CBL & Associates Properties Forms Joint Venture On Three Properties With Partners Property Group.

Business Editors

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

CBL & Associates Properties, Inc. (NYSE:CBL) today announced it has contributed three shopping centers to a joint venture with Partners Property Group (PPG) of New York City for total consideration of $63 million.

CBL contributed to the venture the 386,204-square-foot Willowbrook Plaza in Houston, Texas, the 77,893-square-foot Pemberton Plaza in Vicksburg, Mississippi, and the 290,717-square-foot Massard Crossing in Fort Smith, Arkansas. These three properties are valued at $63 million and the venture is owned 10% by CBL as a limited partner and 90% by PPG. CBL will retain ownership of the land beneath each project and will continue to manage and lease the properties on behalf of the venture. After PPG's preferred return CBL will receive a return on its equity.

The $63 million property value consists of a first mortgage financing of $38,750,000 and the equity contribution of $8 million. CBL received $46,750,000 of cash proceeds from the transaction, which were used to retire the existing debt of $34 million on Willowbrook Plaza with the remaining proceeds used to retire other debt. CBL's retained investment is subordinate to the first mortgage debt and the preferred return to PPG. The venture has unrestricted rights to sell the properties after five years or sooner in the event the returns are not being made.

Charles B. Lebovitz, CBL's chairman and chief executive officer, said, "One component of our growth strategy has been to fund new developments and acquisitions, as well as ongoing reinvestment in our properties, with select asset sales and joint ventures. This transaction affords us the opportunity to realize our value today on these properties and to receive a share of future appreciation from improved performance."

Todd A. Wenner, President of Partners Property Group, LLC said, "We have enjoyed working with CBL in completing this transaction. It afforded us the opportunity to invest capital in projects that are stable investments. The structure of the venture provides CBL with incentives to continue to enhance the value and performance of these properties."

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. CBL owns regional malls and community shopping centers, primarily in the Southeast and select markets in the Northeast and Midwest. With a total of 52 enclosed malls, the Company has a portfolio of 157 properties in 25 states totaling 56 million square feet, including 2.2 million square feet of non-owned shopping centers managed for third parties. The Company has under construction three projects totaling approximately 700,000 square feet, including one mall, one mall expansion and one mall renovation. In addition to its office in Chattanooga, TN, CBL has a regional office in Boston (Waltham), MA. The Company can be found on the Internet at www.cblproperties.com.

PPG is a private real estate investment firm with a specific interest in structuring joint venture transactions with real estate investment trusts that provide REITs further earning potential from the properties involved.

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.