CBL & Associates Acquires Mall in Panama City, Florida.

Business Editors

CHATTANOOGA, Tenn.--(BUSINESS WIRE)--May 31, 2002

CBL & Associates Properties, Inc. (NYSE:CBL) today announced the acquisition of Panama City Mall, a 606,698-square-foot regional mall located in Panama City, Florida, for $46.5 million. The acquisition is expected to generate an initial unleveraged return of 10.5%. Excluding property management fees and structural reserves, the initial unleveraged return is approximately 10.9%. The initial purchase price is comprised of the issuance of 118,695 special common units of CBL's operating partnership with a value of $45.00 per unit and a dividend yield of 8.0%, the assumption of $40.7 million in non-recourse mortgage debt and $458,000 in cash closing costs.

Located on approximately 54 acres at the intersection of 23rd Street (State Road S-390A) and Cove Boulevard (State Road 77), the mall is anchored by Dillard's, JCPenney and Sears. Panama City Mall is currently 87% occupied and posted mall shop sales of $280 per square foot in 2001.

CBL's chairman and chief executive officer, Charles B. Lebovitz commented, "Panama City Mall is 65 miles away from the nearest competing mall and serves a growing trade area of approximately 260,000 plus an annual tourist count exceeding four million. With the additional 10 acres adjacent to the mall, we expect to enhance the franchise value of Panama City Mall through a future expansion as well as through aggressive retenanting and specialty leasing. The current acquisition environment provides select opportunities, and we expect to continue to use our proven expertise to create additional growth through acquisitions."

CBL & Associates Properties, Inc. is the third largest mall real estate investment trust in terms of GLA owned in the United States and the largest owner of malls and shopping centers in the Southeast. With a total of 54 enclosed malls, the Company has a portfolio of 160 properties in 25 states totaling 57.3 million square feet including 2.2 million square feet of non-owned shopping centers managed for third parties. The Company has under construction eight projects totaling approximately 1.4 million square feet, including one mall, one associated center, two community centers, one mall expansion plus three mall renovations. In addition to its office in Chattanooga, TN, the Company has a regional office in Boston (Waltham), MA. The Company can be found on the Internet at www.cblproperties.com.

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