UNITED STATES

SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended June 30, 2009

SIMON PROPERTY GROUP, L.P.(Exact name of registrant as specified in its charter)

Delaware
(State of incorporation or organization)

333-157794
(Commission File No.)

34-175576
(I.R.S. Employer Identification No.)

225
West Washington Street
Indianapolis, Indiana 46204
(Address of principal executive offices)

(317) 636-1600
(Registrant's telephone number, including area code)

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 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 90 days.
Yes ý    No o

Indicate by check mark whether the Registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to
be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that
the Registrant was required to submit and post such files). Yes o    No o

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting
company. See the definitions of "large accelerated filer," "accelerated filer," and "smaller reporting company" in Rule 12b-2 of the Exchange Act (check one):

Large accelerated filer o

Accelerated filer o

Non-accelerated filer ý (Do not check if a smaller reporting company)

Smaller reporting company o


Indicate
by check mark whether Registrant is a shell company (as defined by Rule 12b-2 of the Exchange Act). Yes o
    No ý

Registrant has no common stock outstanding.



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Simon Property Group, L.P. and Subsidiaries
Form 10-Q
INDEX



PagePart I  Financial InformationItem 1.

Consolidated Financial Statements (Unaudited)Consolidated Balance Sheets as of June 30, 2009 and December 31, 2008

3Consolidated Statements of Operations and Comprehensive Income for the three months and six months ended June 30, 2009 and 2008

4Consolidated Statements of Cash Flows for the six months ended June 30, 2009 and 2008

5Condensed Notes to Consolidated Financial Statements

6Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

20Item 3.

Qualitative and Quantitative Disclosures About Market Risk

33Item 4.

Controls and Procedures

33Part II  Other InformationItem 1.

Legal Proceedings

34Item 1A.

Risk Factors

34Item 5.

Other Information

34Item 6.

Exhibits

34Signatures

35


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Table of Contents

Simon Property Group, L.P. and SubsidiariesUnaudited Consolidated Balance Sheets  (Dollars in thousands, except unit amounts)

June 30,
2009

December 31,
2008As AdjustedASSETS:Investment properties, at cost

$
25,327,605

$
25,205,715Less  accumulated depreciation


6,604,384


6,184,28518,723,221


19,021,430Cash and cash equivalents


2,628,431


773,544Tenant receivables and accrued revenue, net


343,365


414,856Investment in unconsolidated entities, at equity


1,552,303


1,663,886Deferred costs and other assets


1,176,998


1,028,333Note receivable from related party


586,000


520,700Total assets

$
25,010,318

$
23,422,749LIABILITIES:Mortgages and other indebtedness

$
17,936,403

$
18,042,532Accounts payable, accrued expenses, intangibles, and deferred revenue


984,851


1,086,248Cash distributions and losses in partnerships and joint ventures, at equity


413,272


380,730Other liabilities and accrued distributions


178,817


155,151Total liabilities


19,513,343


19,664,661Commitments and ContingenciesPreferred Units, various series, at liquidation value, and noncontrolling redeemable interests in properties


571,004


656,121EQUITY:Partners' EquityPreferred units, 796,948 and 891,183 units outstanding, respectively. Liquidation values $39,847 and 42,486, respectively


45,868


48,671General Partner, 281,071,518 and 231,319,644 units outstanding, respectively


4,184,040


2,576,307Limited Partners, 57,091,333 and 56,368,410 units outstanding, respectively


849,864


627,799Total partners' equity


5,079,772


3,252,777Nonredeemable noncontrolling deficit interests in properties, net


(153,801
)

(150,810
)Total equity


4,925,971


3,101,967Total liabilities and equity

$
25,010,318

$
23,422,749


The accompanying notes are an integral part of these statements.

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Simon Property Group, L.P. and SubsidiariesUnaudited Consolidated Statements of Operations and Comprehensive Income  (Dollars in thousands, except per
unit amounts)

For the Three Months Ended June 30,

For the Six Months Ended June 30,2009

2008

2009

2008As Adjusted



As AdjustedREVENUE:Minimum rent

$
567,633

$
566,199

$
1,139,047

$
1,116,881Overage rent


13,493


17,836


25,993


34,487Tenant reimbursements


257,532


259,803


516,294


510,051Management fees and other revenues


30,055


34,879


60,706


67,899Other income


34,899


44,230


80,064


88,927Total revenue


903,612


922,947


1,822,104


1,818,245EXPENSES:Property operating


106,836


111,911


212,983


224,672Depreciation and amortization


251,685


236,617


508,022


464,660Real estate taxes


83,076


85,450


171,319


169,970Repairs and maintenance


20,186


25,845


42,774


54,866Advertising and promotion


19,823


21,739


38,329


41,112Provision for credit losses


7,066


6,781


20,081


13,363Home and regional office costs


26,670


34,844


52,833


74,444General and administrative


5,310


5,095


9,358


10,397Impairment charge


140,478





140,478


Other


17,784


15,627


37,013


33,948Total operating expenses


678,914


543,909


1,233,190


1,087,432OPERATING INCOME


224,698


379,038


588,914


730,813Interest expense


(244,443
)

(232,335
)

(470,479
)

(462,252
)Loss on extinguishment of debt





(20,330
)




(20,330
)Income tax benefit (expense) of taxable REIT subsidiaries


143


(627
)

2,666


(604
)Income (loss) from unconsolidated entities


5,494


(11,393
)

11,039


(4,252
)CONSOLIDATED NET (LOSS) INCOME


(14,108
)

114,353


132,140


243,375Net income attributable to noncontrolling interests


2,325


2,692


5,364


4,793Preferred unit requirement


10,681


15,573


21,388


31,828NET (LOSS) INCOME ATTRIBUTABLE TO UNITHOLDERS

$
(2,714
)
$
96,088

$
105,388

$
206,754NET (LOSS) INCOME ATTRIBUTABLE TO UNITHOLDERS
ATTRIBUTABLE TO:General Partner

$
(20,760
)
$
76,572

$
86,008

$
164,505Limited Partners


(6,354
)

19,516


19,380


42,249Net (loss) income attributable to unitholders

$
(27,114
)
$
96,088

$
105,388

$
206,754BASIC EARNINGS PER UNITNet (Loss) Income attributable to unitholders

$
(0.08
)
$
0.34

$
0.34

$
0.73DILUTED EARNINGS PER UNITNet (Loss) Income attributable to unitholders

$
(0.08
)
$
0.34

$
0.34

$
0.73Consolidated net (loss) income

$
(14,108
)
$
114,353

$
132,140

$
243,375Unrealized (loss) income on interest rate hedges


13,198


17,266


(11,229
)

(6,619
)Net (loss) gain on derivative instruments reclassified from accumulated other comprehensive income (loss) into interest expense


(3,537
)

635


(7,047
)

3,225Currency translation adjustments


7,590


14,706


(5,233
)

(7,688
)Changes in available-for-sale securities and other


190,030


(4,087
)

166,603


(5,342
)Comprehensive income


193,173


142,873


275,234


226,951Comprehensive income attributable to noncontrolling interests


2,325


2,692


5,364


4,793Comprehensive income attributable to unitholders

$
190,848

$
140,181

$
269,870

$
222,158


The accompanying notes are an integral part of these statements.

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Simon Property Group, L.P. and SubsidiariesUnaudited Consolidated Statements of Cash Flows  (Dollars in thousands)

For the Six Months
Ended June 30,2009

2008As AdjustedCASH FLOWS FROM OPERATING ACTIVITIES:Consolidated net income

$
132,140

$
243,375Adjustments to reconcile net income to net cash provided by operating activities Depreciation and amortization


511,832


450,515Impairment charge


140,478


Straight-line rent


(14,482
)

(18,324
)Equity in (income) loss of unconsolidated entities


(11,039
)

4,252Distributions of income from unconsolidated entities


53,922


49,990Changes in assets and liabilities Tenant receivables and accrued revenue, net


86,919


27,757Deferred costs and other assets


(26,856
)

(37,466
)Accounts payable, accrued expenses, intangibles, deferred revenues and other liabilities


14,713


42,825Net cash provided by operating activities


887,627


762,924CASH FLOWS FROM INVESTING ACTIVITIES:Funding of loans to related parties


(70,000
)

Repayments of loans from related parties


4,700


14,000Capital expenditures, net


(239,711
)

(461,563
)Investments in unconsolidated entities


(12,988
)

(34,658
)Purchase of marketable and non-marketable securities


(134,391
)

(212,865
)Distributions of capital from unconsolidated entities and other


68,448


65,119Net cash used in investing activities


(383,942
)

(629,967
)CASH FLOWS FROM FINANCING ACTIVITIES:Issuance of units


1,639,579


5,357Purchase of preferred units and partnership units





(14,043
)Preferred unit redemptions


(87,689
)

(1,845
)Minority interest distributions


(15,129
)

(13,378
)Minority interest contributions


2,704


1,539Partnership distributions


(87,579
)

(538,829
)Mortgage and other indebtedness proceeds, net of transaction costs


2,203,016


3,022,365Mortgage and other indebtedness principal payments


(2,303,700
)

(2,592,226
)Net cash provided by (used in) financing activities


1,351,202


(131,060
)INCREASE IN CASH AND CASH EQUIVALENTS


1,854,887


1,897CASH AND CASH EQUIVALENTS, beginning of period


773,544


501,982CASH AND CASH EQUIVALENTS, end of period

$
2,628,431

$
503,879


The accompanying notes are an integral part of these statements.

