         properties                                189,150             -          87,167         276,317      4.24%
     Construction loans                             25,095             -               -          25,095      4.52%
     Lines of credit                               466,285             -               -         466,285      4.26%
                                              ------------- ---------------- --------------- ------------- ---------------
     Total variable-rate debt                      680,530             -          87,167         767,697      4.26%
                                              ------------- ---------------- --------------- ------------- ---------------
Total                                           $3,458,841     $ (52,436)     $  208,882      $3,615,287      5.91%
                                              ============= ================ =============== ============= ===============
</TABLE>
<TABLE>
<CAPTION>
                                                                                                             Weighted
                                                                                                             Average
                                                              Minority      Unconsolidated                   Interest
                                             Consolidated     Interests       Affiliates       Total         Rate(1)
                                             ------------- ---------------- --------------- ------------- ---------------
<S>                                            <C>             <C>            <C>             <C>             <C>
December 31, 2004:
Fixed-rate debt:
     Non-recourse loans on operating
        properties                             $2,688,186      $ (52,914)     $  104,114      $2,739,386      6.35%
                                             ------------- ---------------- --------------- ------------- ---------------
Variable-rate debt:
     Recourse term loans on operating
        properties                                207,500              -          29,415         236,915      3.40%
     Construction loans                            14,593              -          39,493          54,086      4.05%
     Lines of credit                              461,400              -               -         461,400      3.37%
                                             ------------- ---------------- --------------- ------------- ---------------
     Total variable-rate debt                     683,493              -          68,908         752,401      3.44%
                                             ------------- ---------------- --------------- ------------- ---------------
Total                                          $3,371,679      $ (52,914)     $  173,022      $3,491,787      5.72%
                                             ============= ================ =============== ============= ===============
<FN>
(1)  Weighted average  interest rate including the effect of debt premiums,  but
     excluding amortization of deferred financing costs.
</FN>
</TABLE>

     In  February  2005,  we amended  one of our secured  credit  facilities  to
increase  the total  availability  from $80.0  million to $100.0  million and to
extend the  maturity by one year to June 2007.  The  interest  rate  remained at
LIBOR plus 1.00%.

     We have four secured credit  facilities  with total  availability of $503.0
million,  of which  $465.3  million was  outstanding  as of June 30,  2005.  The
secured credit facilities bear interest at LIBOR plus 100 basis points.

     We have one unsecured  credit  facility with total  availability  of $400.0
million,  of  which  $1.0  million  was  outstanding  as of June 30,  2005.  The
unsecured  credit  facility  bears interest at LIBOR plus a margin of 100 to 145
basis points based on our leverage.

     We also have secured and unsecured lines of credit with total  availability
of $27.1  million  that can only be used to issue  letters of credit.  There was
$8.9 million outstanding under these lines at June 30, 2005.

     The  secured  and  unsecured  credit   facilities   contain,   among  other
restrictions,  certain financial  covenants including the maintenance of certain
coverage ratios,  minimum net worth  requirements,  and limitations on cash flow
distributions.   We  were  in  compliance  with  all  financial   covenants  and
restrictions under our credit facilities at June 30, 2005. Additionally, certain
property-specific mortgage notes payable require the maintenance of debt service
coverage  ratios.  At June 30, 2005,  the  properties  subject to these mortgage
notes payable were in compliance with the applicable ratios.

     We expect to refinance  the  majority of mortgage  and other notes  payable
maturing over the next five years with replacement  loans. Based on our pro rata
share of total debt, there is $597.3 million of debt that is scheduled to mature
before June 30, 2006. There are extension  options in place that will extend the
maturity of $557.3  million of this debt beyond March 31, 2006. Of the remaining
$40.0 million of maturing loans, we obtained an extension for $10,000 subsequent
to June 30, 2005 and expect to either retire or refinance  the  remaining  $30.0
million of maturing loans.



                                       24
<PAGE>

Equity

     At our Annual  Meeting of  Shareholders  on May 9, 2005,  our  shareholders
approved  an  increase in the  authorized  shares of the common  stock under our
amended and restated  certificate of  incorporation  to 180,000,000  shares from
95,000,000  shares.  On  May  10,  2005,  the  Board  of  Directors  approved  a
two-for-one stock split of our common stock, which was effected in the form of a
stock  dividend.  The record date for the stock split was June 1, 2005,  and the
distribution  date was June 15, 2005. We retained the current par value of $0.01
per share for all shares of common stock.  The Operating  Partnership  currently
has  common  units  and  special  common  units  of  limited  partner   interest
outstanding that may be exchanged by their holders, under certain circumstances,
for  shares of common  stock on a  one-for-one  basis.  These  common  units and
special  common  units  were  also  split on a  two-for-one  basis so that  they
continue to be  exchangeable  on a  one-for-one  basis into shares of our common
stock.  All  references  to numbers  of common  shares and per share data in the
accompanying  consolidated  financial  statements,  the notes  thereto  and this
quarterly  report have been adjusted to reflect the stock split on a retroactive
basis.  Shareholders' equity reflects the stock split through a reclassification
of  $0.3  million  from  Additional  Paid-In  Capital  to  Common  Stock,  which
represents the par value of the additional shares resulting from the split.

