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United States

SECURITIES AND EXCHANGE COMMISSION

Washington DC 20549



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FORM 10-Q



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(Mark One)

|x | For the quarterly period ended September 30, 2004
|- | -------------------------------------------------



-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 Number 0-24763



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REGENCY CENTERS, L.P.

(Exact name of registrant as specified in its charter)



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|                                                               |  |                                  
|-------------------------------------------------------------- |  | ---------------------------------
|Delaware                                                       |  | 59-3429602                       
|(State or other jurisdiction of incorporation or organization) |  | (IRS Employer Identification No.)



121 West Forsyth
Street, Suite 200

Jacksonville, Florida 32202

(Address of principal executive offices) (Zip Code)



(904) 598-7000

(Registrants telephone number, including area code)



Unchanged

(Former name, former address and former fiscal year,

if changed since last
report)



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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 whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange
Act).    Yes ̈No  x



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REGENCY CENTERS, L.P.

Consolidated Balance Sheets

September 30, 2004 and December 31, 2003

(in thousands, except unit data)



|                                                                                                                                                                                         |  |             |           |   |      |          
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ----------- | --------- | - | ---- | ---------
|                                                                                                                                                                                         |  | 2004        |           |   | 2003
|                                                                                                                                                                                         |  | (unaudited) |           |   |     
|Assets                                                                                                                                                                                   |  |             |           |   |      |          
|Real estate investments at cost:                                                                                                                                                         |  |             |           |   |      |          
|Land                                                                                                                                                                                     |  | $           | 778,419   |   |      | 738,101  
|Buildings and improvements                                                                                                                                                               |  |             | 1,936,833 |   |      | 1,914,075
|                                                                                                                                                                                         |  |             |           |   |      |          
|                                                                                                                                                                                         |  |             | 2,715,252 |   |      | 2,652,176
|Less: accumulated depreciation                                                                                                                                                           |  |             | 325,130   |   |      | 285,665  
|                                                                                                                                                                                         |  |             |           |   |      |          
|                                                                                                                                                                                         |  |             | 2,390,122 |   |      | 2,366,511
|Properties in development                                                                                                                                                                |  |             | 437,280   |   |      | 369,474  
|Operating properties held for sale                                                                                                                                                       |  |             | 44,931    |   |      | 4,200    
|Investments in real estate partnerships                                                                                                                                                  |  |             | 115,871   |   |      | 140,496  
|                                                                                                                                                                                         |  |             |           |   |      |          
|Net real estate investments                                                                                                                                                              |  |             | 2,988,204 |   |      | 2,880,681
|                                                                                                                                                                                         |  |            
|Cash and cash equivalents                                                                                                                                                                |  |             | 50,181    |   |      | 29,869   
|Notes receivable                                                                                                                                                                         |  |             | 33,452    |   |      | 70,782   
|Tenant receivables, net of allowance for uncollectible accounts of $3,601 and $3,353 at September 30, 2004 and December 31, 2003,
respectively                                           |  |             | 50,337    |   |      | 54,573   
|Deferred costs, less accumulated amortization of $24,120 and $29,493 at September 30, 2004 and December 31, 2003, respectively                                                           |  |             | 41,769    |   |      | 35,804   
|Acquired lease intangible assets, net                                                                                                                                                    |  |             | 11,316    |   |      | 10,205   
|Other assets                                                                                                                                                                             |  |             | 13,661    |   |      | 16,315   
|                                                                                                                                                                                         |  |             |           |   |      |          
|                                                                                                                                                                                         |  | $           | 3,188,920 |   |      | 3,098,229
|                                                                                                                                                                                         |  |             |           |   |      |          
|Liabilities and Partners Capital                                                                                                                                                        |  |             |           |   |      |          
|Liabilities:                                                                                                                                                                             |  |             |           |   |      |          
|Notes payable                                                                                                                                                                            |  |             | 1,249,021 |   |      | 1,257,777
|Unsecured line of credit                                                                                                                                                                 |  |             | 230,000   |   |      | 195,000  
|Accounts payable and other liabilities                                                                                                                                                   |  |             | 109,145   |   |      | 94,280   
|Acquired lease intangible liabilities, net                                                                                                                                               |  |             | 5,400     |   |      | 6,115    
|Tenants security and escrow deposits                                                                                                                                                    |  |             | 9,621     |   |      | 9,358    
|                                                                                                                                                                                         |  |             |           |   |      |          
|Total liabilities                                                                                                                                                                        |  |             | 1,603,187 |   |      | 1,562,530
|                                                                                                                                                                                         |  |             |           |   |      |          
|Limited partners interest in consolidated partnerships                                                                                                                                  |  |             | 1,742     |   |      | 4,651    
|                                                                                                                                                                                         |  |             |           |   |      |          
|Partners Capital:                                                                                                                                                                       |  |             |           |   |      |          
|Series B preferred units, par value $100: 850,000 units issued and outstanding at December 31, 2003                                                                                      |  |             |          |   |      | 82,800   
|Series C preferred units, par value $100: 750,000 units issued, 400,000 units outstanding at December 31, 2003                                                                           |  |             |          |   |      | 38,964   
|Series D preferred units, par value $100: 500,000 units issued and outstanding at September 30, 2004 and December 31, 2003                                                               |  |             | 49,158    |   |      | 49,158   
|Series E preferred units, par value $100: 700,000 units issued, 300,000 units outstanding at September 30, 2004 and December 31,
2003                                                    |  |             | 29,238    |   |      | 29,238   
|Series F preferred units, par value $100: 240,000 units issued and outstanding at September 30, 2004 and December 31, 2003                                                               |  |             | 23,366    |   |      | 23,366   
|Series 3 and 4 Preferred units, par value $0.01: 800,000 and 300,000 units issued and outstanding at September 30, 2004 and December 31, 2003,
respectively; liquidation preference $250 |  |             | 200,000   |   |      | 75,000   
|General partner; 62,538,266 and 59,907,957 units outstanding at September 30, 2004 and December 31, 2003, respectively                                                                   |  |             | 1,267,959 |   |      | 1,205,803
|Limited partners; 976,032 and 1,318,625 units outstanding at September 30, 2004 and December 31, 2003, respectively                                                                      |  |             | 19,704    |   |      | 26,544   
|Accumulated other comprehensive (loss) income                                                                                                                                            |  |             | (5,434    | ) |      | 175      
|                                                                                                                                                                                         |  |             |           |   |      |          
|Total partners capital                                                                                                                                                                  |  |             | 1,583,991 |   |      | 1,531,048
|                                                                                                                                                                                         |  |             |           |   |      |          
|Commitments and contingencies                                                                                                                                                            |  |             |           |   |      |          
|                                                                                                                                                                                         |  | $           | 3,188,920 |   |      | 3,098,229
|                                                                                                                                                                                         |  |             |           |   |      |          



See accompanying notes to consolidated
financial statements.



1



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REGENCY CENTERS, L.P.

Consolidated Statements of Operations

For the Three Months ended September 30, 2004 and 2003

(in thousands, except per unit data)

(unaudited)



|                                                                                         |  |      |        |   |      |         |  
|---------------------------------------------------------------------------------------- |  | ---- | ------ | - | ---- | ------- | -
|                                                                                         |  | 2004 |        |   | 2003 |        
|Revenues:                                                                                |  |      |        |   |      |         |  
|Minimum rent                                                                             |  | $    | 72,606 |   |      | 66,436  |  
|Percentage rent                                                                          |  |      | 733    |   |      | 737     |  
|Recoveries from tenants                                                                  |  |      | 21,536 |   |      | 19,996  |  
|Management fees and commissions                                                          |  |      | 1,917  |   |      | 1,561   |  
|Equity in income of investments in real estate partnerships                              |  |      | 2,199  |   |      | 1,590   |  
|                                                                                         |  |      |        |   |      |         |  
|Total revenues                                                                           |  |      | 98,991 |   |      | 90,320  |  
|                                                                                         |  |      |        |   |      |         |  
|Operating expenses:                                                                      |  |      |        |   |      |         |  
|Depreciation and amortization                                                            |  |      | 20,375 |   |      | 18,105  |  
|Operating and maintenance                                                                |  |      | 14,110 |   |      | 12,527  |  
|General and administrative                                                               |  |      | 7,232  |   |      | 6,138   |  
|Real estate taxes                                                                        |  |      | 10,410 |   |      | 9,549   |  
|Other expenses                                                                           |  |      | 1,479  |   |      | 468     |  
|                                                                                         |  |      |        |   |      |         |  
|Total operating expenses                                                                 |  |      | 53,606 |   |      | 46,787  |  
|                                                                                         |  |      |        |   |      |         |  
|Other expense (income)                                                                   |  |      |        |   |      |         |  
|Interest expense, net of interest income of $886 and $335 in 2004 and 2003, respectively |  |      | 20,099 |   |      | 21,195  |  
|Gain on sale of operating properties and properties in development                       |  |      | (7,946 | ) |      | (11,796 | )
|                                                                                         |  |      |        |   |      |         |  
|Total other expense                                                                      |  |      | 12,153 |   |      | 9,399   |  
|                                                                                         |  |      |        |   |      |         |  
|Income before minority interests                                                         |  |      | 33,232 |   |      | 34,134  |  
|                                                                                         |  |     
|Minority interest of limited partners                                                    |  |      | (85    | ) |      | (113    | )
|                                                                                         |  |      |        |   |      |         |  
|Income from continuing operations                                                        |  |      | 33,147 |   |      | 34,021  |  
|                                                                                         |  |     
|Income from discontinued operations                                                      |  |      | 12,647 |   |      | 5,151   |  
|                                                                                         |  |      |        |   |      |         |  
|Net income                                                                               |  |      | 45,794 |   |      | 39,172  |  
|                                                                                         |  |     
|Preferred unit distributions                                                             |  |      | (9,635 | ) |      | (8,653  | )
|                                                                                         |  |      |        |   |      |         |  
|Net income for common unit holders                                                       |  | $    | 36,159 |   |      | 30,519  |  
|                                                                                         |  |      |        |   |      |         |  
|Income per common unit - basic:                                                          |  |      |        |   |      |         |  
|Continuing operations                                                                    |  | $    | 0.38   |   |      | 0.43    |  
|Discontinued operations                                                                  |  |      | 0.20   |   |      | 0.09    |  
|                                                                                         |  |      |        |   |      |         |  
|Net income for common unit holders per unit                                              |  | $    | 0.58   |   |      | 0.52    |  
|                                                                                         |  |      |        |   |      |         |  
|Income per common unit - diluted:                                                        |  |      |        |   |      |         |  
|Continuing operations                                                                    |  | $    | 0.38   |   |      | 0.43    |  
|Discontinued operations                                                                  |  |      | 0.20   |   |      | 0.08    |  
|                                                                                         |  |      |        |   |      |         |  
|Net income for common unit holders per unit                                              |  | $    | 0.58   |   |      | 0.51    |  
|                                                                                         |  |      |        |   |      |         |  



See accompanying notes to consolidated
financial statements.



2



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REGENCY CENTERS, L.P.

Consolidated Statements of Operations

For the nine months ended September 30, 2004 and 2003

(in thousands, except per unit data)

(unaudited)



|                                                                                             |  |      |         |   |      |         |  
|-------------------------------------------------------------------------------------------- |  | ---- | ------- | - | ---- | ------- | -
|                                                                                             |  | 2004 |         |   | 2003 |        
|Revenues:                                                                                    |  |      |         |   |      |         |  
|Minimum rent                                                                                 |  | $    | 211,531 |   |      | 198,117 |  
|Percentage rent                                                                              |  |      | 1,523   |   |      | 1,496   |  
|Recoveries from tenants                                                                      |  |      | 60,610  |   |      | 57,804  |  
|Management fees and commissions                                                              |  |      | 5,294   |   |      | 5,006   |  
|Equity in income of investments in real estate partnerships                                  |  |      | 6,888   |   |      | 5,910   |  
|                                                                                             |  |      |         |   |      |         |  
|Total revenues                                                                               |  |      | 285,846 |   |      | 268,333 |  
|                                                                                             |  |      |         |   |      |         |  
|Operating expenses:                                                                          |  |      |         |   |      |         |  
|Depreciation and amortization                                                                |  |      | 60,011  |   |      | 53,322  |  
|Operating and maintenance                                                                    |  |      | 39,785  |   |      | 37,484  |  
|General and administrative                                                                   |  |      | 20,337  |   |      | 16,438  |  
|Real estate taxes                                                                            |  |      | 30,255  |   |      | 28,247  |  
|Other expenses                                                                               |  |      | 2,629   |   |      | 1,572   |  
|                                                                                             |  |      |         |   |      |         |  
|Total operating expenses                                                                     |  |      | 153,017 |   |      | 137,063 |  
|                                                                                             |  |      |         |   |      |         |  
|Other expense (income)                                                                       |  |      |         |   |      |         |  
|Interest expense, net of interest income of $2,604 and $1,613 in 2004 and 2003, respectively |  |      | 59,919  |   |      | 62,593  |  
|Gain on sale of operating properties and properties in development                           |  |      | (16,579 | ) |      | (21,600 | )
|                                                                                             |  |      |         |   |      |         |  
|Total other expense                                                                          |  |      | 43,340  |   |      | 40,993  |  
|                                                                                             |  |      |         |   |      |         |  
|Income before minority interests                                                             |  |      | 89,489  |   |      | 90,277  |  
|                                                                                             |  |     
|Minority interest of limited partners                                                        |  |      | (255    | ) |      | (317    | )
|                                                                                             |  |      |         |   |      |         |  
|Income from continuing operations                                                            |  |      | 89,234  |   |      | 89,960  |  
|                                                                                             |  |     
|Income from discontinued operations                                                          |  |      | 16,823  |   |      | 12,709  |  
|                                                                                             |  |      |         |   |      |         |  
|Net income                                                                                   |  |      | 106,057 |   |      | 102,669 |  
|                                                                                             |  |     
|Preferred unit distributions                                                                 |  |      | (22,592 | ) |      | (27,502 | )
|                                                                                             |  |      |         |   |      |         |  
|Net income for common unit holders                                                           |  | $    | 83,465  |   |      | 75,167  |  
|                                                                                             |  |      |         |   |      |         |  
|Income per common unit - basic:                                                              |  |      |         |   |      |         |  
|Continuing operations                                                                        |  | $    | 1.08    |   |      | 1.03    |  
|Discontinued operations                                                                      |  |      | 0.27    |   |      | 0.21    |  
|                                                                                             |  |      |         |   |      |         |  
|Net income for common unit holders per unit                                                  |  | $    | 1.35    |   |      | 1.24    |  
|                                                                                             |  |      |         |   |      |         |  
|Income per common unit - diluted:                                                            |  |      |         |   |      |         |  
|Continuing operations                                                                        |  | $    | 1.08    |   |      | 1.02    |  
|Discontinued operations                                                                      |  |      | 0.27    |   |      | 0.21    |  
|                                                                                             |  |      |         |   |      |         |  
|Net income for common unit holders per unit                                                  |  | $    | 1.35    |   |      | 1.23    |  
|                                                                                             |  |      |         |   |      |         |  



See accompanying notes to consolidated
financial statements.



3



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REGENCY CENTERS, L.P.