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Simon Property Group, L.P. and Subsidiaries
Condensed Notes to Consolidated Financial Statements
(Unaudited)

(Dollars
in thousands, except unit and per unit amounts and where indicated in millions or billions)

1.     Organization

Simon Property Group, L.P. is a Delaware limited partnership and the majority-owned subsidiary of Simon Property Group, Inc. In these condensed
notes to the unaudited consolidated financial statements, the terms "Operating Partnership", "we", "us" and "our" refer to Simon Property Group, L.P. and its subsidiaries and the term "Simon
Property" refers to Simon Property Group, Inc. Simon Property, a Delaware corporation, is a self-administered and self-managed real estate investment trust, or REIT,
under the Internal Revenue Code, as amended (the "Code"). According to our partnership agreement, we are required to pay all expenses of Simon Property.

We
own, develop and manage retail real estate properties, which consist primarily of regional malls, Premium Outlet® centers, The Mills®, and community/lifestyle
centers. As of June 30, 2009, we owned or held an interest in 324 income-producing properties in the United States, which consisted of 163 regional malls, 40 Premium Outlet centers, 70
community/lifestyle centers, 36 properties acquired in the 2007 acquisition of The Mills Corporation, or the Mills acquisition, and 15 other shopping centers or outlet centers in 41 states and Puerto
Rico. Of the 36 properties acquired in the Mills portfolio, 16 of these properties are The Mills, 16 are regional malls, and four are community centers. We also own an interest in one parcel of land
held in the United States for future development. In the United States, we have one new property currently under development aggregating approximately 400,000 square feet which will open during 2009.
Internationally as of June 30, 2009, we had ownership interests in 51 European shopping centers (France, Italy and Poland); seven Premium Outlet centers in Japan; one Premium Outlet
center in Mexico; one Premium Outlet center in South Korea; and one shopping center in China. Also, through joint venture arrangements we have ownership interest in the following properties under
development internationally: a 24% interest in two shopping centers in Italy, a 40% interest in a Premium Outlet center in Japan, and a 32.5% interest in three additional shopping centers under
construction in China.

2.     Basis of Presentation

The accompanying unaudited consolidated financial statements include the accounts of all majority-owned subsidiaries, and all significant inter-company amounts
have been eliminated. Due to the seasonal nature of certain operational activities, the results for the interim period ended June 30, 2009 are not necessarily indicative of the results that may
be obtained for the full fiscal year.

These
consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and include all of the information and disclosures required
by accounting principles generally accepted in the United States (GAAP) for interim reporting. Accordingly, they do not include all of the disclosures required by GAAP for complete financial
statements. In the opinion of management, all adjustments necessary for fair presentation (including normal recurring accruals) have been included. The consolidated financial statements in this
Form 10-Q should be read in conjunction with the audited consolidated financial statements and related notes contained in our 2008 Annual Report on Form 10-K.

As
of June 30, 2009, we consolidated 203 wholly-owned properties and 18 additional properties that are less than wholly-owned, but which we control or for which we are the primary
beneficiary. We account for the remaining 164 properties, or the joint venture properties, using the equity method of accounting. We manage the day-to-day operations of 93 of
the 164 joint venture properties, but have determined that our partner or partners have substantive participating rights with respect to the assets and operations of these joint venture properties.
Our investments in joint ventures in Japan, Europe, and Asia comprise 61 of the remaining 71 properties. The international properties are managed locally by joint ventures in which

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we
share oversight responsibility with our partner. Additionally, we account for our investment in SPG-FCM Ventures, LLC, or SPG-FCM, which acquired The Mills
Corporation and its majority-owned subsidiary, The Mills Limited Partnership, collectively Mills, in April 2007, using the equity method of accounting. We have determined that SPG-FCM is
not a variable interest entity (VIE) and that Farallon Capital Management, L.L.C., or Farallon, our joint venture partner, has substantive participating rights with respect to the assets and
operations of SPG-FCM pursuant to the applicable partnership agreements.

We
allocate net operating results after preferred distributions based on our partners' respective weighted average ownership. Simon Property owns a majority of our units of partnership
interest, or units, and certain series of our preferred units. Simon Property's weighted average ownership interest in us was 81.6% and 79.6% for the six months ended June 30, 2009 and 2008,
respectively. As of June 30, 2009 and December 31, 2008, Simon Property's ownership interest in us was 83.1% and 80.4%, respectively. We adjust the limited partners' interests in the
Operating Partnership at the end of each period to reflect their respective interests in us.

Preferred
unit requirements in the accompanying consolidated statements of operations and cash flows represent distributions on outstanding preferred units.



We made certain reclassifications of prior period amounts in the consolidated financial statements to conform to the 2009 presentation.
The reclassifications were to reflect the retrospective adoption of Statement of Financial Accounting Standard (SFAS) No. 160, "Noncontrolling Interests in Consolidated Financial Statements, an
amendment to ARB 51" (SFAS 160) and the application of EITF Topic D-98, "Classification and Measurement of Redeemable Securities" (EITF D-98), to certain redeemable
securities, as further described in note 3. The reclassifications had no impact on previously reported net income available to common unitholders or earnings per unit.



We have evaluated the financial statements for subsequent events through the time of the filing of this Form 10-Q.

3.     Significant Accounting Policies



We consider all highly liquid investments purchased with an original maturity of 90 days or less to be cash and cash
equivalents. Cash equivalents are carried at cost, which approximates market value. Cash equivalents generally consist of commercial paper, bankers acceptances, Eurodollars, repurchase agreements and
money market funds or accounts. Cash and cash equivalents, as of June 30, 2009, include a balance of $31.4 million related to our co-branded gift card programs which we do
not consider available for general working capital purposes. Financial instruments that potentially subject us to concentrations of credit risk include our cash and cash equivalents and our trade
accounts receivable. We place our cash and cash equivalents with high credit quality institutions. However, at certain times, the cash and cash equivalents deposited with any institution may be in
excess of FDIC and SIPC insurance limits.



Marketable securities consist primarily of the investments of our captive insurance subsidiaries, our investment in shares of common
stock of Liberty International PLC, or Liberty, our deferred compensation plan investments, and certain investments held to fund the debt service requirements of debt previously secured by
investment properties that have been sold.

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The
types of securities included in the investment portfolio of our captive insurance subsidiaries typically include U.S. Treasury or other U.S. government securities as well as
corporate debt securities with maturities ranging from 1 to 10 years. These securities are classified as available-for-sale and are valued based upon quoted market
prices or using discounted cash flows when quoted market prices are not available. The amortized cost of debt securities, which approximates fair value, held by our captive insurance subsidiaries is
adjusted for amortization of premiums and accretion of discounts to maturity. Our investment in Liberty is also accounted for as an available-for-sale security. Liberty
operates regional shopping centers and is the owner of other retail assets throughout the United Kingdom. Liberty is a U.K. FTSE 100 listed company. Liberty converted into a U.K. Real Estate
Investment Trust (REIT) on January 1, 2007. Our interest in Liberty is adjusted to their quoted market price, including a related foreign exchange component. Changes in the values of these
securities are recognized in accumulated other comprehensive income (loss) until the gain or loss is realized or until any unrealized loss is deemed to be other-than-temporary.

During
the quarterly period ended June 30, 2009, we recognized a non-cash impairment charge of $140.5 million, or $0.42 per diluted unit, representing an
other-than-temporary decline in fair value below the carrying value of our investment in Liberty. As of June 30, 2009, we owned 35.4 million shares at a weighted
average cost per share of £5.74. As of June 30, 2009, Liberty's quoted market price was £3.97 per share. As a result of the significance and duration of the decline in
the total share price, including currency revaluations, the decline in value was deemed an other-than-temporary impairment, which established a new cost basis of our investment
in Liberty. Until this quarter, we have marked our Liberty investment to market through other comprehensive income. As a result, the changes in available-for-sale securities
and other in the consolidated statement of operations and comprehensive income includes the reclassification of $140.5 million from accumulated other comprehensive income to earnings related to
this non-cash impairment charge.

Our
insurance subsidiaries are required to maintain statutory minimum capital and surplus as well as maintain a minimum liquidity ratio. Therefore, our access to these securities may be
limited. Our deferred compensation plan investments are classified as trading securities and are valued based upon quoted market prices. The investments have a matching liability recorded as the
amounts are fully payable to the employees who earned the compensation which is in the deferred compensation plan. Changes in the values of these securities are recognized in earnings, but because of
the matching liability the impact to net income is zero. As of June 30, 2009 and December 31, 2008, we had investments of $52.6 million and $53.4 million, respectively,
which must be used to fund the debt service requirements of debt related to investment properties sold. These investments are classified as held-to-maturity and are recorded at
amortized cost as we have the ability and intent to hold these investments to maturity. During 2008, we made an investment of $70 million in a non-marketable security that we
account for under the cost method. To
the extent an other-than-temporary decline in fair value is deemed to have occurred, we would adjust this investment to its estimated fair value.

The
net unrealized losses as of June 30, 2009 were approximately $1.3 million and represented the valuation and related currency adjustments for our marketable securities.
Other than the adjustment related to our investment in Liberty, we do not consider the decline in value of any of our other marketable and non-marketable securities to be an
other-than-temporary decline in value, as these market value declines, if any, have existed for a short period of time, and we have the ability and intent to hold these
securities to maturity in the case of debt securities.



We hold marketable securities that total $481.5 million at June 30, 2009, and are considered to have Level 1 fair
value inputs. In addition, we have derivative instruments, primarily interest rate swap agreements, with a gross liability balance of $14.6 million, which are classified as having
Level 2 inputs. Level 1 fair value inputs are quoted prices for identical items in active, liquid and visible markets such as

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stock
exchanges, and Level 2 fair value inputs are observable information for similar items in active or inactive markets, and appropriately consider counterparty creditworthiness in the
valuations.