     During the six months  ended June 30,  2005,  we received  $5.7  million in
proceeds from  issuances of common stock related to exercises of employee  stock
options and our dividend reinvestment plan.

     During  the six months  ended June 30,  2005,  we paid  dividends  of $66.9
million to holders of our common stock and our preferred stock, as well as $44.3
million in  distributions  to the minority  interest  investors in our Operating
Partnership and certain shopping center properties.

     As a publicly  traded  company,  we have access to capital through both the
public  equity  and  debt  markets.  We have  an  effective  shelf  registration
statement  authorizing  us to publicly issue shares of preferred  stock,  common
stock and warrants to purchase  shares of common stock with an aggregate  public
offering price up to $562.0 million, of which  approximately  $272.0 million was
available at June 30, 2005.

     We anticipate that the combination of equity and debt sources will, for the
foreseeable future,  provide adequate liquidity to continue our capital programs
substantially  as in the past  and make  distributions  to our  shareholders  in
accordance with the requirements applicable to real estate investment trusts.

     Our   policy   is   to   maintain   a   conservative   debt-to-total-market
capitalization  ratio in order to enhance  our access to the  broadest  range of
capital  markets,  both  public  and  private.  Based  on  our  share  of  total
consolidated  and  unconsolidated  debt  and the  market  value of  equity,  our
debt-to-total-market capitalization (debt plus market-value equity) ratio was as
follows at June 30, 2005 (in thousands, except stock prices):
<TABLE>
<CAPTION>
                                                         Shares
                                                       Outstanding      Stock Price (1)          Value
                                                    ------------------  -----------------   -----------------
<S>                                                       <C>                 <C>             <C>
Common stock and operating partnership units              115,162             $43.07          $ 4,960,027
8.75% Series B Cumulative Redeemable Preferred Stock        2,000              50.00              100,000
7.75% Series C Cumulative Redeemable Preferred Stock          460             250.00              115,000
7.375% Series D Cumulative Redeemable Preferred
Stock                                                         700             250.00              175,000
                                                                                            -----------------
Total market equity                                                                             5,350,027
Company's share of total debt                                                                   3,615,287
                                                                                            -----------------
Total market capitalization                                                                    $8,965,314
                                                                                            =================
Debt-to-total-market capitalization ratio                                                           40.3%
                                                                                            =================
<FN>
(1) Stock price for common stock and operating partnership units equals the
   closing price of the common stock on June 30, 2005. The stock price for the
   preferred stock represents the liquidation preference of each respective
   series of preferred stock.
</FN>
</TABLE>

                                       25
<PAGE>

     As of June 30, 2005,  our variable rate debt of $767.7  million  represents
8.6% of our  total  market  capitalization  and  21.2%  of our  share  of  total
consolidated and unconsolidated debt.

Capital Expenditures

     We expect to continue to have access to the capital resources  necessary to
expand and develop our business.  Future development and acquisition  activities
will be undertaken as suitable  opportunities  arise. We do not expect to pursue
these  opportunities  unless  adequate  sources of funding are  available  and a
satisfactory  budget with  targeted  returns on investment  has been  internally
approved.

         An annual capital expenditures budget is prepared for each property
that is intended to provide for all necessary recurring and non-recurring
capital expenditures. We believe that property operating cash flows, which
include reimbursements from tenants for certain expenses, will provide the
necessary funding for these expenditures.

     The  following  development  projects  are under  construction  (dollars in
thousands):
<TABLE>
<CAPTION>
                                                                                     Our Share
                                                                                      of Costs
                                                                                      Incurred
                                                            Project    Our Share        as of
                                                             Square      Of Total      June 30,        Projected       Initial
           Property                      Location             Feet        Costs         2005        Opening Date       Yield
------------------------------       -------------------   ----------  ------------  ------------  ---------------    ---------
Mall Expansions:
<S>                                  <C>                      <C>          <C>            <C>       <C>                 <C>
Citadel Mall                         Charleston, SC           46,000       $ 6,545        $5,000      August-05         9%
Stroud Mall                          Stroudsburg, PA           4,500         1,326           231    September-05        9%
                                     Fairview   Heights,
St. Clair Square                     IL                        8,500         2,794         1,700    September-05        9%
Fayette Mall                         Lexington, KY           144,000        22,961        11,032     October-05         11%
Burnsville Center                    Burnsville, MN          146,000        24,612         6,080    Nov-05/Mar-06       9%