Consolidated Statement of Changes in Partners Capital

For the nine months ended September
30, 2004

(in thousands)

(unaudited)



|                                                                                      |  |                 |          |   |                                          |           |   |                |         |   |                                              |        |   |                       |           |  
|------------------------------------------------------------------------------------- |  | --------------- | -------- | - | ---------------------------------------- | --------- | - | -------------- | ------- | - | -------------------------------------------- | ------ | - | --------------------- | --------- | -
|                                                                                      |  | Preferred Units |          |   | General PartnerPreferred andCommon Units |           |   | LimitedPartner |         |   | Accumulated OtherComprehensive Income (Loss) |        |   | TotalPartnersCapital |          
|Balance at December 31, 2003                                                          |  | $               | 223,526  |   |                                          | 1,280,803 |   |                | 26,544  |   |                                              | 175    |   |                       | 1,531,048 |  
|Comprehensive income:                                                                 |  |                 |          |   |                                          |           |   |                |         |   |                                              |        |   |                       |           |  
|Net income                                                                            |  |                 | 17,621   |   |                                          | 87,020    |   |                | 1,416   |   |                                              |       |   |                       | 106,057   |  
|Loss on settlement of derivative instruments                                          |  |                 |          |   |                                          |           |   |                |         |   |                                              | (5,895 | ) |                       | (5,895    | )
|Amortization of loss on derivative instruments                                        |  |                 |          |   |                                          |           |   |                |         |   |                                              | 286    |   |                       | 286       |  
|                                                                                      |  |                 |          |   |                                          |           |   |                |         |   |                                              |        |   |                       |           |  
|Total comprehensive income                                                            |  |                 |         |   |                                          |          |   |                |        |   |                                              |       |   |                       | 100,448   |  
|Redemption of preferred units                                                         |  |                 | (121,764 | ) |                                          |          |   |                |        |   |                                              |       |   |                       | (121,764  | )
|Cash distributions for dividends                                                      |  |                 |          |   |                                          | (96,247   | ) |                | (1,705  | ) |                                              |       |   |                       | (97,952   | )
|Preferred unit distribution                                                           |  |                 | (17,621  | ) |                                          | (4,971    | ) |                |        |   |                                              |       |   |                       | (22,592   | )
|Units converted for cash                                                              |  |                 |         |   |                                          |          |   |                | (20,402 | ) |                                              |       |   |                       | (20,402   | )
|Series 4 Preferred units issued                                                       |  |                 |         |   |                                          | 125,000   |   |                |        |   |                                              |       |   |                       | 125,000   |  
|Common Units issued as a result of common stock issued by Regency, net of repurchases |  |                 |         |   |                                          | 76,805    |   |                |        |   |                                              |       |   |                       | 76,805    |  
|Common Units exchanged for common stock of Regency                                    |  |                 |         |   |                                          | 5,410     |   |                | (5,410  | ) |                                              |       |   |                       |          |  
|Units issued for acquisition of real estate                                           |  |                 |         |   |                                          |          |   |                | 13,400  |   |                                              |       |   |                       | 13,400    |  
|Reallocation of limited partners interest                                             |  |                 |         |   |                                          | (5,861    | ) |                | 5,861   |   |                                              |       |   |                       |          |  
|                                                                                      |  |                 |          |   |                                          |           |   |                |         |   |                                              |        |   |                       |           |  
|Balance at September 30, 2004                                                         |  | $               | 101,762  |   |                                          | 1,467,959 |   |                | 19,704  |   |                                              | (5,434 | ) |                       | 1,583,991 |  
|                                                                                      |  |                 |          |   |                                          |           |   |                |         |   |                                              |        |   |                       |           |  



See accompanying notes to consolidated
financial statements.



4



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REGENCY CENTERS, L. P.

Consolidated Statements of Cash Flows

For the nine months ended September 30, 2004 and 2003

(unaudited)



|                                                                                  |  |      |          |   |      |          |  
|--------------------------------------------------------------------------------- |  | ---- | -------- | - | ---- | -------- | -
|                                                                                  |  | 2004 |          |   | 2003 |         
|Cash flows from operating activities:                                             |  |      |          |   |      |          |  
|Net income                                                                        |  | $    | 106,057  |   |      | 102,669  |  
|Adjustments to reconcile net income to net cash provided by operating activities: |  |      |          |   |      |          |  
|Depreciation and amortization                                                     |  |      | 60,772   |   |      | 56,279   |  
|Deferred loan cost and debt premium amortization                                  |  |      | 1,813    |   |      | 1,571    |  
|Services provided by Regency in exchange for Common Units                         |  |      | 10,133   |   |      | 8,688    |  
|Minority interest of limited partners                                             |  |      | 255      |   |      | 317      |  
|Equity in income of investments in real estate partnerships                       |  |      | (6,888   | ) |      | (5,910   | )
|Net gain on sale of properties                                                    |  |      | (30,207  | ) |      | (28,256  | )
|Provision for loss on operating and development properties                        |  |      |         |   |      | 1,969    |  
|Distributions from operations of investments in real estate partnerships          |  |      | 10,822   |   |      | 8,303    |  
|Hedge settlement                                                                  |  |      | (5,720   | ) |      |         |  
|Changes in assets and liabilities:                                                |  |      |          |   |      |          |  
|Tenant receivables                                                                |  |      | 4,773    |   |      | 5,592    |  
|Deferred leasing costs                                                            |  |      | (4,683   | ) |      | (7,309   | )
|Other assets                                                                      |  |      | 647      |   |      | (615     | )
|Accounts payable and other liabilities                                            |  |      | 1,709    |   |      | (7,664   | )
|Tenants security and escrow deposits                                             |  |      | 230      |   |      | 566      |  
|                                                                                  |  |      |          |   |      |          |  
|Net cash provided by operating activities                                         |  |      | 149,713  |   |      | 136,200  |  
|                                                                                  |  |      |          |   |      |          |  
|Cash flows from investing activities:                                             |  |      |          |   |      |          |  
|Acquisition of real estate                                                        |  |      | (26,560  | ) |      | (22,476  | )
|Development of real estate                                                        |  |      | (246,185 | ) |      | (225,270 | )
|Proceeds from sale of real estate investments                                     |  |      | 129,475  |   |      | 138,830  |  
|Repayment of notes receivable, net                                                |  |      | 45,530   |   |      | 48,332   |  
|Investments in real estate partnerships                                           |  |      | (18,621  | ) |      | (10,260  | )
|Distributions received from investments in real estate partnerships               |  |      | 21,464   |   |      | 18,361   |  
|                                                                                  |  |      |          |   |      |          |  
|Net cash used in investing activities                                             |  |      | (94,897  | ) |      | (52,483  | )
|                                                                                  |  |      |          |   |      |          |  
|Cash flows from financing activities:                                             |  |      |          |   |      |          |  
|Net proceeds from the issuance of Regency stock and Common Units                  |  |      | 79,002   |   |      | 125,073  |  
|Repurchase of Regency stock and corresponding Common Units                        |  |      |         |   |      | (150,502 | )
|Redemption of preferred units                                                     |  |      | (125,000 | ) |      | (155,750 | )
|Cash paid for conversion of Common Units by limited partner                       |  |      | (20,402  | ) |      | (974     | )
|Contributions from limited partners in consolidated partnerships                  |  |      | 352      |   |      | 247      |  
|Distributions to preferred unit holders                                           |  |      | (19,356  | ) |      | (23,630  | )
|Cash distributions for dividends                                                  |  |      | (97,953  | ) |      | (95,990  | )
|Net proceeds from issuance of Series 3 and 4 preferred units                      |  |      | 120,831  |   |      | 72,295   |  
|Repayment of fixed rate unsecured notes                                           |  |      | (200,000 | ) |      |         |  
|Proceeds from issuance of fixed rate unsecured notes, net                         |  |      | 148,646  |   |      |         |  
|Proceeds from unsecured line of credit, net                                       |  |      | 35,000   |   |      | 116,000  |  
|Proceeds from notes payable                                                       |  |      | 54,852   |   |      | 30,822   |  
|Repayment of notes payable, net                                                   |  |      | (2,350   | ) |      | (7,256   | )
|Scheduled principal payments                                                      |  |      | (4,282   | ) |      | (4,358   | )
|Deferred loan costs                                                               |  |      | (3,844   | ) |      | (253     | )
|                                                                                  |  |      |          |   |      |          |  
|Net cash used in financing activities                                             |  |      | (34,504  | ) |      | (94,276  | )
|                                                                                  |  |      |          |   |      |          |  
|Net increase (decrease) in cash and cash equivalents                              |  |      | 20,312   |   |      | (10,559  | )
|                                                                                  |  |     
|Cash and cash equivalents at beginning of the period                              |  |      | 29,869   |   |      | 56,447   |  
|                                                                                  |  |      |          |   |      |          |  
|Cash and cash equivalents at end of the period                                    |  | $    | 50,181   |   |      | 45,888   |  
|                                                                                  |  |      |          |   |      |          |  



5



---

REGENCY CENTERS, L.P.

Consolidated Statements of Cash Flows

For the nine months ended September 30, 2004 and 2003

(unaudited)



|                                                                                                                                                            |  |   |        |  |       
|----------------------------------------------------------------------------------------------------------------------------------------------------------- |  | - | ------ |  | ------
|Supplemental disclosure of cash flow information - cash paid for interest (net of capitalized interest of $8,903 and $9,778 in 2004 and 2003,
respectively) |  | $ | 73,363 |  | 71,371
|                                                                                                                                                            |  |   |        |  |       
|Supplemental disclosure of non-cash transactions:                                                                                                           |  |   |        |  |       
|Mortgage debt assumed by purchaser on sale of real estate                                                                                                   |  | $ | 9,899  |  | 5,254 
|                                                                                                                                                            |  |   |        |  |       
|Common stock issued for partnership units exchanged                                                                                                         |  | $ | 5,410  |  | 1,164 
|                                                                                                                                                            |  |   |        |  |       
|Mortgage loans assumed for the acquisition of real estate                                                                                                   |  | $ | 4,148  |  | 15,342
|                                                                                                                                                            |  |   |        |  |       
|Real estate contributed as investments in real estate partnerships                                                                                          |  | $ | 4,544  |  | 18,329
|                                                                                                                                                            |  |   |        |  |       
|Exchangeable operating partnership units issued for the acquisition of real estate                                                                          |  | $ | 13,400 |  |      
|                                                                                                                                                            |  |   |        |  |       
|Notes receivable taken in connection with sales of operating properties and properties in development                                                       |  | $ | 8,200  |  | 69,287
|                                                                                                                                                            |  |   |        |  |       
|Change in fair value of derivative instrument                                                                                                               |  | $ |       |  | 1,677 
|                                                                                                                                                            |  |   |        |  |       



See accompanying notes to consolidated
financial statements.



6



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Regency Centers, L.P.



Notes to Consolidated Financial Statements



September 30, 2004



|1. | Summary of Significant Accounting Policies
|-- | ------------------------------------------



| | (a) | Organization and Principles of Consolidation
| | --- | --------------------------------------------



Regency Centers, L.P. (RCLP or the Partnership) is the primary entity through which Regency Centers Corporation
(Regency or the Company), a self-administered and self-managed real estate investment trust (REIT), conducts all of its business and owns all of its assets.



The Partnership was formed in 1996 for the purpose of acquiring certain real
estate properties. At September 30, 2004, Regency owns approximately 98% of the outstanding common units of the Partnership.



The Partnerships ownership interests are represented by Units, of which there are i) five series of preferred Units, ii) common Units owned by the
limited partners and iii) common Units owned by Regency which serves as the general partner. Each outstanding common Unit owned by a limited partner is exchangeable, on a one share per one Unit basis, for the common stock of Regency or for cash at
Regencys election.



The accompanying consolidated
financial statements include the accounts of the Partnership, its wholly owned subsidiaries, and also partnerships in which it has voting control. All significant intercompany balances and transactions have been eliminated in the consolidated
financial statements.



The financial statements reflect all
adjustments that are of a normal recurring nature, and in the opinion of management, are necessary to properly state the results of operations and financial position. Certain information and footnote disclosures normally included in financial
statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted although management believes that the disclosures are adequate to make the information presented not
misleading. The financial statements should be read in conjunction with the financial statements and notes thereto included in the Partnerships December 31, 2003 Form 10-K filed with the Securities and Exchange Commission.



| | (b) | Revenues
| | --- | --------



The Partnership leases space to tenants under agreements with varying terms. Leases are accounted for as operating leases with minimum rent recognized on a straight-line basis over the term of the lease regardless of
when payments are due. Accrued rents are included in tenant receivables.



Substantially all of the lease agreements contain provisions that grant additional rents based on tenants sales volume (contingent or percentage rent) and reimbursement of the tenants share of real estate
taxes and certain common area maintenance (CAM) costs. Percentage rents are recognized when the tenants achieve the specified targets as defined in their lease agreements. Recovery of real estate taxes and CAM costs are recognized as the
respective costs are incurred in accordance with the lease agreements.



7



---

Regency Centers, L.P.



Notes to Consolidated Financial Statements



September 30, 2004



| | (b) | Revenues (continued)
| | --- | --------------------



The Partnership accounts for profit recognition on sales of real estate in accordance with Statement of Financial Accounting Standards (SFAS)
Statement No. 66, Accounting for Sales of Real Estate. In summary, profits from sales will not be recognized by the Partnership unless a sale has been consummated; the buyers initial and continuing investment is adequate to
demonstrate a commitment to pay for the property; the Partnership has transferred to the buyer the usual risks and rewards of ownership; and the Partnership does not have substantial continuing financial involvement with the property.



The Partnership has been engaged by joint ventures to provide asset and
property management services for their shopping centers. The fees are market based and generally calculated as a percentage of revenues earned and the estimated values of the properties and recognized as services are provided.



| | (c) | Real Estate Investments
| | --- | -----------------------



Land, buildings and improvements are recorded at cost. All specifically identifiable costs related to development activities are capitalized into
properties in development on the consolidated balance sheet. The capitalized costs include pre-development costs essential to the development of the property, development costs, construction costs, interest costs, real estate taxes, salaries and
related costs and other costs incurred during the period of development. The Partnership incurs costs prior to land acquisition including acquisition contract deposits, legal, engineering and other external professional fees related to evaluating
the feasibility of developing a shopping center. These pre-acquisition development costs are included in properties in development. If the Partnership determines that the development of a shopping center is no longer probable, any pre-development
costs previously incurred are immediately expensed. At September 30, 2004 and December 31, 2003, the Partnership had capitalized pre-development costs of $15.7 million and $8.8 million, respectively. The Partnerships method of capitalizing
interest is based upon applying its weighted average borrowing rate to that portion of the actual development costs expended. The Partnership ceases cost capitalization when the property is available for occupancy upon substantial completion of
tenant improvements. Maintenance and repairs that do not improve or extend the useful lives of the respective assets are reflected in operating and maintenance expense. Depreciation is computed using the straight-line method over estimated useful
lives of up to 40 years for buildings and improvements, term of lease for tenant improvements, and three to seven years for furniture and equipment.



The Partnership allocates the purchase price of assets acquired (net tangible and identifiable intangible assets) and liabilities assumed based on their
relative fair values at the date of acquisition pursuant to the provisions SFAS No. 141, Business Combinations (Statement 141). Statement 141 provides guidance on allocating a portion of the purchase price of a property to
intangible assets. The Partnerships methodology for this allocation includes estimating an as-if vacant fair value of the physical property, which is allocated to land, building and improvements. The difference between the purchase
price and the as-if vacant fair value is allocated to intangible assets. There are three categories of intangible assets to be considered, (i) value of in-place leases, (ii) above and below-market value of in-place leases and (iii)
customer relationship value.



8



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Regency Centers, L.P.



Notes to Consolidated Financial Statements



September 30, 2004



| | (c) | Real Estate Investments (continued)
| | --- | -----------------------------------



The value of in-place leases is estimated based on the value associated with the costs avoided in originating leases comparable to the acquired in-place
leases as well as the value associated with lost rental and recovery revenue during the assumed lease-up period. The value of in-place leases is amortized to expense over the estimated weighted-average remaining lease lives.



