UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

---

FORM 10-K/A

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2003
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _______________ to _______________

Commission File No. 33-98136

---

CPG PARTNERS, L.P.(Exact name of registrant as specified in its charter)

|Delaware(State or other jurisdiction
of incorporation or organization) | 22-3258100(I.R.S. Employer
Identification No.)
|---------------------------------------------------------------------- | ----------------------------------------------

103 Eisenhower Parkway, Roseland, New Jersey
07068(Address of principal executive offices - zip code)

(973) 228-6111(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b)
of the Act: None

Securities registered pursuant to Section 12 (g) of
the Act: None

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  X   No

Indicate by check mark if the disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein, and will not be
contained, to the best of the registrants knowledge, in definitive proxy
or information statements incorporated by reference in Part III of this Form
10-K or any amendment to this Form 10-K. [x]

Indicate by check mark whether the registrant is an accelerated filer.
Yes     No  X

There are no outstanding shares of Common Stock or voting
securities.

Documents incorporated by reference:

Portions of the definitive Proxy Statement of Chelsea Property Group, Inc.
relating to its 2004 Annual Meeting of Shareholders are incorporated by
reference into Part III as set forth herein.

PART IV

Item 15. Exhibits, Financial Statement Schedules and Reports on Form 8-K

(a) 1 and 2. The response to this portion of Item 15
is submitted as a separate section of this report.

|3. | Exhibits
|-- | --------

|3.1 | Articles of Incorporation of the Company, as amended, including Articles
Supplementary relating to 8 3/8% Series A Cumulative Redeemable Preferred Stock
and Articles Supplementary relating to 9% Series B Cumulative Redeemable
Preferred Stock. Incorporated by reference to Exhibit 3.1 to Form 10-K for the
year ended December 31, 2002.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|3.2 | By-laws of the Company. Incorporated by reference to Exhibit 3.2 to Registration
Statement filed by the Company on Form S-11 under the Securities Act of 1933
(file No. 33-67870) (S-11).
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|3.3 | Agreement of Limited Partnership for the Operating Partnership. Incorporated by
reference to Exhibit 3.3 to S-11.
|--- | -----------------------------------------------------------------------------------------------------------------

|3.4 | Amendments No. 1 and No. 2 to Partnership Agreement dated March 31, 1997 and
October 7, 1997. Incorporated by reference to Exhibit 3.4 to Form 10-K for the
year ended December 31, 1997. ("1997 10-K")
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|3.5 | Amendment No. 3 to Partnership Agreement dated September 3, 1999. Incorporated
by reference to Exhibit 3.5 to 1999 10-K.
|--- | ------------------------------------------------------------------------------------------------------------------------

|4.1 | Form of Indenture among the Company, Chelsea GCA Realty Partnership, L.P., and
State Street Bank and Trust Company, as Trustee. Incorporated by reference to
Exhibit 4.4 to Registration Statement filed by the Company on Form S-3 under the
Securities Act of 1933 (File No. 33-98136).
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.1 | Registration Rights Agreement among the Company and recipients of Units.
Incorporated by reference to Exhibit 4.1 to S-11.
|---- | --------------------------------------------------------------------------------------------------------------------------

|10.2 | Amended and Restated Credit Agreement dated July 31, 2002 among CPG Partners,
L.P. and Fleet National Bank, individually and as an agent, and other Lending
Institutions listed therein. Incorporated by reference to Exhibit 10.1 to Form
10-Q for the period ending September 30, 2002.
|---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.3 | Joint Venture Agreement between Chelsea GCA Realty Partnership, L.P., Mitsubishi
Estate Co., Ltd. and Nissho Iwai Corporation dated June 16, 1999. Incorporated
by reference to Exhibit 10.9 to 1999 10-K.
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.4 | Agreement for Purchase and Sale of Assets dated July 12, 2001. Incorporated by
reference to Exhibit 2 to current report on Form 8-K reporting on an event,
which occurred on September 25, 2001.
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.5 | Purchase Agreement dated November 11, 2002. Incorporated by reference to Exhibit
2 to current report on Form 8-K reporting on an event which occurred December
19, 2002.
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------

PART IV

Item 15. Exhibits, Financial Statement Schedules and Reports on Form 8-K
(continued)

|10.8 | 2002-2006 Long-Term Executive Incentive Plan. Incorporated by reference to
Exhibit 10.8 to Form 10-K for the year ended December 31, 2002.
|---- | ------------------------------------------------------------------------------------------------------------------------------------------

|10.9 | Agreement for Purchase and Sale dated May 8, 2003, as amended. Incorporated by
reference to Exhibit 2 to current report on Form 8-K reporting on an event which
occurred August 1, 2003 (2003 8-K).
|---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.10 | Term Loan Agreement dated July 31, 2003 between CPG Partners, L.P. and Wachovia
Bank, National Association. Incorporated by reference to Exhibit 10 to 2003 8-K.
|----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------

|21 | List of Subsidiaries
|-- | --------------------

|23.1 | Consent of Ernst & Young LLP.
|---- | -----------------------------

|31.1 | Section 302  Chief Executive Officer Certificate
|---- | ------------------------------------------------

|31.2 | Section 302  Chief Financial  Officer Certificate
|---- | -------------------------------------------------

|32.1 | Secton 906  Chief Executive Officer Certificate
|---- | -----------------------------------------------

|32.2 | Section 906  Chief Financial  Officer Certificate
|---- | -------------------------------------------------

|(b) | Reports on Form 8-K.
None
|--- | -------------------------

|(c) | Exhibits
See (a) 3
|--- | ------------------

|(d) | Financial Statement Schedules - The response to this portion of Item 15 is
submitted as a separate schedule of this report.
|--- | ---------------------------------------------------------------------------------------------------------------------------

Item 8, Item 15(a)(1) and (2) and Item 15(d)

(a)1.  Financial Statements

| | Form 10-KReport Page
| | --------------------

Consolidated Financial StatementsCPG
Partners, L.P.

|Report of Independent Auditors
Consolidated Balance Sheets as of December 31, 2003 and 2002
Consolidated Statements of Income for the years ended December 31, 2003, 2002 and 2001
Consolidated Statements of Partners' Capital for the years ended December 31, 2003, 2002 and 2001
Consolidated Statements of Cash Flows for the years ended December 31, 2003, 2002 and 2001
Notes to Consolidated Financial Statements(a)2 and (d) Financial Statement Schedule
Schedule III-Consolidated Real Estate and Accumulated Depreciation | F-1
F-2
F-3
F-4
F-5
F-6
F-34
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------

All other schedules are omitted since the required information
is not present or is not present in amounts sufficient to require submission of
the schedule, or because the information required is included in the
consolidated financial statements and notes thereto.

Report of Independent Auditors

To the Owners
CPG Partners, L.P.

We have audited the accompanying consolidated balance sheets of
CPG Partners, L.P. as of December 31, 2003 and 2002, and the related
consolidated statements of income, partners capital and cash flows for
each of the three years in the period ended December 31, 2003. Our audits also
included the financial statement schedule listed in the Index as Item 15 (a)(2).
These financial statements and schedule are the responsibility of the management
of CPG Partners, L.P. Our responsibility is to express an opinion on
these financial statements and schedule based on our audits.

We conducted our audits in accordance with auditing standards
generally accepted in the United States. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the financial statements referred to above
present fairly, in all material respects, the consolidated financial position of
CPG Partners, L.P. as of December 31, 2003 and 2002, and the consolidated
results of its operations and its cash flows for each of the three years in the
period ended December 31, 2003, in conformity with accounting principles
generally accepted in the United States. Also, in our opinion, the related
financial statement schedule, when considered in relation to the basic financial
statements taken as a whole, presents fairly in all material respects the
information set forth therein.

|New York, New York
February 24, 2004 | /s/Ernst & Young LLP
|------------------------------------ | --------------------

CPG Partners, L.P.
Consolidated
Balance Sheets
(In thousands)

`December 31,
                                                                        2003              2002
                                                                ----------------- --------------
Assets:
Rental properties:
     Land.....................................................     $ 299,176      $   266,461
     Depreciable property.....................................     1,773,607        1,570,713
                                                                  ----------       ----------

Total rental property.........................................     2,072,783        1,837,174
Accumulated depreciation......................................      (332,406)        (284,239)
                                                                  ----------        ---------


Rental properties, net........................................     1,740,377        1,552,935
Cash and cash equivalents.....................................        18,476           22,551
Restricted cash - escrows.....................................         6,456            3,455
Tenant accounts receivable (net of allowance for doubtful
    accounts of $1,615 in 2003 and $2,593 in 2002)............        11,631            7,762
Deferred rent receivable......................................        25,018           18,778
Property held for sale........................................         3,500                -
Investments in unconsolidated affiliates......................       107,068           47,997
Notes receivable-related parties..............................         2,151            2,746
Deferred costs, net...........................................        22,989           16,706
Other assets..................................................        32,748           30,100
                                                                  ----------        ---------
Total assets..................................................    $1,970,414        $1,703,030
                                                                  ==========        ==========


Liabilities and partners' capital:
Liabilities:
     Unsecured bank debt......................................    $  204,035        $ 103,035
     Unsecured notes..........................................       621,803          621,330
     Mortgage debt............................................       385,634          306,455
     Construction payables....................................         7,668            8,046
     Accounts payable and accrued expenses....................        59,738           45,077
     Accrued distribution payable.............................         5,131            4,927
     Other liabilities........................................        20,871           18,886
                                                                  ----------        ---------
Total liabilities.............................................     1,304,880        1,107,756

Commitments and contingencies

Partners' capital:
General partner units outstanding, 43,592 in 2003 and 41,485
in 2002.......................................................        524,295          462,127
Limited partners units outstanding 7,356 in 2003 and 7,563
in 2002.......................................................         81,934           77,094
Preferred partners units outstanding, 1,300 in 2003
and 2002......................................................         63,315           63,315
Officer loan..................................................              -             (488)
Accumulated other comprehensive loss .........................         (4,010)          (6,774)
                                                                  ------------      -----------
 Total partners' capital.......................................       665,534          595,274
                                                                  ------------      -----------
 Total liabilities and partners' capital.......................    $1,970,414       $1,703,030
                                                                  ============     ============`

The accompanying notes are an integral part of the financial statements.

CPG Partners, L.P.
Consolidated Statements of Income
(In thousands, except per unit data)

`Year ended December 31,
                                                                  2003               2002              2001
                                                        ----------------   ---------------   ----------------

Revenues:
     Base rent......................................          $247,894           $178,298          $124,645
     Percentage rent................................            29,134             23,723            17,853
     Expense reimbursements.........................            86,499             64,875            49,496
     Other income...................................             8,738             11,593            10,888
                                                              -------            -------            -------
Total revenues......................................           372,265            278,489           202,882
                                                              -------            -------            -------
Expenses:
     Operating and maintenance......................           102,951             77,863            56,256
     Depreciation and amortization..................            70,830             56,870            46,768
     General and administrative.....................            12,396              7,074             4,620
     Other..........................................             4,984              3,962             2,535
                                                               -------            -------           -------
Total expenses......................................           191,161            145,769           110,179
                                                               -------            -------           -------

Income before unconsolidated investments
  and interest expense .............................           181,104            132,720            92,703
Income from unconsolidated investments..............            11,006              9,802            15,025
Loss from  and impairment of
   Chelsea Interactive..............................            (2,518)           (47,756)           (5,337)
Interest expense.......................................        (69,779)           (49,189)          (37,271)
Gain on sale, net of write-down of assets...........                 -             10,911               617
                                                               -------            -------           -------
Income from continuing operations......................        119,813             56,488            65,737

(Loss) income from discontinued operations..........              (980)             1,366               783
Gain on sale of discontinued operations.............             5,625                  -                 -
                                                               -------            -------           -------
Net income..........................................           124,458             57,854            66,520
Preferred unit requirement..........................            (9,184)            (9,270)          (10,036)
                                                               -------            -------           -------
Net income available to common unitholders..........          $115,274            $48,584           $56,484
                                                              ========            =======           =======

Net income to common unitholders:
     General partner................................           $98,192            $41,714           $47,626
     Limited partners...............................            17,082              6,870             8,858
                                                               -------            -------           -------
Total...............................................          $115,274            $48,584           $56,484
                                                              ========            =======           =======

Net income per common unit:
General partner  (including $0.09, $0.03 and
   $0.02 income from discontinued operations
    in 2003, 2002 and 2001, respectively) ..........            $2.30              $1.09             $1.41
  Limited partners (including $0.09, $0.03 and
     $0.02 income from discontinued operations
      in 2003, 2002 and 2001, respectively) ........            $2.30              $1.07             $1.39

Weighted average units outstanding:
     General partner................................            42,613             38,245            33,678
     Limited partners...............................             7,442              6,426             6,358
                                                               -------            -------           -------
Total...............................................            50,055             44,671            40,036
                                                              ========            =======           =======`

The accompanying notes are an integral part of the financial
statements.