Open-Air Centers:
Southaven Towne Center               Southaven, MS           437,600        43,238        28,860     October-05         10%
Gulf Coast Town Center               Ft. Myers, FL           445,000        71,806        47,799     October-05         9%

Community Centers:
Cobblestone Village at Royal Palm    Royal Palm, FL          225,000        10,029         8,719    September-05        9%
Chicopee Marketplace                 Chicopee, MA            156,000        20,360        12,726    September-05        9%

Community Center Expansion:
Fashion Square                       Orange Park, FL          18,000         3,278           886    September-05       10%
                                                           ----------  ------------  ------------
                                                           1,630,600      $206,949      $123,033
                                                           ==========  ============  ============
</TABLE>

     There is a  construction  loan in place  for the costs of  Southaven  Towne
Center.  The costs of the remaining  projects will be funded with operating cash
flows and the credit facilities.

     We have entered into a number of option  agreements for the  development of
future regional malls,  open-air centers and community  centers.  Except for the
projects  discussed under  Developments and Expansions above, we do not have any
other material capital commitments.

Acquisitions

     Effective June 1, 2005, the Company  acquired a 70% joint venture  interest
in Laurel Park Place, a regional mall in Livonia,  MI, at a negotiated  purchase
price of $82.2 million.  This purchase price  consisted of $2.7 million in cash,
the  assumption of $50.6 million of  nonrecourse  debt that bears  interest at a
stated rate of 8.50% and matures in  December  2012 and the  issuance of 571,700
special common units in the Operating Partnership at a negotiated economic value
of $28.9 million ($50.48 per special common unit).  The Company  recorded a debt
premium of $10.6 million,  computed using an estimated  market  interest rate of
5.00%,  since the debt assumed was at an above-market  interest rate compared to
similar debt instruments at the date of acquisition.

                                       26
<PAGE>

     The Company  recorded the purchase of the 70% joint venture  interest based
on a purchase  price of $80.3  million.  The  difference  between the  announced
purchase price and the price at which the acquisition was recorded for financial
reporting  purposes reflects an additional $0.1 million of transaction costs and
a reduction of the value of the special common units from $28.9 million to $26.9
million, or $47.02 per special common unit. The reduction reflects an adjustment
to record the issuance of the special common units at their estimated fair value
on the date of issuance  rather than the economic value  negotiated  between the
parties.

     See Note 4 to the accompanying  consolidated  financial statements for more
information related to the purchase of Laurel Park Place.

     On July 14, 2005, we purchased The Mall of Acadiana,  a super-regional mall
in Lafayette,  LA, for a cash purchase price of $175.0 million.  We also entered
into 10-year lease  agreements for land adjacent to The Mall of Acadiana,  which
provide us the right to purchase the land at anytime during the lease term for a
cash purchase  price of $3.2  million.  After the first year of the lease terms,
the seller may put the land to us for $3.2 million Additionally,  we obtained an
option to acquire an additional adjacent tract of land for a cash purchase price
of $3.2 million.

Dispositions

     We  received a total of $58.2  million in cash  proceeds  from the sales of
real estate assets during the six months ended June 30, 2005. The third phase of
the joint venture transaction with Galileo America, which is discussed in Note 2
to the unaudited  consolidated  financial statements,  closed on January 5, 2005
and generated net cash  proceeds of $42.5  million.  We received $8.2 million in
cash  proceeds  and issued a note  receivable  for $2.6 million from the sale of
five  community  centers that are located in  Michigan.  We also  received  $7.5
million in cash proceeds from the sales of seven outparcels.

     On July 19, 2005,  we entered into  definitive  agreements  to transfer our
8.4% ownership  interest in Galileo  America to Galileo  America and to sell all
management and advisory  contracts with Galileo America to New Plan Excel Realty
Trust, Inc. See Note 13 to the accompanying  consolidated  financial  statements
for a more detailed description of these transactions.

Other Capital Expenditures

     Including our share of unconsolidated  affiliates' capital expenditures and
excluding  minority  investor's  share of capital  expenditures,  we spent $20.2
million during the six months ended June 30, 2005 for tenant  allowances,  which
generate  increased rents from tenants over the terms of their leases.  Deferred
maintenance  expenditures  were $9.3  million for the six months  ended June 30,
2005 and included $4.9 million for roof repairs and  replacements,  $1.9 million
for resurfacing and improved lighting of parking lots and $2.5 million for other
capital  expenditures.  Renovation  expenditures  were $9.5  million for the six
months ended June 30, 2005.