Above-market and below-market in-place lease values for acquired properties
are recorded based on the present value of the difference between (i) the contractual amounts to be paid pursuant to the in-place leases and (ii) managements estimates of fair market lease rates for the comparable in-place leases, measured
over a period equal to the remaining non-cancelable term of the lease. The value of above-market lease values is accreted as a reduction of base rental revenue over the remaining terms of the respective leases. The value of below-market lease values
is acreted as an increase to base rental revenue over the remaining terms of the respective leases including renewal options.



The Partnership allocates no value to customer relationship intangibles if the Partnership has pre-existing business relationships with the major
retailers in the acquired property because the customer relationships associated with the acquired property provide no incremental value over the Partnerships existing relationships.



The Partnership follows the provisions of SFAS No. 144, Accounting for
the Impairment or Disposal of Long-Lived Assets (Statement 144). In accordance with Statement 144, operating properties held for sale includes only those properties available for immediate sale in their present condition and for
which management believes it is probable that a sale of the property will be completed within one year. Operating properties held for sale are carried at the lower of cost or fair value less costs to sell. Depreciation and amortization are suspended
during the held for sale period.



The Partnership reviews its
real estate portfolio for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable based upon expected undiscounted cash flows from the property. The Partnership determines impairment by
comparing the propertys carrying value to an estimate of fair value based upon varying methods such as i) estimating future cash flows, ii) determining resale values by market, or iii) applying a capitalization rate to net operating income
using prevailing rates in a given market. These methods of determining fair value can fluctuate significantly as a result of a number of factors, including changes in the general economy of those markets in which we operate, tenant credit quality
and demand for new retail stores. In the event a property is impaired, we write down the asset to fair value for held-and-used assets and to fair value less costs to sell for held-for-sale assets. During June 2003, we
recorded a provision for loss of approximately $2.0 million on three shopping centers located in geographic areas no longer considered primary investment markets that also lacked the long-term investment growth that the Partnership believes is
critical to its investment strategy. At the time the provision was recorded, the three properties were under contract for sale, and the provision was established based upon the criteria described above. These assets were subsequently sold to third
parties and included as part of discontinued operations.



9



---

Regency Centers, L.P.



Notes to Consolidated Financial Statements



September 30, 2004



| | (c) | Real Estate Investments (continued)
| | --- | -----------------------------------



The Partnerships properties generally have operations and cash flows that can be clearly distinguished from the rest of the Partnership. In
accordance with Statement 144, the operations and gains on sales reported in discontinued operations include those operating properties and properties in development that have been sold and for which operations and cash flows can be clearly
distinguished. The operations from these properties have been eliminated from ongoing operations and the Partnership will not have continuing involvement after disposition. Prior periods have been restated to reflect the operations of these
properties as discontinued operations. The operations and gains on sales of operating properties sold to real estate partnerships in which the Partnership has continuing involvement are included in income from continuing operations.



| | (d) | Deferred Costs
| | --- | --------------



Deferred costs include deferred leasing costs and deferred loan costs, net of accumulated amortization. Such costs are amortized over the periods through
lease expiration or loan maturity. Deferred leasing costs consist of internal and external commissions associated with leasing the Partnerships shopping centers. Net deferred leasing costs were $31.5 million and $28.0 million at September 30,
2004 and December 31, 2003, respectively. Deferred loan costs consist of initial direct and incremental costs associated with financing activities. Net deferred loan costs were $10.3 million and $7.8 million at September 30, 2004 and December 31,
2003, respectively.



| | (e) | Earnings per Unit and Treasury Stock
| | --- | ------------------------------------



Basic net income per unit is computed based upon the weighted average number of common units outstanding during the period. Diluted net income per unit
also includes common unit equivalents for stock options and exchangeable operating partnership units. See note 8 for the calculation of earnings per unit.



Repurchases of the Companys common stock (net of shares retired) are recorded at cost and are reflected as Treasury stock in the consolidated
statement of stockholders equity. Outstanding shares do not include treasury shares. Concurrent with the Treasury stock repurchases by Regency, the Partnership repurchases the same amount of general partnership units from Regency.



| | (f) | Stock-Based Compensation
| | --- | ------------------------



Regency is committed to contribute to the Partnership all proceeds from the exercise of options or other stock-based awards granted under Regencys
Stock Option and Incentive Plan. Regencys ownership in the Partnership will be increased based on the amount of proceeds contributed to the Partnership.



The Partnership follows the provisions of SFAS No. 148, Accounting for Stock-Based Compensation - Transition and Disclosure
(Statement 148). Statement 148 provides alternative methods of transition for a voluntary change to the fair value based method of accounting for stock-based employee compensation. In addition, Statement 148 amends the disclosure
requirements of SFAS Statement No. 123, Accounting for Stock-Based Compensation (Statement 123), to require more prominent and frequent disclosures in



10



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Regency Centers, L.P.



Notes to Consolidated Financial Statements



September 30, 2004



| | (f) | Stock-Based Compensation (continued)
| | --- | ------------------------------------



financial statements about the effects of stock-based compensation. As permitted under Statement 123 and Statement 148, the Partnership will continue to
follow the accounting guidelines pursuant to Accounting Principles Board Opinion No. 25, Accounting for Stock Issued to Employees (Opinion 25), for stock-based compensation and to furnish the pro forma disclosures as required
under Statement 148.



The Partnership applies Opinion 25 in
accounting for its plan, and accordingly, no compensation cost has been recognized for its stock options in the consolidated financial statements. Had the Partnership determined compensation cost based on the fair value at the grant date for its
stock options under Statement 123, the Partnerships net income for common unit holders for the three months and nine months ended September 30, 2004 and 2003 would have been reduced to the pro forma amounts indicated below (in thousands except
per unit data):



|                                                                                                                 |  |                                          |        |      |       
|---------------------------------------------------------------------------------------------------------------- |  | ---------------------------------------- | ------ | ---- | ------
|                                                                                                                 |  | For the three months ended September 30,
|                                                                                                                 |  | 2004                                     |        | 2003
|Net income for common unit holders as reported                                                                   |  | $                                        | 36,159 |      | 30,519
|Add: stock-based employee compensation expense included in reported net income                                   |  |                                          | 3,051  |      | 2,918 
|Deduct: total stock-based employee compensation expense determined under fair value based methods for all awards |  |                                          | 5,114  |      | 4,149 
|                                                                                                                 |  |                                          |        |      |       
|Pro forma net income                                                                                             |  | $                                        | 34,096 |      | 29,288
|                                                                                                                 |  |                                          |        |      |       
|Earnings per unit:                                                                                               |  |                                          |        |      |       
|Basic  as reported                                                                                              |  | $                                        | 0.58   |      | 0.52  
|                                                                                                                 |  |                                          |        |      |       
|Basic  pro forma                                                                                                |  | $                                        | 0.55   |      | 0.50  
|                                                                                                                 |  |                                          |        |      |       
|Diluted  as reported                                                                                            |  | $                                        | 0.58   |      | 0.51  
|                                                                                                                 |  |                                          |        |      |       
|Diluted  pro forma                                                                                              |  | $                                        | 0.54   |      | 0.49  
|                                                                                                                 |  |                                          |        |      |       



|                                                                                                                 |  |                                        |        |      |       
|---------------------------------------------------------------------------------------------------------------- |  | -------------------------------------- | ------ | ---- | ------
|                                                                                                                 |  | For the nine months endedSeptember 30,
|                                                                                                                 |  | 2004                                   |        | 2003
|Net income for common unit holders as reported                                                                   |  | $                                      | 83,465 |      | 75,167
|Add: stock-based employee compensation expense included in reported net income                                   |  |                                        | 10,126 |      | 8,688 
|Deduct: total stock-based employee compensation expense determined under fair value based methods for all awards |  |                                        | 14,190 |      | 11,763
|                                                                                                                 |  |                                        |        |      |       
|Pro forma net income                                                                                             |  | $                                      | 79,401 |      | 72,092
|                                                                                                                 |  |                                        |        |      |       
|Earnings per unit:                                                                                               |  |                                        |        |      |       
|Basic  as reported                                                                                              |  | $                                      | 1.35   |      | 1.24  
|                                                                                                                 |  |                                        |        |      |       
|Basic  pro forma                                                                                                |  | $                                      | 1.28   |      | 1.18  
|                                                                                                                 |  |                                        |        |      |       
|Diluted  as reported                                                                                            |  | $                                      | 1.35   |      | 1.23  
|                                                                                                                 |  |                                        |        |      |       
|Diluted  pro forma                                                                                              |  | $                                      | 1.28   |      | 1.18  
|                                                                                                                 |  |                                        |        |      |       



11



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Regency Centers, L.P.



Notes to Consolidated Financial Statements



September 30, 2004



| | (g) | Consolidation of Variable Interest Entities
| | --- | -------------------------------------------



In December 2003, the Financial Accounting Standards Board (FASB) issued Interpretation No. 46 (FIN 46) (revised December 2003
(FIN 46R)), Consolidation of Variable Interest Entities, which addresses how a business enterprise should evaluate whether it has controlling financial interest in an entity through means other than voting rights and
accordingly should consolidate the entity. FIN 46R replaces FIN 46, which was issued in January 2003. FIN 46R is applicable immediately to a variable interest entity created after January 31, 2003 and as of the first interim period ending after
March 15, 2004 to those variable interest entities created before February 1, 2003 and not already consolidated under FIN 46 in previously issued financial statements. The Partnership did not create any variable interest entities after January 31,
2003. The Partnership has adopted FIN 46R, analyzed the applicability of this interpretation to its structures and determined that they are not party to any variable interest entities that should be consolidated.



| | (h) | Segment Reporting
| | --- | -----------------



The Partnerships business is investing in retail shopping centers through direct ownership or through joint ventures. The Partnership actively
manages its portfolio of retail shopping centers and may from time to time make decisions to sell lower performing properties, or developments not meeting its long-term investment objectives. The proceeds of sales are reinvested into higher quality
retail shopping centers through acquisitions or new developments, which management believes will meet its planned rate of return. It is managements intent that all retail shopping centers will be owned or developed for investment purposes. The
Partnerships revenue and net income are generated from the operation of its investment portfolio. The Partnership will also earn incidental fees from third parties for services provided to manage and lease retail shopping centers owned through
joint ventures.



The Partnerships portfolio is located
throughout the United States; however, management does not distinguish or group its operations on a geographical basis for purposes of allocating resources or measuring performance. The Partnership reviews operating and financial data for each
property on an individual basis, therefore, the Partnership defines an operating segment as its individual properties. No individual property constitutes more than 10% of the Partnerships combined revenue, net income or assets, and thus the
individual properties have been aggregated into one reportable segment based upon their similarities with regard to both the nature of the centers, tenants and operational processes, as well as long-term average financial performance. In addition,
no single tenant accounts for 10% or more of revenue and none of the shopping centers are located outside the United States.



| | (i) | Derivative Financial Instruments
| | --- | --------------------------------



The Partnership adopted SFAS No. 133 Accounting for Derivative Instruments and Hedging Activities as amended (Statement 133), on
January 1, 2001. Statement 133 requires that all derivative instruments be recorded on the balance sheet at their fair value. Gains or losses resulting from changes in the values of those derivatives are accounted for depending on the use of the
derivative and whether it qualifies for hedge accounting. The Partnerships use of derivative financial instruments is normally to mitigate its interest rate risk on a related financial instrument or forecasted transaction through the use of
interest rate swaps or rate locks.



12



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Regency Centers, L.P.



Notes to Consolidated Financial Statements



September 30, 2004



| | (i) | Derivative Financial Instruments (continued)
| | --- | --------------------------------------------



Statement 133 requires that changes in fair value of derivatives that qualify as cash flow hedges be recognized in other comprehensive income (loss) while
the ineffective portion of the derivatives change in fair value be recognized immediately in earnings. Upon the settlement of a hedge, gains and losses associated with the transaction will be recorded in other comprehensive income (loss) and
amortized over the underlying term of the hedge transaction. Historically all of the Partnerships derivative instruments qualify for hedge accounting.



To determine the fair value of derivative instruments, the Partnership uses standard market conventions and techniques such as discounted cash flow
analysis, option pricing models and termination costs at each balance sheet date. All methods of assessing fair value result in a general approximation of value, and such value may never actually be realized.



| | j) | Financial Instruments with Characteristics of Both Liabilities and Equity
| | -- | -------------------------------------------------------------------------



In May 2003, the FASB issued SFAS No. 150, Accounting for Certain Financial Instruments with Characteristics of both
Liabilities and Equity (Statement 150). Statement 150 affects the accounting for certain financial instruments, including requiring companies having consolidated entities with specified termination dates to treat minority
owners interests in such entities as liabilities in an amount based on the fair value of the entities. Although Statement 150 was originally effective July 1, 2003, the FASB has indefinitely deferred certain provisions related to
classification and measurement requirements for mandatorily redeemable financial instruments that become subject to Statement 150 solely as a result of consolidation including minority interests of entities with specified termination dates. As a
result, Statement 150 has no impact on the Partnerships consolidated statements of operations for the nine months ended September 30, 2004.



At September 30, 2004, the Partnership held a majority interest in three consolidated entities with specified termination dates ranging from 2017 to 2049.
The minority owners interests in these entities are to be settled upon termination by distribution or transfer of either cash or specific assets of the underlying entities. The estimated fair value of minority interests in entities with
specified termination dates was approximately $5.3 million at September 30, 2004 as compared to the carrying value of $1.4 million. The Partnership has no other financial instruments that are affected by Statement 150.



| | (k) | Reclassifications
| | --- | -----------------



Certain reclassifications have been made to the 2003 amounts to conform to classifications adopted in 2004.



13



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Regency Centers, L.P.



Notes to Consolidated Financial Statements



September 30, 2004



|2. | Discontinued Operations
|-- | -----------------------



During the three months ended September 30, 2004, the Partnership sold 100% of its interest in three properties for net proceeds of $33.6 million and the
combined operating income and gain of $12.6 million on these sales are included in discontinued operations. The revenues from properties included in discontinued operations, including properties sold in 2004 and 2003, as well as operating properties
held for sale, were $1.9 million and $5.3 million for the three months ended September 30, 2004 and 2003, respectively. The operating income from these properties was $1.8 million and $2.6 million for the three months ended September 30, 2004 and
2003, respectively.



During the nine months ended September
30, 2004, the Partnership sold 100% of its interest in 11 properties for net proceeds of $71.2 million and the combined operating income and gain of $16.8 million on these sales are included in discontinued operations. The revenues from properties
included in discontinued operations, including properties sold in 2004 and 2003, as well as operating properties held for sale, were $8.0 million and $17.2 million for the nine months ended September 30, 2004 and 2003, respectively. The operating
income from these properties was $3.5 million and $6.1 million for the nine months ended September 30, 2004 and 2003, respectively.



|3. | Real Estate Investments
|-- | -----------------------



As of September 30, 2004, the Partnership acquired two operating properties from third parties. One of the properties was acquired for a purchase price
$25.1 million, and the second by the assumption of $4.1 million in debt and the issuance of 339,167 exchangeable operating partnership units valued at $13.4 million. Acquired lease intangible assets of $2.6 million for in-place leases were recorded
for the acquisitions. The acquisitions were accounted for as purchases and the results of their operations are included in the consolidated financial statements from the respective dates of acquisition, and neither was considered significant to the
Partnerships operations in the current or preceding periods. On October 12, 2004, the Partnership purchased one operating property by the assumption of approximately $22.7 million of debt, the issuance of 581,395 exchangeable operating
partnership units valued at approximately $25 million and $9.8 million in cash.



The Partnership accounts for all investments in which it owns 50% or less and does not have a controlling financial interest using the equity method. The Partnerships combined investment in these partnerships
was $115.9 million and $140.5 million at September 30, 2004 and December 31, 2003, respectively. Any difference between the carrying amount of these investments and the underlying equity in net assets is amortized to equity in income of investments
in real estate partnerships over the depreciable life of the property, which is generally 40 years. Net income, which includes all operating results, as well as gains and losses on sales of properties within the joint ventures, is allocated to the
Partnership in accordance with the respective partnership agreements. Such allocations of net income are recorded in equity in income of investments in real estate partnerships in the accompanying consolidated statements of operations.