CPG Partners, L.P.
Consolidated Statements of Partners Capital
(In thousands)

`Accum.
                                                 General      Limited     Preferred                      Other      Total
                                                Partner's    Partners'    Partner's      Officer        Comp.       Partners'
                                                 Capital      Capital      Capital         Loan          Loss       Capital
                                                 ---------   ---------    ---------      -------        ------      --------

Balance December 31, 2000....................     $271,482      $37,888     $63,315    $        -       $ (123)     $372,562

Net income...................................       51,814       14,706           -             -            -        66,520
Other comprehensive income
Foreign currency translation.................            -            -           -             -         (252)         (252)
Interest rate swap...........................            -            -           -             -       (3,105)       (3,105)
                                                                                                                    --------
Total comprehensive income...................                                                                         63,163
                                                                                                                    --------

Common distributions.........................      (52,939)      (9,839)          -             -            -       (62,778)
Preferred distribution.......................       (4,188)      (5,848)          -             -            -       (10,036)
Contributions (net of costs).................      112,151            -           -             -            -       112,151
Revaluation of limited partners' interests...      (18,209)      18,209           -             -            -             -
Transfer of a limited partners' interest.....        2,291       (2,291)          -             -            -             -
                                                   -------       ------      ------        ------       ------       -------
Balance December 31, 2001....................      362,402       52,825      63,315             -       (3,480)      475,062

Net income...................................       45,136       12,718           -             -            -        57,854
Other comprehensive income
Foreign currency translation.................            -            -           -             -          320           320
Interest rate swap...........................            -            -           -             -       (3,614)       (3,614)
                                                                                                                     -------
Total comprehensive income...................                                                                         54,560
                                                                                                                     -------

Issuance of limited partnership units........            -       44,593           -             -            -        44,593
Common distributions.........................      (72,220)     (12,304)          -             -            -       (84,524)
Preferred distribution.......................       (3,422)      (5,848)          -             -            -        (9,270)
Contributions (net of costs).................      124,995            -           -             -            -       124,995
Redemption of preferred units
     (net of costs)..........................       (9,654)           -           -             -            -        (9,654)
Officer loan.................................            -            -           -          (488)           -          (488)
Revaluation of limited partners' interests...       14,651      (14,651)          -             -            -             -
Transfer of a limited partners' interest.....          239         (239)          -             -            -             -
                                                   -------       -------     ------          -----       ------       -------
Balance December 31, 2002....................      462,127       77,094      63,315          (488)       (6,774)      595,274

Net income...................................      101,528       22,930           -             -            -       124,458
Other comprehensive income
Foreign currency translation.................            -            -           -             -          503           503
Interest rate swap...........................            -            -           -             -        2,261         2,261
                                                                                                                     -------
Total comprehensive income...................                                                                        127,222
                                                                                                                     -------

Common distributions.........................      (91,947)     (15,897)          -             -            -      (107,844)
Preferred distribution.......................       (3,336)      (5,848)                        -            -        (9,184)
Contributions (net of costs).................       59,578            -           -             -            -        59,578
Repayment of officer loan                                -            -           -           488            -           488
Revaluation of limited partners interests....       (5,736)       5,736           -             -            -             -
Transfer of a limited partners' interest.....        2,081       (2,081)          -             -            -             -
                                                   -------       -------     ------          -----       ------       -------
Balance December 31, 2003....................     $524,295      $81,934     $63,315    $        -      $(4,010)     $665,534
                                                  ========      =======     =======    ========        ========     ========`

The accompanying notes are an integral part of the
financial statements.

CPG Partners, L.P.
Consolidated Statements of Partners Capital
(In thousands)

`Year ended December 31,
                                                                    2003               2002               2001
                                                            ----------------   ----------------   ---------------
Cash flows from operating activities
Net income.................................................     $124,458            $57,854            $66,520
Adjustments to reconcile net income to
  net cash provided by operating activities:
  Depreciation and amortization............................      73,651             58,275             48,554
  Equity in earnings of unconsolidated investments
     in excess of distributions received...................      (5,491)            (2,407)            (2,215)
  Loss from and impairment of Chelsea Interactive..........           -             47,756              5,337
  Loss from interest rate swap.............................         514                 -                  -
  Gain on sale of assets...................................           -            (11,514)              (333)
  Gain on sale of discontinued operations..................      (5,625)                 -                  -
  Proceeds from non-compete receivable.....................           -              4,300              4,600
  Amortization of non-compete revenue......................           -             (5,136)            (5,136)
  Additions to deferred lease costs........................      (2,642)            (1,153)            (1,869)
  Other operating activities...............................      (1,487)              (845)              (570)
  Changes in assets and liabilities:
      Straight-line rent receivable........................      (7,285)            (3,872)            (1,761)
      Other assets.........................................        (467)            (3,211)               965
      Deferred compensation pay out........................           -            (14,401)
      Due from affiliates..................................      (5,742)              (284)            (1,924)
      Accounts payable and other liabilities...............      11,750              2,860              9,555
                                                                 ------              -----              -----
Net cash provided by operating activities...................    181,634            128,222            121,723

Cash flows from investing activities
Additions to rental properties..............................    (171,685)          (385,519)          (103,521)
Proceeds from sale of centers...............................      13,853              7,929              7,100
Additions to investments in unconsolidated affiliates.......     (46,688)           (37,855)           (14,763)
Distributions from investments in unconsolidated
    affiliates in excess of earnings........................           -                337              5,079
Proceeds from sale of investment in unconsolidated
    affiliates .............................................           -             11,293              2,839
Additions to  deferred lease costs from acquisitions........      (8,536)                 -                  -
Loans to related parties....................................           -               (550)            (2,750)
Payments from related parties...............................       1,083              1,085              1,685
Additions to deferred development costs.....................      (1,630)              (898)            (8,220)
                                                                  ------               ----             ------
Net cash used in investing activities.......................    (213,603)          (404,178)          (112,551)

Cash flows from financing activities
Debt proceeds...............................................     124,000            503,958            177,538
Repayments of debt..........................................     (38,078)          (249,540)          (217,318)
Net proceeds from sale of common stock......................      59,577            124,990            112,151
Distributions...............................................    (116,828)           (92,717)           (72,873)
Redemption of preferred units...............................           -               (9,654)               -
Additions to deferred financing costs.......................        (777)              (3,134)          (2,102)
                                                                  ------             ------             ------
Net cash provided by (used in) financing activities.........      27,894            273,903             (2,604)

Net (decrease) increase in cash and cash equivalents........      (4,075)            (2,053)             6,568
Cash and cash equivalents, beginning of period..............      22,551             24,604             18,036
                                                                  ------             ------             ------
Cash and cash equivalents, end of period....................     $18,476            $22,551            $24,604
                                                                 =======            =======            =======`

The accompanying notes are an integral part of the financial statements

CPG Partners, L.P.
Notes to Consolidated Financial Statements

1.   Organization and Basis of
Presentation

Organization

CPG Partners, L.P., (the Operating Partnership or
OP), which commenced operations on November 2, 1993 specializes in
owning, developing, leasing, marketing and managing upscale and fashion-oriented
manufacturers outlet centers. As of December 31, 2003, the OP wholly or
partially owned 60 centers in 31 states and Japan containing approximately 16.1
million square feet of gross leasable area (GLA). The OPs
portfolio is comprised of 30 Premium Outlet centers containing 10.6 million
square feet of GLA (the Premium Properties) and 30 other retail
centers containing approximately 5.5 million square feet of GLA (Other
Properties) (collectively the Properties). The OPs
Premium Properties generated approximately 75% and 86% of the OPs real
estate net operating income for the years ended December 31, 2003, and 2002,
respectively. The Premium Properties generally are located near metropolitan
areas including New York City, Los Angeles, Chicago, Boston, Washington, D.C.,
San Francisco, Sacramento, Atlanta, Dallas, Tokyo and Osaka, Japan. Some Premium
Properties are also located within 20 miles of major tourist destinations
including Palm Springs, Napa Valley, Orlando, Las Vegas and Honolulu.

The sole general partner of the OP, Chelsea Property Group, Inc.
(the Company) is a self-administered and self-managed Real Estate
Investment Trust (REIT).

Basis of Presentation

The financial statements contain the accounts of the Operating
Partnership and its majority owned subsidiaries. Such subsidiaries represent
partnerships in which the OP has greater than a 50% ownership interest and the
ability to maintain operational control. All significant intercompany
transactions and accounts have been eliminated in consolidation.

On May 1, 2002, the Company declared a 2-for-1 stock split of
the Companys common shares. The stock dividend was paid May 28, 2002, to
stockholders of record on May 14, 2002. The Operating Partnership simultaneously
declared a 2-for-1 split of its limited units. All applicable unit and per
unit information in the accompanying financial statements have been adjusted to
reflect the split.

2.   Summary of Significant Accounting
Principles

Rental Properties

Rental properties are presented at cost net of accumulated
depreciation. Depreciation is computed on the straight-line basis over the
estimated useful lives of the assets. The OP uses 25-40 year estimated lives for
buildings, and 15 and 5-7 year estimated lives for improvements and equipment,
respectively. Expenditures for ordinary maintenance and repairs are charged to
operations as incurred, while significant renovations and enhancements that
improve and or extend the useful life of an asset are capitalized and
depreciated over the estimated useful life. The OP reviews real estate assets
for impairment wherever events or changes in circumstances indicate that the
carrying value of assets to be held and used may not be recoverable. Impaired
assets are reported at the lower of cost or fair value. Assets to be disposed of
are reported at the lower of cost or fair value less cost to sell. No impairment
write-downs of rental properties were required for the three years ended
December 31, 2003. At December 31, 2003, the Lakeland Factory Outlet Mall was
held for sale. The Lakeland property was purchased in August 2003 in conjunction
with the Las Vegas Outlet Center. The OP anticipates selling the Lakeland
property during 2004. At December 31, 2002, no assets were held for sale.

Gains and losses from sales of real estate are recorded when
title is conveyed to the buyer, subject to the buyers financial commitment
being sufficient to provide economic substance to the sale.

CPG Partners, L.P.
Notes to Consolidated Financial Statements

2.   Summary of Significant Accounting
Principles (continued)

Rental Properties (continued)

In accordance with Statement of Financial Accounting Standards
No.141, or SFAS 141, Business Combinations, the OP allocates the
purchase price of real estate to land, building, tenant improvements and if
determined to be material, intangibles, such as the value of above, below and at
market leases and origination cost associated with in-place leases. The OP
depreciates the amount allocated to building and other intangible assets over
their estimated useful lives, which generally range from five to forty years.
The values of the above and below market leases are amortized and recorded as
either an increase (in the case of below market leases) or a decrease (in the
case of above market leases) to rental income over the remaining term of the
associated lease. The value associated with in-place leases are amortized over
the term of the lease. If a tenant vacates its space prior to the contractual
termination of the lease and no rental payments are being made on the lease, any
unamortized balance of the related intangible will be written off. The tenant
improvements and origination costs are amortized as an expense over the
remaining life of the lease (or charged against earnings if the lease is
terminated prior to contractual expiration date). The OP assesses fair value
based on estimated cash flow projections that utilize appropriate discount and
capitalization rate and available market information. Estimates of future cash
flows are based on a number of factors including the historical operating
results, known trends and market/ economic conditions that may affect the
property.

Cash and Equivalents

All demand and money market accounts and certificates of deposit
with original terms of three months or less from the date of purchase are
considered cash equivalents. The OP places its cash investments in excess of
insured amounts with high quality financial institutions. At December 31, 2003
and 2002, cash equivalents consisted of repurchase agreements, commercial paper,
U.S. Government agency securities, domestic bank obligations and other corporate
and municipal obligations that mature between January and March of the following
year. The carrying amount of such investments approximated fair value.

Investment in Unconsolidated Joint Ventures

The OP accounts for its investments in unconsolidated joint
ventures under the equity method of accounting as the OP exercises significant
influence, but does not control these entities. In all the joint ventures, the
rights of the minority investor are both protective as well as participating.
These rights preclude the OP from consolidating these investments. These
investments are recorded initially at cost, as investments in unconsolidated
joint ventures, and subsequently adjusted for equity in earnings (loss) and cash
contributions and distributions. Any difference between the carrying amount of
these investments on the balance sheet of the OP and the underlying equity in
net assets is amortized as an adjustment to equity in earnings (loss) of
unconsolidated joint ventures over the associated rental propertys useful
life.

Development Costs

Development costs, including interest, taxes, insurance and
other costs incurred in developing new properties, are capitalized. Upon
completion of construction, development costs are amortized on a straight-line
basis over the useful lives of the respective assets. Development costs related
to inactive projects are expensed at such time as the project is deemed
abandoned.