Effective January 1, 2009, we adopted the provisions of SFAS 160, which requires a noncontrolling interest in a
subsidiary to be reported as equity and the amount of consolidated net income specifically attributable to the noncontrolling interest to be included within consolidated net income. SFAS 160
also requires consistency in the manner of reporting changes in the parent's ownership interest and requires fair value measurement of any noncontrolling equity investment retained in a
deconsolidation. In connection with our retrospective adoption of SFAS 160, we also performed a concurrent review and retrospectively adopted the measurement provisions of EITF
D-98. Upon adoption, we adjusted the carrying amounts of noncontrolling redeemable interests held by third parties in certain of our properties to redemption values at each reporting date.
Because holders of the noncontrolling redeemable interests in properties can require us to redeem these interests for cash, we have classified these noncontrolling redeemable interests outside of
permanent equity upon the adoption of SFAS 160. These adjustments increased the December 31, 2007 carrying value of these noncontrolling redeemable interests by $41.5 million,
with a corresponding decrease to partners' equity. Subsequent adjustments to the carrying amounts of these noncontrolling redeemable interests in properties, to reflect the change in its redemption
value at the end of each reporting period, are recorded to partners' equity.

Our
reassessment of EITF D-98 also resulted in the reclassification of our 6% Series I Convertible Perpetual Preferred Units (Series I Preferred Units), our
Series D 8% Cumulative Redeemable Preferred Units (Series D Preferred Units), and our 7.5% Cumulative Redeemable Preferred Units (7.5% Preferred Units) from permanent equity to temporary
equity due to the possibility that we could be required to redeem the securities for cash. For the Series I Preferred Units, the reclassification to temporary equity resulted from the holders'
ability to redeem this series of preferred units for cash upon the occurrence of a change in control event, which would include a change in the majority of the directors on Simon Property Group's
Board of Directors, or the Board, that occurs over a two year period. Such a change in Board composition could be deemed outside of our control. For the Series D Preferred Units and 7.5%
Preferred Units, the reclassification to temporary equity was required because redemption of these series of preferred units requires the delivery of fully registered shares of Simon Property common
stock. The previous and current carrying amount of all of these series of preferred units is equal to their liquidation value, which is the amount payable upon the occurrence of any event that could
potentially result in cash settlement.

As
a result of the reclassifications, total equity at December 31, 2008 decreased by $720.2 million from the $3.8 billion previously reported. Effective
June 30, 2009, we also reclassified $2.6 million to temporary equity related to our Series C Cumulative Redeemable Preferred Units.

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The
detail of the carrying value, which is at liquidation value, of the preferred units and the carrying amount of the noncontrolling redeemable interests in properties classified in
temporary equity is as follows:

June 30,
2009

December 31,
20086% Series I Convertible Perpetual Preferred Units, 19,000,000 units authorized, 9,108,635 issued and outstanding

$
455,432

$
455,432Series C 7% Cumulative Redeemable Preferred Units, 2,700,000 units authorized, 94,235 issued and outstanding


2,639


Series D 8% Cumulative Redeemable Preferred Units, 2,700,000 units authorized, 1,269,524 and 1,356,814, respectively, issued and
outstanding


38,086


40,7047.5% Cumulative Redeemable Preferred Units, 260,000 units authorized, 255,373 issued and outstanding


25,537


25,5377.75%/8.00% Cumulative Redeemable Preferred Units, 850,698 units issued and outstanding at 2008





85,070Total carrying value of preferred units


521,694


606,743Noncontrolling redeemable interests in properties


49,310


49,378Total preferred units and noncontrolling redeemable interests in properties

$
571,004

$
656,121


The
adoption of SFAS 160 also resulted in the reclassification to equity of noncontrolling nonredeemable interests (deficit interests) in properties. Further, as a result of the
adoption of SFAS 160, net income attributable to noncontrolling interests (which includes nonredeemable noncontrolling interests in consolidated properties) is now excluded from the
determination of consolidated net income. Corresponding changes have also been made to the accompanying consolidated statements of cash flows. Such changes result in a net increase to cash flows
provided by operating activities with an offsetting increase to cash flows used in financing activities related to distributions to noncontrolling interest holders in properties.

A
progression of noncontrolling nonredeemable interests in properties for the three and six month periods ending June 30 is as follows:

For the Three Months
Ended June 30,

For the Six Months
Ended June 30,2009

2008

2009

2008Noncontrolling interests, beginning of period

$
(150,740
)
$
(145,283
)
$
(150,810
)
$
(141,251
)Net income attributable to noncontrolling interests


2,325


2,692


5,364


4,793Distributions to noncontrolling interest holders


(5,720
)

(5,508
)

(10,977
)

(11,790
)Other


334


2,424


2,622


2,573Total noncontrolling nonredeemable interests in properties, end of period

$
(153,801
)
$
(145,675
)
$
(153,801
)
$
(145,675
)




Effective January 1, 2009, we adopted SFAS No. 161, "Disclosures about Derivative Instruments and Hedging Activities, an
amendment of FASB Statement No. 133" (SFAS 161), which amends and expands the disclosure requirements of SFAS No. 133, "Accounting for Derivative Instruments and Hedging
Activities" (SFAS 133). SFAS 161 requires qualitative disclosures about objectives and strategies for using

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derivatives
and quantitative disclosures about the fair value of and gains and losses on derivative instruments. As required by SFAS 133, we record all derivatives on the balance sheet at fair
value. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative, whether we have elected to designate a derivative in a hedging relationship and apply
hedge accounting and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. We use a variety of derivative financial instruments in the normal course of
business to manage or hedge the risks associated with our indebtedness and interest payments. Our objectives in using interest rate derivatives are to add stability to interest expense and to manage
our exposure to interest rate movements. To accomplish this objective, we primarily use interest rate swaps and caps. We require that hedging derivative instruments be highly effective in reducing the
risk exposure that they are designated to hedge. We formally designate any instrument that meets these hedging criteria as a hedge at the inception of the derivative contract.

As
of June 30, 2009, we had the following outstanding interest rate derivatives related to interest rate risk:

Interest Rate Derivative

Number of Instruments

Notional AmountInterest Rate Swaps


4

$
695.0 millionInterest Rate Caps


3

$
390.0 million


The
carrying value of our interest rate swap agreements, at fair value, is included with other liabilities and was $14.6 million as of June 30, 2009. The interest rate cap
agreements were of no net value at June 30, 2009 and we generally do not apply hedge accounting to these arrangements. The total gross accumulated other comprehensive loss related to our
derivative activities, including our share of the other comprehensive loss from joint venture properties, approximated $57.4 million as of June 30, 2009. There was no significant
ineffectiveness from any of our derivative activities during the period.

We
are also exposed to fluctuations in foreign exchange rates on investments denominated in a foreign currency that we hold, primarily in Japan and Europe. We use currency forward
agreements to manage our exposure to changes in foreign exchange rates on certain Yen-denominated receivables. Currency forward agreements involve fixing the USD-Yen exchange
rate for delivery of a specified amount of foreign currency on a specified date. The currency forward agreements are typically cash settled in US dollars for their fair value at or close to their
settlement date. We entered into USD-Yen forwards during 2009 for approximately ¥3 billion that we expect to receive over the next 33 months at an average
exchange rate of 97.1 USD:Yen, of which approximately ¥1.7 billion remains as of June 30, 2009. The June 30, 2009 asset balance related to these forwards was
not significant and we have reflected the changes in fair value for these forward contracts in earnings. The underlying currency adjustments on the foreign-denominated receivables are also reflected
in income and generally offset the amounts in earnings for these forward contracts.

We
have no credit-risk-related hedging or derivative activities.

4.     Per Unit Data

We determine basic earnings per unit based on the weighted average number of units outstanding during the period. We determine diluted earnings per unit based on
the weighted average number of common units outstanding combined with the incremental weighted average units that would have been

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outstanding
assuming all dilutive potential units were converted into units at the earliest date possible. The following table sets forth the computation of our basic and diluted earnings per unit.

For the Three Months
Ended June 30,

For the Six Months
Ended June 30,2009

2008

2009

2008Net (Loss) Income available to Unitholders  Basic & Dilutive

$
(27,114
)
$
96,088

$
105,388

$
206,754Weighted Average Units Outstanding  Basic


325,115,460


282,382,491


307,743,270


281,803,492Effect of stock options of Simon Property





588,806


259,551


604,699Effect of contingently issuable units from unit distributions








1,897,350


Weighted Average Units Outstanding  Diluted


325,115,460


282,971,297


309,900,171


282,408,191


For the six months ended June 30, 2009, potentially dilutive securities include options to purchase shares of Simon Property common stock, preferred units,
contingently issuable units from unit distributions and certain preferred units that are convertible into or exchangeable for units. The only securities that had a dilutive effect for the six months
ended June 30, 2009 were stock options of Simon Property and contingently issuable units from unit distributions. Potentially dilutive securities were excluded from the calculation of diluted
earnings per unit for the three months ended June 30, 2009 because the effect of their conversion would have been anti-dilutive to net loss attributable to common unitholders. We
accrue distributions when they are declared.

5.     Investment in Unconsolidated Entities



Joint ventures are common in the real estate industry. We use joint ventures to finance properties, develop new properties, and
diversify our risk in a particular property or portfolio. We held joint venture ownership interests in 103 properties in the United States as of June 30, 2009 and December 31, 2008. We
also held interests in two joint ventures which owned 51 European
shopping centers as of June 30, 2009 and December 31, 2008. We also held interests in seven joint venture properties under operation in Japan, one joint venture property in China, one
joint venture property in Mexico, and one joint venture property in South Korea. We account for these joint venture properties using the equity method of accounting.

Substantially
all of our joint venture properties are subject to rights of first refusal, buy-sell provisions, or other sale or marketing rights for partners which are
customary in real estate joint venture agreements and the industry. Our partners in these joint ventures may initiate these provisions at any time (subject to any applicable lock up or similar
restrictions), which could result in either the sale of our interest or the use of available cash or borrowings to acquire a joint venture interest from our partner.



