<PAGE>

                                                                   Exhibit 10.32

                                    MORTGAGE

                                     MADE BY

                    GLIMCHER PROPERTIES LIMITED PARTNERSHIP,

                                  AS MORTGAGOR

                                       to

                          KEYBANK NATIONAL ASSOCIATION

                                  AS MORTGAGEE

                          Dated as of: October 17, 2003

                   PREPARED BY AND UPON RECORDATION RETURN TO:

                       Sonnenschein Nath & Rosenthal, LLP

                                8000 Sears Tower

                                233 South Wacker

                             Chicago, Illinois 60606

                              Attention: Pat Moran, Esq.

Gratiot Center, Saginaw, Michigan

                                        1
<PAGE>

                                    MORTGAGE

                             Project Common Known As
                       "Gratiot Center, Saginaw, Michigan"

         THIS MORTGAGE (this "Mortgage") is made as of October 17, 2003, by
Glimcher Properties Limited Partnership, a Delaware limited partnership
("Mortgagor") whose address is 150 East Gay Street, Columbus, Ohio 43215, and
KEYBANK NATIONAL ASSOCIATION, as administrative agent for itself and one or more
Lenders (as defined in that certain Credit Agreement bearing the date October
17, 2003 by and between Glimcher Properties Limited Partnership, a Delaware
limited partnership (the "Borrower"), such Lenders and KEYBANK NATIONAL
ASSOCIATION, as administrative agent, hereinafter the "Credit Agreement"),
(together with its successors and assigns, the "Mortgagee"), whose address is
127 Public Square, Cleveland, Ohio 44114.

1.       GRANT AND SECURED OBLIGATIONS.

         1.1      Grant. Borrower has executed and delivered to the Lenders
certain promissory notes and may in the future execute and deliver to the
Lenders additional promissory notes (the promissory notes, made in favor of the
Lenders, together with any amendments or allonges thereto, or restatements,
replacements or renewals thereof, or new promissory notes to new Lenders under
the Credit Agreement, are collectively referred to herein as the "Notes"), in
and by which the Borrower promises to pay the principal of all Loans under such
Credit Agreement and interest at the rate and in installments as provided in the
Notes, with a final payment of the outstanding principal balance and accrued and
unpaid interest being due on or before October 16, 2006. The maximum aggregate
principal amount of the Loans evidenced by the Notes shall be $150,000,000. The
indebtedness secured hereby shall be governed by the terms and conditions of the
Credit Agreement. Such Notes, as well as any repayment provisions contained in
such Credit Agreement, are hereby incorporated in this Mortgage. To the extent
there may be any inconsistency between the terms and provisions of this Mortgage
and the terms and provisions of the Credit Agreement, the terms and provisions
of the Credit Agreement shall govern and control. All capitalized terms used
herein and not otherwise defined shall have the meanings ascribed to such terms
in the Credit Agreement.

         In consideration of the debt evidenced by the Notes and the Commitments
evidenced by the Credit Agreement and to secure the timely payment of both
principal and interest in accordance with the terms and provisions of the Notes
and in accordance with the terms, provisions and limitations of this Mortgage,
to secure the payment of any and all amounts advanced by the Administrative
Agent or the Lenders with respect to the Premises for the payment of taxes,
assessments, insurance premiums or any other costs incurred in the protection of
the Premises, and to secure the performance of the covenants and agreements
contained herein and in the Notes, the Credit Agreement, the Guaranty, the
Subsidiary Guaranty and any other documents evidencing and securing the loan
secured hereby or delivered to Mortgagee pursuant to the Credit Agreement
(collectively, the "Loan Documents") to be performed by Mortgagor, and to secure
all Rate Management Transactions entered into with the Administrative Agent or
any of the Lenders in connection with the Credit Agreement, and for the purpose
of securing payment and performance of the Secured Obligations defined and
described in Section 1.2

Gratiot Center, Saginaw, Michigan

<PAGE>

below, Mortgagor hereby irrevocably and unconditionally grants, bargains, sells,
conveys, mortgages and warrants to Mortgagee, with power of sale, provided
adequate notice has been provided to Mortgagor prior to pursuit of such power of
sale, and with right of entry and possession, all estate, right, title and
interest which Mortgagor now has or may later acquire in and to the following
property (all or any part of such property, or any interest in all or any part
of it, as the context may require, the "Property"):

                  (a)      The real property located in the County of Saginaw,
         State of Michigan, as described in Exhibit A, together with all
         existing and future easements and rights affording access to it (the
         "Premises"); together with

                  (b)      All buildings, structures and improvements now
         located or later to be constructed on the Premises (the
         "Improvements"); together with

