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                                                                    Exhibit 99.2

                  FACTORS AFFECTING FUTURE OPERATING RESULTS

          This Form 10-K, the Company's Annual Report to Shareholders, any Form
10-Q or any Form 8-K of the Company or any other written or oral statements made
by or on behalf of the Company include forward-looking statements that reflect
the Company's current views with respect to future events and financial
performance.  These forward-looking statements are subject to certain risks and
uncertainties, including those discussed below that could cause actual results
to differ materially from historical results or anticipated results.  The words
"believe," "expect," "anticipate" and similar expressions identify forward-
looking statements.  Readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of their dates.  The Company
undertakes no obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events or otherwise.

          The following factors could cause actual results of The Rouse Company,
its subsidiaries and affiliates (collectively and individually, the "Company")
to differ materially from historical results or anticipated results:

          REIT RISKS.  Failure to Qualify as a REIT.  Although the Company
believes that it is organized and intends to operate in such a manner as to
qualify as a real estate investment trust ("REIT") under the Internal Revenue
Code of 1986, as amended (the "Code"), no assurance can be given that the
Company will remain so qualified.  Qualification as a REIT involves the
application of highly technical and complex Code provisions for which there are
only limited judicial or administrative interpretations.  The complexity of
these provisions and applicable Treasury Regulations is also increased to the
extent a REIT holds some of its assets in partnership form.  The determination
of various factual matters and circumstances not entirely within the Company's
control may affect its ability to qualify as a REIT.  In addition, no assurance
can be given that legislation, new regulations, administrative interpretations
or court decisions will not significantly change the tax laws with respect to
qualification as a REIT or the Federal income tax consequences of such
qualification.  Currently, there are proposals before Congress to make
significant changes to the requirements for qualifying as a REIT and to the
operations REITs may conduct.

          If in any taxable year the Company fails to qualify as a REIT, the
Company would not be allowed a deduction for distributions to shareholders in
computing its taxable income and would be subject to Federal income tax
(including applicable alternative minimum tax) on its taxable income at regular
corporate rates.  As a result, the amount available for distribution to the
Company's shareholders would be reduced for the year or years involved.  In
addition, unless entitled to relief under certain statutory provisions, the
Company would be disqualified from treatment as a REIT for the four taxable
years following the year during which it lost its qualification.

          Notwithstanding that the Company currently operates in a manner
designed to qualify as a REIT, future economic, market, legal, tax or other
considerations may cause the Company to determine that it is in the best
interest of the Company and its shareholders to revoke its REIT election.  The
Company would then be disqualified from electing treatment as a REIT for the
four taxable years following the year of such revocation.

          Inability to Comply With REIT Distribution Requirements.  To obtain
the favorable tax treatment for REITs qualifying under the Code, the Company
generally will be required to distribute to its shareholders at least 95% of its
otherwise taxable income (after certain adjustments, including for the Company's
net operating loss carryover).  Such distributions must be paid either (i) in
the taxable year to which they relate or (ii) in the following taxable year if
declared before the Company timely files its tax return for such year and if
paid on or before the first regular distribution payment after such declaration.
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In addition, the Company will be subject to a 4% nondeductible excise tax on the
amount, if any, by which certain distributions paid by it with respect to any
calendar year are less than the sum of 85% of its ordinary income for the
calendar year, 95% of its capital gains net income for the calendar year and any
undistributed taxable income from prior periods. Failure to comply with the 95%
distribution requirement would result in the Company failing to qualify as a
REIT and the Company's income being subject to tax at regular corporate rates.

          The Company intends to make distributions to its shareholders to
comply with the 95% tax distribution provision of the Code and to avoid the
nondeductible excise tax discussed above.