     Deferred maintenance expenditures are generally billed to tenants as common
area  maintenance  expense,  and most are recovered over a 5- to 15-year period.
Renovation  expenditures  are primarily for remodeling and upgrades of malls, of
which approximately 30% is recovered from tenants over a 5- to 15-year period.

CRITICAL ACCOUNTING POLICIES

     Our  significant  accounting  policies  are  disclosed  in  Note  2 to  the
consolidated  financial  statements  included in the Company's  Annual Report on
Form  10-K for the year  ended  December  31,  2004.  The  following  discussion
describes our most critical accounting  policies,  which are those that are both
important  to the  presentation  of  our  financial  condition  and  results  of
operations and that require significant judgment or use of complex estimates.

                                       27
<PAGE>

Revenue Recognition

     Minimum  rental   revenue  from   operating   leases  is  recognized  on  a
straight-line  basis over the initial terms,  including  rent  holidays,  of the
related  leases.  Certain  tenants are required to pay percentage  rent if their
sales volumes exceed thresholds specified in their lease agreements.  Percentage
rent is recognized as revenue when the  thresholds  are achieved and the amounts
become determinable.

     We receive  reimbursements  from tenants for real estate taxes,  insurance,
common area maintenance,  utilities and other recoverable  operating expenses as
provided  in the lease  agreements.  Tenant  reimbursements  are  recognized  as
revenue  in the period the  related  operating  expenses  are  incurred.  Tenant
reimbursements  related to certain  capital  expenditures  are billed to tenants
over periods of 5 to 15 years and are recognized as revenue when billed.

     We receive management,  leasing and development fees from third parties and
unconsolidated  affiliates.  Management  fees are  charged  as a  percentage  of
revenues (as defined in the management  agreement) and are recognized as revenue
when earned. Development fees are recognized as revenue on a pro rata basis over
the development  period.  Leasing fees are charged for newly executed leases and
lease  renewals  and are  recognized  as revenue when  earned.  Development  and
leasing fees  received from  unconsolidated  affiliates  during the  development
period are  recognized  as revenue  to the extent of the  third-party  partners'
ownership interest. Fees to the extent of our ownership interest are recorded as
a reduction to our investment in the unconsolidated affiliate.

     Gains on sales of real estate assets are  recognized  when it is determined
that  the  sale  has  been  consummated,  the  buyer's  initial  and  continuing
investment  is  adequate,  our  receivable,  if any,  is not  subject  to future
subordination,  and the  buyer  has  assumed  the usual  risks  and  rewards  of
ownership of the asset. When we have an ownership interest in the buyer, gain is
recognized to the extent of the third party partner's ownership interest and the
portion of the gain attributable to our ownership interest is deferred.

Real Estate Assets

     We  capitalize  predevelopment  project  costs paid to third  parties.  All
previously  capitalized  predevelopment  costs are expensed when it is no longer
probable  that the project  will be  completed.  Once  development  of a project
commences,  all direct  costs  incurred  to  construct  the  project,  including
interest and real estate taxes, are capitalized.  Additionally,  certain general
and administrative  expenses are allocated to the projects and capitalized based
on the amount of time  applicable  personnel  work on the  development  project.
Ordinary  repairs and maintenance are expensed as incurred.  Major  replacements
and  improvements  are capitalized and depreciated  over their estimated  useful
lives.

     All acquired real estate assets are accounted for using the purchase method
of accounting  and  accordingly,  the results of operations  are included in the
consolidated  statements of operations from the respective dates of acquisition.
The purchase  price is allocated to (i)  tangible  assets,  consisting  of land,
buildings  and  improvements,  and tenant  improvements,  (ii) and  identifiable
intangible  assets generally  consisting of above- and  below-market  leases and
in-place  leases.  We use estimates of fair value based on estimated cash flows,
using  appropriate  discount rates, and other valuation  methods to allocate the
purchase  price to the acquired  tangible  and  intangible  assets.  Liabilities
assumed  generally  consist of mortgage debt on the real estate assets acquired.
Assumed debt with a stated  interest rate that is  significantly  different from
market  interest  rates is recorded at its fair value based on estimated  market
interest rates at the date of acquisition.

                                       28
<PAGE>

     Depreciation is computed on a  straight-line  basis over estimated lives of
40 years for  buildings,  10 to 20 years for  certain  improvements  and 7 to 10
years for  equipment and  fixtures.  Tenant  improvements  are  capitalized  and
depreciated  on a  straight-line  basis  over  the  term of the  related  lease.
Lease-related  intangibles from acquisitions of real estate assets are amortized
over the remaining terms of the related leases.  Any difference between the face
value of the debt assumed and its fair value is  amortized  to interest  expense
over the remaining term of the debt using the effective interest method.