14



---

Regency Centers, L.P.



Notes to Consolidated Financial Statements



September 30, 2004



|3. | Real Estate Investments (continued)
|-- | -----------------------------------



The Partnership has a 25% equity interest in Macquarie CountryWide-Regency, LLC (MCWR), a joint venture with an affiliate of Macquarie
CountryWide Trust of Australia (MCW), a Sydney, Australia-based property trust focused on investing in grocery-anchored shopping centers. As of September 30, 2004, MCWR had acquired two properties from the Partnership for $43.4 million,
for which the Partnership received net proceeds of $20.1 million.



The Partnership also has a 20% equity interest in Columbia Regency Retail Partners, LLC (Columbia), a joint venture with the Oregon Public Employees Retirement Fund (OPERF) that was formed for the purpose of
investing in retail shopping centers. In August 2004, Columbia acquired six shopping centers for a purchase price of $119.2 million totaling approximately 900,000 square feet located in the Chicago area. The Partnership contributed $5.2 million for
its proportionate share of the purchase price.



On August 16,
2004, the Partnership entered into two separate definitive agreements with its joint venture partners, MCW and OPERF to acquire 24 retail properties totaling 2.6 million square feet located in the Southeastern United States. The acquisitions were
completed in the fourth quarter and the Partnership contributed $56.1 million for its proportionate share of the purchase price.



Recognition of gains from sales to joint ventures is recorded on only that portion of the sales not attributable to the Partnerships ownership
interest. The gains and operations are not recorded as discontinued operations because of the Partnerships continuing involvement in these shopping centers. Columbia and MCWR intend to continue to acquire retail shopping centers, some of which
they may acquire directly from the Partnership. For those properties acquired from third parties, the Partnership is required to contribute its pro-rata share of the purchase price to the partnerships.



With the exception of Columbia and MCWR, both of which intend to continue
expanding their investment in shopping centers, the investments in real estate partnerships represent single asset entities formed for the purpose of developing or owning retail based commercial real estate.



In August 2004, the Partnership sold its membership interest in the Hermosa
Venture 2002, LLC to the partner. In March 2004, the two properties in the OTR/Regency Texas Realty Holdings, L.P., an unconsolidated joint venture in which the Partnership has a 30% equity interest, were sold to an outside party for $28.3 million
resulting in a gain of $8.2 million. The Partnership received $17.2 million which represents a $4.3 million distribution for the Partnerships 30% equity interest and $12.9 million for the repayment of a loan. The Partnership recognized a $1.2
million gain in the equity in income of investments in real estate partnerships in the accompanying consolidated statements of operations.



15



---

Regency Centers, L.P.



Notes to Consolidated Financial Statements



September 30, 2004



|3. | Real Estate Investments (continued)
|-- | -----------------------------------



The Partnerships investments in real estate partnerships as of September 30, 2004 and December 31, 2003 consist of the following (in thousands):



|                                              |  |           |  |      |         |      |        
|--------------------------------------------- |  | --------- |  | ---- | ------- | ---- | -------
|                                              |  | Ownership |  | 2004 |         | 2003
|Columbia Regency Retail Partners, LLC         |  | 20%       |  | $    | 50,316  |      | 40,267 
|Macquarie CountryWide-Regency, LLC            |  | 25%       |  |      | 42,355  |      | 39,071 
|Other investments in real estate partnerships |  | 30% - 50% |  |      | 23,200  |      | 61,158 
|                                              |  |           |  |      |         |      |        
|                                              |  |           |  | $    | 115,871 |      | 140,496
|                                              |  |           |  |      |         |      |        



Summarized financial
information for the unconsolidated investments on a combined basis, is as follows (in thousands):



|                                |  |                    |         |                   |        
|------------------------------- |  | ------------------ | ------- | ----------------- | -------
|                                |  | September 30, 2004 |         | December 31, 2003
|Balance Sheet:                  |  |                    |         |                   |        
|Investment in real estate, net  |  | $                  | 844,786 |                   | 727,530
|Acquired lease intangibles, net |  |                    | 48,984  |                   | 45,252 
|Other assets                    |  |                    | 50,801  |                   | 39,408 
|                                |  |                    |         |                   |        
|Total assets                    |  | $                  | 944,571 |                   | 812,190
|                                |  |                    |         |                   |        
|Notes payable                   |  | $                  | 417,286 |                   | 322,238
|Other liabilities               |  |                    | 17,101  |                   | 14,102 
|Partners equity                |  |                    | 510,184 |                   | 475,850
|                                |  |                    |         |                   |        
|Total liabilities and equity    |  | $                  | 944,571 |                   | 812,190
|                                |  |                    |         |                   |        



Unconsolidated
partnerships and joint ventures had notes payable of $417.3 million at September 30, 2004 and the Partnerships proportionate share of these loans was $102.9 million. The Partnership does not guarantee any debt of these partnerships beyond its
ownership percentage.



The revenues and expenses on a combined
basis are summarized as follows for the three months ended September 30, 2004 and 2003 (in thousands):



|                                   |  |      |        |      |        |  
|---------------------------------- |  | ---- | ------ | ---- | ------ | -
|                                   |  | 2004 |        | 2003 |       
|Statement of Operations:           |  |      |        |      |        |  
|Total revenues                     |  | $    | 26,352 |      | 18,835 |  
|Total expenses                     |  |      | 19,411 |      | 13,375 |  
|Gain (loss) on sale of real estate |  |      | 421    |      | (9     | )
|                                   |  |      |        |      |        |  
|Net income                         |  | $    | 7,362  |      | 5,451  |  
|                                   |  |      |        |      |        |  



The revenues and
expenses on a combined basis are summarized as follows for the nine months ended September 30, 2004 and 2003 (in thousands):



|                            |  |      |        |      |       
|--------------------------- |  | ---- | ------ | ---- | ------
|                            |  | 2004 |        | 2003
|Statement of Operations:    |  |      |        |      |       
|Total revenues              |  | $    | 72,474 |      | 52,257
|Total expenses              |  |      | 52,225 |      | 34,616
|Gain on sale of real estate |  |      | 8,667  |      | 652   
|                            |  |      |        |      |       
|Net income                  |  | $    | 28,916 |      | 18,293
|                            |  |      |        |      |       



16



---

Regency Centers, L.P.



Notes to Consolidated Financial Statements



September 30, 2004



|4. | Acquired Lease Intangibles
|-- | --------------------------



The Partnership follows Statement 141 to account for the acquisition of shopping centers that are considered businesses. In accordance with Statement 141,
identifiable intangible assets are valued and recorded at the acquisition date. Such intangibles include the value of in-place leases and above or below-market leases.



Acquired lease intangible assets are net of accumulated amortization of $1.9 million and $405,327 at September 30, 2004 and
December 31, 2003, respectively. These assets have a weighted average amortization period of eight years. The aggregate amortization expense from acquired leases was $1.5 million and $82,285 for the nine months ended September 30, 2004 and 2003,
respectively. Acquired lease intangible liabilities are net of previously accreted minimum rent of $1.7 million and $953,964 at September 30, 2004 and December 31, 2003, respectively and have a weighted average amortization period of seven years.



|5. | Notes Payable and Unsecured Line of Credit
|-- | ------------------------------------------



The Partnerships outstanding debt at September 30, 2004 and December 31, 2003 consists of the following (in thousands):



|                             |  |      |           |      |          
|---------------------------- |  | ---- | --------- | ---- | ---------
|                             |  | 2004 |           | 2003
|Notes Payable:               |  |      |           |      |          
|Fixed rate mortgage loans    |  | $    | 259,162   |      | 217,001  
|Variable rate mortgage loans |  |      | 40,958    |      | 41,629   
|Fixed rate unsecured loans   |  |      | 948,901   |      | 999,147  
|                             |  |      |           |      |          
|Total notes payable          |  |      | 1,249,021 |      | 1,257,777
|Unsecured line of credit     |  |      | 230,000   |      | 195,000  
|                             |  |      |           |      |          
|Total                        |  | $    | 1,479,021 |      | 1,452,777
|                             |  |      |           |      |          



On April 1, 2004, RCLP
completed the sale of $150 million of ten-year senior unsecured notes. The 4.95% notes are due April 15, 2014 and were priced at 99.747% to yield 4.982%. The proceeds of the offering were used to partially repay the $200 million of 7.4% notes
maturing on April 1, 2004 and the remaining balance due was funded from the unsecured line of credit. As a result of two forward-starting interest rate swaps totaling $144.2 million initiated in 2003 in anticipation of this transaction, the
effective interest rate is 5.47%. On March 31, 2004, the interest rate swaps were settled for $5.7 million, which is recorded in other comprehensive loss and will be amortized over the life of the notes to interest expense. The swaps qualified for
hedge accounting under Statement 133; therefore, the change in fair value was recorded through other comprehensive (loss) income.



On March 26, 2004, the Partnership closed on the amended and restated unsecured revolving line of credit (the Line). Under the new agreement,
the Partnership reduced the line commitment from $600 million to $500 million. The Line has a three-year term with a one-year extension option at an interest rate of LIBOR plus .75% which is a reduction of 10 basis points from the prior agreement.
At September 30, 2004, the balance on the Line is $230 million. Interest rates paid on the Line, which are based on LIBOR plus .75%, were 2.5% at September 30, 2004 and LIBOR plus .85% or 1.975% at December 31, 2003. The spread paid on the Line is
dependent upon the Partnership maintaining specific investment-grade ratings. The Partnership is also required to comply, and is in compliance, with certain financial covenants such as Minimum Net Worth, Total Liabilities to Gross Asset Value
(GAV) and Secured Indebtedness to GAV and other covenants



17



---

Regency Centers, L.P.



Notes to Consolidated Financial Statements



September 30, 2004



|5. | Notes Payable and Unsecured Line of Credit (continued)
|-- | ------------------------------------------------------



customary with this type of unsecured financing. The Line is used primarily to finance the development of real estate, but is also available for general
working capital purposes.



Mortgage loans are secured by
certain real estate properties and may be prepaid, but could be subject to a yield-maintenance premium. Mortgage loans are generally due in monthly installments of interest and principal and mature over various terms through 2019. Variable interest
rates on mortgage loans are currently based on LIBOR plus a spread in a range of 125 to 150 basis points. Fixed interest rates on mortgage loans range from 5.01% to 9.50%.



The fair value of the Partnerships notes payable and Line are estimated based on the current rates available to the
Partnership for debt of the same remaining maturities. Notes payable with variable interest rates and the Line are considered to be at fair value, since the interest rates on such instruments reprice based on current market conditions. Fixed rate
loans assumed in connection with real estate acquisitions are recorded in the accompanying financial statements at fair value. Based on the borrowing rates currently available to the Partnership for loans with similar terms and average maturities,
the fair value of long-term debt is $1.7 billion.



As of
September 30, 2004, scheduled principal repayments on notes payable and the Line were as follows (in thousands):



|                           |  |                              |        |                      |           |                |          
|-------------------------- |  | ---------------------------- | ------ | -------------------- | --------- | -------------- | ---------
|Scheduled Payments by Year |  | Scheduled Principal Payments |        | Term Loan Maturities |           | Total Payments
|Current year               |  | $                            | 1,230  |                      | 21,803    |                | 23,033   
|2005                       |  |                              | 3,642  |                      | 168,516   |                | 172,158  
|2006                       |  |                              | 3,348  |                      | 21,126    |                | 24,474   
|2007 (includes the Line)   |  |                              | 3,008  |                      | 256,165   |                | 259,173  
|2008                       |  |                              | 2,823  |                      | 19,621    |                | 22,444   
|2009                       |  |                              | 2,861  |                      | 53,090    |                | 55,951   
|Beyond 5 Years             |  |                              | 18,492 |                      | 898,886   |                | 917,378  
|Unamortized debt premiums  |  |                              |       |                      | 4,410     |                | 4,410    
|                           |  |                              |        |                      |           |                |          
|Total                      |  | $                            | 35,404 |                      | 1,443,617 |                | 1,479,021
|                           |  |                              |        |                      |           |                |          



|6. | Derivative Financial Instruments
|-- | --------------------------------



The Partnership is exposed to capital market risk, such as changes in interest rates. In order to manage the volatility relating to interest rate risk,
the Partnership may enter into interest rate hedging arrangements from time to time. The Partnership does not utilize derivative financial instruments for trading or speculative purposes.



During 2003, the Partnership entered into two forward-starting interest rate
swaps of $96.5 million and $47.7 million. The Partnership designated the $144.2 million swaps as cash flow hedges to fix the rate on a refinancing in April 2004. On March 31, 2004, the Partnership settled the swaps with a payment to the
counter-party for $5.7 million. The swaps qualify for hedge accounting under Statement 133, therefore the losses associated with the swaps have been included in accumulated other comprehensive loss. These amounts are included as an adjustment to
interest expense as interest is incurred on the $150 million of ten-year unsecured notes sold April 1, 2004.



18



---

Regency Centers, L.P.



Notes to Consolidated Financial Statements



September 30, 2004



|7. | Regencys Stockholders Equity and Partners Capital
|-- | ----------------------------------------------------



| | (a) | On August 31, 2004, the Company received proceeds from a $125 million offering of 5,000,000 depositary shares representing 500,000 shares of Series 4 Cumulative Redeemable Preferred
Stock. The depositary shares are perpetual preferred stock, not convertible into common stock of the Company, are redeemable at par upon Regencys election on or after August 31, 2009, pay a 7.25% annual dividend, and have a liquidation value
of $25 per depositary share. The proceeds from this offering were used to redeem $85 million of Series B 8.75% Preferred Units and $40 million of Series C 9.0% Preferred Units. On April 3, 2003, the Company received proceeds from a $75 million
offering of 3,000,000 depositary shares representing 300,000 shares of Series 3 Cumulative Redeemable Preferred Stock. The depositary shares are perpetual preferred stock, not convertible into common stock of the Company, are redeemable at par upon
Regencys election on or after April 3, 2008, pay a 7.45% annual dividend, and have a liquidation value of $25 per depositary share. The terms of the Series 3 and Series 4 Preferred Stock do not contain any unconditional obligations which would
require the Company to redeem the securities at any time or for any purpose. The proceeds from these transactions were contributed to the Partnership in exchange for 300,000 shares of Series 3 Preferred Units and 500,000 of Series 4 Preferred Units
issued to and held by Regency with terms exactly the same as the Series 3 and Series 4 Cumulative Redeemable Preferred Stock.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (b) | On August 24, 2004, the Company sold 1,500,000 shares of common stock to Citigroup Global Markets Inc. and the net proceeds of approximately $67 million were used to reduce the
balance of the Line.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (c) | RCLP has issued Cumulative Redeemable Preferred Units (Preferred Units) in various amounts since 1998. The issues were sold primarily to institutional investors in
private placements for $100 per unit. The Preferred Units, which may be called by RCLP at par after certain dates, have no stated maturity or mandatory redemption, and pay a cumulative, quarterly dividend at fixed rates. At any time after ten years
from the date of issuance, the Preferred Units may be exchanged by the holder for Cumulative Redeemable Preferred Stock (Preferred Stock) at an exchange rate of one share for one unit. The Preferred Units and the related Preferred Stock
are not convertible into common stock of the Company. At September 30, 2004 and December 31, 2003, the face value of total Preferred Units issued was $104 million and $229 million with an average fixed distribution rate of 8.93% and 8.88%,
respectively.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



On September 3, 2004, the
Partnership redeemed $85 million of Series B 8.75% Preferred Units and $40 million of Series C 9.0% Preferred Units from proceeds of the Series 4 Preferred stock offering described above. At the time of the redemptions, $3.2 million of previously
deferred costs related to the original preferred units issuance were recognized in the consolidated statements of operations as a component of minority interest of preferred units.