Capitalized Interest

Interest, including the amortization of deferred financing costs
for borrowings used to fund development and construction, is capitalized as
construction in progress and allocated to individual property costs.

CPG Partners, L.P.
Notes to Consolidated Financial Statements

2.   Summary of Significant Accounting
Principles (continued)

Foreign Currency Translation

The OP conforms to the requirements of the Statement of
Financial Accounting Standards No. 52 entitled Foreign Currency
Translation. Accordingly, assets and liabilities of foreign equity
investees are translated at prevailing year-end rates of exchange. Translation
gain or loss is recognized as a component of other comprehensive income.

Rental Expense

Rental expense is recognized on a straight-line basis over the
initial term of the lease.

Deferred Lease Costs

Deferred lease costs consist of fees and direct internal costs
incurred to initiate and renew operating leases, and are amortized on a
straight-line basis over the initial lease term or renewal period as
appropriate.

Deferred Financing Costs

Deferred financing costs represent commitment fees, legal and
other third party costs associated with obtaining commitments for financing
which result in a closing of such financing. Deferred financing costs are
amortized as interest costs over the terms of the respective agreements.
Unamortized deferred financing costs are expensed when the associated debt is
retired before maturity. Costs incurred in seeking financial transactions which
do not close are expensed in the period it is determined the financing will not
be closing.

Revenue Recognition

Leases with tenants are accounted for as operating leases. Base
rent revenue is recognized on a straight-line basis over the lease term
according to the provisions of the lease. The excess of rents recognized over
amounts contractually due and unpaid rents are included in deferred rent
receivable in the accompanying financial statements. Certain lease agreements
contain provisions for rents that are calculated on a percentage of sales and
recorded on the accrual basis. These rents are accrued monthly once the required
thresholds per the lease agreement are exceeded. Virtually all lease agreements
contain provisions for additional rents representing reimbursement of real
estate taxes, insurance, advertising and common area maintenance costs.

Bad Debt Expense

Bad debt expense included in other expense totaled $2.2 million,
$2.0 million and $1.2 million for the years ended December 31, 2003, 2002 and
2001, respectively. The OP maintains an allowance for doubtful accounts for
estimated losses resulting from the inability of its tenants to make required
rent payments.

CPG Partners, L.P.
Notes to Consolidated Financial Statements

2.   Summary of Significant Accounting
Principles (continued)

Income Taxes

No provision has been made for income taxes in the accompanying
consolidated financial statements since such taxes, if any, are the
responsibility of the individual partners.

The following summarizes the tax components of the OPs
common distributions declared for the years ended December 31, 2003, 2002 and
2001:

`2003          2002         2001
                                                      ----------     --------     ---------
      Distributions per unit..............              $2.14          $1.86        $1.56
      Capital gain (a)....................              (0.13)         (0.21)          -
      Unrecaptured Section 1250 gain .....                  -          (0.01)          -
                                                      ----------     --------     ---------
      Ordinary income.....................              $2.01          $1.64        $1.56
                                                      ==========     ========     =========`

(a)  Capital rates were 15% and 20% in 2003 and 2002,
respectively.

Net Income Per Partnership Unit

Net income per partnership unit is determined by allocating net
income to the general partner (including the general partners preferred
unit allocation) and the limited partners based on their weighted average
partnership units outstanding during the respective periods presented.

CPG Partners, L.P.
Notes to Consolidated Financial Statements

2.   Summary of Significant Accounting
Principles (continued)

Concentration of OPs Revenue and Credit
Risk

For the years ended December 31, 2003, 2002 and 2001,
respectively, 13%, 16% and 21% of the OPs revenues were derived from
Woodbury Common Premium Outlets. The loss of this center or a material decrease
in revenues from the center for any reason may have a material adverse effect on
the OP. In addition, for the years ended December 31, 2003, 2002 and 2001,
respectively, 23%, 25% and 28% of the OPs revenues were derived from the
OPs centers in California.

Management of the OP performs ongoing credit evaluations of its
tenants and requires certain tenants to provide security deposits. Although the
OPs tenants operate principally in the retail industry, there is no
dependence upon any single tenant.

Use of Estimates

The preparation of financial statements in conformity with
accounting principles generally accepted in the United States requires
management to make estimates and assumptions that affect the amounts reported in
the financial statements and accompanying notes. Actual results could differ
from those estimates.

Accumulated Other Comprehensive Loss

At December 31, 2003 and 2002, other comprehensive loss was
comprised of the following (in thousands):

`2003               2002
                                               ----               ----
          Interest rate swap                 $4,458             $6,719
          Foreign currency translation         (448)                55
                                               ----               ----
          Total                              $4,010             $6,774
                                             ======             ======`

Derivative and Financial Instruments

In the normal course of business, the OP uses a variety of
derivative and financial instruments to manage, or hedge, interest rate and
foreign currency risk. The OP requires that hedging derivative instruments are
effective in reducing the interest rate or foreign currency risk exposure as
they are designated. This effectiveness is an essential for hedge accounting
under accounting principles generally accepted in the United States. Derivative
instruments may be associated with the hedge of an anticipated transaction. In
those cases, hedge effectiveness criteria also require that it be probable that
the underlying transaction occurs. Instruments that meet these hedging criteria
are formally designated as hedges at the inception of the derivative contract
and recorded on the balance sheet at their fair values with the changes in fair
value reflected in accumulated other comprehensive income (loss). When the terms
of an underlying transaction are modified, or when the underlying hedged item
ceases to exist, all changes in the fair value of the instrument are
marked-to-market with changes in value included in net income each period until
the instrument matures or is terminated or assigned. Any derivative instrument
used for risk management that does not meet the hedging criteria is
marked-to-market each period in net income.

CPG Partners, L.P.
Notes to Consolidated Financial Statements

2.   Summary of Significant Accounting
Principles (continued)

Derivative and Financial Instruments (continued)

To determine the fair values of derivative and financial
instruments, the OP uses a variety of methods and assumptions that are based on
market conditions and risks existing at each balance sheet date. For the
majority of financial instruments including most derivatives, long-term
investments and long-term debt, standard market conventions and techniques such
as discounted cash flow analysis, option pricing models, replacement cost, and
termination cost are used to determine fair value. All methods of assessing fair
value result in a general approximation of value, and such value may never
actually be realized.

Recently Issued Accounting Pronouncements

In October 2001, the FASB issued Statement of Financial
Accounting Standard No. 144, Accounting for the Impairment or Disposal of
Long-Lived Assets (SFAS 144) which was effective and adopted
by the OP on January 1, 2002. SFAS 144 provides accounting guidance for
financial accounting and reporting for impairment or disposal of long-lived
assets. SFAS 144 supersedes SFAS No. 121, Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to be Disposed Of. SFAS 144
retains fundamental provisions of SFAS 121 related to the recognition and
measurement of the impairment of long-lived assets to be held and used. In
addition, SFAS 144 superseded APB Opinion 30, Reporting the Results of
Operations-Reporting the Effects of Disposal of a Segment of a Business, and
Extraordinary, Unusual and Infrequently Occurring Events and Transactions.
SFAS 144 extended the reporting of a discontinued operation to a component
of an entity. Thus, the operations of assets sold or held for sale are
presented as discontinued operations in the OPs statement of income.

In June 2002, FASB issued Statement of Financial Accounting
Standards No. 146, Accounting for Costs Associated with Exit or Disposal
Activities (SFAS 146) which was effective for exit or disposal
activities initiated after December 31, 2002. SFAS 146 requires that a liability
for a cost associated with an exit or disposal activity be recognized and
measured initially at fair value, only when the liability is incurred. See note
6 to financial statements for discussion related to the estimated future costs
to be incurred in connection with the future operations of Chelsea Interactive.

In November 2002, the FASB issued No. 45, Guarantors
Accounting and Disclosure Requirements for Guarantees, Including Indirect
Guarantees of Indebtedness of Others (FIN 45). FIN 45 requires
certain guarantees to be recorded at fair value, instead of recording a
liability only when a loss is probable and reasonably estimable, as those terms
are defined in FASB Statement No. 5, Accounting for Contingencies. FIN 45 also
requires a guarantor to make significant new disclosures, even when the
likelihood of making any payments under the guarantee is remote. The disclosure
requirements of FIN 45 are effective for financial statements of interim or
annual periods ending after December 15, 2002. The OP adopted the disclosure
provisions of FIN 45 effective December 31, 2002. FIN 45s initial
recognition and initial measurement provisions are applicable on a prospective
basis to guarantees issued or modified after December 31, 2002. The adoption of
FIN 45 did not have a material impact on the OPs financial position or the
results of operations.

In January 2003, the FASB issued Interpretation No. 46,
Consolidation of Variable Interest Entities (FIN 46). FIN 46
clarifies the application of existing accounting pronouncements to certain
entities in which equity investors do not have the characteristics of a
controlling financial interest or do not have sufficient equity at risk for the
entity to finance its activities without additional subordinated financial
support from other parties. The provisions of FIN 46 will be immediately
effective for all variable interests in variable interest entities created after
January 31, 2003. The OP has not created any variable interest entities
subsequent to January 31, 2003. In December 2003, FASB issued a revision to
Interpretation 46 (FIN 46-R) to clarify the provisions of FIN 46.
The application of FIN 46-R is effective for public companies, other than small
business issuers, after March 15, 2004. The OP does not believe that FIN 46-R
will have a significant impact on the OPs financial statements.

CPG Partners, L.P.
Notes to Consolidated Financial Statements

2.   Summary of Significant
Accounting Principles (continued)

Recently Issued Accounting Pronouncements
(continued)

April 30, 2003, FASB issued SFAS No.149, Amendment of
Statement 133 on Derivative Instruments and Hedging Activities (SFAS
149). SFAS 149 amends and clarifies the accounting guidance on (1)
derivative instruments (including certain derivative instruments embedded in
other contracts) and (2) hedging activities that fall within the scope of SFAS
No. 133, Accounting for Derivative Instruments and Hedging Activities
(SFAS 133). SFAS 149 also amends certain other existing
pronouncements, which will result in more consistent reporting of contracts that
are derivatives in the entirety or that contain embedded derivatives that
warrant separate accounting. SFAS 149 is effective (1) for contracts entered
into or modified after June 30, 2003, with certain exceptions, and (2) for
hedging relationships designed after June 30, 2003. The guidance is to be
applied prospectively. The adoption of SFAS 149 did not have a material impact
on the OPs financial condition, results of operations or cash
flows.

In May 2003, FASB issued SFAS No. 150, Accounting for
Certain Financial Instruments with Characteristics of both Liabilities and
Equity (SFAS 150). This statement establishes standards for
the classification and measurement of certain financial instruments with
characteristics of both liabilities and equity. SFAS 150 is effective for
financial instruments entered into or modified after May 31, 2003 and otherwise
is effective at the beginning of the first interim period beginning after June
15, 2003. It is to be implemented by reporting the cumulative effect of a change
in accounting principle for financial instruments created before the issuance
date of the statement and still existing at the beginning of the interim period
of adoption. The implementation of SFAS 150 did not have a material impact on
the OPs financial condition, results of operations or cash
flows.

Reclassifications

Certain amounts in the 2002 and 2001 financial statements have
been reclassified to conform to the 2003 presentation.

3.   Acquisitions and Dispositions

Acquisitions

In June 2003, the OP purchased The Crossings Factory Stores
(The Crossings), a 390,000 square-foot outlet center located in
Tannersville, Pennsylvania, for $111.3 million, including closing costs, and
assumed a $60.7 million 5.85% mortgage loan due 2013. The stated interest rate
was greater than that available to the OP for comparable debt. Consequently, the
OP recognized a $3.4 million debt premium that will be amortized over the period
of the loan, which reduces the effective rate to 5.1%. An additional $5.0
million will be due to the sellers upon the completion of a 21,000 square-foot
expansion scheduled to open in late 2004, subject to permits. In accordance with
the provisions of SFAS 141, the OP allocated the purchase price between land,
building and in-place leases. Tenant origination costs of $4.0 million are
included in deferred costs on the balance sheet and a net intangible lease
liability of $3.1 million is included in other liabilities. The tenant
origination costs and intangible lease liability are being amortized over the
respective lease terms. For the period ended December 31, 2003, the OP
recognized rental income of $0.5 million related to the amortization of in-place
leases.