Carrying Value of Long-Lived Assets

     We periodically  evaluate  long-lived assets to determine if there has been
any  impairment in their  carrying  values and record  impairment  losses if the
undiscounted  cash flows estimated to be generated by those assets are less than
the assets' carrying amounts or if there are other indicators of impairment.  If
it is  determined  that an impairment  has  occurred,  the excess of the asset's
carrying value over its estimated fair value will be charged to operations.  See
Note 2 to the unaudited  consolidated  financial statements for a description of
the loss on  impairment  of real estate assets of $0.3 million that was recorded
in the six months ended June 30, 2005.  There were no impairment  charges in the
three  months  ended June 30, 2005 and 2004 or in the six months  ended June 30,
2004.

RECENT ACCOUNTING PRONOUNCEMENTS

     In December  2004, the FASB released its final revised  standard,  SFAS No.
123 (Revised  2004),  "Share-Based  Payment."  SFAS No.  123(R)  requires that a
public  entity  measure the cost of equity  based  service  awards  based on the
grant-date fair value of the award. That cost will be recognized over the period
during  which an employee is  required  to provide  service in exchange  for the
award or the vesting  period.  No  compensation  cost is  recognized  for equity
instruments  for which employees do not render the requisite  service.  In April
2005, the Securities and Exchange  Commission  amended  Regulation S-X to modify
the  effective  date so that SFAS No. 123(R) can be adopted  beginning  with the
first interim  reporting period of the next fiscal year beginning after June 15,
2005 instead of the first  interim  period  beginning  after June 15, 2005.  The
Company   previously  adopted  the  fair  value  provisions  of  SFAS  No.  123,
"Accounting  for  Stock  Based  Compensation",  as  amended  by  SFAS  No.  148,
"Accounting  for  Stock-Based  Compensation  -  Transition  and  Disclosure - An
Amendment of FASB Statement No. 123" effective January 1, 2003. The Company does
not expect  the  adoption  of this  standard  to have a  material  effect on its
financial position or results of operations.

IMPACT OF INFLATION

     In the last three years,  inflation has not had a significant impact on the
Company because of the relatively low inflation rate.  Substantially  all tenant
leases do, however,  contain provisions designed to protect the Company from the
impact of inflation.  These  provisions  include clauses enabling the Company to
receive  percentage rent based on tenant's gross sales, which generally increase
as prices rise, and/or escalation clauses, which generally increase rental rates
during the terms of the leases. In addition, many of the leases are for terms of
less than ten years,  which may enable the  Company to replace  existing  leases
with new leases at higher base and/or  percentage rents if rents of the existing
leases are below the then  existing  market  rate.  Most of the  leases  require
tenants  to pay  their  share  of  operating  expenses,  including  common  area
maintenance,  real estate taxes and  insurance,  thereby  reducing the Company's
exposure to increases in costs and operating expenses resulting from inflation.

FUNDS FROM OPERATIONS

     Funds From  Operations  ("FFO") is a widely used  measure of the  operating
performance of real estate companies that  supplements net income  determined in
accordance with generally accepted accounting principles ("GAAP").  The National
Association  of Real  Estate  Investment  Trusts  ("NAREIT")  defines FFO as net


                                       29
<PAGE>

income  (computed in accordance with GAAP) excluding gains or losses on sales of
operating properties, plus depreciation and amortization,  and after adjustments
for   unconsolidated   partnerships   and  joint   ventures.   Adjustments   for
unconsolidated partnerships and joint ventures are calculated on the same basis.
We define  FFO  available  for  distribution  as  defined  above by NAREIT  less
dividends on preferred  stock.  Our method of  calculating  FFO may be different
from methods used by other REITs and, accordingly, may not be comparable to such
other REITs.

     We believe  that FFO  provides an  additional  indicator  of the  operating
performance of our properties without giving effect to real estate  depreciation
and  amortization,  which  assumes  the  value of real  estate  assets  declines
predictably over time. Since values of  well-maintained  real estate assets have
historically  risen  with  market  conditions,  we  believe  that  FFO  enhances
investors'  understanding  of our  operating  performance.  The use of FFO as an
indicator of financial  performance  is influenced not only by the operations of
our properties and interest rates, but also by our capital structure.