19



---

Regency Centers, L.P.



Notes to Consolidated Financial Statements



September 30, 2004



|7. | Regencys Stockholders Equity and Partners Capital (continued)
|-- | ----------------------------------------------------------------



| | (c) | Terms and conditions of the Preferred Units outstanding as of September 30, 2004 are summarized as follows:
| | --- | -----------------------------------------------------------------------------------------------------------



|         |  |                  |  |            |  |                   |             |                  |       |   |                        |          |                            |         
|-------- |  | ---------------- |  | ---------- |  | ----------------- | ----------- | ---------------- | ----- | - | ---------------------- | -------- | -------------------------- | --------
|Series   |  | UnitsOutstanding |  | IssuePrice |  | AmountOutstanding |             | DistributionRate |       |   | Callable byPartnership |          | Exchangeableby Unit holder
|Series D |  | 500,000          |  | 100.00     |  |                   | 50,000,000  |                  | 9.125 | % |                        | 09/29/04 |                            | 09/29/09
|Series E |  | 300,000          |  | 100.00     |  |                   | 30,000,000  |                  | 8.750 | % |                        | 05/25/05 |                            | 05/25/10
|Series F |  | 240,000          |  | 100.00     |  |                   | 24,000,000  |                  | 8.750 | % |                        | 09/08/05 |                            | 09/08/10
|         |  |                  |  |            |  |                   |             |                  |       |   |                        |          |                            |         
|         |  | 1,040,000        |  |            |  | $                 | 104,000,000 |                  |       |   |                        |          |                            |         
|         |  |                  |  |            |  |                   |             |                  |       |   |                        |          |                            |         



20



---

Regency Centers, L.P.



Notes to Consolidated Financial Statements



September 30, 2004



|8. | Earnings per Unit
|-- | -----------------



The following summarizes the calculation of basic and diluted earnings per unit for the three months ended September 30, 2004 and 2003, respectively (in
thousands except per unit data):



|                                                                                                  |  |      |        |      |       
|------------------------------------------------------------------------------------------------- |  | ---- | ------ | ---- | ------
|                                                                                                  |  | 2004 |        | 2003
|Numerator:                                                                                        |  |      |        |      |       
|Income from continuing operations                                                                 |  | $    | 33,147 |      | 34,022
|Discontinued operations                                                                           |  |      | 12,647 |      | 5,150 
|                                                                                                  |  |      |        |      |       
|Net income                                                                                        |  |      | 45,794 |      | 39,172
|Less: Preferred unit distributions and original issuance costs                                    |  |      | 9,635  |      | 8,653 
|                                                                                                  |  |      |        |      |       
|Net income for common unit holders  basic and diluted                                            |  | $    | 36,159 |      | 30,519
|                                                                                                  |  |      |        |      |       
|Denominator:                                                                                      |  |      |        |      |       
|Weighted average common units outstanding for basic EPU                                           |  |      | 62,492 |      | 59,079
|Incremental units to be issued under the Company's common stock options using the Treasury method |  |      | 167    |      | 363   
|                                                                                                  |  |      |        |      |       
|Weighted average common units outstanding for diluted EPU                                         |  |      | 62,659 |      | 59,442
|                                                                                                  |  |      |        |      |       
|Income per common unit  basic                                                                    |  |      |        |      |       
|Income from continuing operations                                                                 |  | $    | 0.38   |      | 0.43  
|Discontinued operations                                                                           |  |      | 0.20   |      | 0.09  
|                                                                                                  |  |      |        |      |       
|Net income for common unit holders per unit                                                       |  | $    | 0.58   |      | 0.52  
|                                                                                                  |  |      |        |      |       
|Income per common unit  diluted                                                                  |  |      |        |      |       
|Income from continuing operations                                                                 |  | $    | 0.38   |      | 0.43  
|Discontinued operations                                                                           |  |      | 0.20   |      | 0.08  
|                                                                                                  |  |      |        |      |       
|Net income for common unit holders per unit                                                       |  | $    | 0.58   |      | 0.51  
|                                                                                                  |  |      |        |      |       



21



---

Regency Centers, L.P.



Notes to Consolidated Financial Statements



September 30, 2004



|8. | Earnings per Unit (continued)
|-- | -----------------------------



The following summarizes the calculation of basic and diluted earnings per unit for the nine months ended September 30, 2004 and 2003, respectively (in
thousands except per unit data):



|                                                                                                  |  |      |         |      |        
|------------------------------------------------------------------------------------------------- |  | ---- | ------- | ---- | -------
|                                                                                                  |  | 2004 |         | 2003
|Numerator:                                                                                        |  |      |         |      |        
|Income from continuing operations                                                                 |  | $    | 89,234  |      | 89,960 
|Discontinued operations                                                                           |  |      | 16,823  |      | 12,709 
|                                                                                                  |  |      |         |      |        
|Net income                                                                                        |  |      | 106,057 |      | 102,669
|Less: Preferred unit distributions and original issuance costs                                    |  |      | 22,592  |      | 27,502 
|                                                                                                  |  |      |         |      |        
|Net income for common unit holders  basic and diluted                                            |  | $    | 83,465  |      | 75,167 
|                                                                                                  |  |      |         |      |        
|Denominator:                                                                                      |  |      |         |      |        
|Weighted average common units outstanding for basic EPU                                           |  |      | 61,834  |      | 60,766 
|Incremental units to be issued under the Company's common stock options using the Treasury method |  |      | 222     |      | 395    
|                                                                                                  |  |      |         |      |        
|Weighted average common units outstanding for diluted EPU                                         |  |      | 62,056  |      | 61,161 
|                                                                                                  |  |      |         |      |        
|Income per common unit  basic                                                                    |  |      |         |      |        
|Income from continuing operations                                                                 |  | $    | 1.08    |      | 1.03   
|Discontinued operations                                                                           |  |      | 0.27    |      | 0.21   
|                                                                                                  |  |      |         |      |        
|Net income for common unit holders per unit                                                       |  | $    | 1.35    |      | 1.24   
|                                                                                                  |  |      |         |      |        
|Income per common unit  diluted                                                                  |  |      |         |      |        
|Income from continuing operations                                                                 |  | $    | 1.08    |      | 1.02   
|Discontinued operations                                                                           |  |      | 0.27    |      | 0.21   
|                                                                                                  |  |      |         |      |        
|Net income for common unit holders per unit                                                       |  | $    | 1.35    |      | 1.23   
|                                                                                                  |  |      |         |      |        



22



---

Regency Centers, L.P.



Notes to Consolidated Financial Statements



September 30, 2004



|9. | Contingencies
|-- | -------------



The Partnership is involved in litigation on a number of matters and is subject to certain claims which arise in the normal course of business, none of
which, in the opinion of management, is expected to have a material adverse effect on the Partnerships consolidated financial position, results of operations or liquidity.



23



---

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



In addition to historical information, the following information contains
forward-looking statements as defined under federal securities laws. These statements are based on current expectations, estimates and projections about the industry and markets in which Regency Centers Corporation (Regency or the
Company) operates, and managements beliefs and assumptions. Forward-looking statements are not guarantees of future performance and involve certain known and unknown risks and uncertainties that could cause actual results to differ
materially from those expressed or implied by such statements. Such risks and uncertainties include, but are not limited to, changes in national and local economic conditions; financial difficulties of tenants; competitive market conditions,
including pricing of acquisitions and sales of properties and out-parcels; changes in expected leasing activity and market rents; timing of acquisitions, development starts and sales of properties and out-parcels; weather; the ability to obtain
governmental approvals; and meeting development schedules. The following discussion should be read in conjunction with the accompanying Consolidated Financial Statements and Notes thereto of Regency Centers, L.P. (RCLP or
Partnership) appearing elsewhere within.



Introduction and Strategic Overview



Regency
is a qualified real estate investment trust (REIT), which began operations in 1993. Our primary operating and investment goal is long-term growth in earnings per share and total shareholder return by focusing on a strategy of owning and
operating grocery anchored shopping centers that are anchored by market-leading supermarkets, and that are located in areas with attractive demographics. Regency owns and operates its shopping centers through our operating partnership, Regency
Centers, L.P. (RCLP), in which we currently own approximately 98% of the operating partnership units. Regencys operating, investing and financing activities are generally performed by RCLP, its wholly-owned subsidiaries and its
joint ventures with third parties.



Currently, our real estate
investment portfolio before depreciation totals $4.1 billion with 263 shopping centers in 21 states including approximately $878.9 million in real estate assets comprised of 51 shopping centers owned by unconsolidated joint ventures in 16 states.
Portfolio information is presented on a combined basis including unconsolidated joint ventures (Combined Basis), on a basis that excludes the unconsolidated joint ventures (Regency Consolidated Properties) and on basis
including only the unconsolidated joint ventures (Unconsolidated Properties). We believe that providing our shopping center portfolio information under these methods provides a more complete understanding of the properties that we own,
including those that we partially own but for which we provide property and asset management services. At September 30, 2004, our gross leasable area (GLA) on a Combined Basis totaled 30.6 million square feet and was 93.5% leased. The
GLA for the Regency Consolidated Properties totaled 24.1 million square feet and was 92.6% leased. The GLA for the Unconsolidated Properties totaled 6.5 million square feet and was 96.7% leased.



We earn revenues and generate operating cash flow by leasing space to grocers
and retail side-shop tenants in our shopping centers. We experience growth in revenues by increasing occupancy and rental rates at currently owned shopping centers, and by developing new shopping centers. A neighborhood center is a convenient,
cost-effective distribution platform for food retailers. Grocery anchored centers generate substantial daily traffic and offer sustainable competitive advantages to their tenants. This high traffic generates increased sales, thereby driving higher
occupancy, rental rates and rental-rate growth for Regency, which we expect to sustain our growth in earnings per share and increase the value of our portfolio over the long term.



We seek a range of strong national, regional and local specialty tenants, for the same reason that we choose to anchor our
centers with leading grocers. We have created a formal partnering process  the Premier Customer Initiative (PCI)  to promote mutually beneficial relationships with our non-grocer specialty retailers. The objective of PCI is
for Regency to build a base of specialty tenants who represent the best-in-class operators in their respective merchandising categories. Such tenants reinforce the consumer appeal and other strengths of a centers grocery anchor,
help to stabilize a centers occupancy, reduce re-leasing downtime, reduce tenant turnover and yield higher sustainable rents.



24



---

We grow our shopping center portfolio through new shopping center development, where we acquire the land
and construct the building. Development is customer-driven, meaning we generally have an executed lease from the anchor before we start construction. Developments serve the growth needs of our grocery and specialty retail customers, result in modern
shopping centers with long-term leases from the grocery anchors and produce attractive returns on our invested capital. This development process can require up to 36 months from initial land or redevelopment acquisition through construction,
lease-up and stabilization of rental income, depending upon the size of the project. Generally, anchor tenants begin operating their stores prior to construction completion of the entire center, resulting in rental income during the development
phase.



We intend to maintain a conservative capital structure
to fund our growth programs without compromising our investment-grade ratings. Our approach is founded on our self-funding business model. This model utilizes center recycling as a key component. Our recycling strategy calls for us to
re-deploy the proceeds from the sales of properties into new higher quality developments that we expect to generate sustainable revenue growth and more attractive returns on invested capital. Our commitment to maintaining a high-quality shopping
center portfolio dictates that we continually assess the value of all of our properties and sell those that no longer meet our long-term investment standards.



Joint venturing of shopping centers also provides us with a capital source for new development, as well as the opportunity to earn fees for asset and
property management services. As asset manager, we are engaged by our partners to apply similar operating, investment, and capital strategies to the portfolios owned by the joint ventures. Joint ventures grow their shopping center investments
through acquisitions from third parties or direct purchases of shopping centers from Regency. Although selling properties to joint ventures reduces our ownership interest, we continue to share in the risks and rewards of centers that meet our
long-term investment strategy. Regency is not subject to liability and has no obligations or guarantees of the joint ventures beyond its ownership percentage.



We have identified certain significant risks and challenges affecting our industry, and we are addressing them accordingly. A further economic downturn
could result in declines in occupancy levels at our shopping centers, which would reduce our rental revenues; however, we believe that our investment focus on grocery anchored shopping centers that provide daily necessities will minimize the impact
of a downturn in the economy. Increased competition from super-centers such as Wal-Mart could result in grocery anchor closings or consolidations in the grocery store industry. We closely monitor the operating performance and tenants sales of
our shopping centers that operate near super-centers. A slow down in our shopping center development program would reduce operating revenues and gains from sales. We believe that developing shopping centers in markets with strong demographics with
leading grocery stores will enable us to continue to maintain our development program at historical averages.



25



---

Shopping Center Portfolio



The following tables summarize general operating statistics related to our
shopping center portfolio that we use to evaluate and monitor our performance. The portfolio information below is presented on a (a) Combined Basis, (b) for Regency Consolidated Properties and (c) for Unconsolidated Properties:



|                               |  |            |   |  |            |  
|------------------------------ |  | ---------- | - |  | ---------- | -
|                               |  | 9/30/04    |   |  | 12/31/03   |  
|Number of Properties (a)       |  | 263        |   |  | 265        |  
|Number of Properties (b)       |  | 212        |   |  | 219        |  
|Number of Properties (c)       |  | 51         |   |  | 46         |  
|                               |  |           
|Properties in Development (a)  |  | 31         |   |  | 36         |  
|Properties in Development (b)  |  | 30         |   |  | 34         |  
|Properties in Development (c)  |  | 1          |   |  | 2          |  
|                               |  |           
|Gross Leaseable Area (a)       |  | 30,591,437 |   |  | 30,347,744 |  
|Gross Leaseable Area (b)       |  | 24,121,444 |   |  | 24,565,776 |  
|Gross Leaseable Area (c)       |  | 6,469,993  |   |  | 5,781,968  |  
|                               |  |           
|% Leased  All Properties (a)  |  | 93.5       | % |  | 92.2       | %
|% Leased  All Properties (b)  |  | 92.6       | % |  | 91.8       | %
|% Leased  All Properties (c)  |  | 96.7       | % |  | 95.7       | %
|                               |  |           
|% Leased  Non development (a) |  | 95.5       | % |  | 95.4       | %
|% Leased  Non development (b) |  | 95.0       | % |  | 95.1       | %
|% Leased  Non development (c) |  | 97.1       | % |  | 97.1       | %