As part of our acquisition of a joint venture interest in The Mills Corporation through SPG-FCM, we made loans to
SPG-FCM and Mills primarily at rates of LIBOR plus 270-275 basis points. These funds were used by SPG-FCM and Mills to repay loans and other obligations, including
the redemption of Mills' preferred stock. As of December 31, 2008 and June 30, 2009, the outstanding balance of our remaining loan to SPG-FCM was $520.7 million and
$586.0 million, respectively. During the first six months of 2009 and 2008, we recorded approximately $4.5 million and $8.1 million in interest income (net of inter-entity

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eliminations),
respectively, related to this loan. The loan facility bears interest at a rate of LIBOR plus 275 basis points and matures on June 8, 2010, with two available one-year
extensions.



European Joint Ventures.We conduct our international operations in Europe through two European joint ventures: Simon Ivanhoe
S.à.r.l., or Simon Ivanhoe, and Gallerie Commerciali Italia, or GCI. The carrying amount of our total combined investment in these two joint venture investments was
$210.6 million and $224.2 million as of June 30, 2009 and December 31, 2008, respectively, including all related components of other comprehensive income. We have a 50%
ownership in Simon Ivanhoe and a 49% ownership in GCI.

Asian Joint Ventures.We conduct our investment in the seven international Premium Outlet operations in Japan through joint
ventures in which we hold
a 40% ownership interest. The carrying amount of our investment in these joint ventures was $296.0 million and $312.6 million as of June 30, 2009 and December 31, 2008,
respectively, including all related components of other comprehensive income. On June 1, 2007, we opened Yeoju Premium Outlets, our first Premium Outlet center in South Korea, in which we hold
a 50% ownership interest. Our investment in this property was $19.8 million and $18.0 million as of June 30, 2009 and December 31, 2008, respectively, including all related
components of other comprehensive income.

We
also own a 32.5% interest in shopping centers located in China which are anchored by Wal-Mart, and a 32.5% ownership in the management operation overseeing these projects,
collectively referred to as Great Mall Investments, Ltd., or GMI. During 2008, GMI completed construction and opened its first center in China, and there are three additional centers under
construction which are scheduled to be opened in late 2009.            Our combined investment in GMI was approximately $55.1 million and $53.9 million as of June 30, 2009
and December 31, 2008, respectively, including the related cumulative translation adjustments.

We
account for all of our international joint venture investments using the equity method of accounting.

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Summary financial information (in thousands) of all of our joint ventures and a summary of our investment in and share of income from
such joint ventures follow. We condensed into separate line items major captions of the statements of operations for joint venture interests sold or consolidated. Consolidation occurs when we acquire
an additional interest in the joint venture and, as a result, gain unilateral control of the property or are determined to be the primary beneficiary. We reclassify these line items into "Discontinued
Joint Venture Interests" and
"Consolidated Joint Venture Interests" on the balance sheets and statements of operations, if material, so that we may present comparative results of operations for these joint venture properties held
as of June 30, 2009.

June 30,
2009

December 31,
2008BALANCE SHEETSAssets:Investment properties, at cost

$
21,504,051

$
21,472,490Less  accumulated depreciation


4,184,876


3,892,95617,319,175


17,579,534Cash and cash equivalents


740,085


805,411Tenant receivables and accrued revenue, net


365,331


428,322Investment in unconsolidated entities, at equity


238,698


230,497Deferred costs and other assets


577,251


594,578Total assets

$
19,240,540

$
19,638,342Liabilities and Partners' Equity:Mortgages and other indebtedness

$
16,610,441

$
16,686,701Accounts payable, accrued expenses, intangibles, and deferred revenue


908,549


1,070,958Other liabilities


1,038,611


982,254Total liabilities


18,557,601


18,739,913Preferred units


67,450


67,450Partners' equity


615,489


830,979Total liabilities and partners' equity

$
19,240,540

$
19,638,342Our Share of:Total assets

$
7,897,076

$
8,056,873Partners' equity

$
444,877

$
533,929Add: Excess Investment


694,154


749,227Our net Investment in Joint Ventures

$
1,139,031

$
1,283,156Mortgages and other indebtedness

$
6,513,659

$
6,632,419


"Excess
Investment" represents the unamortized difference of our investment over our share of the equity in the underlying net assets of the joint ventures acquired. We amortize excess
investment over the life of the related properties, typically no greater than 40 years, and the amortization is included in the reported amount of income from unconsolidated entities.

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Table of Contents

For the Three Months
Ended June 30,

For the Six Months
Ended June 30,STATEMENTS OF OPERATIONS

2009

2008

2009

2008Revenue:Minimum rent

$
490,889

$
478,418

$
957,566

$
948,481Overage rent


30,358


26,813


50,937


45,529Tenant reimbursements


239,202


244,593


476,644


473,338Other income


40,663


37,427


78,907


83,518Total revenue


801,112


787,251


1,564,054


1,550,866Operating Expenses:Property operating


162,385


163,813


311,325


316,737Depreciation and amortization


198,025


207,770


385,488


379,469Real estate taxes


63,385


66,629


132,774


132,373Repairs and maintenance


24,912


30,165


50,635


60,503Advertising and promotion


14,636


14,826


28,931


29,122Provision for credit losses


4,960


2,795


15,387


7,828Other


51,878


47,628


88,193


85,605Total operating expenses


520,181


533,626


1,012,733


1,011,637Operating Income


280,931


253,625


551,321


539,229Interest expense


(221,269
)

(234,837
)

(440,420
)

(483,710
)Income (loss) from unconsolidated entities


1,555


(4,150
)

787


(4,129
)Income from Continuing Operations


61,217


14,638


111,688


51,390Income from discontinued joint venture interests











47Net Income

$
61,217

$
14,638

$
111,688

$
51,437Third-Party Investors' Share of Net Income

$
41,711

$
14,906

$
72,890

$
33,557Our Share of Net Income (Loss)


19,506


(268
)

38,798


17,880Amortization of Excess Investment


(14,012
)

(11,125
)

(27,759
)

(22,132
)Income (loss) from Unconsolidated Entities, Net

$
5,494

$
(11,393
)
$
11,039

$
(4,252
)


6.     Debt



Our unsecured debt currently consists of $11.3 billion of our senior unsecured notes and our $3.5 billion unsecured
credit facility, or Credit Facility. The Credit Facility bears interest at LIBOR plus 37.5 basis points and an additional facility fee of 12.5 basis points. The Credit Facility matures
January 11, 2010 and may be extended one year at our option.

In
the first six months of 2009, we repaid three series of unsecured notes totaling $700.0 million, which had fixed rates of 3.75%, 7.13% and 3.50%, respectively.

On
March 25, 2009, we issued $650.0 million of senior unsecured notes at a fixed interest rate of 10.35% due April 1, 2019. We used the proceeds from the offering to
reduce borrowings on the Credit Facility and for general working capital purposes.

On
May 15, 2009, we issued $600.0 million of senior unsecured notes at a fixed interest rate of 6.75% due May 15, 2014. We used the proceeds from the offering for
general working capital purposes.

During
the six months ended June 30, 2009, we drew amounts from the Credit Facility to fund the repayment of $600.0 million of maturing unsecured notes. We repaid a total
of $1.2 billion on the Credit

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Facility
during the six months ended June 30, 2009. The total outstanding balance of the Credit Facility as of June 30, 2009 was $433.5 million, all related to the U.S. dollar
equivalent of Euro and Yen-denominated borrowings, and the maximum amount outstanding during the six months ended June 30, 2009 was approximately $1.6 billion. During the six
months ended June 30, 2009, the weighted average outstanding balance was approximately $893.4 million.



Total secured indebtedness was $6.2 billion and $6.3 billion at June 30, 2009 and December 31, 2008,
respectively.



The carrying value of our variable-rate mortgages and other loans approximates their fair values. We estimate the fair
values of consolidated fixed-rate mortgages using cash flows discounted at current borrowing rates and other indebtedness using cash flows at current market rates. We estimate the fair
values of consolidated fixed-rate unsecured notes using quoted market prices, or, if no quoted market prices are available, we use quoted market prices for securities with similar terms
and maturities. The fair values of our fixed-rate debt at June 30, 2009 and December 31, 2008 was $14,920 and $12,385, respectively, compared to carrying values at those
dates of $15,473 and 14,919, respectively.

7.     Equity

The Compensation Committee of the Board awarded 242,183 shares of restricted stock of Simon Property as part of the 2008 stock incentive program created
under The Simon Property Group, L.P. 1998 Stock Incentive Plan to employees on February 27, 2009 at a fair market value of $33.10 per share, 19,315 shares of restricted stock of Simon
Property on March 2, 2009 at a fair market value of $29.96 per share, and 764 shares of restricted stock of Simon Property on April 13, 2009 at a fair market value
of $42.65 per share. On May 8, 2009, Simon Property's non-employee Directors were awarded 11,178 shares of restricted stock of Simon Property under this plan at a fair market value
of $53.93 per share, and 3,250 shares of restricted stock on June 1, 2009 at a fair market value of $56.39 per share. The fair market value of the restricted stock of Simon Property awarded on
February 27, 2009, March 2, 2009 and April 13, 2009 is being recognized as expense over the four-year vesting service period. The fair market value of the restricted
stock awarded on May 8, 2008 and June 1, 2009, is being recognized as expense over a one-year vesting service period. In accordance with our partnership agreement, we issued
an equal number of units to Simon Property.

During
the first six months of 2009, fifty limited partners exchanged 1,136,948 of our units for an equal number of shares of Simon Property common stock. These transactions increased
Simon Property's ownership interest in us.

On
June 19, 2009, we issued 2,525,204 units to Simon Property and 514,720 units to limited partners related to our quarterly distribution. The closing price per share of the Simon
Property common stock on June 19, 2009 was $52.92.

On
March 18, 2009, we issued 5,519,765 units to Simon Property and 1,345,151 units to limited partners related to our quarterly distribution. The closing price per share of the
Simon Property common stock on March 18, 2009 was $35.38.