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

     FFO  increased  21.0% for the three  months  ended  June 30,  2005 to $83.2
million  compared to $68.7  million for the same period in 2004.  FFO  increased
24.0% for the six  months  ended June 30,  2005 to $171.7  million  compared  to
$138.4 million for the same period in 2004. The New Properties generated 90% and
77% of the growth in FFO in the three-month and six-month periods, respectively.
Consistently  high portfolio  occupancy and recoveries of operating  expenses as
well as increases in rental rates from renewal and replacement leasing accounted
for the  remaining  10% and 23% growth in FFO in the  three-month  and six-month
periods, respectively.

The calculation of FFO is as follows (in thousands):
<TABLE>
<CAPTION>
                                                                 Three Months Ended               Six Months Ended
                                                                      June 30,                        June 30,
                                                              --------------------------    -------------------------
                                                                  2005           2004           2005          2004
                                                              -------------  -----------    ------------  -----------
<S>                                                           <C>             <C>           <C>            <C>
Net income available to common shareholders                   $   20,783      $  21,708     $  46,154      $  51,897
Depreciation and amortization from:
    Consolidated properties                                       43,339         32,878        84,625         65,434
    Unconsolidated affiliates                                      2,210          1,547         3,920          2,743
    Discontinued operations                                           --            156            --            345
Minority interest in earnings of operating partnership            16,895         17,840        37,721         42,874
Minority investors' share of depreciation and
     amortization in shopping center properties                     (289)          (304)         (651)          (597)
(Gain) loss on disposal of:
    Operating real estate assets                                     397         (4,484)          174        (23,565)
    Discontinued operations                                           54           (525)           86           (520)
Depreciation and amortization of non-real estate assets             (186)           (78)         (365)          (213)
                                                              -------------  -----------    ------------  -----------
Funds from operations                                          $  83,203      $  68,738     $ 171,664      $ 138,398
                                                              =============  ===========    ============  ===========
Diluted weighted average shares and potential dilutive
    common shares with operating partnership
    units fully converted                                        116,452        113,802       116,251        113,664
</TABLE>

ITEM 3:  Quantitative and Qualitative Disclosures About Market Risk

     We are exposed to interest rate risk on our debt obligations and derivative
financial  instruments.  We may elect to use derivative financial instruments to
manage our  exposure  to changes in  interest  rates,  but will not use them for
speculative  purposes.  Our interest rate risk  management  policy requires that
derivative  instruments  be used for  hedging  purposes  only  and that  they be
entered  into only  with  major  financial  institutions  based on their  credit
ratings and other factors.

                                       30
<PAGE>

     Based  on  our  proportionate  share  of  consolidated  and  unconsolidated
variable  rate debt at June 30,  2005,  a 0.5%  increase or decrease in interest
rates on this variable-rate debt would decrease or increase annual cash flows by
approximately $3.8 million and, after the effect of capitalized interest, annual
earnings by approximately $3.7 million.

     Based on our proportionate  share of total  consolidated and unconsolidated
debt at June 30, 2005, a 0.5% increase in interest rates would decrease the fair
value of debt by approximately $55.6 million,  while a 0.5% decrease in interest
rates would increase the fair value of debt by approximately $57.2 million.

     We did not have any derivative financial  instruments during the six months
ended June 30, 2005 or at June 30, 2004.

ITEM 4:  Controls and Procedures

     Because  of its  inherent  limitations,  internal  control  over  financial
reporting  may not prevent or detect  misstatements.  Also,  projections  of any
evaluation of its  effectiveness  to future periods are subject to the risk that
controls may become  inadequate  because of changes in  conditions,  or that the
degree of compliance with the policies or procedures may deteriorate.

     As of  the  end  of  the  period  covered  by  this  quarterly  report,  an
evaluation,  under  Rule  13a-15  of the  Securities  Exchange  Act of 1934  was
performed  under  the  supervision  of our  Chief  Executive  Officer  and Chief
Financial  Officer  and  with  the  participation  of  our  management,  of  the
effectiveness  of the  design  and  operation  of our  disclosure  controls  and
procedures pursuant to Exchange Act Rule 13a-15. Based upon that evaluation, the
Chief  Executive   Officer  and  Chief  Financial  Officer  concluded  that  our
disclosure  controls and  procedures  are  effective.  No change in our internal
control over  financial  reporting  occurred  during the period  covered by this
quarterly report that materially affected, or is reasonably likely to materially
affect, our internal control over financial reporting.