26



---

The following table is a list of the shopping centers summarized by state and in order of largest
holdings presented on a Combined Basis:



|               |  |                    |  |            |                   |               |   |  |         |   |  |             |  |            |  |               |   |  |         |  
|-------------- |  | ------------------ |  | ---------- | ----------------- | ------------- | - |  | ------- | - |  | ----------- |  | ---------- |  | ------------- | - |  | ------- | -
|               |  | September 30, 2004 |  |            | December 31, 2003 |              
|Location       |  | #Properties        |  | GLA        |                   | % of TotalGLA |   |  | %Leased |   |  | #Properties |  | GLA        |  | % of TotalGLA |   |  | %Leased |  
|California     |  | 47                 |  | 5,957,619  |                   | 19.5          | % |  | 94.2    | % |  | 49          |  | 5,917,372  |  | 19.5          | % |  | 90.8    | %
|Florida        |  | 49                 |  | 5,835,727  |                   | 19.1          | % |  | 94.7    | % |  | 50          |  | 5,943,345  |  | 19.6          | % |  | 94.3    | %
|Texas          |  | 37                 |  | 4,696,522  |                   | 15.4          | % |  | 88.8    | % |  | 41          |  | 5,086,086  |  | 16.7          | % |  | 88.1    | %
|Georgia        |  | 20                 |  | 2,008,069  |                   | 6.6           | % |  | 94.7    | % |  | 20          |  | 2,008,066  |  | 6.6           | % |  | 95.8    | %
|Ohio           |  | 14                 |  | 1,876,012  |                   | 6.1           | % |  | 87.3    | % |  | 14          |  | 1,901,538  |  | 6.3           | % |  | 90.6    | %
|Colorado       |  | 15                 |  | 1,639,055  |                   | 5.3           | % |  | 96.4    | % |  | 14          |  | 1,623,674  |  | 5.3           | % |  | 94.2    | %
|Virginia       |  | 12                 |  | 1,486,539  |                   | 4.9           | % |  | 90.4    | % |  | 10          |  | 1,272,369  |  | 4.2           | % |  | 89.1    | %
|North Carolina |  | 9                  |  | 1,191,424  |                   | 3.9           | % |  | 98.3    | % |  | 3           |  | 408,211    |  | 1.3           | % |  | 97.0    | %
|Washington     |  | 10                 |  | 1,050,011  |                   | 3.4           | % |  | 97.5    | % |  | 10          |  | 1,050,061  |  | 3.5           | % |  | 98.7    | %
|Oregon         |  | 10                 |  | 1,046,772  |                   | 3.4           | % |  | 97.6    | % |  | 9           |  | 1,020,470  |  | 3.4           | % |  | 96.4    | %
|Arizona        |  | 8                  |  | 837,956    |                   | 2.7           | % |  | 95.5    | % |  | 8           |  | 838,715    |  | 2.8           | % |  | 92.2    | %
|Tennessee      |  | 5                  |  | 588,486    |                   | 1.9           | % |  | 93.1    | % |  | 7           |  | 652,906    |  | 2.1           | % |  | 91.5    | %
|Illinois       |  | 6                  |  | 444,234    |                   | 1.5           | % |  | 96.8    | % |  | 6           |  | 444,234    |  | 1.5           | % |  | 96.5    | %
|Alabama        |  | 5                  |  | 380,607    |                   | 1.2           | % |  | 88.0    | % |  | 6           |  | 543,330    |  | 1.8           | % |  | 85.5    | %
|Michigan       |  | 4                  |  | 368,348    |                   | 1.2           | % |  | 93.8    | % |  | 4           |  | 368,260    |  | 1.2           | % |  | 87.2    | %
|South Carolina |  | 5                  |  | 339,926    |                   | 1.1           | % |  | 96.7    | % |  | 5           |  | 339,926    |  | 1.1           | % |  | 95.7    | %
|Kentucky       |  | 2                  |  | 302,669    |                   | 1.0           | % |  | 97.5    | % |  | 3           |  | 323,029    |  | 1.1           | % |  | 97.8    | %
|Delaware       |  | 2                  |  | 240,418    |                   | 0.8           | % |  | 99.9    | % |  | 2           |  | 240,418    |  | 0.8           | % |  | 99.5    | %
|Maryland       |  | 1                  |  | 206,050    |                   | 0.7           | % |  | 91.7    | % |  | 1           |  | 188,243    |  | 0.6           | % |  | 90.2    | %
|New Jersey     |  | 1                  |  | 88,993     |                   | 0.3           | % |  | 98.6    | % |  | 1           |  | 88,993     |  | 0.3           | % |  | 89.4    | %
|Pennsylvania   |  | 1                  |  | 6,000      |                   |              |   |  | 100.0   | % |  | 1           |  | 6,000      |  |              |   |  | 100.0   | %
|Missouri       |  |                   |  |           |                   |              |   |  |        |   |  | 1           |  | 82,498     |  | 0.3           | % |  | 91.5    | %
|               |  |                    |  |            |                   |               |   |  |         |   |  |             |  |            |  |               |   |  |         |  
|Total          |  | 263                |  | 30,591,437 |                   | 100.0         | % |  | 93.5    | % |  | 265         |  | 30,347,744 |  | 100.0         | % |  | 92.2    | %
|               |  |                    |  |            |                   |               |   |  |         |   |  |             |  |            |  |               |   |  |         |  



The following table is
a list of the shopping centers summarized by state and in order of largest holdings presented for Regency Consolidated Properties:



|               |  |                    |  |            |                   |               |   |  |         |   |  |             |  |            |  |               |   |  |         |  
|-------------- |  | ------------------ |  | ---------- | ----------------- | ------------- | - |  | ------- | - |  | ----------- |  | ---------- |  | ------------- | - |  | ------- | -
|               |  | September 30, 2004 |  |            | December 31, 2003 |              
|Location       |  | #Properties        |  | GLA        |                   | % of TotalGLA |   |  | %Leased |   |  | #Properties |  | GLA        |  | % of TotalGLA |   |  | %Leased |  
|California     |  | 41                 |  | 5,076,471  |                   | 21.0          | % |  | 93.6    | % |  | 41          |  | 4,859,526  |  | 19.8          | % |  | 90.1    | %
|Florida        |  | 38                 |  | 4,631,284  |                   | 19.2          | % |  | 94.0    | % |  | 39          |  | 4,738,901  |  | 19.3          | % |  | 94.1    | %
|Texas          |  | 32                 |  | 3,997,494  |                   | 16.6          | % |  | 88.2    | % |  | 34          |  | 4,167,951  |  | 17.0          | % |  | 87.9    | %
|Ohio           |  | 13                 |  | 1,767,109  |                   | 7.3           | % |  | 86.8    | % |  | 13          |  | 1,792,635  |  | 7.3           | % |  | 92.7    | %
|Georgia        |  | 17                 |  | 1,656,297  |                   | 6.9           | % |  | 95.6    | % |  | 17          |  | 1,656,294  |  | 6.7           | % |  | 96.8    | %
|Colorado       |  | 12                 |  | 1,241,978  |                   | 5.2           | % |  | 96.5    | % |  | 11          |  | 1,223,072  |  | 5.0           | % |  | 92.6    | %
|Virginia       |  | 9                  |  | 1,020,145  |                   | 4.2           | % |  | 86.4    | % |  | 8           |  | 910,103    |  | 3.7           | % |  | 85.2    | %
|North Carolina |  | 9                  |  | 970,508    |                   | 4.0           | % |  | 97.5    | % |  | 9           |  | 970,558    |  | 3.9           | % |  | 98.6    | %
|Washington     |  | 8                  |  | 695,460    |                   | 2.9           | % |  | 97.2    | % |  | 7           |  | 662,573    |  | 2.7           | % |  | 95.6    | %
|Oregon         |  | 6                  |  | 574,358    |                   | 2.4           | % |  | 95.4    | % |  | 7           |  | 688,359    |  | 2.8           | % |  | 92.2    | %
|Arizona        |  | 4                  |  | 480,839    |                   | 2.0           | % |  | 91.6    | % |  | 6           |  | 545,277    |  | 2.2           | % |  | 90.5    | %
|Tennessee      |  | 6                  |  | 444,234    |                   | 1.8           | % |  | 96.8    | % |  | 6           |  | 444,234    |  | 1.8           | % |  | 96.5    | %
|Illinois       |  | 3                  |  | 415,011    |                   | 1.7           | % |  | 97.4    | % |  | 3           |  | 408,211    |  | 1.7           | % |  | 97.0    | %
|Michigan       |  | 4                  |  | 368,348    |                   | 1.5           | % |  | 93.8    | % |  | 4           |  | 368,260    |  | 1.5           | % |  | 87.2    | %
|Alabama        |  | 4                  |  | 305,515    |                   | 1.3           | % |  | 85.0    | % |  | 5           |  | 468,238    |  | 1.9           | % |  | 83.1    | %
|Delaware       |  | 2                  |  | 240,418    |                   | 1.0           | % |  | 99.9    | % |  | 2           |  | 240,418    |  | 1.0           | % |  | 99.5    | %
|South Carolina |  | 2                  |  | 140,982    |                   | 0.6           | % |  | 92.0    | % |  | 3           |  | 223,315    |  | 0.9           | % |  | 94.3    | %
|New Jersey     |  | 1                  |  | 88,993     |                   | 0.4           | % |  | 98.6    | % |  | 1           |  | 88,993     |  | 0.4           | % |  | 89.4    | %
|Pennsylvania   |  | 1                  |  | 6,000      |                   |              |   |  | 100.0   | % |  | 1           |  | 6,000      |  |              |   |  | 100.0   | %
|Missouri       |  |                   |  |           |                   |              |   |  |        |   |  | 1           |  | 82,498     |  | 0.3           | % |  | 91.5    | %
|Kentucky       |  |                   |  |           |                   |              |   |  |        |   |  | 1           |  | 20,360     |  | 0.1           | % |  | 93.1    | %
|               |  |                    |  |            |                   |               |   |  |         |   |  |             |  |            |  |               |   |  |         |  
|Total          |  | 212                |  | 24,121,444 |                   | 100.0         | % |  | 92.6    | % |  | 219         |  | 24,565,776 |  | 100.0         | % |  | 91.8    | %
|               |  |                    |  |            |                   |               |   |  |         |   |  |             |  |            |  |               |   |  |         |  



27



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The following table is a list of the shopping centers summarized by state and in order of largest
holdings presented for Unconsolidated Properties:



|               |  |                    |  |           |                   |               |   |  |         |   |  |             |  |           |  |               |   |  |         |  
|-------------- |  | ------------------ |  | --------- | ----------------- | ------------- | - |  | ------- | - |  | ----------- |  | --------- |  | ------------- | - |  | ------- | -
|               |  | September 30, 2004 |  |           | December 31, 2003 |              
|Location       |  | #Properties        |  | GLA       |                   | % of TotalGLA |   |  | %Leased |   |  | #Properties |  | GLA       |  | % of TotalGLA |   |  | %Leased |  
|Florida        |  | 11                 |  | 1,204,443 |                   | 18.6          | % |  | 97.5    | % |  | 11          |  | 1,204,444 |  | 20.8          | % |  | 98.0    | %
|California     |  | 6                  |  | 881,148   |                   | 13.6          | % |  | 97.8    | % |  | 8           |  | 1,057,846 |  | 18.3          | % |  | 97.5    | %
|Illinois       |  | 6                  |  | 776,413   |                   | 12.0          | % |  | 98.7    | % |  |            |  |          |  |              |   |  |        |  
|Texas          |  | 5                  |  | 699,028   |                   | 10.8          | % |  | 92.6    | % |  | 7           |  | 918,135   |  | 15.9          | % |  | 89.2    | %
|Virginia       |  | 3                  |  | 466,394   |                   | 7.2           | % |  | 99.3    | % |  | 2           |  | 362,266   |  | 6.3           | % |  | 99.0    | %
|Colorado       |  | 3                  |  | 397,077   |                   | 6.1           | % |  | 96.1    | % |  | 3           |  | 400,602   |  | 6.9           | % |  | 99.1    | %
|Georgia        |  | 3                  |  | 351,772   |                   | 5.4           | % |  | 90.3    | % |  | 3           |  | 351,772   |  | 6.1           | % |  | 91.1    | %
|Washington     |  | 2                  |  | 351,312   |                   | 5.4           | % |  | 98.2    | % |  | 2           |  | 357,897   |  | 6.2           | % |  | 97.8    | %
|Kentucky       |  | 2                  |  | 302,669   |                   | 4.7           | % |  | 97.5    | % |  | 2           |  | 302,669   |  | 5.2           | % |  | 98.1    | %
|Oregon         |  | 2                  |  | 263,598   |                   | 4.1           | % |  | 95.7    | % |  | 1           |  | 150,356   |  | 2.5           | % |  | 92.5    | %
|Maryland       |  | 1                  |  | 206,050   |                   | 3.2           | % |  | 91.7    | % |  | 1           |  | 188,243   |  | 3.3           | % |  | 90.2    | %
|South Carolina |  | 3                  |  | 198,944   |                   | 3.1           | % |  | 100.0   | % |  | 2           |  | 116,611   |  | 2.0           | % |  | 98.5    | %
|Ohio           |  | 1                  |  | 108,903   |                   | 1.7           | % |  | 96.1    | % |  | 1           |  | 108,903   |  | 1.9           | % |  | 88.4    | %
|Arizona        |  | 1                  |  | 107,647   |                   | 1.7           | % |  | 100.0   | % |  | 1           |  | 107,629   |  | 1.9           | % |  | 96.3    | %
|North Carolina |  | 1                  |  | 79,503    |                   | 1.2           | % |  | 98.5    | % |  | 1           |  | 79,503    |  | 1.4           | % |  | 100.0   | %
|Alabama        |  | 1                  |  | 75,092    |                   | 1.2           | % |  | 100.0   | % |  | 1           |  | 75,092    |  | 1.3           | % |  | 100.0   | %
|               |  |                    |  |           |                   |               |   |  |         |   |  |             |  |           |  |               |   |  |         |  
|Total          |  | 51                 |  | 6,469,993 |                   | 100.0         | % |  | 96.7    | % |  | 46          |  | 5,781,968 |  | 100.0         | % |  | 95.7    | %
|               |  |                    |  |           |                   |               |   |  |         |   |  |             |  |           |  |               |   |  |         |  



The following
summarizes the four largest grocery tenants occupying our shopping centers at September 30, 2004:



|               |  |                     |  |                                      |   |  |                                        |  
|-------------- |  | ------------------- |  | ------------------------------------ | - |  | -------------------------------------- | -
|Grocery Anchor |  | Number ofStores (a) |  | Percentage of Company- owned GLA (b) |   |  | Percentage of Annualized Base Rent (c) |  
|Kroger         |  | 59                  |  | 11.0                                 | % |  | 7.9                                    | %
|Publix         |  | 54                  |  | 8.0                                  | % |  | 5.0                                    | %
|Safeway        |  | 53                  |  | 6.4                                  | % |  | 4.9                                    | %
|Albertsons     |  | 22                  |  | 2.8                                  | % |  | 2.1                                    | %

---

|(a) | Includes stores owned by the grocery anchor that are attached to our centers.
|--- | -----------------------------------------------------------------------------

|(b) | GLA includes 100% of the GLA in unconsolidated joint ventures.
|--- | --------------------------------------------------------------

|(c) | Annualized base rent includes only Regencys pro-rata share of rent from unconsolidated joint ventures.
|--- | -------------------------------------------------------------------------------------------------------



Liquidity and Capital Resources



General



We expect that cash generated from revenues will provide the necessary funds
on a short-term basis to pay our operating expenses, interest expense, scheduled principal payments on outstanding indebtedness, recurring capital expenditures necessary to maintain our shopping centers properly, and distributions to stock and unit
holders. Net cash provided by operating activities was $149.7 million and $136.2 million for the nine months ended September 30, 2004 and 2003, respectively. During the nine months ended September 30, 2004 and 2003, we incurred capital expenditures
of $7.7 million and $10.5 million to maintain our shopping centers, paid scheduled principal payments of $4.3 million and $4.4 million to our lenders, and paid dividends and distributions of $117.3 million and $119.6 million to our share and unit
holders, respectively.



Although base rent is supported by
long-term lease contracts, tenants who file bankruptcy are able to cancel their leases and close the related stores. In the event that a tenant with a significant number of leases in our shopping centers files bankruptcy and cancels its leases, we
could experience a



28



---

significant reduction in our revenues. We are not currently aware of any current or pending bankruptcy of any of our
tenants that would cause a significant reduction in our revenues, and no tenant represents more than 10% of our annual base rental revenues.



We expect to meet long-term capital requirements for maturing preferred units and debt, the acquisition of real estate, and the renovation or development
of shopping centers from: (i) residual cash generated from operating activities after the payments described above, (ii) proceeds from the sale of real estate, (iii) joint venturing of real estate, (iv) refinancing of debt, and (v) equity raised in
the private or public markets.



Regency currently has $400
million available for equity securities under our shelf registration and RCLP has $180 million available for debt under their shelf registration. Additionally, we have the right to call and repay, at par, outstanding preferred units beginning five
years after their issuance date, at our discretion.