CPG Partners, L.P.
Notes to Consolidated Financial Statements

3.   Acquisitions and Dispositions
(continued)

Acquisitions (continued)

In August 2003, the OP acquired Las Vegas Outlet Center
(Las Vegas), a 477,000 square-foot outlet center in Las Vegas,
Nevada, for $104.0 million including the assumption of a $24.4 million 8.12%
mortgage loan due 2012. The stated interest rate was greater than that available
to the OP for comparable debt. Consequently, the OP recognized a $1.9 million
debt premium that will be amortized over the period of the loan, which reduces
the effective rate to 6.29%. As part of the transaction, the OP also acquired
Lakeland Factory Outlet Mall (Lakeland), a 319,000 square-foot
outlet center near Memphis, Tennessee, for an additional $3.5 million. The
Lakeland property is being marketed for sale. In accordance with the provisions
of SFAS 141, the OP allocated the purchase price between land, building and
in-place leases. Tenant origination costs of $4.5 million are included in
deferred costs on the balance sheet and a net intangible lease liability of $0.4
million is included in other liabilities. The tenant origination costs and
intangible lease liability are being amortized over the respective lease terms.
For the period ending December 31, 2003, the OP recognized a charge against
rental income of $0.3 million related to the amortization of in-place
leases.

On April 1, 2002, the OP became the sole owner of the Orlando
Premium Outlets (Simon-Orlando) by acquiring Simon Property Group,
Inc.s (Simon) 50% undivided ownership interest for $46.6
million in cash and the assumption of $29.7 million of existing mortgage debt
and the guarantee related thereto. On June 16, 2002, the OP repaid the
outstanding balance of $59.4 million and extinguished the mortgage. After
closing the transaction the operating results and balance sheet of Simon-Orlando
were consolidated in the accompanying financial statements.

On April 1, 2002, the OP purchased a 305,000 square foot outlet
center located in Edinburgh, Indiana for $27.0 million in cash.

On August 20, 2002, the OP became the sole owner of four Premium
Outlet centers by acquiring Fortress Registered Investment Trusts
(Fortress) 51% undivided ownership interest in the F/C Acquisition
Holdings, LLC joint venture (F/C Acquisition). The OP paid $58.9
million in cash and assumed $86.5 million of existing mortgage debt on the
properties. After closing the transaction the operating results and balance
sheet of the four Premium Outlet centers including $169.6 million of existing
nonrecourse mortgage debt, were consolidated in the accompanying financial
statements.

On November 22, 2002, the OP purchased two outlet centers from
JMJ Properties, Inc. (JMJ); a 305,000 square-foot center located in
Albertville, Minnesota and a 278,000 square foot center located in Johnson
Creek, Wisconsin for a total purchase price of $89.5 million. The OP paid $44.9
million in cash and issued 1.3 million limited partnership units with an
assigned value of $44.6 million.

On December 19, 2002 the OP acquired four outlet centers for an
all cash price of $193.0 million from New Plan Excel Realty Trust, Inc.
(NPXL). The four properties consist of a 292,000 square foot outlet
center located in Jackson, New Jersey; a 391,000 square foot outlet center
located in Osage Beach, Missouri; a 329,000 square foot outlet center located in
St. Augustine, Florida; and a 300,000 square foot outlet center located in
Branson, Missouri.

CPG Partners, L.P.
Notes to Consolidated Financial Statements

3.   Acquisitions and Dispositions
(continued)

Acquisitions (continued)

The aggregate condensed balance sheet (unaudited) on the date of
acquisition of the acquired properties is as follows (in thousands):

`2003               2002
                                                      ----------         ------------

Land                                                   $ 33,660          $100,540
Depreciable property                                    190,716           591,018
Accumulated depreciation                                      -           (15,977)
Other assets                                                945            19,487
                                                       --------          --------
  Total assets                                         $225,321          $695,068
                                                       ========          ========

Mortgage debt                                          $ 90,491          $228,025
Other liabilities                                           383             9,884
                                                       --------          --------
  Total liabilities                                      90,874           237,909
                                                       --------          --------
Net equity                                             $134,447          $457,159
                                                       ========          ========`

The following condensed pro forma (unaudited) information
assumes that the acquisitions of The Crossings Factory Stores, Las Vegas Outlet
Center and Lakeland Factory Outlet Mall had occurred on January 1, 2002.
Additionally, it assumes that the effect of the sale of 1.2 million shares of
the Companys common stock in conjunction with The Crossings acquisition
and the $100.0 million term loan in conjunction with the Las Vegas acquisition
occurred on January 1, 2002 (in thousands)

`Year Ended December 31,
                                                                   2003             2002
                                                               ------------      -----------

        Total revenue                                            $386,407          $307,284

        Net income to common unitholders                         119,004             54,772

        Earnings per unit:
        Net income to common unitholders                           $2.33              $1.19
        Weighted average common units
          outstanding                                             51,169             45,871`

CPG Partners, L.P.
Notes to Consolidated Financial Statements

3.   Acquisitions and Dispositions (continued)

Dispositions

In June 2003, the OP sold a 23,000 square-foot Premium Outlet
center located in St. Helena, California for $7.4 million, resulting in a gain
of approximately $4.7 million. The center partially secured a mortgage note due
April 2010 and $5.0 million of the sales proceeds were used to pay down the
mortgage loan. Revenues and expenses related to the St. Helena property have
been reclassified to discontinued operations in the period of sale and
comparable periods in the accompanying financial statements.

In September 2003, the OP realized a gain of approximately $0.9
million from the sale of one of its non-core properties, the former Factory
Stores of America at Mesa, Arizona (Mesa property). Revenues and
expenses connected with the Mesa property have been reclassified to discontinued
operations in the period of sale and comparable periods in the accompanying
financial statements.

The OP terminated its long-term lease on American Tin Cannery
Premium Outlets. Revenues and expenses connected with the ATC property have been
reclassified to discontinued operations in the period of termination and
comparable periods in the accompanying financial statements.

During June and July 2002, the OP sold four Other Properties
centers and two outparcels generating net proceeds of approximately $6.8
million, which approximated the net book value of these properties. Accordingly,
no gain or loss on the sales was recognized. The aggregate revenues and net
income of the sold properties were $1.2 million and $0.3 million for the year
ended December 31, 2002, respectively, and $0.6 million and $0.2 million for the
year ended December 31, 2001, respectively.

In November 2002, the OP sold an additional Other Properties
center and an outparcel that generated net proceeds of approximately $1.1
million, which resulted in a gain of approximately $0.6 million which is
included in other income in the accompanying financial statements. The aggregate
revenues and net income of the sold property were $0.6 million and $0.4 million
for the year ended December 31, 2002, respectively and $0.1 million and $40,000
for the year ended December 31, 2001, respectively.

In October 2001, the OP sold a Premium Properties center and
recognized a loss of approximately $0.3 million that is included as a charge in
other income in the accompanying financial statements. The aggregate revenues
and net income of the sold property were immaterial to the operations of the OP
for the years ended December 31, 2001 and 2000.

4.   Rental Properties

The following summarizes the carrying values of rental
properties as of December 31 (in thousands):

`2003             2002
                                                          ------------     -------------
  Land and improvements..............................      $  495,819      $   460,227
  Buildings and improvements.........................       1,536,998        1,351,183
  Construction-in-progress...........................          16,838            6,708
  Equipment and furniture............................          23,128           19,056
                                                           ----------       ----------
  Total rental property..............................       2,072,783        1,837,174
                                                           ----------       ----------
  Accumulated depreciation and amortization..........       (332,406)        (284,239)
                                                           ----------       ----------
  Total rental property, net.........................      $1,740,377      $1,552,935
                                                          ===========      ===========`

CPG Partners, L.P.
Notes to Consolidated Financial Statements

4. Rental Properties (continued)

Interest costs capitalized as part of buildings and improvements
were $4.3 million, $2.9 million and $2.0 million for the years ended December
31, 2003, 2002 and 2001, respectively.

Commitments for land, new construction, development and
acquisitions including the OPs 50% share of joint venture activity,
totaled approximately $49.7 million and $19.1 million at December 31, 2003 and
2002, respectively.

Depreciation expense (including amortization of the capital
lease) amounted to $67.3 million, $53.1 million and $42.9 million for the years
ended December 31, 2003, 2002 and 2001, respectively.

5.   Restricted Cash-Escrows

Restricted cash escrows include $6.5 million and $3.5 million at
December 31, 2003 and 2002, respectively, of escrows and reserve funds for real
estate taxes, property insurance, capital and tenant improvements and leasing
costs established pursuant to certain mortgage loan agreements.

6.   Investments in Affiliates

The OP holds interests in several domestic and international
joint ventures. Non-controlling investments are accounted for under the equity
method. Equity in earnings or losses of these affiliates, and related management
advisory, license, leasing and guarantee fees earned are included in income from
unconsolidated investments and loss from impairment of Chelsea Interactive in
the accompanying financial statements.

As
of December 31, 2003 and 2002, the OPs interests in joint ventures
included: a 50% interest in Las Vegas Premium Outlets (Simon-Las
Vegas) and a 50% interest in Chicago Premium Outlets
(Simon-Chicago) with Simon (collectively
Simon-Ventures); a 40% interest in Chelsea Japan Co., Ltd.
(Chelsea Japan); a 50% interest in a strategic alliance with Sordo
Madaleno y Asociados and affiliates; minority interests in various outlet
centers and development projects in Europe operated by Value Retail PLC
(Value Retail); and 100% of the non-voting preferred stock of
Chelsea Interactive and 50% of the non-voting common stock representing 40% of
the total common stock. As of December 31, 2001, the OPs investment in
joint ventures also included a 50% interest in Simon-Orlando and a 49% interest
in F/C Acquisition.

CPG Partners, L.P.
Notes to Consolidated Financial Statements

6.   Investments in Affiliates
(continued)

In June 2002, the OP and Simon entered into a 50/50 joint
venture to develop and operate Las Vegas Premium Outlets, a 435,000 square-foot
single-phase outlet center located in Las Vegas, Nevada, which opened on August
1, 2003. The OP is responsible for financing its 50% share of development costs,
or approximately $48.0 million. As of December 31, 2003, the OP had contributed
$44.7 million and capitalized interest and other costs of $2.3
million.

In August 2002, the OP and Simon entered into a new 50/50 joint
venture to develop and operate Simon-Chicago, a 438,000 square-foot single-phase
premium outlet center located in Aurora, Illinois, near Chicago. The center is
scheduled to open in mid-2004. On September 23, 2002, Simon-Chicago purchased a
140-acre site, including 80 acres of conservation area, and commenced
construction. The OP is responsible for financing its 50% share of the
development costs, which are expected to be approximately $46.0 million. As of
December 31, 2003, the OP had contributed $26.7 million and capitalized interest
and other costs of $1.5 million.

In June 1999, the OP entered into an agreement with Mitsubishi
Estate Co., Ltd. and Nissho Iwai Corporation to jointly develop, own and operate
Premium Outlet centers in Japan. The OP has a 40% interest in Chelsea Japan. In
conjunction with the agreement, the OP contributed $1.7 million in equity and
provides its share of construction financing and/or loan guarantees. Chelsea
Japan opened its initial project, the 220,000 square-foot first phase of Gotemba
Premium Outlets, on July 13, 2000. Gotemba has grown to 390,000 square feet with
the completion of its 170,000 square-foot second phase that opened in July 2003.
Gotemba is located on the Tomei Expressway, approximately 60 miles west of Tokyo
and midway between Mt. Fuji and the Hakone resort area. Chelsea Japan opened its
second project, located outside Osaka, the second-largest city in Japan, the
180,000 square-foot first phase of Rinku Premium Outlets on November 23, 2000.
Rinku increased to 250,000 square feet in March 2002, upon opening its 70,000
square-foot second phase. Rinkus 70,000 square-foot third phase is
scheduled to open in late 2004. Chelsea Japans third project, the 180,000
square foot first phase of Sano Premium Outlets opened in March 2003 and in Fall
2004, Sano is scheduled to open its 55,000 square foot second phase. Sano is
located 40 miles north of Tokyo off Tohoku Expressway.

In May 2002, the OP entered into a 50/50 joint venture agreement
with Sordo Madaleno y Asociados and affiliates to jointly develop Premium Outlet
centers in Mexico. Construction on the 230,000 square-foot first phase of Punta
Norte Premium Outlets commenced in July 2003 and the center is scheduled to open
in late 2004. The OP is responsible for financing its 50% share of project costs
of approximately $15.0 million. As of December 31, 2003, the OP contributed $2.5
million. In January 2004, an affiliate of the OP entered into a 180.0 million
Peso denominated credit facility which is guaranteed by the OP to fund its share
of construction costs.