                           PART II - OTHER INFORMATION

ITEM 1:  Legal Proceedings

         None

ITEM 2:  Unregistered Sales of Equity Securities and Use of Proceeds

         The following table presents information with respect to
         repurchases of common stock made by us during the three months
         ended June 30, 2005:
<TABLE>
<CAPTION>
                                                                                        Maximum Number
                                                    Average        Total Number of            of
                                 Total Number        Price       Shares Purchased as   Shares That May Yet
                                  of Shares        Paid per       Part of a Publicly      Be Purchased
         Period                 Purchased (1)      Share (2)         Announced Plan      Under the Plan
         ------                 -------------      ---------       ------------------- --------------------
         <S>                          <C>               <C>                 <C>                    <C>
         April 1-30, 2005             --                --                  --                     --

         May 1-31, 2005             5,538           $39.289                 --                     --

         June 1-30, 2005              --                --                  --                     --
                                --------------- ---------------- --------------------- ---------------------

         Total                      5,538           $39.289                 --                     --
                                =============== ================ ===================== =====================

                                       31
<PAGE>
<FN>
          (1)  Represents  shares  surrendered  to the Company by  employees  to
               satisfy  federal and state  income tax  withholding  requirements
               related to the vesting of shares of restricted stock issued under
               the CBL & Associates Properties, Inc. 1993 Stock Incentive Plan.

          (2)  Represents  the market  value of the common  stock on the vesting
               date  for the  shares  of  restricted  stock,  which  was used to
               determine  the number of shares  required  to be  surrendered  to
               satisfy income tax withholding requirements.
</FN>
</TABLE>

ITEM 3:  Defaults Upon Senior Securities

         None

ITEM 4:  Submission of Matters to a Vote of Security Holders

         We held our Annual Meeting of Shareholders on May 9, 2005. The
         matters that were submitted to a vote of shareholders and the
         related results are as follow:

          1.   The following  directors were re-elected to three-year terms that
               expire in 2008:

               |X|  Charles  B.  Lebovitz  (19,569,194  votes for and  8,300,548
                    votes against or withheld)

               |X|  Claude M. Ballard  (26,906,353  votes for and 963,389  votes
                    against or withheld)

               |X|  Gary L. Bryenton  (19,135,542  votes for and 8,734,200 votes
                    against or withheld)

               |X|  Leo Fields (20,104,663 votes for and 7,765,079 votes against
                    or withheld)

               The  following   additional   directors  are  presently   serving
               three-year  terms,  which continue beyond the 2005 Annual Meeting
               of Shareholders:

               |X|  John N. Foy (term expires in 2006),

               |X|  Martin J. Cleary (term expires in 2006),

               |X|  Matthew S. Dominski (term expires in 2006),

               |X|  Winston W. Walker (term expires in 2007), and

               |X|  Stephen D. Lebovitz (term expires in 2007).

               2.   The  amendment  to our Amended and Restated  Certificate  of
                    Incorporation to increase the number of authorized shares of
                    our common stock, par value $.01 per share,  from 95,000,000
                    to 180,000,000 shares was approved (25,711,651 votes for and
                    2,158,085 votes against, abstentions or broker non-votes).

               3.   Deloitte & Touche was  ratified  as our  independent  public
                    accountants  for our fiscal  year ending  December  31, 2005
                    (26,746,997   votes  for  and  1,122,744  votes  against  or
                    abstentions).


ITEM 5:  Other Information

         None

ITEM 6:  Exhibits

                                       32
<PAGE>

     3.6  Certificate  of Amendment to the Amended and Restated  Certificate  of
          Incorporation of the Company, dated May 10, 2005.

     3.7  Amended and Restated  Certificate of Incorporation of the Company,  as
          amended through May 10, 2005.

   10.1.5 Fourth  Amendment  to the Second  Amended and  Restated  Partnership
          Agreement of the Operating Partnership, dated as of June 1, 2005.

   10.1.6 Third Amended and Restated Agreement of Limited Partnership of CBL &
          Associates  Properties,  Inc.,  dated June 15, 2005.  (Incorporated by
          reference to Exhibit 10.1 to the Company's Current Report on Form 8-K,
          filed on June 21, 2005.)

   10.5.9 Form of Stock  Restriction  Agreement for restricted stock awards in
          2004 and  subsequent  years.  (Incorporated  by  reference  to Exhibit
          10.5.9 to the Company's  Current  Report on Form 8-K, filed on May 13,
          2005.)

   10.7.6 Summary  Description of May 9, 2005  Compensation  Committee  Action
          Confirming 2005 Executive Base Salary Levels. +

   10.7.7 Summary  Description of May 9, 2005  Compensation  Committee  Action
          Approving 2005 Executive Bonus Opportunities.+

    10.21 Amended and Restated Limited  Liability  Company Agreement of JG Gulf
          Coast Town Center LLC by and between JG Gulf Coast Member LLC, an Ohio
          limited  liability  company and CBL/Gulf Coast, LLC, a Florida limited
          liability company, dated April 27, 2005.