We intend
to continue to grow our portfolio through new development and acquisitions, either directly or through our joint venture relationships. Because development and acquisition activities are discretionary in nature, they are not expected to burden the
capital resources we have currently available for liquidity requirements. Capital necessary to complete developments-in-process are funded from our line of credit. Regency expects that cash provided by operating activities, unused amounts available
under our line of credit and cash reserves are adequate to meet short-term and committed long-term liquidity requirements.



Shopping Center Development, Acquisitions and Sales



At September 30, 2004, we had 31 projects under construction or undergoing major renovations, which, when completed, will
represent an expected investment of $547.7 million before the estimated reimbursement of certain tenant-related costs and projected sales proceeds from adjacent land and out-parcels of $117.1 million. Costs necessary to complete these developments
are estimated to be $192.7 million, which are generally already committed as part of existing construction contracts, and will be expended through 2006. These developments are approximately 65% complete and 80% pre-leased. The costs necessary to
complete these developments will be funded from our line of credit which has a commitment amount of $500 million and a balance of $230 million at September 30, 2004. In 2004, we started three new developments for $34.2 million based on total costs
that we expect to expend through completion.



During 2004 we
sold 11 retail centers to third parties for $84.7 million, compared with eight retail centers sold for $57.6 million during the nine months ended September 30, 2003 as part of our asset recycling program. All of the centers sold in 2004 and 2003
were operating and are included in discontinued operations in our accompanying consolidated statements of operations.



We have land out-parcels adjacent to our shopping centers that we routinely develop, lease, or sell. During the nine months ended September 30, 2004 and
2003, gains related to the sale of out-parcels were $10.9 million and $4.4 million, respectively.



Investments in new developments and acquisitions, and proceeds from the sale of properties to third parties or partial sales to joint ventures are
included in investing activities in the accompanying consolidated statements of cash flows. Net cash used in investing activities was $94.9 million and $52.5 million for the nine months ended September 30, 2004 and 2003, respectively.



Investments in Real Estate Partnerships



At September 30, 2004, we had investments in real estate partnerships of
$115.9 million, primarily comprised of two partnerships, a 20% investment interest in Columbia Regency Retail Partners, LLC (Columbia), a joint venture with the Oregon Public Employees Retirement Fund



29



---

(OPERF) and a 25% investment interest in Macquarie CountryWide-Regency, LLC (MCWR), a joint
venture with an affiliate of Macquarie CountryWide Trust of Australia (MCW), a Sydney, Australia-based property trust. The purpose of these partnerships is to invest in retail shopping centers, and we have been engaged by our partners to
provide asset and property management services.



The following
is a summary of unconsolidated combined assets and liabilities of these partnerships, and our pro-rata share at September 30, 2004 and December 31, 2003 ($ amounts in thousands):



|                         |  |      |         |      |   |        
|------------------------ |  | ---- | ------- | ---- | - | -------
|                         |  | 2004 |         | 2003
|Number of Joint Ventures |  |      | 7       |      |   | 8      
|Regencys Ownership      |  |      | 20%-50% |      |   | 20%-50%
|Number of Properties     |  |      | 51      |      |   | 46     
|                         |  |     
|Combined Assets          |  | $    | 944,571 |      | $ | 812,190
|Combined Liabilities     |  |      | 434,387 |      |   | 336,340
|Combined Equity          |  |      | 510,184 |      |   | 475,850
|                         |  |     
|Regencys Share of:      |  |      |         |      |   |        
|Assets                   |  | $    | 234,610 |      | $ | 256,050
|Liabilities              |  |      | 107,892 |      |   | 106,034



As of September 30,
2004 and 2003 total unconsolidated combined net income for all joint ventures was $28.9 million and $18.3 million, and our pro-rata share was $6.9 million and $5.9 million, respectively. Any difference between the carrying amount of our investments
in real estate partnerships and the underlying equity in net assets is amortized to equity in income of investments in real estate partnerships over the depreciable life of the property, which is generally 40 years.



As of September 30, 2004, Columbia owned 19 shopping centers and had total
assets of $417.5 million. In August 2004, Columbia acquired six shopping centers for a purchase price of $119.2 million totaling approximately 900,000 square feet located in the Chicago area. We contributed $5.2 million for our proportionate share
of the purchase price. At September 30, 2004, MCWR owned 28 shopping centers and had total assets of $450.9 million. During the nine months ended September 30, 2004, MCWR had acquired two properties from us for $43.4 million, for which we received
net proceeds of $20.1 million.



On August 16, 2004, we entered
into definitive agreements with two of our joint venture partners, MCW and OPERF to acquire 24 retail properties totaling 2.6 million square feet located in the Southeastern United States. The acquisitions were completed in the fourth quarter and we
contributed $56.1 million for our proportionate share of the purchase price.



The gain we recognize on the sales of our properties to Columbia and MCWR is recorded on only the portion attributable to our joint venture partners ownership percentage. The gains and operations are not
recorded as discontinued operations because of our continuing involvement in these shopping centers. Columbia and MCWR intend to continue to acquire retail shopping centers, some of which they may acquire directly from us. For those properties
acquired from third parties, we are required to contribute our pro-rata share of the purchase price to the partnership.



In August 2004, we sold our membership interest in the Hermosa Venture 2002, LLC, an unconsolidated joint venture, to our partner and have no further
financial commitments related to the venture. In March 2004, the only two properties owned by OTR/Regency Texas Realty Holdings, L.P., an unconsolidated joint venture in which Regency has a 30% interest, were sold to a third party for $28.3 million
resulting in a gain of $8.2 million. We received $17.2 million representing $12.9 million for loan repayments and a $4.3 distribution for our interest. We recognized our share of the gain of $1.2 million in equity in income of investments in real
estate partnerships.



30



---

Debt and Equity



Outstanding debt at September 30, 2004 and December 31, 2003 consists of the following (in thousands):



|                             |  |      |           |      |          
|---------------------------- |  | ---- | --------- | ---- | ---------
|                             |  | 2004 |           | 2003
|Notes Payable:               |  |      |           |      |          
|Fixed-rate mortgage loans    |  | $    | 259,162   |      | 217,001  
|Variable-rate mortgage loans |  |      | 40,958    |      | 41,629   
|Fixed-rate unsecured loans   |  |      | 948,901   |      | 999,147  
|                             |  |      |           |      |          
|Total notes payable          |  |      | 1,249,021 |      | 1,257,777
|Unsecured line of credit     |  |      | 230,000   |      | 195,000  
|                             |  |      |           |      |          
|Total                        |  | $    | 1,479,021 |      | 1,452,777
|                             |  |      |           |      |          



Mortgage loans are
secured and may be prepaid, but could be subject to yield maintenance premiums. Mortgage loans are generally due in monthly installments of interest and principal, and mature over various terms through 2019. Variable interest rates on mortgage loans
are currently based on LIBOR, plus a spread in a range of 125 to 150 basis points. Fixed interest rates on mortgage loans range from 5.01% to 9.50%.



On March 26, 2004, we entered into a new unsecured revolving line of credit (the Line). Under the new agreement, we reduced the line
commitment from $600 million to $500 million, but have the right to expand the Line by an additional $150 million subject to additional lender syndication. The new facility has a three-year term, a one-year extension option at maturity, and an
interest rate of LIBOR plus .75% which is a reduction of 10 basis points from the previous agreement. Interest rates paid on the Line, which are based on LIBOR plus .75%, were 2.50% at September 30, 2004 and LIBOR plus .85% or 1.975% at December 31,
2003. The spread that we pay on the Line is dependent upon maintaining specific investment-grade ratings. We are also required to comply, and are in compliance, with certain financial covenants such as Minimum Net Worth, Total Liabilities to Gross
Asset Value (GAV), Secured Indebtedness to GAV and other covenants customary with this type of unsecured financing. The Line is used primarily to finance the development and acquisition of real estate, but is also available for general
working capital purposes.



As of September 30, 2004, scheduled
principal repayments on notes payable and the Line were as follows (in thousands):



|                           |  |                            |        |                     |           |               |          
|-------------------------- |  | -------------------------- | ------ | ------------------- | --------- | ------------- | ---------
|Scheduled Payments by Year |  | ScheduledPrincipalPayments |        | Term LoanMaturities |           | TotalPayments
|Current year               |  | $                          | 1,230  |                     | 21,803    |               | 23,033   
|2005                       |  |                            | 3,642  |                     | 168,516   |               | 172,158  
|2006                       |  |                            | 3,348  |                     | 21,126    |               | 24,474   
|2007 (includes the Line)   |  |                            | 3,008  |                     | 256,165   |               | 259,173  
|2008                       |  |                            | 2,823  |                     | 19,621    |               | 22,444   
|2009                       |  |                            | 2,861  |                     | 53,090    |               | 55,951   
|Beyond 5 Years             |  |                            | 18,492 |                     | 898,886   |               | 917,378  
|Unamortized debt premiums  |  |                            |       |                     | 4,410     |               | 4,410    
|                           |  |                            |        |                     |           |               |          
|Total                      |  | $                          | 35,404 |                     | 1,443,617 |               | 1,479,021
|                           |  |                            |        |                     |           |               |          



Our investments in
real estate partnerships had unconsolidated notes and mortgage loans payable of $417.3 million at September 30, 2004, and our proportionate share of these loans was $102.9 million. We do not guarantee any debt of these partnerships beyond our
ownership percentage.



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We are exposed to capital market risk such as changes in interest rates. In order to manage the
volatility related to interest-rate risk, we originate new debt with fixed interest rates, or we consider entering into interest-rate hedging arrangements. At September 30, 2004, 82% of our total debt had fixed interest rates, compared with 84% at
December 31, 2003. We intend to limit the percentage of variable interest- rate debt to be no more than 30% of total debt, which we believe to be an acceptable risk. Based upon the variable interest-rate debt outstanding at September 30, 2004, if
variable interest rates were to increase by 1%, our annual interest expense would increase by $2.7 million. We do not utilize derivative financial instruments for trading or speculative purposes. We account for derivative instruments under Statement
of Financial Accounting Standards (SFAS) No. 133, Accounting for Derivative Instruments and Hedging Activities as amended (Statement 133).



On April 1, 2004, RCLP completed the sale of $150 million ten-year senior unsecured notes (the Notes). The 4.95%
Notes are due April 15, 2014 and were priced at 99.747% to yield 4.982%. The proceeds of the offering combined with borrowings from the Line were used to repay $200 million of 7.4% notes that matured on April 1, 2004. Related to the offering, we
settled two forward-starting interest rate swaps that were initiated in 2003 totaling $144.2 million. On March 31, 2004, the interest rate swaps were settled for $5.7 million, which is recorded in other comprehensive (loss) income and is being
amortized over the ten year term of the Notes to interest expense. The swaps qualified for hedge accounting under Statement 133; and therefore, the change in fair value was recorded in other comprehensive (loss) income. After taking into effect the
hedge settlement, the effective interest rate on the Notes is 5.47%.



We have issued Preferred Units in various amounts since 1998, the net proceeds of which we used to reduce the balance of the Line. We issued Preferred Units primarily to institutional investors in private placements. The Preferred Units,
which may be called by us in 2004 and 2005, have no stated maturity or mandatory redemption, and they pay a cumulative, quarterly dividend at fixed rates ranging from 8.75% to 9.125%. At any time after ten years from the date of issuance, the
Preferred Units may be exchanged by the holders for Cumulative Redeemable Preferred Stock at an exchange rate of one share for one unit. The Preferred Units and the related Preferred Stock are not convertible into Regency common stock. At September
30, 2004 and December 31, 2003, the face value of total Preferred Units issued was $104 million and $229 million with an average fixed distribution rate of 8.93% and 8.88%, respectively. Included in Preferred Units are original issuance costs of
$2.2 million that will be expensed as the underlying Preferred Units are redeemed in the future.



On August 24, 2004 we sold 1,500,000 shares of common stock to Citigroup Global Markets Inc. The net proceeds of approximately $67 million were used to
reduce the balance of the Line.



On August 31, 2004, we sold
5,000,000 depositary shares representing 500,000 shares of Series 4 Cumulative Redeemable Preferred Stock for $125 million. The depositary shares are perpetual preferred stock, not convertible into common stock of the Company, are redeemable at par
upon our election on or after August 31, 2009, pay a 7.25% annual dividend, and have a liquidation value of $25 per depositary share. The proceeds from this offering were used to redeem $85 million of Series B 8.75% Preferred Units and $40 million
of Series C 9.0% Preferred Units. The terms of the Series 4 Preferred Stock do not contain any unconditional obligations which would require us to redeem the securities at any time or for any purpose.



On September 3, 2004, we redeemed $85 million of Series B 8.75% Preferred
Units and $40 million of Series C 9.0% Preferred Units from proceeds of the Series 4 Preferred stock offering described above. At the time of the redemptions, $3.2 million of previously deferred costs related to the original preferred units
issuance were recognized in the consolidated statements of operations as a component of minority interest of preferred units.



In summary, net cash used in financing activities related to the debt and equity activity discussed above was $34.5 million and $94.3 million for the nine
months ended September 30, 2004 and 2003, respectively.



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Critical Accounting Policies and Estimates



Knowledge about our accounting policies is necessary for a complete
understanding of our financial results, and discussions and analysis of these results. The preparation of our financial statements requires that we make certain estimates that impact the balance of assets and liabilities at a financial statement
date and the reported amount of income and expenses during a financial reporting period. These accounting estimates are based upon our judgments and are considered to be critical because of their significance to the financial statements and the
possibility that future events may differ from those judgments, or that the use of different assumptions could result in materially different estimates. We review these estimates on a periodic basis to ensure reasonableness. However, the amounts we
may ultimately realize could differ from such estimates.



Capitalization of Costs - We have an investment services group with an established infrastructure that supports the due diligence, land acquisition, construction, leasing and accounting of our development properties. All direct costs
related to these activities are capitalized. Included in these costs are interest and real estate taxes incurred during construction, as well as estimates for the portion of internal costs that are incremental and deemed directly or indirectly
related to our development activity. If future accounting standards limit the amount of internal costs that may be capitalized, or if our development activity were to decline significantly without a proportionate decrease in internal costs, we could
incur a significant increase in our operating expenses.



Valuation of Real Estate Investments - Our long-lived assets, primarily real estate held for investment, are carried at cost unless circumstances indicate that the carrying value of the assets may not be recoverable. We review long-lived
assets for impairment whenever events or changes in circumstances indicate such an evaluation is warranted. The review involves a number of assumptions and estimates used to determine whether impairment exists. Depending on the asset, we use varying
methods such as i) estimating future cash flows, ii) determining resale values by market, or iii) applying a capitalization rate to net operating income using prevailing rates in a given market. These methods of determining fair value can fluctuate
significantly as a result of a number of factors, including changes in the general economy of those markets in which we operate, tenant credit quality and demand for new retail stores. If we determine that impairment exists due to our inability to
recover an assets carrying value, a provision for loss is recorded to the extent that the carrying value exceeds estimated fair value.