At December 31, 2003 and 2002, the OP had minority interests
ranging from 3% to 8% and 5% to 15% at December 31, 2001, in several outlet
centers and outlet development projects in Europe. Five outlet centers,
containing approximately 900,000 square feet of GLA, including Bicester Village,
outside London, England, La Roca OP Stores outside of Barcelona, Spain, Las
Rozas Village outside Madrid, Spain, La Vallee near Disneyland Paris and
Maasmechelen Village in Belgium are currently open and operated by Value Retail
PLC and its affiliates. In July 2002, the OP sold approximately 40% of its
holdings in Value Retail to a third party for $11.4 million, resulting in a gain
of approximately $10.9 million which was recorded as a gain on sale of
unconsolidated investments in the accompanying financial statements. In 2001,
the OP sold a portion of its Bicester Village holding resulting in a gain of
$1.8 million, which was included in gain on sale of unconsolidated investments,
net of write-down in the accompanying financial statements.

CPG Partners, L.P.
Notes to Condensed Consolidated Financial Statements

6.   Investments in Affiliates
(continued)

The OP and Simon entered into a 50/50 joint venture agreement to
develop and operate Simon-Orlando a 428,000 square foot center that was
completed in May 2000 and is located on Interstate 4, midway between Walt Disney
World/EPCOT and Sea World in Orlando. In April 2002, the OP purchased
Simons 50% undivided ownership interest in the center for $46.6 million in
cash and assumed Simons $29.7 million pro-rata share of existing mortgage
debt. The operations and balance sheet of the center are consolidated in the
accompanying financial statements from the buyout date.

In December 2000, the OP and Fortress acquired four outlet
centers from a competitor, through F/C Acquisition in which the OP had a 49%
interest. The total purchase price was $240.0 million, including the assumption
of approximately $174.0 million of 6.99% fixed-rate non-recourse mortgage debt
due in 2008. In July 2002, Fortress exercised its option under the F/C Limited
Liability Company Agreement to invoke the Buy/Sell Right which gave
the OP the option to sell its 49% ownership interest in F/C Acquisition or buy
the partners 51% ownership interest. On August 20, 2002, the OP exercised
its right to buy the 51% interest for cash of $58.9 million and assumed $86.5
million of existing mortgage debt on the properties. The operations and balance
sheet of the four F/C Acquisition Premium Outlet centers have been consolidated
in the accompanying financial statements from the buyout date.

In December 2001, the OP had a 15% minority interest in a
partnership that owns an outlet center located in Guam. The center had been
generating operating losses and the OP did not anticipate recovering its
investment. Therefore, in December 2001, the OP wrote off its investment in Guam
and recognized a loss of $1.2 million which is included in gain on sale of
unconsolidated investments, net of write-down in 2001 in the accompanying
financial statements. During the year ended December 31, 2002, the OP withdrew
as a partner in the Guam outlet center.

Chelsea Interactive

At December 31, 2002, the OP recognized an impairment loss equal
to the net book value of its investment in Chelsea Interactive.  The OP
believes that it will not be able to recover the net book value of its
investment in Chelsea Interactive through future cash flows. A $2.5 million
funding loss was reported for the year ended December 31, 2003.  Future
funding by the OP will be reported as a loss in the period funding is required.
Through December 31, 2003, the OP had funded $54.9 million and anticipates that
funding to Chelsea Interactive will not reach the OPs funding limit of
$60.0 million. On February 17, 2004, the OP announced a joint venture between
Chelsea Interactive and a publicly traded third party, GSI Commerce, Inc. Under
the terms of the agreement, Chelsea Interactive will no longer operate its
e-commerce technology, but will retain a minority interest in GSI-Chelsea
Solutions. Chelsea Interactives largest clients have entered into service
agreements with GSI-Chelsea Solutions and will transition e-commerce activities
to the GSI-Chelsea platform by the second quarter of 2004.

CPG Partners, L.P.
Notes to Consolidated Financial Statements

The following is a summary of investments in and amounts due
from affiliates at December 31, 2003 and 2002 (in thousands):

`Chelsea     Simon-    Simon-        Chelsea
                                        F/C        Japan       Orlando   Ventures      Interactive    Other     Total
                                      --------     --------    -------   -----------   -----------   -------    ------
Balance December 31, 2001........     $36,118      $9,296      $9,723    $      -      $34,856        $3,696    $93,689

Additional
   investment.......................        -         655           -      31,281       13,508           303     45,747
Income (loss) from
  unconsolidated
    investments..................       4,331       4,136       1,310           -      (13,386)           25     (3,584)
Distributions and fees...........      (2,841)     (2,528)       (250)          -            -             -     (5,619)
Buyout reclassifications.........     (36,531)          -      (9,199)          -            -             -    (45,730)
Impairment loss..................           -           -           -           -      (34,370)            -    (34,370)
Disposition......................           -           -           -           -            -          (382)      (382)
Advances (net)...................      (1,077)        912      (1,584)        638         (608)          (35)    (1,754)
                                     --------     -------    --------     -------     --------        ------   --------
Balance December 31, 2002........    $      -     $12,471    $      -     $31,919     $      -        $3,607    $47,997
                                     ========     =======    ========     =======     ========        ======    =======`

`Chelsea   Simon-    Simon-     Chelsea       Chelsea
                                   F/C        Japan     Orlando   Ventures   Interactive   Mexico     Other     Total
                                 --------     --------  -------   --------   -----------   -------    ------    -----

Balance December 31, 2002......   $     -    $12,471    $     -    $31,919   $      -      $     -     $3,607    $47,997

Additional
  Investment...................         -      1,591          -     43,965          -         6,212        26     51,794
Income (loss) from
  unconsolidated
    investments................         -      8,574          -      2,432          -             -        -       11,006
Distributions and fees.........               (5,102)         -     (2,754)         -             -        -       (7,856)
Foreign exchange...............         -        503          -          -          -             -        -          503
Advances (net).................         -      1,424          -      2,177          -             -        23       3,624
                                  --------   --------   --------   --------  --------        --------  -------- ---------
Balance December 31, 2003......   $     -    $19,461    $     -    $77,739   $      -         $6,212   $3,656   $107,068
                                  ========   ========   ========   ========  ========         ======== ======== ========`

CPG Partners, L.P.
Notes to Condensed Consolidated Financial Statements

The OPs share of income before depreciation, depreciation
expense and income from unconsolidated investments for the years ended December
31, 2003, 2002 and 2001 is as follows (in thousands):

`Chelsea      Simon-        Simon
For the Year Ended:                                F/C      Japan       Orlando      Ventures
                                              ---------    ---------    ---------    -----------
December 31, 2003
Income (loss) before depreciation.........      $    -      $11,923       $  -         $ 3,152
Depreciation..............................           -        3,349          -             720
                                              ---------   ---------    ---------    -----------
Income(loss) from unconsol. investment....      $    -      $ 8,574       $  -         $ 2,432
                                              =========   =========    =========    ===========
December 31, 2002
Income (loss) before depreciation.........      $6,178      $ 5,932       $1,833       $    -
Depreciation..............................       1,847        1,796          523            -
Impairment loss...........................           -            -            -            -
                                              ---------   ---------    ---------    -----------
Income (loss) from unconsol. investment...      $4,331       $4,136       $1,310       $    -
                                              =========    =========   =========    ===========
December 31, 2001
Income (loss) before depreciation..........     $9,214       $4,676       $7,374       $    -
Depreciation...............................      2,692        1,390        1,882            -
                                              ---------   ---------    ---------    -----------
Income (loss) from unconsol. investment..       $6,522       $3,286       $5,492       $    -
                                              =========    =========    =========    ===========

                                                                        Chelsea
For the Year Ended:                           Other       Total        Interactive
                                             --------    ----------   -------------
December 31, 2003
Income (loss) before depreciation.........  $    -       $15,075        $   (1)
Depreciation..............................       -         4,069              -
                                            --------    ----------    -------------
Income(loss) from unconsol. investment....  $    -       $11,006        $     -
                                            ========    ==========    =============
December 31, 2002
Income (loss) before depreciation.........  $   25       $13,968        $(5,115)
Depreciation..............................       -         4,166          8,271
Impairment loss...........................       -             -        (34,370)
                                            --------    ----------    -------------
Income (loss) from unconsol. investment...  $   25       $ 9,802       $(47,756)
                                             ========    ==========   =============
December 31, 2001
Income (loss) before depreciation.........  $ (275)      $20,989       $ (2,449)
Depreciation..............................       -         5,964          2,888
                                            --------    ----------    -------------
Income (loss) from unconsol. investment..   $ (275)      $15,025       $ (5,337)
                                             ========    ==========   =============`

(1)     
A $2.5 million funding loss was reported for the year ended December 31,
2003.

CPG Partners, L.P.
Notes to Consolidated Financial Statements

Condensed financial information as of December 31, 2003 and
2002, and for the years then ended for Chelsea Japan and Simon-Ventures (which
are included in Real Estate) and Chelsea Interactive is as follows
(in thousands):

`Chelsea
                                                                Real Estate     Interactive
                                                                --------------  -------------
Property, plant and equipment (net)
     December 31, 2003.........................................    $288,780     $        -
     December 31, 2002.........................................     140,057              -

Total assets
     December 31, 2003.........................................     380,426              -
     December 31, 2002.........................................     190,157          1,887

Long term debt (1)
     December 31, 2003.........................................     129,731              -
     December 31, 2002.........................................      75,139              -

Total liabilities
     December 31, 2003.........................................     220,238          1,352
     December 31, 2002.........................................     119,886          1,548

Net income (loss)
     December 31, 2003.........................................      12,717         (2,518)
     December 31, 2002.........................................      12,594        (14,247)

OP's share of net income (loss)
     December 31, 2003.........................................       5,488         (2,518)
     December 31, 2002.........................................       5,795        (13,386)

Fee income
     December 31, 2003.........................................       5,518              -
     December 31, 2002.........................................       3,982              -`

(1)     
Long-term debt in 2003 and 2002 consists of borrowings related to Chelsea Japan.

7. Deferred Costs

The following summarizes the carrying amounts for deferred costs at December 31,
2003 and 2002 (in thousands):

`2003          2002
                                                                ------------  ------------

Lease costs....................................................    $29,609       $28,074
FAS 141 lease adjustment.......................................      8,536             -
Financing costs................................................     10,506         9,200
Development costs..............................................      2,311         1,572
Other..........................................................        371           871
                                                                ------------  ------------
Total deferred costs...........................................     51,333        39,717
Accumulated amortization.......................................    (28,344)      (23,011)
                                                                ------------  ------------
Total deferred costs, net......................................    $22,989       $16,706
                                                                ============  ============`

CPG Partners, L.P.
Notes to Consolidated Financial Statements

8. Non-Compete Agreement

In October 1998 the OP sold its interest in and
terminated the development of Houston Premium Outlets, a joint venture project
with Simon. Under the terms of the agreement, the OP received non-compete
payments totaling $21.4 million from The Mills Corporation; $3.0 million at
closing and four annual installments of $4.6 million, terminating in January
2002. The January 2002 payment had a $0.3 million legal escrow reserve withheld.
The revenue is being recognized on a straight-line basis over the term of the
non-compete agreement and the OP recognized income of $5.1 million during the
years ended December 31, 2002 and 2001. Such amounts are included in other
income in the accompanying financial statements.

9. Other Assets

The following summarizes the components of other assets at
December 31 (in thousands):

`2003            2002
                                                ------------      -----------

Sales tax receivable............................   $10,728          $11,708
Prepaid expenses................................    10,680            9,902
Deferred compensation...........................     8,800            6,400
Non-compete receivable..........................       300              300
Due from equity investees.......................         -              136
Other...........................................     2,240            1,654
                                                  ------------   ----------
Total other assets.............................    $32,748          $30,100
                                                  ============   ==========`

CPG Partners, L.P.
Notes to Consolidated Financial Statements

10.  Debt

Unsecured Bank Debt

The OP has a $200.0 million senior unsecured bank line of credit
(the Senior Credit Facility) with an expiration date of March 31,
2005, which the OP has the right to extend until March 31, 2006. The Senior
Credit Facility bears interest on the outstanding balance, payable monthly, at a
rate equal to the London Interbank Offered Rate (LIBOR) plus 0.95%
(2.09% at December 31, 2003) or the prime rate, at the OPs option. The
LIBOR rate spread ranges from 0.85% to 1.50% depending on the OPs Senior
Debt rating. The OP received a debt rating upgrade in July 2003, resulting in a
reduction of the LIBOR rate spread to 0.95% from 1.05%. At December 31, 2003,
$99.0 million was outstanding under the Senior Credit Facility.

The OP also has a $5.0 million term loan that carries the same
interest rate and maturity as the Senior Credit Facility.

The OP has a one-year $100.0 million unsecured bridge loan (the
Bridge Loan Facility) due July 31, 2004 and has the right to extend
the loan until January 31, 2005. The Bridge Loan Facility bears interest on the
outstanding balance, payable monthly, at a rate equal to LIBOR plus 0.80% (1.96%
at December 31, 2003). The LIBOR rate spread ranges from 0.70% to 1.35%
depending on the OPs Senior Debt rating.