On
May 12, 2009, Simon Property issued 23,000,000 shares of common stock in a public offering at a public offering price of $50.00 per share. As a result, we issued 23,000,000
units to Simon Property, and used the proceeds from the offering for general working capital purposes.

On
March 25, 2009, Simon Property issued 17,250,000 shares of common stock in a public offering at a public offering price of $31.50 per share. As a result, we issued 17,250,000
units to Simon Property, and

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Table of Contents

used
the proceeds from the offering to repay amounts drawn on the Credit Facility and for general working capital purposes.

The
Simon Property Board had authorized the repurchase of up to $1.0 billion of common stock through July 2009. No purchases were made as part of this program in 2009. The program
was not renewed.



For the quarter ending June 30, 2009, holders of our Series I Preferred Units were not eligible to convert their
preferred units during the quarter into units as the triggering price for Simon Property common stock of $77.55 was not met as of March 31, 2009. As of June 30, 2009, the conversion
trigger price of $77.07 had again not been met. On June 30, 2009we redeemed all outstanding 7.75%/8.00% Cumulative Redeemable Preferred Units for cash in the aggregate amount of $85,070.
Subsequent to June 30, 2009, we gave notices to the holders of our 7.50% Cumulative Redeemable Preferred Units and 7.00% Cumulative Redeemable Preferred Units of our intention to redeem those
securities. The redemption price is the liquidation values, which is also their carrying values, of $25,537 and $2,639, respectively. The redemption price will be paid in the form of additional common
units of the Operating Partnership.



The following table provides a reconciliation of the beginning and ending carrying amounts of total equity, equity attributable to
partners and equity attributable to noncontrolling interests:

Preferred
Units

Simon Property
(Managing General
Partner)

Limited
Partners

Noncontrolling
interests

Total EquityJanuary 1, 2009

$
48,671

$
2,576,307

$
627,799

$
(150,810
)
$
3,101,967General partner contributions





1,586








1,586Proceeds of public offering of Simon Property stock





1,638,340








1,638,340Limited partner units converted to common units





12,973


(12,973
)




Other


(2,803
)

6,859


723


2,622


7,401Adjustment to limited partners' interest from increased ownership in the Operating Partnership





(196,680
)

196,680





Distributions (and units issued) to limited partners, excluding preferred interests classified as temporary equity


(1,668
)

(54,303
)

(11,889
)

(10,977
)

(78,837
)Comprehensive income, excluding preferred distributions on temporary equity preferred units of $19,719


1,668


198,958


49,524


5,364


255,514June 30, 2009

$
45,868

$
4,184,040

$
849,864

$
(153,801
)
$
4,925,971


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8.     Commitments and Contingencies



There have been no material developments with respect to the pending litigation disclosed in our 2008 Annual Report on
Form 10-K and no new material developments or litigation has arisen since those disclosures were made.

We
are involved in various other legal proceedings that arise in the ordinary course of our business. We believe that such routine litigation, claims and administrative proceedings will
not have a material adverse impact on our financial position or our results of operations. We record a liability when a loss is considered probable and the amount can be reasonably estimated.



Joint venture debt is the liability of the joint venture, and is typically secured by the joint venture property, which is
non-recourse to us. As of June 30, 2009, we have loan guarantees and other guarantee obligations of $47.8 million and $2.0 million, respectively, to support our total
$6.5 billion share of joint venture mortgage and other indebtedness in the event
that the joint venture borrower defaults under the terms of the underlying arrangement. Mortgages which are guaranteed by us are secured by the property of the joint venture and that property may be
sold in order to satisfy the outstanding obligation.

9.     Real Estate Acquisitions and Dispositions

We had no consolidated property acquisitions or dispositions during the six months ended June 30, 2009.

10.   Recent Financial Accounting Standards

In December 2007, the Financial Accounting Standards Board (FASB) issued SFAS No. 141(R), "Business Combinations", or SFAS 141(R).
SFAS 141(R) requires an acquirer to measure the identifiable assets acquired, the liabilities assumed and any noncontrolling interest in the acquiree at their fair values on the acquisition
date, with goodwill being the excess value over the net identifiable assets acquired. SFAS 141(R) is effective for financial statements issued for fiscal years beginning after
December 15, 2008. Our adoption of SFAS 141(R), did not have a significant impact on our results of operations or financial position.

In
February 2008, the FASB issued FASB Staff Position (FSP) No. 157-2, "Effective Date of FASB Statement No. 157" which permitted a one-year
deferral for the implementation of SFAS 157 with regard to nonfinancial assets and liabilities that are not recognized or disclosed at fair value in the financial statements on a recurring
basis (at least annually). On January 1, 2009, we adopted SFAS 157 as it relates to nonfinancial assets and nonfinancial liabilities that are not recognized or disclosed at fair value in
the financial statements on at least an annual basis. The adoption of SFAS 157, as it relates to nonfinancial assets and nonfinancial liabilities, had no impact on the financial statements. The
provisions of SFAS 157 will be applied at such time a fair value measurement of a nonfinancial asset or nonfinancial liability is required, which may result in a fair value that is materially
different than would have been calculated prior to the adoption of SFAS 157.

In
June 2008, the FASB ratified Emerging Issue Task Force Issue No. 07-5, "Determining Whether an Instrument (or an Embedded Feature) Is Indexed to an Entity's Own
Stock" (EITF 07-5). EITF 07-5 provides that an entity should use a two step approach to evaluate whether an equity-linked financial instrument (or embedded
feature) is indexed to its own stock, including evaluating the instrument's contingent exercise and settlement provisions. EITF 07-5 was effective for us as of January 1,
2009, and our adoption of EITF 07-5 had no impact on our financial position, results of operations or cash flows.

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On
January 1, 2009, we adopted FSP No. EITF 03-6-1, "Determining Whether Instruments Granted in Share-Based Payment Transactions Are Participating
Securities," (FSP EITF 03-6-1). FSP EITF 03-6-1 states that unvested share-based payment awards that contain nonforfeitable rights to
dividends or dividend equivalents (whether paid or unpaid) are participating securities and shall be included in the computation of earnings per share pursuant to the two-class method. The
adoption of FSP EITF 03-6-1 did not have a significant impact on reported earnings per unit.

In
May 2009, the FASB issued SFAS No. 165, "Subsequent Events" (SFAS 165), which is effective for interim and annual periods ending after June 15, 2009.
SFAS 165 establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued or are available to be
issued. The statement introduces new terminology but is based on the same principles that previously existed in the auditing standards. SFAS 165 requires disclosure of the date through which
management has evaluated subsequent events and whether that date represents the date the financial statements were issued or the date the financial statements were available to be issued. Management
has evaluated subsequent events through the time these financial statements were filed with the SEC.

In
June 2009, the FASB issued SFAS No. 168, "The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles" (SFAS 168), which is
effective for interim and annual periods ending after September 15, 2009. SFAS 168 defines a new hierarchy for U.S. GAAP and establishes the FASB Accounting Standards Codification
as the sole source for authoritative guidance to be applied by nongovernmental entities. SFAS 168 replaces SFAS 162, "The Hierarchy of Generally Accepted Accounting Principles," which
was issued in May 2008. The adoption of SFAS 168 will change the manner in which U.S. GAAP guidance is referenced, but it will not have any impact on our financial position or results of
operations.

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Table of Contents

Item 2.    Management's Discussion and Analysis of Financial Condition and Results of Operations

You should read the following discussion in conjunction with the financial statements and notes thereto that are included in this
report.

Overview

Simon Property Group, L.P. is a Delaware limited partnership and the majority-owned partnership subsidiary of Simon Property
Group, Inc. In this discussion, the terms "Operating Partnership", "we", "us" and "our" refer to Simon Property Group, L.P. and its subsidiaries and the term "Simon Property" refers
specifically to Simon Property Group, Inc.

We
own, develop, and manage retail real estate properties, primarily regional malls, Premium Outlet® centers, The Mills®, and community/lifestyle centers. As of
June 30, 2009, we owned or held an interest in 324 income-producing properties in the United States, which consisted of 163 regional malls, 40 Premium Outlet centers, 70 community/lifestyle
centers, 36 properties acquired in the 2007 acquisition of The Mills Corporation, or Mills, and 15 other shopping centers or outlet centers in 41 states plus Puerto Rico. Of the 36 properties in the
Mills portfolio, 16 of these properties are The Mills, 16 are regional malls, and four are community centers. We also own an interest in one parcel of land held in the United States for future
development. In the United States, we have one new property currently under development aggregating approximately 400,000 square feet which will open during 2009. Internationally, we have ownership
interests in 51 European shopping centers (France, Italy and Poland); seven Premium Outlet centers in Japan; one Premium Outlet center in Mexico; one Premium Outlet center in South Korea; and
one shopping center in China. Also, through joint venture arrangements we have ownership interests in the following properties under development internationally: a 24% interest in two shopping centers
in Italy, a 40% interest in a Premium Outlet center in Japan, and a 32.5% interest in three additional shopping centers under construction in China.

We
generate the majority of our revenues from leases with retail tenants including:



Revenues
of our management company, after intercompany eliminations, consist primarily of management fees that are typically based upon the revenues of the property being managed.

We
seek growth in earnings and cash flows by enhancing the profitability and operation of our properties and investments. We seek to accomplish this growth through the
following:



We
also grow by generating supplemental revenues from the following activities:



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We
focus on high quality real estate across the retail real estate spectrum. We expand or renovate to enhance existing assets' profitability and market share when we believe the
investment of our capital meets our risk-reward criteria. We selectively develop new properties in metropolitan areas that exhibit strong population and economic growth.

We
routinely review and evaluate acquisition opportunities based on their ability to complement our portfolio. Our international strategy includes partnering with established real estate
companies and financing international investments with local currency to minimize foreign exchange risk.