          Recently Proposed Tax Legislation.  The President's fiscal year 1999
budget contains a number of REIT-related provisions which, if enacted, would
change certain of the REIT qualification rules described above.  Specifically, a
REIT would be prohibited from owning more than 10% of the stock of any one
corporate issuer, determined either by vote or by value.  Currently, this 10%
test is applied only by reference to voting power.  The proposal would make this
change generally effective with respect to stock acquired on or after the date
of the first Congressional committee action on the proposal.  In addition, the
President proposes to expand upon the "five or fewer requirement" to prohibit
any person (including any type of entity) from owning more than 50% of the stock
of the REIT determined by vote or by value.  The current "closely-held"
restriction prohibits more than 50% of the REIT from being owned by five or
fewer individuals but does not apply to entities.  As proposed, this change
would be effective for entities electing REIT status for taxable years beginning
on or after the date of the first committee action on the proposal.  It is
anticipated that, because of the proposed effective date provisions, these new
rules, if enacted, would not apply to the Company.  However, there can be no
assurance that the proposals will be enacted in the form proposed or with the
proposed effective date and, therefore, any legislation, if enacted, may
adversely effect the status of the Company as a REIT.

          REAL ESTATE DEVELOPMENT AND INVESTMENT RISKS.  General.  Real property
investments are subject to varying degrees of risk.  Revenues and property
values may be adversely affected by the general economic climate, the local
economic climate and local real estate conditions, including (i) the perceptions
of prospective tenants or purchasers as to the attractiveness of the property;
(ii) the ability to provide adequate management, maintenance and insurance;
(iii) the inability to collect rent due to bankruptcy or insolvency of tenants
or otherwise; and (iv) increased operating costs.  Real estate values may also
be adversely affected by such factors as applicable laws, including tax laws,
interest rate levels and the availability of financing.

          Development Risks.  New project development is subject to a number of
risks, including risks of availability of financing, construction delays or cost
overruns that may increase project costs, risks that the properties will not
achieve anticipated occupancy levels or sustain anticipated lease or sales
levels, and new project commencement risks such as receipt of zoning, occupancy
and other required governmental permits and authorizations and the incurrence of
development costs in connection with projects that are not pursued to
completion.

          Lack of Geographical Diversification.  A significant portion of the
properties held by the Company's subsidiaries and affiliates is geographically
concentrated.  Land sales, for instance, relate primarily to land in and around
Columbia, Maryland and Las Vegas, Nevada.  These sales are affected by the
economic climate in Howard County, Maryland, the Baltimore-Washington area and
the greater Las Vegas area, and by local real estate conditions and other
factors, including applicable zoning laws and the availability of financing for
residential development.  Similarly, most of the office/industrial buildings
that are owned or managed by the Company's subsidiaries and affiliates are
located in the Baltimore-Washington corridor, including Columbia, Maryland, and
the greater Las Vegas metropolitan area.  Due to the geographic concentration of
this portfolio, the operating results from managing these buildings and

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selling property for development depend especially on the local economic climate
and real estate conditions, including the availability of comparable, competing
buildings and properties.

          Illiquidity of Real Estate Investments.  Real estate investments are
relatively illiquid and therefore may tend to limit the ability of the Company
to react promptly in response to changes in economic or other conditions.

          Dependence on Rental Income from Real Property.  The Company's cash
flow and results of operations would be adversely affected if a significant
number of tenants were unable to meet their obligations or if the Company were
unable to lease a significant amount of space in its income-producing properties
on economically favorable lease terms.  In the event of a default by a tenant,
the Company may experience delays in enforcing its rights as lessor and may
incur substantial costs in protecting its investment.  The bankruptcy or
insolvency of a major tenant may have an adverse effect on an income-producing
property.

          Effect of Uninsured Loss.  The Company carries comprehensive
liability, fire, flood, extended coverage and rental loss insurance with respect
to its properties with insured limits and policy specifications that it believes
are customary for similar properties.  There are, however, certain types of
losses (generally of a catastrophic nature, such as wars, floods or earthquakes)
which may be either uninsurable, or, in the Company's judgment, not economically
insurable.  Should an uninsured loss occur, the Company could lose both its
invested capital in and anticipated profits from the affected property.