    10.22 Master  Transaction  Agreement by and among REJ Realty LLC, JG Manager
          LLC, JG Gulf Coast  Member  LLC, JG Gulf Coast Town Center LLC,  CBL &
          Associates  Limited  Partnership and CBL/Gulf Coast, LLC, dated April
          27, 2005.

     31.1 Certification  pursuant to Securities  Exchange Act Rule  13a-14(a) by
          the Chief Executive Officer, as adopted pursuant to Section 302 of the
          Sarbanes-Oxley Act of 2002.

     31.2 Certification  pursuant to Securities  Exchange Act Rule  13a-14(a) by
          the Chief Financial Officer, as adopted pursuant to Section 302 of the
          Sarbanes-Oxley Act of 2002.

     32.1 Certification  pursuant to Securities  Exchange Act Rule  13a-14(b) by
          the Chief Executive Officer, as adopted pursuant to Section 906 of the
          Sarbanes-Oxley Act of 2002.

     32.2 Certification  pursuant to Securities  Exchange Act Rule  13a-14(b) by
          the Chief Financial  Officer as adopted pursuant to Section 906 of the
          Sarbanes-Oxley Act of 2002.

     +    A management contract or compensatory plan or arrangement  required to
          be filed pursuant to Item 15(b) of this report.



                                       33
<PAGE>


                                    SIGNATURE



         Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

                            CBL & ASSOCIATES PROPERTIES, INC.

                                     /s/ John N. Foy
                 -------------------------------------------------------
                                       John N. Foy
                 Vice Chairman of the Board, Chief Financial Officer and
                                        Treasurer
                         (Authorized Officer of the Registrant,
                              Principal Financial Officer)

Date: August 9, 2005



                                       34
<PAGE>



                                INDEX TO EXHIBITS


Exhibit
Number    Description
--------  -----------

     3.6  Certificate  of Amendment to the Amended and Restated  Certificate  of
          Incorporation of the Company, dated May 10, 2005.

     3.7  Amended and Restated  Certificate of Incorporation of the Company,  as
          amended through May 10, 2005.

   10.1.5 Fourth  Amendment  to the Second  Amended and  Restated  Partnership
          Agreement of the Operating Partnership, dated as of June 1, 2005.

   10.1.6 Third Amended and Restated Agreement of Limited Partnership of CBL &
          Associates  Properties,  Inc.,  dated June 15, 2005.  (Incorporated by
          reference to Exhibit 10.1 to the Company's Current Report on Form 8-K,
          filed on June 21, 2005.)

   10.5.9 Form of Stock  Restriction  Agreement for restricted stock awards in
          2004 and  subsequent  years.  (Incorporated  by  reference  to Exhibit
          10.5.9 to the Company's  Current  Report on Form 8-K, filed on May 13,
          2005.)+

   10.7.6 Summary  Description of May 9, 2005  Compensation  Committee  Action
          Confirming 2005 Executive Base Salary Levels.+

   10.7.7 Summary  Description of May 9, 2005  Compensation  Committee  Action
          Approving 2005 Executive Bonus Opportunities.+

    10.21 Amended and Restated Limited  Liability  Company Agreement of JG Gulf
          Coast Town Center LLC by and between JG Gulf Coast Member LLC, an Ohio
          limited  liability  company and CBL/Gulf Coast, LLC, a Florida limited
          liability company, dated April 27, 2005.

    10.22 Master  Transaction  Agreement by and among REJ Realty LLC, JG Manager
          LLC, JG Gulf Coast  Member  LLC, JG Gulf Coast Town Center LLC,  CBL &
          Associates  Limited  Partnership and CBL/Gulf Coast, LLC, dated April
          27, 2005.

     31.1 Certification  pursuant to Securities  Exchange Act Rule  13a-14(a) by
          the Chief Executive Officer, as adopted pursuant to Section 302 of the
          Sarbanes-Oxley Act of 2002.

     31.2 Certification  pursuant to Securities  Exchange Act Rule  13a-14(a) by
          the Chief Financial Officer, as adopted pursuant to Section 302 of the
          Sarbanes-Oxley Act of 2002.

     32.1 Certification  pursuant to Securities  Exchange Act Rule  13a-14(b) by
          the Chief Executive Officer, as adopted pursuant to Section 906 of the
          Sarbanes-Oxley Act of 2002.

     32.2 Certification  pursuant to Securities  Exchange Act Rule  13a-14(b) by
          the Chief Financial  Officer as adopted pursuant to Section 906 of the
          Sarbanes-Oxley Act of 2002.


     +    A management contract or compensatory plan or arrangement  required to
          be filed pursuant to Item 15(b) of this report.


                                       35