Discontinued Operations - The application of current accounting principles that govern the classification of any of our properties as held for sale on the
balance sheet, or the presentation of results of operations and gains on the sale of these properties as discontinued, requires management to make certain significant judgments. In evaluating whether a property meets the criteria set forth by SFAS
Statement No. 144 Accounting for the Impairment and Disposal of Long-Lived Assets (Statement 144), the Company makes a determination as to the point in time that it can be reasonably certain that a sale will be consummated.
Given the nature of all real estate sales contracts, it is not unusual for such contracts to allow potential buyers a period of time to evaluate the property prior to formal acceptance of the contract. In addition, certain other matters critical to
the final sale, such as financing arrangements often remain pending even upon contract acceptance. As a result, properties under contract may not close within the expected time period, if at all. Due to these uncertainties, it is not likely that the
Company can meet the criteria of Statement 144 prior to the sale formally closing. Therefore, any properties categorized as held for sale represent only those properties that management has determined are probable to close within the requirements
set forth in Statement 144. The Company also makes judgments regarding the extent of involvement it will have with a property subsequent to its sale, in order to determine if the results of operations and gain on sale should be reflected as
discontinued. Consistent with Statement 144, any property sold to an entity in which the Company has significant continuing involvement (most often joint ventures) are not considered to be discontinued. In addition, any property which the Company
sells to an unrelated third party, but retains a property or asset management function, is also not considered discontinued. Thus, only properties sold, or to be sold, to unrelated third parties for which the Company, in its judgment, has no
continuing involvement are classified as discontinued.



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Income Tax Status - The prevailing assumption underlying the operation of our business is that we will
continue to operate so as to qualify as a REIT, defined under the Internal Revenue Code. We are required to meet certain income and asset tests on a periodic basis to ensure that we continue to qualify as a REIT. As a REIT, we are allowed to reduce
taxable income by all or a portion of our distributions to stockholders. We evaluate the transactions that we enter into and determine their impact on our REIT status. Determining our taxable income, calculating distributions, and evaluating
transactions requires us to make certain judgments and estimates as to the positions we take in our interpretation of the Internal Revenue Code. Because many types of transactions are susceptible to varying interpretations under federal and state
income tax laws and regulations, our positions are subject to change at a later date upon final determination by the taxing authorities.



Results from Operations



Comparison of the nine months ended September 30, 2004 to 2003



At September 30, 2004, we were operating or developing 263 shopping centers. We identify our shopping centers as either development properties or
stabilized properties. Development properties are defined as properties that are in the construction or initial lease-up process and have not reached their initial full occupancy (reaching full occupancy generally means achieving at least 93% leased
and rent paying on newly constructed or renovated square feet). All properties not categorized as development properties are considered stabilized properties. At September 30, 2004, we had 182 stabilized shopping centers that were 95.1% leased,
which excludes properties owned through unconsolidated joint ventures.



Our revenues increased by $17.5 million, or 7%, to $285.8 million in 2004. This increase was related to changes in occupancy for the combined portfolio of stabilized and development properties, growth in re-leasing rental rates, and
revenues from new developments commencing operations in 2004, net of a reduction in revenues from properties sold. In addition to collecting minimum rent from our tenants for the GLA that they lease from us, we also collect contingent rent based
upon tenant sales, which we refer to as percentage rent. Tenants are also responsible for reimbursing us for their pro-rata share of the expenses associated with operating our shopping centers. In 2004, our minimum rent increased by $13.4 million,
or 7%, and our recoveries from tenants increased $2.8 million, or 5%.



Our operating expenses increased by $16.0 million, or 12%, to $153.0 million in 2004. Our combined operating, maintenance, and real estate taxes increased by $4.3 million, or 7%, during 2004 to $70.0 million. This increase was primarily due
to new developments that incurred operating expenses for only a portion of the previous year, general increases in operating expenses on the stabilized properties. Although the three hurricanes affected 42 shopping centers in Florida, all of the
centers are operating and fully functional. Total clean-up and repair costs including those costs that will be reimbursed by our insurance coverage are estimated to be $1 million, mostly for debris removal and roof repairs.



Our general and administrative expenses were $20.3 million during 2004,
compared with $16.4 million in 2003, or 24% higher, primarily related to accruing higher incentive compensation based upon growth in net income, and costs associated with implementing new regulations for public companies imposed by the Sarbanes
Oxley Act. Our depreciation and amortization expense increased $6.7 million during the current year primarily related to new development properties placed in service during 2004.



Our net interest expense decreased to $59.9 million in 2004 from $62.6 million in 2003. Average interest rates on our
outstanding debt declined to 5.92% at September 30, 2004 compared with 6.60% at September 30, 2003, due to reductions in the LIBOR rate and the lower interest rate on the Notes discussed in Debt and Equity. Our average fixed interest rates were
7.50% at September 30, 2004, compared with 6.79% at September 30, 2003.



We account for profit recognition on sales of real estate in accordance with SFAS Statement No. 66, Accounting for Sales of Real Estate. Profits from sales of real estate will not be recognized by us unless a sale has been
consummated; the buyers initial and continuing investment is adequate to



34



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demonstrate a commitment to pay for the property; we have transferred to the buyer the usual risks and rewards of
ownership; and we do not have substantial continuing involvement with the property. Gains from the sale of operating and development properties includes $10.9 million in gains from the sale of 25 out-parcels for proceeds of $26.9 million and $5.7
million for properties sold to joint ventures. During 2003, the gains from the sale of operating and development properties included $4.4 million from the sale of 23 out-parcels for proceeds of $30.3 million and $17.2 million for properties sold to
joint ventures. These gains are included in continuing operations rather than discontinued operations because they were either properties that had no operating income, or they were properties sold to joint ventures where we have continuing
involvement through our minority investment.



We review our
real estate portfolio for impairment whenever events or changes in circumstances indicate that we may not be able to recover the carrying amount of an asset. We determine whether impairment has occurred by comparing the propertys carrying
value to an estimate of fair value based upon methods described in our Critical Accounting Policies. In the event a property is impaired, we write down the asset to fair value for held-and-used assets and to fair value less costs to sell
for held-for-sale assets.



Our income from
discontinued operations was $16.8 million in 2004 related to 11 centers sold to third parties for $84.7 million. In compliance with the adoption of Statement 144 in January 2002, if we sell an asset in the current year, we are required to reclassify
its operating income into discontinued operations for all prior periods. This practice results in a reclassification of amounts previously reported as continuing operations into discontinued operations. Reclassified operating income from
discontinued operations was $5.2 million in 2003, a result of reclassifying the historical operations of the properties sold in 2004 as well as properties sold subsequent to September 30, 2003. Our income from discontinued operations was $12.7
million in 2003 related to eight centers sold to third parties for $57.6 million.



In March of 2003, we redeemed $35 million of Series C 9% Preferred Units and $40 million of Series E 8.75% Preferred Units. At the time of redemption, the premium and $1.9 million of previously deferred costs related
to the original preferred units issuance were recognized in the consolidated statements of operations as a component of preferred unit distributions. During August of 2003, we redeemed the $80 million Series A 8.125% Preferred Units. At the
time of redemption, $1.2 million of previously deferred costs related to the original preferred units issuance were recognized in the consolidated statements of operations as a component of preferred unit distributions. On September 3, 2004,
we redeemed $85 million of Series B 8.75% Preferred Units and $40 million of Series C 9.0% Preferred Units. At the time of redemptions, $3.2 million of previously deferred cost related to the original preferred units issuance were recognized
in the consolidated statements of operations as a component of preferred unit distributions.



Net income for common unit holders was $83.5 million in 2004, compared with $75.2 million in 2003 or a 11% increase for the reasons previously discussed. Diluted earnings per unit were $1.35 in 2004, compared with
$1.23 in 2003, or 10% higher, related to the increase in net income and an increase in weighted average common units of 894,106 units.



Comparison of the three months ended September 30, 2004 to 2003



Our revenues increased by $8.7 million, or 10%, to $99.0 million in 2004. This increase was related to changes in occupancy for the combined portfolio of
stabilized and development properties, growth in re-leasing rental rates, and revenues from new developments commencing operations in 2004, net of a reduction in revenues from properties sold. During the three months ended September 30, 2004, our
minimum rent increased by $6.2 million, or 9%, and our recoveries from tenants increased $1.5 million, or 8%.



35



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Our operating expenses increased by $6.8 million, or 15%, to $53.6 million in 2004. Our combined
operating, maintenance, and real estate taxes increased by $2.4 million, or 11%, during 2004 to $24.5 million. This increase was primarily due to new developments that incurred operating expenses for only a portion of the previous year, general
increases in operating expenses on the stabilized properties.



Our general and administrative expenses were $7.2 million during the three months ended September 30, 2004, compared with $6.1 million in 2003, or 18% higher, primarily related to accruing higher incentive compensation based upon growth in
net income, and costs associated with implementing new regulations for public companies imposed by the Sarbanes Oxley Act. Our depreciation and amortization expense increased $2.3 million in 2004 compared to 2003 related to new development
properties placed in service during 2004.



Our net interest
expense decreased to $20.1 million for the three months ended September 30, 2004 from $21.2 million for the comparable period in 2003 due to interest savings related to the $150 million debt offering completed on April 1, 2004 discussed previously.



Our income from discontinued operations was $12.6 million
related to the sale of three centers to third parties for $34.4 million for the three months ended September 30, 2004 compared to $5.2 million related to the sale of three properties for $18.5 million for the comparable period in 2003. Reclassified
operating income from discontinued operations was $2.2 million in 2003, a result of reclassifying the historical operations of the properties sold in 2004 as well as properties sold subsequent to September 30, 2003.



Net income for common unit holders was $36.2 million in 2004, compared with
$30.5 million in 2003 or a 18% increase. Diluted earnings per unit were $0.58 in 2004, compared with $0.51 in 2003.



Environmental Matters



We are subject to numerous environmental laws and regulations and we are primarily concerned with dry cleaning plants that currently operate or have
operated at our shopping centers in the past. We believe that the tenants who currently operate plants do so in accordance with current laws and regulations. Generally, we use all legal means to cause tenants to remove dry cleaning plants from our
shopping centers or convert them to environmentally approved systems. Where available, we have applied and been accepted into state-sponsored environmental programs. We have a blanket environmental insurance policy that covers us against third-party
liabilities and remediation costs on shopping centers that currently have no known environmental contamination. We have also placed environmental insurance, where possible, on specific properties with known contamination, in order to mitigate our
environmental risk. We believe that the ultimate disposition of currently known environmental matters will not have a material effect on Regencys financial position, liquidity, or operations; however, we can give no assurance that existing
environmental studies with respect to our shopping centers have revealed all potential environmental liabilities; that any previous owner, occupant or tenant did not create any material environmental condition not known to us; that the current
environmental condition of the shopping centers will not be affected by tenants and occupants, by the condition of nearby properties, or by unrelated third parties; or that changes in applicable environmental laws and regulations or their
interpretation will not result in additional environmental liability to us.



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Inflation



Inflation has remained relatively low and has had a minimal impact on the operating performance of our shopping centers;
however, substantially all of our long-term leases contain provisions designed to mitigate the adverse impact of inflation. Such provisions include clauses enabling us to receive percentage rentals based on tenants gross sales, which generally
increase as prices rise; and/or escalation clauses, which generally increase rental rates during the terms of the leases. Such escalation clauses are often related to increases in the consumer price index or similar inflation indices. In addition,
many of our leases are for terms of less than ten years, which permits us to seek increased rents upon re-rental at market rates. Most of our leases require tenants to pay their share of operating expenses, including common area maintenance, real
estate taxes, and insurance and utilities, thereby reducing our exposure to increases in costs and operating expenses resulting from inflation.



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Item 3. Quantitative and Qualitative Disclosures about Market Risk



Market Risk



We are exposed to interest-rate changes primarily related to the variable
interest rate on the Line and the refinancing of long-term debt which currently contain fixed interest rates. Our interest-rate risk management objective is to limit the impact of interest-rate changes on earnings and cash flows and to lower our
overall borrowing costs. To achieve these objectives, we borrow primarily at fixed interest rates and may enter into derivative financial instruments such as interest-rate swaps, caps and treasury locks in order to mitigate our interest-rate risk on
a related financial instrument. We have no plans to enter into derivative or interest-rate transactions for speculative purposes.



Our interest-rate risk is monitored using a variety of techniques. The table below presents the principal cash flows (in thousands), weighted average
interest rates of remaining debt, and the fair value of total debt (in thousands), by year of expected maturity to evaluate the expected cash flows and sensitivity to interest-rate changes.



|                                   |  |      |        |   |      |         |   |      |        |   |      |         |   |      |        |   |      |        |   |            |         |   |       |           |            |          
|---------------------------------- |  | ---- | ------ | - | ---- | ------- | - | ---- | ------ | - | ---- | ------- | - | ---- | ------ | - | ---- | ------ | - | ---------- | ------- | - | ----- | --------- | ---------- | ---------
|                                   |  | 2004 |        |   | 2005 |         |   | 2006 |        |   | 2007 |         |   | 2008 |        |   | 2009 |        |   | Thereafter |         |   | Total |           | Fair Value
|Fixed rate debt                    |  | $    | 7,075  |   |      | 147,158 |   |      | 24,474 |   |      | 29,173  |   |      | 22,444 |   |      | 55,951 |   |            | 917,378 |   |       | 1,203,653 |            | 1,415,280
|Average interest rate for all debt |  |      | 7.01   | % |      | 6.92    | % |      | 6.91   | % |      | 6.88    | % |      | 6.88   | % |      | 6.83   | % |            | 6.45    | % |       |          |            |         
|Variable rate LIBOR debt           |  | $    | 15,958 |   |      | 25,000  |   |      |       |   |      | 230,000 |   |      |       |   |      |       |   |            |        |   |       | 270,958   |            | 270,958  
|Average interest rate for all debt |  |      | 2.00   | % |      | 1.89    | % |      |       |   |      | 1.89    | % |      |       |   |      |       |   |            |        |   |       |          |            |         



As the table
incorporates only those exposures that exist as of September 30, 2004, it does not consider those exposures or positions, which could arise after that date. Moreover, because firm commitments are not presented in the table above, the information
presented above has limited predictive value. As a result, our ultimate realized gain or loss with respect to interest-rate fluctuations will depend on the exposures that arise during the period, our hedging strategies at that time, and actual
interest rates.



Item 4. Controls and Procedures



Under the supervision and with the participation of the Partnerships
management, including the Partnerships Chief Executive Officer, Chief Operating Officer and Chief Financial Officer, the Partnership has evaluated the effectiveness of the design and operation of its disclosure controls and procedures as of
the end of the period covered by this report, and, based on their evaluation, the Chief Executive Officer, Chief Operating Officer and Chief Financial Officer have concluded that these disclosure controls and procedures are effective. There have
been no changes in the Partnerships internal controls over financial reporting identified in connection with this evaluation that occurred during the period covered by this report and that have affected, or are reasonably likely to materially
affect, the Partnerships internal controls over financial reporting.



38



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PART II



Item 1. Legal Proceedings



We are a party to various legal proceedings, which arise, in the ordinary course of our business. We are not currently involved in any
litigation nor to our knowledge, is any litigation threatened against us, the outcome of which would, in our judgment based on information currently available to us, have a material adverse effect on our financial position or results of operations.



Item 3. None



Item 4. None



Item 5. None



Item 6. Exhibits



| | (a) | Exhibits:
| | --- | ---------



|     |  |                                                       
|---- |  | ------------------------------------------------------
|31.1 |  | Rule 13a-14 Certification of Chief Executive Officer. 
|     | 
|31.2 |  | Rule 13a-14 Certification of Chief Financial Officer. 
|     | 
|31.3 |  | Rule 13a-14 Certification of Chief Operating Officer. 
|     | 
|32.1 |  | Section 1350 Certification of Chief Executive Officer.
|     | 
|32.2 |  | Section 1350 Certification of Chief Financial Officer.
|     | 
|32.3 |  | Section 1350 Certification of Chief Operating Officer.



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SIGNATURE



Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.



|                       |  |                                                                        |  |                             
|---------------------- |  | ---------------------------------------------------------------------- |  | ----------------------------
|Date: November 8, 2004 |  | REGENCY CENTERS, L.P. By: Regency Centers Corporation, General Partner
|                       |  |                                                                       
|                       |  | By:                                                                    |  | /s/ J. Christian Leavitt    
|                       |  |                                                                        |  | Senior Vice President and   
|                       |  |                                                                        |  | Principal Accounting Officer



40