          ENVIRONMENTAL MATTERS.  Under various federal, state and local
environmental laws, ordinances and regulations, a current or previous owner or
operator of real property may become liable for the costs of the investigation,
removal and remediation of hazardous or toxic substances on, under, in or
migrating from such property.  Such laws often impose liability without regard
to whether the owner or operator knew of, or was responsible for, the presence
of such hazardous or toxic substances.  The presence of hazardous or toxic
substances, or the failure to remediate properly such substances when present,
may adversely affect the owner's ability to sell or rent such real property or
to borrow using such real property as collateral.  Persons who arrange for the
disposal or treatment of hazardous or toxic wastes may also be liable for the
costs of the investigation, removal and remediation of such wastes at the
disposal or treatment facility, regardless of whether such facility is owned or
operated by such person.  Other federal, state and local laws, ordinances and
regulations require abatement or removal of certain asbestos-containing
materials in the event of demolition or certain renovations or remodeling,
impose certain worker protection and notification requirements and govern
emissions of and exposure to asbestos fibers in the air.

          Certain of the Company's properties contain underground storage tanks
which are subject to strict laws and regulations designed to prevent leakage or
other releases of hazardous substances into the environment.  In connection with
its ownership, operation and management of such properties, the Company could be
held liable for the environmental response costs associated with the release of
such regulated substances or related claims.  In addition to remediation actions
brought by federal, state and local agencies, the presence of hazardous
substances on a property could result in personal injury or similar claims by
private plaintiffs.  Such claims could result in costs or liabilities which
could exceed the value of such property.  The Company is not aware of any
notification by any private party or governmental authority of any non-
compliance, liability or other claim in connection with environmental conditions
at any of its properties that it believes will involve any expenditure which
would be material to the Company, nor is the Company aware of any environmental
condition with respect to any of its properties that it believes will involve
any such material expenditure.  However, there can be no assurance that any such
non-compliance, liability, claim or expenditure will not arise in the future.

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          AMERICANS WITH DISABILITIES ACT COMPLIANCE.  Under the Americans with
Disabilities Act (the "ADA"), all public accommodations and commercial
facilities are required to meet certain federal requirements related to access
and use by disabled persons.  These requirements became effective in 1992.  The
Company has surveyed each of its properties and believes that it is in
substantial compliance with the ADA and that it will not be required to make
substantial capital expenditures to address the requirements of the ADA.  In
addition, the Company has developed an ADA Compliance Plan and has budgeted for
and moved forward with the removal of those barriers to access that are readily
achievable.  The Company believes that implementation of its ADA Compliance Plan
will not have a material adverse effect on its financial condition.

          COMPETITION.  There are numerous other developers, managers and owners
of real estate that compete with the Company in seeking management and leasing
revenues, land for development, properties for acquisition and disposition and
tenants for properties, and there can be no assurance that the Company will
successfully respond to or manage competitive conditions.

          CHANGES IN ECONOMIC CONDITIONS.  The Company's business and operating
results can be adversely affected by changes in the economic environment
generally.  For example, an increase in interest rates will affect the interest
payable on the Company's outstanding floating rate debt and may result in
increased interest expense if debt is refinanced at higher interest rates.
Moreover, in a recessionary economy, credit conditions may be inflexible and
consumer spending conservative, which could adversely affect the Company's
revenues from its retail centers.