To
support our growth, we employ a three-fold capital strategy:



Diluted earnings per unit decreased $0.39 during the first six months of 2009, or 53.4%, to $0.34 from $0.73 for the same period last
year. The decrease in diluted earnings per unit was attributable to a $140.5 million, or $0.45 per unit, other-than-temporary impairment charge relate to our investment
in Liberty International, PLC, or Liberty, a U.K. REIT. We recorded the other-than-temporary charge in the first six months of 2009 due to the significance and duration
of the decline in quoted fair value, including related currency exchange component, below the carrying value of the securities. During the six months ended June 30, 2008, we recorded a
$20.3 million loss on extinguishment of debt related to our redemption of the 7% MandatOry Par Put Remarketed Securities, or MOPPRS. For the quarterly and six-month periods, we also
had additional dilution to earnings per unit from Simon Property's 2009 equity offerings of approximately $0.05 per unit.

Core
business fundamentals were affected by the difficult economic environment during the first six months of 2009. Regional mall comparable sales per square foot, or psf, declined 10.5%
during the first six months of 2009 to $442 psf from $494 psf for the same period in 2008. However, our regional mall average base rents increased 3.8% to $40.29 psf as of June 30, 2009, from
$38.81 psf as of June 30, 2008 due to releasing of space at higher rents. We were able to lease available square feet at higher rents than the expiring rental rates in the regional mall
portfolio resulting in a leasing spread of $6.27 psf as of June 30, 2009, representing a 17.0% increase over expiring rents. Regional mall occupancy was 90.9% as of June 30, 2009, as
compared to 91.8% as of June 30, 2008 driven by higher bankruptcies and lease terminations. The more stable operating fundamentals of the Premium Outlet centers contributed to the positive
operating results for the six month period as occupancy of the portfolio remained high at 97.0% while comparable sales psf decreased 5.0% to $493 as consumers continued to prefer retail value, offset
by the impact of the economic downturn. Premium Outlet leasing spreads were $9.57, or 34.6% above expiring rents.

As
of June 30, 2009, our effective overall borrowing rate increased five basis points to 5.57% as compared to June 30, 2008. This was primarily a result of an increase of
our fixed rate debt of $400 million ($16.2 billion at June 30, 2009 versus $15.8 billion at June 30, 2008), which increased the weighted average

21

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rate
26 basis points as compared to June 30, 2008. This increase was partially offset by a decrease in the base LIBOR rate applicable to a majority of our floating rate debt (0.31% at
June 30, 2009, versus 2.46% at June 30, 2008). Financing activities for the six months ended June 30, 2009 included:



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The portfolio data discussed in this overview includes the following key operating statistics: occupancy, average base rent per square
foot, and comparable sales per square foot for our domestic asset platforms. We include acquired properties in this data beginning in the year of acquisition and remove properties sold in the year
disposed. We do not include any properties located outside of the United States. The following table sets forth these key operating statistics for:



June 30,
2009

June 30,
2008

%/basis point
Change(1)Regional Malls:OccupancyConsolidated


90.9%


92.0%

-110 b
psUnconsolidated


90.9%


91.4%

-50 b
psTotal Portfolio


90.9%


91.8%

-90 b
psAverage Base Rent per Square FootConsolidated

$
38.74

$
37.70

2.8
%Unconsolidated

$
43.41

$
41.04

5.8
%Total Portfolio

$
40.29

$
38.81

3.8
%Comparable Sales Per Square FootConsolidated

$
424

$
468

-9.4
%Unconsolidated

$
481

$
552

-12.9
%Total Portfolio

$
442

$
494

-10.5
%Premium Outlet Centers:Occupancy


97.0%


98.3%

-130 b
psAverage base rent per square foot

$
32.74

$
26.66

22.8
%Comparable sales per square foot

$
493

$
519

-5.0
%The Mills®:Occupancy


90.9%


94.4%

-350 b
psAverage base rent per square foot

$
19.77

$
19.43

1.7
%Comparable sales per square foot

$
369

$
380

-2.9
%Mills Regional Malls:Occupancy


88.4%


87.1%

+130 b
psAverage base rent per square foot

$
36.77

$
37.23

-1.2
%Comparable sales per square foot

$
397

$
449

-11.6
%Community/Lifestyle Centers:Occupancy


88.5%


93.2%

-470 b
psAverage Base Rent per Square Foot

$
13.37

$
12.68

5.4
%


---

23

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Table of Contents

Occupancy Levels and Average Base Rent Per Square Foot.Occupancy and average base rent are based on mall gross leasable area, or
GLA, owned by us in
the regional malls, all tenants at the Premium Outlet centers, all tenants in the Mills portfolio, and all tenants at community/lifestyle centers. Our portfolio has maintained stable occupancy and
increased average base rents.

Comparable Sales Per Square Foot.Comparable sales include total reported retail tenant sales at owned GLA (for mall and
freestanding stores with
less than 10,000 square feet) in the regional malls and all reporting tenants at the Premium Outlet centers and the Mills portfolio. Retail sales at Owned GLA affect revenue and profitability levels
because sales determine the amount of minimum rent that can be charged, the percentage rent realized, and the recoverable expenses (common area maintenance, real estate taxes, etc.) that tenants can
afford to pay.



The following key operating statistics are provided for our international properties, which we account for using the equity method of
accounting.

June 30,
2009

June 30,
2008

%/basis point
ChangeEuropean Shopping Centers:Occupancy


96.0%


98.4%


-240 b
psComparable sales per square foot

€
409

€
427


-4.2
%Average base rent per square foot

€
31.78

€
29.81


6.6
%International Premium Outlets(1)Occupancy


99.8%


100.0%


-20 b
psComparable sales per square foot


¥91,528


¥ 93,847


-2.5
%Average base rent per square foot


¥ 4,723


¥ 4,644


1.7
%


---

Results of Operations

In addition to the activity discussed above in the "Results Overview" section, the following property openings and other activity
affected our consolidated results from continuing operations in the comparative periods:



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Table of Contents



In
addition to the activities discussed in "Results Overview," the following dispositions and property openings affected our income from unconsolidated entities in the comparative
periods:



For
the purposes of the following comparison between the six months ended June 30, 2009, and 2008, the above transactions are referred to as the "property transactions". In the
following discussions of our results of operations, "comparable" refers to properties open and operating throughout the periods in both 2009 and 2008.



Minimum rents increased $1.4 million during the period, of which the property transactions accounted for $6.4 million of
the increase. Comparable minimum rents decreased $5.0 million, or 0.9%. This was primarily attributable to a decline in the fair market value of in-place lease amortization of
$7.2 million and a $6.5 million decrease in straight-line rents, offset by an increase in base minimum rents of $6.5 million and an increase in comparable rents from
carts, kiosks, and other temporary tenants of $2.2 million.

Overage
rents decreased $4.3 million, or 24%, as a result of a reduction in tenant sales for the period as compared to the prior year.

Tenant
reimbursements decreased $2.3 million, due to a $2.4 million increase attributable to the property transactions offset by a $4.7 million, or 1.9%, decrease in
the comparable properties as a result of a decrease in expenditures allocable to tenants paying common area maintenance on a proportionate basis. We continue to migrate our tenants' payments of common
area maintenance contributions to a fixed-payment methodology, which serves to offset the variability of this revenue in relation to variability in the underlying expenses.

Management
fees and other revenues decreased $4.8 million principally as a result of decreased earned premiums of our wholly-owned captive insurance entities and lower fee revenue
due to the reduction in development, leasing and joint venture property refinancing activity.

Total
other income decreased $9.3 million, and was principally the result of the following:



25

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Table of Contents



Property
operating costs decreased $5.1 million, or 4.5%, primarily related to our cost control and cost reduction initiatives.

Depreciation
and amortization expense increased $15.1 million due to the impact of our prior year openings and expansion activity and acceleration of depreciation for certain
properties scheduled for redevelopment.

Repairs
and maintenance decreased $5.7 million primarily due to our cost savings efforts.

Home
and regional office expense decreased $8.2 million primarily due to decreased personnel costs attributable to our cost control initiatives and lower incentive compensation
levels.

During
the quarter ended June 30, 2009, we recognized a non-cash impairment charge of $140.5 million, or $0.42 per unit, representing the
other-than-temporary decline in the fair value below the carrying value of our investment in Liberty. As of June 30, 2009, we owned 35.4 million shares at a
weighted average cost per share of £5.74. As of June 30, 2009, Liberty's quoted market price was £3.97 per share. We recorded the charge to earnings due to the
significance and duration of the decline in the total share price, including currency revaluations. As a result, the decline in value was deemed other-than-temporary, which
established a new cost basis of our investment in Liberty.

Interest
expense increased $12.1 million primarily related to our issuance of $600 million senior unsecured notes on May 15, 2009 and $650 million senior
unsecured notes on March 25, 2009, offset by decreased interest expense on our Credit Facility due to the payoff of the US tranche.

We
recognized a loss on extinguishment of debt of $20.3 million in the second quarter of 2008 related to the redemption of the $200 million outstanding principal amount of
MOPPRS. We extinguished this
debt because the remarketing reset base rate of the MOPPRS was above the rate for 30-year U.S. Treasury securities at the time of redemption.

Income
from unconsolidated entities increased $16.9 million as a result of our 2008 joint venture openings and expansion activity, interest rate savings from favorable interest
rates and debt refinancings, and additional depreciation provisions related to the finalization of purchase accounting on asset basis step-ups in the 2008 period associated with the
acquisition of Mills.

Preferred
unit distribution requirements decreased $4.9 million as a result of the conversion or exchange of preferred units to units during 2008.