Unsecured Notes

A summary of the terms of the unsecured notes outstanding at
December 31, 2003 and December 31, 2002, is as follows (in thousands):

`December 31,        December 31,       Effective
                                                                   2003               2002          Yield (1)
                                                       ------------------   -  --------------    --------------
8.375%  Unsecured Notes due August 2005..............        $  49,952             $  49,922          8.44%
7.250%  Unsecured Notes due October 2007.............          124,874               124,841          7.39%
8.625%  Unsecured Notes due August 2009..............           49,943                49,933          8.76%
8.250%  Unsecured Notes due February 2011............          148,963               148,817          8.40%
6.875%  Unsecured Notes due June 2012................           99,878                99,825          6.90%
6.000%  Unsecured Notes due January 2013.............          148,193               147,992          6.18%
                                                          -------------------  --------------
 Total unsecured notes                                       $ 621,803             $ 621,330
                                                          ===================  ==============`

(1)      Including discount
on the notes

CPG Partners, L.P.
Notes to Consolidated Financial Statements

10. Debt (continued)

Mortgage Debt

A summary of the terms of the mortgage debt outstanding at
December 31, 2003 and 2002, and the related interest rate and Net Book Value
(NBV) of the associated collateral as of December 31, 2003, is as
follows (in thousands):

`Effective
                                       December  31,            December 31,          Interest
                                              2003                    2002              Rate             NBV
                                      ----------------        ---------------       ------------      -----------
 Due July 2008 (1) .............            $164,727                $167,723            7.26%          $252,972

 Due April 2010 (2) ............              61,475                  67,250            7.26%            67,978
 Due December 2012 (3) .........              25,477                       -            6.29%           101,341

 Due December 2012 (4) .........              70,460                  71,482            7.67%            74,416
 Due March 2013 (5) ............              63,495                       -            5.10%           112,650
                                            ---------             -----------                        -----------
                                            $385,634                $306,455                           $609,357
                                          ============            ===========                        ===========`

|(1) | The F/C mortgage loan was consolidated as part of the August 20,
2002 buyout of Fortress' 51% interest in the F/C Acquisition joint venture. The
mortgage bears interest at 6.99% per annum through July 11, 2008, (the "Optional
Prepayment Date") and thereafter at a rate equal to the greater of 8.4% plus 5%
or the Treasury Rate, as defined, plus 6.5% until the earlier of the date the
mortgage is paid in full or its maturity date of July 11, 2028. The mortgage may
be prepaid in whole or in part at any time after the Optional Prepayment Date
without a prepayment penalty. The mortgage calls for a $1.2 million fixed
monthly interest plus principal payment based on a 26-year amortization
schedule. The F/C Mortgage Loan had a face value of $169.6 million and a
carrying amount fair value of $168.7 million on the buyout date. During the year
ended December 31, 2003, the OP recognized $135,000 in debt discount
amortization that is included in interest expense in the accompanying financial
statements.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | In April 2000, Chelsea Financing entered into a $70.0 million
mortgage loan due April 2010 originally secured by its four properties. On June
2, 2003 the OP sold one of the encumbered properties for $7.4 million with an
NBV of $2.5 million. Proceeds of $5.0 million were used to pay down the mortgage
loan. In February 2004, the OP amended the mortgage loan to unsecure the
properties and reduced the interest rate to LIBOR plus 1.25% from LIBOR plus
1.50% (2.62% at December 31, 2003). The loan calls for quarterly principal
amortization of $0.25 million through April 2005 and thereafter $0.45 million
per quarter until maturity. In December 2000, the OP entered into an interest
rate swap agreement to hedge against unfavorable fluctuations in LIBOR rates by
fixing the interest rate at 7.26% until January 2006. During the years ended
December 31, 2003 and 2002, the OP recognized interest expense of $3.1 million
and $2.7 million, respectively on the hedge that is included in interest expense
in the accompanying financial statements.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | The mortgage loan due December 2012 was assumed as part of an
August 2003 acquisition. The stated interest rate of 8.12% was greater than that
available to the OP for comparable debt. Consequently, the OP recognized a $1.9
million debt premium that will be amortized over the period of the loan, which
reduces the effective interest rate to 6.29%. The mortgage loan calls for a $0.3
million fixed monthly debt service payment on a 17-year amortization schedule.
During the year ended December 31, 2003, the OP recognized approximately
$120,000 in debt premium amortization that is included in interest expense in
the accompanying financial statements.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) | The mortgage loan was assumed as part of a September 2001
acquisition. The stated interest rate of 9.1% was greater than that available to
the OP in the public debt markets. Accordingly, the OP recorded a $6.9 million
debt premium that will be amortized over the period of the loan which reduces
the effective interest rate to 7.67%. The loan calls for fixed monthly debt
service payments of $0.5 million for interest plus principal based on a 26-year
amortization schedule. The mortgage loan matures in March 2028 but can be
prepaid beginning December 2012. During the years ended December 31, 2003 and
2002, the OP recognized $0.5 million and $0.4 million, respectively, in debt
premium amortization that is included in interest expense in the accompanying
financial statements.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(5) | The mortgage loan due March 2013 was assumed as part of a June
2003 acquisition. The stated interest rate of 5.85% was greater than that
available to the OP for comparable debt. Accordingly, the OP recorded a $3.4
million debt premium that will be amortized over the period of the loan, which
reduces the effective interest rate to 5.10%. The loan calls for a $0.4 million
fixed monthly debt service payment on a 25-year amortization schedule. During
the year ended December 31, 2003, the OP recognized approximately $144,000 in
debt premium amortization that is included in interest expense in the
accompanying financial statements.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

CPG Partners, L.P.
Notes to Consolidated Financial Statements

10. Debt (continued)

Mortgage Debt (continued)

Following is a schedule of the estimated fair value of the
OPs debt using current broker quotations at December 31, 2003, (in
thousands):

`Carrying         Principal         Estimated
             Description                           Value           Balance         Fair Value
             --------------------------------  --------------   ---------------   --------------

             Fixed Rate Debt...............       $945,962         $938,959        $1,043,232

             Variable Rate Debt............        265,510          265,510           265,510`

Interest paid, excluding amounts capitalized, was $70.2 million, $47.5 million
and $34.5 million for the years ended December 31, 2003, 2002 and 2001,
respectively.

Following is a schedule of the OPs debt maturities, including debt premium
amortization, at December 31, 2003, (in thousands):

`2004............   $  107,873
                    2005............      163,095
                    2006............        9,829
                    2007............      135,442
                    2008............      157,145
                    Thereafter......      638,088
                                        -------------
                                       $1,211,472
                                        =============`

11. Financial Instruments: Derivatives and Hedging

In the normal course of business, the OP is exposed to the effect of interest
rate changes. The OP limits these risks by following established risk management
policies and procedures including the use of derivatives. For interest rate
exposures, derivatives are used primarily to align rate movements between
interest rates associated with the OPs financial assets with interest
rates on related debt, and manage the cost of borrowing obligations. For foreign
currency exposures, derivatives are used primarily to align movements between
currency rates to protect forecasted returns of fees to the U.S.

The OP has a policy of only entering into contracts with major financial
institutions based upon their credit ratings and other factors. When viewed in
conjunction with the underlying and offsetting exposure that the derivatives are
designed to hedge, the OP has not sustained a material loss from those
instruments nor does it anticipate any material adverse effect on its net income
or financial position in the future from the use of derivatives.

To manage interest rate and foreign currency risk, the OP may employ options,
forwards, interest rate swaps, caps and floors or a combination thereof
depending on the underlying exposure. The OP undertakes a variety of borrowings:
from lines of credit, to medium- and long-term financings. To reduce overall
interest cost, the OP uses interest rate instruments, typically interest rate
swaps, to convert a portion of variable rate debt to fixed rate debt, or a
portion of its fixed-rate debt to variable rate. Interest rate differentials
that arise under these swap contracts are recognized in interest expense over
the life of the contracts.

CPG Partners, L.P.
Notes to Consolidated Financial Statements

11. Financial Instruments: Derivatives and Hedging
(continued)

Interest rate swaps that are designated as cash flow hedges hedge the future
cash outflows on debt. Interest rate swaps that convert variable payments to
fixed payments, interest rate caps, floors, collars, and forwards are cash flow
hedges. Unrealized gains and losses in the fair value of cash flow hedges are
reported on the balance sheet with a corresponding adjustment to Accumulated
Other Comprehensive Income to the extent they are offsetting and otherwise
qualify in the period for cash flow hedge accounting. Over time, the unrealized
gains and losses held in Accumulated Other Comprehensive Income will be
reclassified to earnings through interest expense. This reclassification occurs
over the same time period in which the hedged items affect earnings. The OP
hedges its exposure to variability in future cash flows for forecasted
transactions other than those associated with existing floating-rate debt over a
maximum period of 12 months. During the forecast period, unrealized gains and
losses in the hedging instrument will be reported in Accumulated Other
Comprehensive Income. Once the hedged transaction takes place, the hedge gains
and losses will be reported in earnings during the same period in which the
hedged item is recognized in earnings. During 2003, the OP paid down
approximately $5.0 million of hedged debt and reclassed approximately $0.5
million out of accumulated other comprehensive loss to other expenses. The
ineffective portion of the hedge will be marked to market through
earnings.

The notional value and fair value of the swap provide an indication of the
extent of the OPs involvement in financial derivative instruments at
December 31, 2003. It does not represent exposure to credit, interest rate or
market risks. At December 31, 2003, and 2002, the swap was reported at its fair
value and classified as other liabilities in the accompanying financial
statements of $4.8 million and $6.7 million, respectively. Within the next
twelve months, the OP expects to reclassify to earnings approximately $2.7
million of the current balance held in accumulated other comprehensive loss
related to the interest rate swap.

`As of December 31, 2003
                        Hedge Type             Notional Value    Rate            Maturity        Fair Value
                       -----------            ----------------   -----           --------        -----------
                   Swap, Cash Flow             $66.5 mil        5.7625%           1/1/06         ($4.8 mil)`

During 2002, the OP had Japanese yen forward contracts with a notional value of
255 million yen and a fair value of $10,000 as a hedge against its
yen-denominated receivable due from Chelsea Japan. During the year ended
December 31, 2002, the receivable and yen forward contracts were settled and the
OP received $1.9 million and recognized a $0.1 million foreign exchange loss,
which is included in income from unconsolidated investments in the accompanying
financial statements.

During 2001, the OP entered into a yen forward contract with a notional value of
$1.4 million and a fair value of $40,000 as a hedge against its yen-denominated
receivable. During the year ended December 31, 2001 the receivable and yen
forward contract were settled and the OP received $1.4 million.

12. Preferred Units

In September 1999, the OP completed a private sale of $65
million of Series B Cumulative Redeemable Preferred Units (Preferred
Units) to an institutional investor. The private placement took the form
of 1.3 million Preferred Units at a stated value of $50 each. The Preferred
Units may be called at par on or after September 2004, have no stated maturity
or mandatory redemption and pay a cumulative quarterly dividend at an annualized
rate of 9.0%. The Preferred Units are exchangeable into Series B Cumulative
Redeemable Preferred Stock of the Company after ten years. Activity related to
the Preferred Units is included in partners capital account.

CPG Partners, L.P.
Notes to Consolidated Financial Statements

13. Preferred Stock

In October 1997, the Company issued 1.0 million shares of non-voting 8.375%
Series A Cumulative Redeemable Preferred Stock (the Preferred
Stock), par value $0.01 per share, having a liquidation preference of $50
per share. The Preferred Stock has no stated maturity and is not convertible
into any other securities of the Company. The Preferred Stock is redeemable on
or after October 15, 2027, at the OPs option.

During the year ended December 31, 2002, the Company redeemed and retired
136,500 shares of Preferred Stock at a net price of $47 per share and 66,552
shares at a net share of $47.25 per share.

14. Common Stock

In June 2003, the Company sold 1.2 million shares of common stock at a price of
$42.10 per share, yielding net proceeds after expenses of $49.4 million, which
were used to fund the Crossings acquisition.

In November 2002, the Company sold 3.5 million shares of common stock at a price
of $34.65 per share, yielding net proceeds after expenses of $118.8 million,
which were used to fund the NPXL acquisition.

On May 1, 2002, the Company declared a 2-for-1 stock split on the Companys
common shares. The stock dividend was paid May 28, 2002, to stockholders of
record on May 14, 2002.

