<PAGE>
 
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 to differ materially
from historical results or anticipated results:

          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
Company's properties is geographically concentrated.  The Company's 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,
Nevada 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 the
Company manages are located in the Baltimore-Washington corridor, including
Columbia, Maryland, and the greater Las Vegas, Nevada metropolitan area.  Due to
the geographic concentration of this portfolio, the Company's operating results
in managing these buildings and 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.
<PAGE>
 
Exhibit 99.2


          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.

                                      -2-
<PAGE>
 
Exhibit 99.2


          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.  The Company, through
its subsidiaries and affiliates owns approximately 3.2  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,  the Tournament Players
Club golf club at

                                      -3-
<PAGE>
 
Exhibit 99.2


Summerlin and approximately 16,500 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.  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 most 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 Company's development or investment activities 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.  The Company is not able to determine whether current or
future legalized gaming venues will have an adverse impact on the Las Vegas
economy and thereby adversely affect the Company's properties in the Las Vegas
area.

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