          INTEREST RATE EXCHANGE AGREEMENTS.  The Company makes limited use of
interest rate exchange agreements, including interest rate caps and swaps,
primarily to manage interest rate risk associated with variable rate debt.
Under interest rate cap agreements, the Company makes initial premium payments
to the counterparties in exchange for the right to receive payments from them if
interest rates on the related variable rate debt exceed specified levels during
the agreement period.  Premiums paid are amortized to interest expense over the
terms of the agreements using the interest method, and payments receivable from
the counterparties are accrued as reductions of interest expense.  Under
interest rate swap agreements, the Company and the counterparties agree to
exchange the difference between fixed rate and variable rate interest amounts
calculated by reference to specified notional principal amounts during the
agreement period.  Notional principal amounts are used to express the volume of
these transactions, but the cash requirements and amounts subject to credit risk
are substantially less. Amounts receivable or payable under swap agreements are
accounted for as adjustments to interest expense on the related debt.

          Parties to interest rate exchange agreements are subject to market
risk for changes in interest rates and risk of credit loss in the event of
nonperformance by the counterparties.  Although the Company deals only with
highly rated financial institution counterparties (which, in certain cases, are
also the lenders on the related debt) and does not expect that any
counterparties will fail to meet their obligations, there can be no assurance
that this will not occur.

          RISKS RELATING TO NEVADA PROPERTIES.  General.  Affiliates of the
Company own approximately 3.5  million rentable square feet of office and
industrial space primarily around Las Vegas, Nevada, a 75% partnership interest
in Fashion Show Mall, an 840,000 square foot regional shopping center located on
the "Strip" in Las Vegas,  two Tournament Players Club golf clubs in Summerlin
and approximately 16,500 acres (11,500 saleable acres) of development and
investment land located in Summerlin, Nevada. These properties could be
adversely affected by the following risks.

          Water Availability in the Las Vegas Metropolitan Area.  The Las Vegas
metropolitan area is a desert environment where the ability to develop real
estate is largely dependent on the continued availability of water.

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The Las Vegas metropolitan area has a limited supply of water to service future
development, and it is uncertain whether the metropolitan area will be
successful in obtaining new sources of water. If the Las Vegas metropolitan area
does not obtain new sources of water, development activities could be materially
hindered.

          Air Quality.  The Las Vegas Valley is classified as a moderate carbon
monoxide and a serious PM-10 nonattainment area by the U.S. Environmental
Protection Agency ("EPA").  The EPA is currently assessing whether the Las Vegas
Valley meets certain regulatory requirements with respect to levels of ozone.
Efforts are underway to develop air quality plans to achieve and maintain
applicable EPA standards.  However, there are also ongoing efforts to relax
certain requirements under the Clean Air Act and to modify the EPA's authority
thereunder.  The outcome of these efforts may significantly affect real estate
development activities in the Las Vegas Valley.

          Availability of Infrastructure.  As with many rapidly growing
communities, the rate of growth in the Las Vegas metropolitan area is straining
the capacity of the community's infrastructure, particularly with respect to
schools, water delivery systems, transportation, flood control and sewage
treatment.  Certain responsible federal, state and local government agencies
finance the construction of infrastructure improvements through a variety of
means, including general obligation bond issues, some of which are subject to
voter approval.  The failure of these agencies to obtain financing for or to
complete such infrastructure improvements could materially delay development in
the area or materially increase development costs through the imposition of
impact fees and other fees and taxes, or require the construction or funding of
portions of such infrastructure.  The availability of infrastructure or water
has not had a negative impact on the development or investment activities of the
Company's affiliates to date.

          Non-Nevada Gaming.  Until this decade, the gaming industry was
principally limited to the traditional markets of Nevada and New Jersey.
Several states, however, have legalized casino gaming and other forms of
gambling in recent years.  In addition, several states have negotiated compacts
with Indian tribes pursuant to the Indian Gaming Regulatory Act of 1988 that
permit certain forms of gaming on Indian lands.  These additional gaming venues
create alternative destinations for gamblers and tourists who might otherwise
have visited Las Vegas.  It is not possible to determine whether current or
future legalized gaming venues will have an adverse impact on the Las Vegas
economy and thereby adversely affect the properties held by Company affiliates
in the Las Vegas area.

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