15.  Lease Agreements

The OP is the lessor and sub-lessor of retail stores under operating leases with
term expiration dates ranging from 2004 to 2020. Most leases are renewable for
five years after expiration of the initial term at the lessees option.
Future minimum lease receipts under non-cancelable operating leases at December
31, 2003, exclusive of renewal option periods, were as follows (in
thousands):

`2004...................   $ 252,259
                2005...................     230,216
                2006...................     196,693
                2007...................     162,283
                2008...................     129,848
                Thereafter.............     309,278
                                         ----------
                                         $1,280,577
                                         ==========`

In 1987, a predecessor partnership entered into a lease agreement for property
in California. Land was estimated to be approximately 37% of the fair market
value of the property, and accordingly the portion of the lease attributed to
land was classified as an operating lease. The portion attributed to building
was classified as a capital lease as the present value of payments related to
the building exceeded 90% of its fair value at inception of the lease. The
initial lease term was 25 years with two options of 5 and 4.5 years,
respectively. The lease provided for additional rent based on specific levels of
income generated by the property. No additional rental payments were incurred
during 2003, 2002 or 2001. The OP terminated the lease agreement and recognized
a $0.1 million gain on the termination.

CPG Partners, L.P.
Notes to Consolidated Financial Statements

15. Lease Agreements (continued)

Operating Leases

Future minimum rental payments under operating leases
for administrative offices at December 31, 2003, are as follows (in
thousands):

`2004.............      $1,480
                            2005.............         916
                            2006.............          52
                                               -----------
                                                   $2,448
                                               ===========`

Rental expense amounted to $1.4 million for the years ended December 31, 2003
and 2002, and $0.8 million for the year ended December 31, 2001.

Capital Lease

A leased property included in rental properties at December 31, 2002 consisted
of the following (in thousands):

`Building.....................................         $6,796
        Less accumulated amortization................         (5,865)
                                                         ------------
        Leased property, net.........................        $  931
                                                         ============`

Amortization expense on capital lease of $0.9 million for the year ended
December 31, 2003 and $0.3 million for the years ended December 31, 2002 and
2001, is included in depreciation and amortization expense in the financial
statements.

Ground Lease

In connection with the 2003 and 2002 property acquisitions, the OP acquired six
properties subject to ground leases that were assumed by the OP. These ground
leases have termination dates ranging from 2007 to 2087 and allow for renewal
terms of 4 to 30 years.

Future minimum lease payments under ground leases at December 31, 2003,
exclusive of renewal option periods were as follows (in thousands):

`2004.................    $     819
                      2005.................          819
                      2006.................          822
                      2007.................          811
                      2008.................        1,547
                      Thereafter...........       17,368
                                           --------------
                                                 $22,186
                                           ==============`

CPG Partners, L.P.
Notes to Consolidated Financial Statements

16. Commitments and Contingencies

In connection with the Simon-Ventures, the OP has committed to provide 50% of
the development costs or approximately $48.0 million to Simon-Las Vegas and
$46.0 million to Simon-Chicago. As of December 31, 2003, the OP had contributed
$44.7 million to Simon-Las Vegas and $26.7 million to Simon-Chicago.

Borrowings related to Chelsea Japan for which the Company and the OP have
provided guarantees for repayment of debt as of December 31, 2003, are as
follows (in thousands):

`Total Facility                                           Outstanding
                   ----------------                                         -------------
                                                                                              Due     Interest
          Yen        US $ Equivalent         Yen         US $ Equivalent    US $ Guarantee    Date     Rate
    --------------  -----------------     -----------    ---------------    ---------------    ----- --------
4.0 billion (1)      $37.3 million      0.9 billion       $8.4 million      $ 8.4 million     2004    1.31%
3.8 billion (2)       35.4 million      3.2 billion       30.0 million       12.0 million     2015    2.20%
0.6 billion (2)        5.6 million      0.5 billion       4.7 million         1.9 million     2012    1.50%`

(1) Facility entered into by an equity investee of
the OP and has a one-year extension option; until April 1, 2005.

(2) Facilities entered into by Chelsea Japan,
secured by Gotemba and Rinku and 40% severally guaranteed by the OP.

In May 2002, the OP entered into a 50/50 joint venture agreement
with Sordo Madaleno y Asociados and affiliates to jointly develop Premium Outlet
centers in Mexico. Construction on the 230,000 square-foot first phase of Punta
Norte Premium Outlets commenced in July 2003 and the center is scheduled to open
in late 2004. The OP is responsible for financing its share of project costs of
approximately $15.0 million. As of December 31, 2003, the OP had contributed
$2.5 million. In January 2004, an affiliate of the OP entered into a Peso
denominated credit facility which is guaranteed by the OP to fund its share of
construction costs.

As of December 31, 2003, the OP had provided limited debt
service guarantees of approximately $17.1 million to Value Retail and
affiliates, under a standby facility for loans provided to Value Retail and
affiliates to construct outlet centers in Europe. The standby facility, which
has a maximum limit of $22.0 million, expired in November 2001, and outstanding
guarantees, shall not survive more than five years after project completion.

At December 31, 2003, other assets include $8.8 million and
accrued expenses and other liabilities include $17.6 million related to the 2002
deferred unit incentive program which may be paid to certain key officers in
2007.

The OP is not presently involved in any material litigation nor,
to its knowledge, is any material litigation threatened against the OP or its
properties, other than routine litigation arising in the ordinary course of
business. Management believes the costs incurred by the OP related to any of its
litigation will not be material and have been adequately provided for in the
consolidated financial statements.

CPG Partners, L.P.
Notes to Consolidated Financial Statements

17.  Related Party Information

In 1999, the OP established a $6.0 million secured loan facility that expires in
June 2004 for the benefit of certain unitholders. Each borrower issued a note
that is secured by OP units, bears interest at a rate of LIBOR plus 200 basis
points per annum payable quarterly and is due by the facility expiration date.
At December 31, 2003, the $2.2 million note receivable from related parties
represents a loan made to a unitholder, who is also an officer and director of
the OP. During the year ended December 31, 2003, the OP received $1.1 million
from a unitholder in full repayment of his loan. Effective June 2002, the OP
changed its policy to eliminate new loans to directors and officers.

The OP leased space to related parties of approximately 56,000 square feet
during the year ended December 31, 2001. Rental income from those tenants,
including reimbursement for taxes, common area maintenance and advertising,
totaled $2.1 million during the year ended December 31, 2001.

In August 1997, the OP and one of its directors entered into a Consulting
Agreement pursuant to which the director agreed to perform services for the OP
in connection with the development and operation of manufacturers outlet
centers in Japan and Hawaii. The agreement provided for payments to the director
of $10,000 per month and was terminated by the OP in December 1999. During the
term of the agreement and for four years after the termination, the director
will be entitled to deferred compensation of 1% of the development costs, up to
a maximum amount of $0.5 million per project, on all projects in which he was
involved in Japan or Hawaii either directly or as a result of Mitsubishi and/or
Nissho Iwai committing to develop such project with the OP in Japan during the
previously mentioned four year period. Fees paid under this agreement totaled
$0.3 million for the year ended December 31, 2003. These fees are included in
investment in affiliates in the accompanying financial statements. The final
payment under this agreement, related to the opening of Tosu Premium Outlets
which was Board approved during 2003, is expected to be paid in
2004.

18.  Employee Stock Purchase Plan

The Companys Board of Directors and unitholders approved an Employee Stock
Purchase Plan (the Purchase Plan), effective July 1, 1998. The
Purchase Plan covers an aggregate of 1.0 million shares of common stock.
Eligible employees have been in the employ of the OP or a participating
subsidiary for five months or more and customarily work more than 20 hours per
week. The Purchase Plan excludes employees who are highly compensated
employees, as defined, or own 5% or more of the voting interest of the
Companys stock. Eligible employees will purchase shares through automatic
payroll deductions up to a maximum of 10% of weekly base pay. The Purchase Plan
will be implemented by consecutive three-month offerings (each an Option
Period). The price at which shares may be purchased shall be the lower of
(a) 85% of the fair market value of the stock on the first day of the Option
Period or (b) 85% of the fair market value of the stock on the last day of the
Option Period. As of December 31, 2003, 118 employees were enrolled in the
Purchase Plan and $10,000 in expenses has been incurred and is included in the
OPs general and administrative expense. The Purchase Plan will terminate
in July 2008 unless terminated earlier by the Board of Directors.

CPG Partners, L.P.
Notes to Consolidated Financial Statements

19.  401(k) Plan

The OP maintains a defined contribution 401(k) savings plan (the
Plan), which was established to allow eligible employees to make
tax-deferred contributions through voluntary payroll withholdings. All employees
of the OP are eligible to participate in the Plan after completing six months of
service and attaining age 21. Employees who elect to enroll in the Plan may
elect to have from 1% to 15% of their pre-tax gross pay contributed to their
account each pay period. As of January 1, 1998 the Plan was amended to include
an employer discretionary matching contribution which currently excludes certain
officers, in an amount not to exceed 100% of each participants first 6% of
yearly compensation to the Plan. Matching contributions of approximately
$156,000 in 2003, $96,000 in 2002 and $128,000 in 2001 are included in the
OPs general and administrative expense in the accompanying financial
statements.

20.  Quarterly Financial Information (Unaudited)

The following summary represents the results of operations, expressed in
thousands except per share amounts, for each quarter during 2003 and 2002:

`March 31         June 30        September 30         December 31
                                                  ------------    ------------   ------------------  -----------------
2003
Base rental revenue............................     $59,159         $59,461              $63,645          $  65,629
Total revenues.................................      83,282          86,609               92,203            110,171
Net income available to common
  unitholders..................................      21,762          29,079               29,272             35,161

Net income per weighted average
   common unit.................................       $0.44           $0.59                $0.58              $0.69

2002
Base rental revenue............................     $37,629         $42,458              $46,100          $  52,111
Total revenues.................................      55,395          63,844               70,387             88,863
Net income (loss) available to common unitholders
                                                     13,880          15,631               28,228             (9,155)
Net income(loss) per weighted average
   common unit.................................       $0.32           $0.35                $0.64             $(0.20)`

CPG Partners, L.P.
Notes to Consolidated Financial Statements

21.  Segment Information

The OP is principally engaged in the development, ownership, acquisition and
operation of manufacturers outlet centers and has determined that under
SFAS No.131 Disclosures About Segments of an Enterprise and Related
Information it has three reportable real estate segments: premium
domestic, other domestic and international in 2003 and 2002. The OP evaluates
real estate performance and allocates resources based on Net Operating Income
(NOI) defined as total revenue less operating expenses. The primary
sources of revenue are generated from tenant base rents, percentage rents and
reimbursement revenue. Operating expenses primarily consist of common area
maintenance, real estate taxes and promotional expenses. The real estate
business segments meet the quantitative threshold for determining reportable
segments:

`For the years ended:                      Premium          Other
(in thousands)                            Domestic          Domestic      International       Other         Total
--------------------------------------------------------------------------------------------------------------------
                                                              (2)              (3)             (4)
Total revenues (1)
     December 31, 2003.............       $ 266,944       $104,797          $    -           $  524     $ 372,265
     December 31, 2002.............         224,701         48,306               -            5,482       278,489

Interest income(1)
     December 31, 2003.............           1,015             35               -              156         1,206
     December 31, 2002.............           1,169            124               -              358         1,651

Income (loss) from unconsolidated
investments
     December 31, 2003.............           2,432              -           8,574          (2,518)        8,488
     December 31, 2002.............           5,641              -          15,072         (47,756)      (27,043)

NOI
     December 31, 2003.............         196,444         70,386          15,449         (12,985)      269,294
     December 31, 2002.............         176,001         30,664           7,891         (12,216)      202,340

Fixed asset additions
     December 31, 2003.............          17,404        239,519               -            1,006      257,929
     December 31, 2002.............         398,933        309,540               -              795      709,268

Total assets
     December 31, 2003.............       1,341,535        501,093          29,306           98,480    1,970,414
     December 31, 2002.............       1,262,190        394,984          16,077           29,779    1,703,030`

|(1) | Excludes revenue for St. Helena, Mesa and American Tin Cannery
properties which are classified as discontinued operations.
|--- | --------------------------------------------------------------------------------------------------------------------------

|(2) | Approximately 16% and 23% of the GLA is occupied by and
approximately 9% and 12% of annual base rent is derived from one tenant during
the 2003 and 2002 periods, respectively.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | Principally comprised of the OP's interest in Chelsea Japan.
|--- | ------------------------------------------------------------

|(4) | Includes corporate overhead assets and results from Chelsea
Interactive.
|--- | ------------------------------------------------------------------------

CPG Partners, L.P.
Notes to Consolidated Financial Statements

21.  Segment Information (continued)

Following is a reconciliation of net operating income to net
income for the years ended December 31, 2003 and 2002 (in thousands):

`2003              2002
                                                                --------------   --------------
Segment NOI..................................................      $269,294         $202,340
Interest expense - consolidated..............................       (69,215)         (48,693)
Interest expense - unconsolidated investments................          (886)            (556)
Depreciation expense - consolidated..........................       (73,651)         (58,275)
Depreciation expense - unconsolidated investments                    (4,069)          (4,166)
Depreciation expense - Chelsea Interactive...................            -            (8,271)
Impairment loss- Chelsea Interactive.........................            -           (34,370)
Income tax - unconsolidated investments......................        (2,640)          (1,378)
Gain/(loss) on sale of centers...............................         5,625              312
Gain on sale, net of writedown - International...............            -            10,911
                                                                --------------   --------------
Net income...................................................      $124,458         $ 57,854
                                                                ==============   ==============`

22.    Non-Cash Investing and Financing Activities

In December 2003, 2002 and 2001, the OP declared quarterly distributions per
unit of $0.535, $0.485, and $0.390, respectively (assumes May 2002, 2-for-1
unit split occurred on January 1, 2001). The limited partners
distributions were paid in January of each subsequent year.