Minimum rents increased $22.2 million during the period, of which the property transactions accounted for $15.7 million
of the increase. Comparable rents increased $6.5 million, or 0.6%. This was primarily due to an increase in minimum rents of $20.7 million due to releasing of space, offset by a
$10.2 million decrease in comparable property activity, primarily attributable to a decline in the fair market value of in-place lease amortization, and a $5.5 million
decrease in straight-line rents. In addition, increased rents from carts, kiosks, and other temporary tenants increased comparable rents by $1.5 million.

Overage
rents decreased $8.5 million, or 25%, as a result of a reduction in tenant sales for the period as compared to the prior year.

Tenant
reimbursements increased $6.2 million, due to a $6.1 million increase attributable to the property transactions, and the remainder of the increase of
$0.1 million attributable to our ongoing initiative to convert our leases to a fixed reimbursement methodology for common area maintenance costs.

Management
fees and other revenues decreased $7.2 million principally as a result of decreased earned premiums of our wholly-owned captive insurance entities and lower fee revenue
due to the reduction in development, leasing and joint venture property refinancing activity.

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Table of Contents

Total
other income decreased $8.8 million, and was the result of an $8.8 million net decrease in interest income primarily attributable to lower reinvestment rates and the
lower rate applicable to our loan facility with SPG-FCM.

Property
operating costs decreased $11.7 million, or 5.2%, primarily related to our cost control and cost reduction initiatives.

Depreciation
and amortization expense increased $43.4 million due to the impact of our prior year openings and expansion activity and acceleration of depreciation for certain
properties scheduled for redevelopment.

Repairs
and maintenance decreased $12.1 million primarily due to our cost savings efforts.

Provision
for credit losses increased $6.7 million due to an increase in the reserve for tenants in default and an increased number of tenants entering bankruptcy proceedings.

Home
and regional office expense decreased $21.6 million primarily due to decreased personnel costs attributable to our cost control initiatives and lower incentive compensation
levels.

As
noted above in the quarterly period discussion, we recognized a $140.5 million other-than-temporary impairment charge related to our investment in
Liberty.

Interest
expense increased $8.2 million primarily related to our issuance of $600 million senior unsecured notes on May 15, 2009 and $650 million senior
unsecured notes on March 25, 2009, offset by decreased interest expense on our Credit Facility due to the payoff of the US tranche and other property debt refinancings.

We
recognized a loss on extinguishment of debt of $20.3 million in the second quarter of 2008 related to the redemption of the $200 million outstanding principal amount of
MOPPRS. We extinguished this
debt because the remarketing reset base rate of the MOPPRS was above the rate for 30-year U.S. Treasury securities at the time of redemption.

Income
from unconsolidated entities increased $15.3 million as a result of our 2008 joint venture openings and expansion activity, interest rate savings from favorable interest
rates and debt refinancings, and additional depreciation provisions related to the finalization of purchase accounting on asset basis step-ups in the 2008 period associated with the
acquisition of Mills.

Preferred
unit distribution requirements decreased $10.4 million as a result of the conversion of preferred units to units during 2008.

Liquidity and Capital Resources

Because we generate revenues primarily from long-term leases, our financing strategy relies primarily on
long-term fixed rate debt. We manage our floating rate debt to be at or below 15-25% of total outstanding indebtedness. Floating rate debt currently comprises only
approximately 10% of our total consolidated debt. We also enter into interest rate protection agreements as appropriate to assist in managing our interest rate risk. We derive most of our liquidity
from leases that generate positive net cash flow from operations and distributions of capital from unconsolidated entities that totaled $956.1 million during the first half of 2009. In
addition, the Credit Facility provides an alternative source of liquidity as our cash needs vary from time to time.

Our
balance of cash and cash equivalents increased $1.9 billion during the first six months of 2009 to $2.6 billion as of June 30, 2009. Our balance of cash and cash
equivalents as of June 30, 2009, and December 31, 2008, includes $31.4 million and $29.8 million, respectively, related to our co-branded gift card programs,
which we do not consider available for general working capital purposes. The excess cash is being held in a number of financial institutions and is generally invested in overnight investment funds and
is available to us as an immediate source of liquidity.

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Table of Contents

Our
business model requires us to regularly access the debt and equity capital markets to raise funds for acquisition and development activity, redevelopment capital, and to refinance
maturing debt. We continue to see substantial turmoil in the capital markets in recent months. This has impacted the
ability to readily access debt and equity capital for many organizations, including ours. We raised approximately $2.9 billion in the public capital markets in the first six months of 2009;
however, there is no assurance we will be able to continue to do so in future periods or on similar terms or conditions. We believe we have sufficient cash on hand and availability under our corporate
Credit Facility to address our debt maturities and capital needs through 2010.



As part of our acquisition of a joint venture interest in The Mills Corporation through SPG-FCM, we made loans to
SPG-FCM and Mills primarily at rates of LIBOR plus 270-275 basis points. These funds were used by SPG-FCM and Mills to repay loans and other obligations of Mills,
including the redemption of Mills' preferred stock. As of December 31, 2008 and June 30, 2009, the outstanding balance of our remaining loan to SPG-FCM was
$520.7 million and $586.0 million, respectively. During the first six months of 2009 and 2008, we recorded approximately $4.5 million and $8.1 million in interest income
(net of inter-entity eliminations), respectively, related to this loan. The loan facility bears interest at a rate of LIBOR plus 275 basis points and matures on June 8, 2010, with two available
one-year extensions.

Cash Flows

Our net cash flow from operating activities and distributions of capital from unconsolidated entities for the six months ended
June 30, 2009, totaled $956.1 million. In addition, we had net borrowings from all of our debt financing and repayment activities in this period of $100.7 million. These
activities are further discussed below in "Financing and Debt." During the 2009 period we also:



In
general, we anticipate that cash generated from operations will be sufficient to meet operating expenses, monthly debt service, recurring capital expenditures, and the cash portion of
distributions necessary to maintain Simon Property's REIT qualification for 2009. In addition, we expect to be able to obtain capital for nonrecurring capital expenditures, such as acquisitions, major
building renovations and expansions, as well as for scheduled principal maturities on outstanding indebtedness, from excess cash generated from operations and working capital reserves, and from
borrowings on our Credit Facility.

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Table of Contents

Financing and Debt



Our unsecured debt currently consists of $11.3 billion of our senior unsecured notes and the Credit Facility. The Credit
Facility bears interest at LIBOR plus 37.5 basis points and an additional facility fee of 12.5 basis points. The Credit Facility matures January 11, 2010 and may be extended one year at our
option.

During
the six months ended June 30, 2009, we drew amounts from our $3.5 billion Credit Facility to fund the redemption of $600.0 million in maturing series of
unsecured notes. We repaid a total of $1.2 billion on our Credit Facility during the six months ended June 30, 2009. The total outstanding balance of the Credit Facility as of
June 30, 2009 was $433.5 million, all of which was comprised of the U.S. dollar equivalent of Euro and Yen-denominated borrowings. The maximum outstanding balance during the
quarter ended June 30, 2009 was approximately $1.6 billion. During the six months ended June 30, 2009, the weighted average outstanding balance on the Credit Facility was
approximately $893.4 million.



Total secured indebtedness was $6.2 billion and $6.3 billion at June 30, 2009 and December 31, 2008,
respectively.



Our consolidated debt, adjusted to reflect outstanding derivative instruments, and the effective weighted average interest rates as of
June 30, 2009, and December 31, 2008, consisted of the following (dollars in thousands):

Debt Subject to

Adjusted Balance
as of
June 30, 2009

Effective
Weighted Average
Interest Rate

Adjusted Balance
as of
December 31, 2008

Effective
Weighted Average
Interest RateFixed Rate

$
16,167,878


6.05
%
$
15,424,318


5.76
%Variable Rate


1,768,525


1.21
%

2,618,214


1.31
%$
17,936,403


5.57
%
$
18,042,532


5.12
%


As
of June 30, 2009, we had $695.0 million of notional amount fixed rate swap agreements that have a weighted average fixed pay rate of 2.79% and a weighted average
variable receive rate of 0.68%. As of June 30, 2009, the net effect of these agreements effectively converted $695.0 million of variable rate debt to fixed rate debt.

Contractual Obligations and Off-Balance Sheet Arrangements.There have been no material changes to our outstanding capital
expenditure
commitments previously disclosed in our 2008 Annual Report on Form 10-K.

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Table of Contents

In
regards to long-term debt arrangements, the following table summarizes the material aspects of these future obligations as of June 30, 2009, for the remainder of
2009 and subsequent years thereafter (dollars in thousands):

2009

2010-2011

2012-2014

After 2014

TotalLong-Term DebtConsolidated(1)

$
374,202

$
4,748,601

$
7,124,079

$
5,699,488

$
17,946,370Pro rata share of Long-Term Debt:Consolidated(2)

$
372,785

$
4,700,486

$
6,954,708

$
5,641,080

$
17,669,059Joint Ventures(2)


329,076


1,430,492


2,539,411


2,205,211


6,504,190Total Pro Rata Share of Long-Term Debt

$
701,861

$
6,130,978

$
9,494,119

$
7,846,291

$
24,173,249


---

Our
off-balance sheet arrangements consist primarily of our investments in real estate joint ventures which are common in the real estate industry and are described in
Note 5 of the notes to the accompanying financial statements. Joint venture debt is the liability of the joint venture, is typically secured by the joint venture property, and is
non-recourse to us. As of June 30, 2009, we had loan guarantees and other guarantee obligations of $47.8 million and $2.0 million, respectively, to support our total
$6.5 billion share of joint venture mortgage and other indebtedness presented in the table above.

Acquisitions and Dispositions

Buy-sell provisions are common in real estate partnership agreements. Most of our partners are institutional investors who
have a history of direct investment in retail real estate. Our partners in our joint venture properties may initiate these provisions at any time. If we determine it is in our unitholders' best
interests for us to purchase the joint venture interest and we believe we have adequate liquidity to execute the purchase without hindering our cash flows, then we may initiate these provisions or
elect to buy. If we decide to sell any of our joint venture interests, we expect to use the net proceeds to reduce outstanding indebtedness or to reinvest in development, redevelopment, or expansion
opportunities.