In connection with the Crossings and Las Vegas acquisitions, the OP assumed
approximately $64.1 million and $26.3 million, respectively, in mortgage loans
payable.

In connection with the buyout of Simons 50% interest in Simon-Orlando in
April 2002, the OP assumed additions of approximately $68.9 million in rental
properties, $6.5 million in accumulated depreciation, $8.8 million in other
assets, $3.2 million in other liabilities and $59.4 million in mortgage
debt.

In connection with the buyout of Fortress 51% interest in F/C Acquisition
in August 2002, the OP assumed additions of approximately $207.0 million in
rental properties, $9.4 million in accumulated depreciation, $11.7 million in
other assets and $5.3 million in other liabilities and $168.7 million in
mortgage debt.

In connection with the purchase of the JMJ properties in November 2002, the OP
issued 1.3 million units with an assigned value of $44.6 million.

In connection with the Konover acquisition in 2001, the OP assumed approximately
$131.0 million in REMIC and mortgage loans payable.

CPG Partners, L.P.
Schedule III-Consolidated Real Estate and Accumulated Depreciation
for the year ended December 31, 2003 (in thousands)

`Cost Capitalized           Step-Up Related
                                                               (Disposed of) Subsequent       to Acquisition
                                                                    to Acquisition            of Partnership
                                     Initial Cost to Company        (Improvements)             Interest (1)
                                     -----------------------        --------------             ------------
                                                 Buildings,                Buildings,                 Buildings,
   Description           Encum-                Fixtures and              Fixtures and               Fixtures and
Outlet Center Name       brances      Land       Equipment      Land       Equipment       Land      Equipment
------------------       -------      ----       ---------      ----       ---------       ----      ---------
Woodbury Common, NY            -    $4,448         $16,073    $4,967        $127,871        $ -            $ -
Orlando, FL (6)                -     9,946          65,711       300           1,151      7,957         31,829
Gilroy, CA (6)               (4)    17,053          84,641         2             840      1,812          8,840
Wrentham, MA                   -       157           2,817     3,842          84,595          -              -
Waikele, HI                    -    22,800          54,357         -           3,374          -              -
Leesburg, VA                   -     6,296               -      (811)         71,995          -              -
Desert Hills, CA               -       975               -     2,376          67,366        830          4,936
Michigan City, IN (6)        (4)     7,264          60,107         -             885        772          6,243
Camarillo, CA                  -     4,000               -    10,696          58,254          -              -
Osage Beach, MO (6)            -    10,395          58,701         -           1,869          -              -
Jackson, NJ (6)                -    10,302          58,178         -             339          -              -
Albertville, MN (6)            -    15,794          45,977     2,851          12,029          -              -
North Georgia, GA              -     2,960          34,726      (223)         22,252          -              -
Waterloo, NY (6)             (4)     5,258          42,942         -             670        559          4,519
Clinton, CT                    -     4,124          43,656       202           1,674          -              -
Allen, TX                      -     8,938           2,068      (834)         37,203          -              -
Vacaville, CA                  -     9,683          38,850        18           1,921          -              -
Folsom, CA                   (2)     4,169          10,465     2,692          27,140          -              -
Carolina Outlet (I), NC        -     6,220          24,860      (181)            794          -              -
Carolina Outlet (II), NC     (5)         -           7,862         -             305          -              -
Petaluma Village, CA           -     3,735               -     2,959          32,370          -              -
St. Augustine, FL (6)          -     5,783          32,658         -             585          -              -
Liberty Village, NJ            -       345             405     1,499          23,159     11,015          2,195
Napa, CA                     (2)     3,456           2,113     7,908          19,756          -              -
Kittery (I), ME (6)      (4) (5)     2,143          23,985         6             289        228          2,354
Kittery (II), ME               -       567           2,265         -              92          -              -
Johnson Creek, WI (6)          -     4,648          26,341         3             113          -              -
Aurora, OH                     -       637           6,884     1,055          23,023          -              -
Edinburgh, IN (6)              -     5,415          21,659         -           2,118          -              -
North Bend, WA                 -     4,735          18,925       (83)           (283)         -              -
The Crossings, PA            (7)    17,187          97,443        35            (597)         -              -
Las Vegas Outlet, NV         (8)    15,930          90,270        19          (3,915)         -              -
Branson II (6)                 -     2,892          16,332         -             270          -              -
Columbia Gorge, OR           (2)       934               -       428          13,845        497          2,647
Santa Fe, NM                   -        74               -     1,300          12,188        491          1,772
American Tin Cannery, CA       -         -           8,621         -          (8,621)         -              -
Patriot Plaza, VA              -       789           1,854       976           4,081          -              -
Corporate Offices, NJ, CA      -         -              60         -           7,542          -              -
St. Helena, CA                 -     1,029           1,522    (1,067)         (1,600)        38             78
Poconos, PA                    -       330               -         -               -          -              -
Tinton Falls, NJ               -       110               -         -               -          -              -
Chicago, IL                    -       465               -      (465)              -          -              -
Las Vegas, NV                  -       405               -      (405)              -          -              -
Other retail             (3) (5)    15,406          64,911    (2,885)         (6,986)         -              -
                         -------------------------------------------------------------------------------------
            (2)(3)(4)    385,634  $237,797      $1,068,239   $37,180        $639,955    $24,199        $65,413
                         -------------------------------------------------------------------------------------


                              Gross Amount Carried
                               at Close of Period                                                   Life Used to
                               December 31, 2003                                                       Compute
                               -----------------                                                    Depreciation
                                        Buildings,                                                    in Latest
   Description                        Fixtures and              Accumulated          Date of            Income
Outlet Center Name           Land      Equipment       Total   Depreciation       Construction        Statement
------------------           ----      ---------       -----   ------------       ------------        ---------
Woodbury Common, NY        $9,415       $143,944    $153,359      $57,875      '85, '93, '95, '98         40
Orlando, FL (6)            18,203         98,691     116,894       14,161             '00                 40
Gilroy, CA (6)             18,867         94,321     113,188        7,270     '90,'91,'92,'94,'95         40
Wrentham, MA                3,999         87,412      91,411       23,735           '95, '00              40
Waikele, HI                22,800         57,731      80,531       13,190             '98                 40
Leesburg, VA                5,485         71,995      77,480       19,090           '96-'00               40
Desert Hills, CA            4,181         72,302      76,483       31,164    '90, '94-'95, '97-'98        40
Michigan City, IN (6)       8,036         67,235      75,271        5,220  '87,'88,'89,'91,'94,'95,'97    40
Camarillo, CA              14,696         58,254      72,950       18,584           '94-'99               40
Osage Beach, MO (6)        10,395         60,570      70,965        1,543           '87-'90               40
Jackson, NJ (6)            10,302         58,517      68,819        1,463           '97,'98               40
Albertville, MN (6)        18,645         58,006      76,651        1,529           '00,'01               40
North Georgia, GA           2,737         56,978      59,715       19,816           '95-'99               40
Waterloo, NY (6)            5,817         48,131      53,948        3,716         '95,'96,'97             40
Clinton, CT                 4,326         45,330      49,656       18,533           '95-'96               40
Allen, TX                   8,104         39,271      47,375        6,520            '99-'01              40
Vacaville, CA               9,701         40,771      50,472        2,333         '88,'91,'92             40
Folsom, CA                  6,861         37,605      44,466       13,425  '90, '92, '93, '96-'97,'00     40
Carolina Outlet (I), NC     6,039         25,654      31,693        1,528       '87,'95,'96,'99           40
Carolina Outlet (II), NC        -          8,167       8,167          502       '87,'95,'96,'99           40
Petaluma Village, CA        6,694         32,370      39,064       11,742         '93, '95-'96            40
St. Augustine, FL (6)       5,783         33,243      39,026          846           '90-'92               40
Liberty Village, NJ        12,859         25,759      38,618        9,492         '81, '97-'98            30
Napa, CA                   11,364         21,869      33,233        8,275         '62, '93, '95           40
Kittery (I), ME (6)         2,377         26,628      29,005        2,234             '86                 40
Kittery (II), ME              567          2,357       2,924          139       '10,'84,'89,'95           40
Johnson Creek, WI (6)       4,651         26,454      31,105          873         '98,'99,'01             40
Aurora, OH                  1,692         29,907      31,599       10,777     '90, '93, '94, '95          40
Edinburgh, IN (6)           5,415         23,777      29,192        1,020           '89,'95               40
North Bend, WA              4,652         18,642      23,294        1,088           '90,'95               40
The Crossings, PA          17,222         96,846     114,068        1,418             '03                 40
Las Vegas Outlet, NV       15,949         86,355     102,304          964             '03                 40
Branson II (6)              2,892         16,602      19,494          421           '88,'94               40
Columbia Gorge, OR          1,859         16,492      18,351        6,371           '91, '94              40
Santa Fe, NM                1,865         13,960      15,825        4,874           '93, '98              40
American Tin Cannery, CA        -              -           -            -           '87, '98               0
Patriot Plaza, VA           1,765          5,935       7,700        2,638        '86, '93, '95            40
Corporate Offices, NJ, CA       -          7,602       7,602        4,824              -                   5
St. Helena, CA                  -              -           -            -             '83                 40
Poconos, PA                   330              -         330            -              -                   0
Tinton Falls, NJ              110              -         110            -              -                   0
Chicago, IL                     -              -           -            -              -                  40
Las Vegas, NV                   -              -           -            -              -                  40
Other retail               12,521         57,925      70,446        3,213           various               40
                         -----------------------------------------------
            (2)(3)(4)    $299,176     $1,773,607  $2,072,783    $332,406
                         -----------------------------------------------`

The
aggregate cost of the land, buildings, fixtures and equipment for federal tax
purposes was approximately $1,754 million at December 31, 2003.

|(1) | As part of the formation transaction assets acquired for cash have
been accounted for as a purchase.  The step-up represents the amount of the
purchase price that exceeds the net book value of the assets acquired.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Projects encumbered by mortgage totaling $61.5 million at December
31, 2003.
|--- | ----------------------------------------------------------------------------

|(3) | Projects encumbered by mortgage totaling $70.5 million at December
31, 2003.
|--- | ----------------------------------------------------------------------------

|(4) | Projects encumbered by mortgage totaling $164.7 million at
December 31, 2003.
|--- | -----------------------------------------------------------------------------

|(5) | Project held under long term land lease.
|--- | ----------------------------------------

|(6) | Purchase price has been tentatively allocated.
|--- | ----------------------------------------------

|(7) | Projects encumbered by mortgage totaling $63.5 million at December
31, 2003.
|--- | ----------------------------------------------------------------------------

|(8) | Projects encumbered by mortgage totaling $25.5 million at December
31, 2003.
|--- | ----------------------------------------------------------------------------

CPG Partners, L.P.
Schedule IIIConsolidated Real Estate
and Accumulated Depreciation (continued)
(in thousands)

The changes in total real estate:

`Year ended December 31,
                                                              2003                 2002
                                                    ------------------   -----------------

Balance, beginning of period......................      $1,837,174           $1,127,906
Additions.........................................         268,318              719,857
Dispositions and other............................         (32,709)             (10,589)
                                                    ------------------   -----------------
Balance, end of period............................      $2,072,783           $1,837,174
                                                    ==================   =================`

The changes in accumulated depreciation:

`Year ended December 31,
                                                              2003                 2002
                                                    ------------------   ----------------

Balance, beginning of period......................        $284,239             $217,462
Additions.........................................          67,023               53,065
Consolidation of properties previously held as
investments in unconsolidated affiliates..........               -               15,977
Dispositions and other............................         (18,856)              (2,265)
                                                    ------------------   ----------------
Balance, end of period............................        $332,406             $284,239
                                                    ==================   ================`

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused this amendment
to the report to be signed on its behalf by the undersigned, thereunto duly
authorized on the 18th of March, 2004.

| | CPG Partners, L.P.By:     /s/ Michael J. Clarke
         Michael J. Clarke, Chief
Financial Officer
| | ---------------------------------------------------------------------------------------------------