Acquisitions.Although the acquisition of high quality individual properties or portfolios of properties remains an integral
component of our growth
strategies, we did not acquire any properties during the first six months of 2009.

Dispositions.We continue to pursue the disposal of properties that no longer meet our strategic criteria or that are not the
primary retail venue
within their trade area. However, we did not dispose of any operating properties during the six months of 2009.

Development Activity

New Domestic Development.Given the significant downturn in the economy, we have substantially reduced our development spending.
We expect to
complete construction and open Cincinnati Premium Outlets, a 400,000 square foot upscale manufacturers' outlet center located in Monroe, OH, during the third quarter of 2009. The estimated total cost
of this project is $92.0 million, and the carrying amount of the construction in progress at June 30, 2009 was $69.0 million. We expect to fund this project with

30

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Table of Contents

available
cash from operations. We do not expect our share of any other 2009 new development to be significant.

Strategic Expansions and Renovations.In addition to new development, we incur costs related to construction for significant
renovation and/or
expansion projects at our properties. Included in these projects are the renovation and addition of Nordstrom at Northshore Mall, Ross Park Mall and South Shore Plaza; a life-style
addition at Tacoma Mall; and Phase II expansions at The Domain, Orlando Premium Outlets, and The Promenade at Camarillo. We expect to fund these capital projects with cash flow from operations.
Our share of other renovation and/or expansion projects that we expect to initiate or complete in 2009 is approximately $270.0 million.

International Development Activity.We typically reinvest net cash flow from our international investments to fund future
international development
activity. We believe this strategy mitigates some of the risk of our initial investment and our exposure to changes in foreign currencies. We have also funded our European investments with
Euro-denominated borrowings that act as a natural hedge against local currency fluctuations. This has also been the case with our Premium Outlet centers in Japan and Mexico where we use
Yen and Peso denominated financing, respectively. We expect our share of international development costs for 2009 will be approximately $140.0 million, for which funding is already in place. We
expect international development and redevelopment/expansion activity for 2009 to include:



Currently,
our net income exposure to changes in the volatility of the Euro, Yen, Peso, Pounds Sterling and other foreign currencies is not material. In addition, since cash flows from
international operations are currently being reinvested in other development projects, we do not expect to repatriate foreign denominated earnings in the near term.

The
carrying amount of our total combined investment in our two European joint ventures, Simon Ivanhoe S.à.r.l., or Simon Ivanhoe, and GCI, as of June 30, 2009,
including all related components of other comprehensive income, was $210.6 million. Our investments in Simon Ivanhoe and GCI are accounted for using the equity method of accounting. The total
net cost of the 942,000 square feet of GLA under construction in Europe is approximately €221 million, of which our share is approximately €53 million, or
$74.5 million based on current Euro:USD exchange rates.

As
of June 30, 2009, the carrying amount of our 40% joint venture investment in the seven Japanese Premium Outlet Centers including all related components of other comprehensive
income was $296.0 million. The total net cost of the 403,000 square feet of GLA under construction in Japan is approximately JPY 23.0 billion, of which our share is approximately JPY
9.2 billion, or $96.3 million based on applicable Yen:USD exchange rates.

As
of June 30, 2009, the carrying amount of our 32.5% joint venture investment in GMI including all related components of other comprehensive income was $55.1 million. As
of June 30, 2009, one center is open in Changshu, China and three additional centers are under development. The three centers under development will add approximately 1.5 million square
feet of GLA for a total net cost of approximately

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CNY
1.6 billion, of which our share is approximately CNY 527 million, or $77.2 million based on applicable CNY:USD exchange rates.

During
2008, we acquired approximately 16.7 million shares of stock of Liberty. Liberty operates regional shopping centers and is the owner of other prime retail assets throughout
the U.K. Liberty is a U.K. FTSE 100 listed company, with shareholders' funds of £4.7 billion and property investments of £8.6 billion, of which its U.K.
regional shopping centers comprise 75%. Assets of the group under control or joint control amount to £11.0 billion. Liberty converted into a U.K. Real Estate Investment Trust (REIT)
on January 1, 2007. Our interest in Liberty is less than 7% of their shares and is adjusted to their quoted market price, including a related foreign exchange component. During the quarterly
period ended June 30, 2009, we recognized a $140.5 million impairment charge related to this investment as the significance and duration of the decline in fair value below its carrying
value was deemed to be other-than-temporary in nature.

Distributions and Stock Repurchase Program

Simon Property's Board of Directors declared and we paid a distribution of $0.60 per unit in the second quarter of 2009. The
distribution was paid 20% in cash and 80% in units. We issued 2,525,204 common units to Simon Property and 514,720 units to limited partners on June 19, 2009. The closing price of a share of
Simon Property common stock was $52.92 on the payment date. Our distributions typically exceed our net income generated in any given year primarily because of depreciation, which is a
"non-cash" expense. Our future distributions will be determined by Simon Property's Board of Directors based on actual results of operations, cash available for distributions, and the
amount of distributions required to maintain Simon Property's status as a REIT.

Simon
Property recently announced that it intends to pay a quarterly dividend for the third quarter of 2009 of $0.60 per share, consisting of a combination of cash and Simon Property
common stock. The cash component of this dividend will not exceed 20% in the aggregate, or $0.12 per share. As a result of Simon Property's dividends, we will make a corresponding distribution of
$0.60 per unit, consisting of a combination of cash and units.

The
Simon Property Board of Directors had authorized a common stock repurchase program under which Simon Property may purchase up to $1.0 billion of its common stock through July
2009. During 2009, no purchases were made as part of this program.

Forward-Looking Statements

Certain statements made in this section or elsewhere in this report may be deemed "forward-looking statements" within the meaning of
the Private Securities Litigation Reform Act of 1995. Although we believe the expectations reflected in any forward-looking statements are based on reasonable assumptions, we can give no assurance
that our expectations will be attained, and it is possible that our actual results may differ materially from those indicated by these forward-looking statements due to a variety of risks and
uncertainties. Such factors include, but are not limited to: our ability to meet debt service requirements, the availability of financing, changes in our credit rating, changes in market rates of
interest and foreign exchange rates for foreign currencies, the ability to hedge interest rate risk, risks associated with the acquisition, development and expansion of properties, general risks
related to retail real estate, the liquidity of real estate investments, environmental liabilities, international, national, regional and local economic climates, changes in market rental rates,
trends in the retail industry, relationships with anchor tenants, the inability to collect rent due to the bankruptcy or insolvency of tenants or otherwise, risks relating to joint venture properties,
costs of common area maintenance, competitive market forces, risks related to international activities, insurance costs and coverage, terrorist activities, changes in economic and market conditions
and maintenance of Simon Property's status as a real estate investment trust. We discussed these and other risks and uncertainties under the heading "Risk Factors" in our most recent

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Annual
Report on Form 10-K. We may update that discussion in our Quarterly Reports on Form 10-Q, but otherwise we undertake no duty or obligation to update or
revise these forward-looking statements, whether as a result of new information, future developments, or otherwise.

Item 3.    Qualitative and Quantitative Disclosures About Market Risk

Sensitivity Analysis.We disclosed a comprehensive qualitative and quantitative analysis regarding market risk in the
Management's Discussion and
Analysis of Financial Condition and Results of Operations included in our 2008 Annual Report on Form 10-K. There have been no material changes in the assumptions used or results
obtained regarding market risk since December 31, 2008.

Item 4.    Controls and Procedures

Evaluation of Disclosure Controls and Procedures.We carried out an evaluation under the supervision and with participation of
management, including
the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our "disclosure controls and procedures" (as defined in Rule 13a-15(e)
under the Securities Exchange Act of 1934 (the "Exchange Act")) as of the end of the period covered by this Quarterly Report on Form 10-Q. Based upon that evaluation, the Chief
Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were effective as of June 30, 2009.

Changes in Internal Control Over Financial Reporting.There have not been any changes in our internal control over financial
reporting (as defined in
Rule 13a-15(f)) that occurred during the quarter ended June 30, 2009 that have materially affected, or are reasonably likely to materially affect, our internal control over
financial reporting.

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Table of Contents

Part II  Other Information

Item 1.    Legal Proceedings

There have been no material developments with respect to the pending litigation disclosed in our 2008 Annual Report on
Form 10-K and no new material developments or litigation has arisen since those disclosures were made.

We
are involved in various other legal proceedings that arise in the ordinary course of our business. We believe that such routine litigation, claims and administrative proceedings will
not have a material adverse impact on our financial position or our results of operations. We record a liability when a loss is considered probable and the amount can be reasonably estimated.

Item 1A.    Risk Factors

Through the period covered by this report, there were no significant changes to the Risk Factors disclosed in "Part 1: Business"
of our 2008 Annual Report on Form 10-K.

Item 5.    Other Information

During the quarter covered by this report, the Audit Committee of Simon Property Group, Inc.'s Board of Directors
pre-approved Ernst & Young, LLP, our independent registered public accounting firm, to perform certain tax compliance services, consulting, and other international services.
This disclosure is made pursuant to Section 10A(i)(2) of the Securities Exchange Act of 1934, as added by Section 202 of the Sarbanes-Oxley Act of 2002.

Item 6.    Exhibits

Exhibit
Number

Exhibit Descriptions31.1

Certification by the Chief Executive Officer pursuant to rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.2

Certification by the Chief Financial Officer pursuant to rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32

Certification by the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.


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Table of Contents

SIGNATURES

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.

SIMON PROPERTY GROUP, L.P./s/STEPHEN E. STERRETT Stephen E. Sterrett
Executive Vice President
and Chief Financial Officer
Simon Property Group, Inc.
General Partner of Simon Property Group, L.P.Date: August 5, 2009


35

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