                  (c)      All existing and future appurtenances, privileges,
         easements, franchises and tenements of the Premises, including all
         minerals, oil, gas, other hydrocarbons and associated substances,
         sulphur, nitrogen, carbon dioxide, helium and other commercially
         valuable substances which may be in, under or produced from any part of
         the Premises, all development rights and credits, air rights, water,
         water rights (whether riparian, appropriative or otherwise, and whether
         or not appurtenant) and water stock, and any Premises lying in the
         streets, roads or avenues, open or proposed, in front of or adjoining
         the Premises and Improvements; together with

                  (d)      All existing and future leases, subleases,
         subtenancies, licenses, occupancy agreements and concessions ("leases")
         relating to the use and enjoyment of all or any part of the Premises
         and Improvements, and any and all guaranties and other agreements
         relating to or made in connection with any of such leases; together
         with

                  (e)      All real property and improvements on it, and all
         appurtenances and other property and interests of any kind or
         character, whether described in Exhibit A or not, which may be
         reasonably necessary or desirable to promote the present and any
         reasonable future beneficial use and enjoyment of the Premises and
         Improvements; together with

                  (f)      All goods, materials, supplies, chattels, furniture,
         fixtures, equipment and machinery now or later to be attached to,
         placed in or on, or used in connection with the use, enjoyment,
         occupancy or operation of all or any part of the Premises and
         Improvements, whether stored on the Premises or elsewhere, including
         all pumping plants, engines, pipes, ditches and flumes, and also all
         gas, electric, cooking, heating, cooling, air conditioning, lighting,
         refrigeration and plumbing fixtures and equipment, all of which shall
         be considered to the fullest extent of the law to be real property for
         purposes of this Mortgage and any manufacturer's warranties with
         respect thereto; together with

                  (g)      All building materials, equipment, work in process or
         other personal property of any kind, whether stored on the Premises or
         elsewhere, which have been or later will be acquired for the purpose of
         being delivered to, incorporated into or installed in or about the
         Premises or Improvements; together with

Gratiot Center, Saginaw, Michigan

                                       -2-
<PAGE>

                  (h)      All of Mortgagor's interest in and to all operating
         accounts pertaining to the Property and the Loan funds, whether
         disbursed or not; together with

                  (i)      All rights to the payment of money, accounts,
         accounts receivable, reserves, deferred payments, refunds, cost
         savings, payments and deposits, whether now or later to be received
         from third parties (including all earnest money sales deposits) or
         deposited by Mortgagor with third parties (including all utility
         deposits), contract rights, development and use rights, governmental
         permits and licenses, applications, architectural and engineering
         plans, specifications and drawings, as-built drawings, chattel paper,
         instruments, documents, notes, drafts and letters of credit (other than
         letters of credit in favor of Mortgagee), which arise from or relate to
         construction on the Premises or to any business now or later to be
         conducted on it, or to the Premises and Improvements generally and any
         builder's or manufacturer's warranties with respect thereto; together
         with

                  (j)      All insurance policies pertaining to the Premises and
         all proceeds, including all claims to and demands for them, of the
         voluntary or involuntary conversion of any of the Premises,
         Improvements or the other property described above into cash or
         liquidated claims, including proceeds of all present and future fire,
         hazard or casualty insurance policies and all condemnation awards or
         payments now or later to be made by any public body or decree by any
         court of competent jurisdiction for any taking or in connection with
         any condemnation or eminent domain proceeding, and all causes of action
         and their proceeds for any damage or injury to the Premises,
         Improvements or the other property described above or any part of them,
         or breach of warranty in connection with the construction of the
         Improvements, including causes of action arising in tort, contract,
         fraud or concealment of a material fact; together with

                  (k)      All of Mortgagor's rights in and to all Rate
         Management Transactions entered into with the Administrative Agent or
         any of the Lenders in connection with the Credit Agreement;

                  (l)      All books and records pertaining to any and all of
         the property described above, including computer-readable memory and
         any computer hardware or software necessary to access and process such
         memory ("Books and Records"); together with

                  (m)      All proceeds of, additions and accretions to,
         substitutions and replacements for, and changes in any of the property
         described above.

         Capitalized terms used above and elsewhere in this Mortgage without
definition have the meanings given them in the Credit Agreement referred to in
Subsection 1.2(a)(iii) below.

         1.2      Secured Obligations.

                  (a)      Mortgagor makes the grant, conveyance, and mortgage
         set forth in Section 1.1 above, and grants the security interest set
         forth in Section 3 below for the purpose of securing the following
         obligations (the "Secured Obligations") in any order of priority that
         Mortgagee may choose:

Gratiot Center, Saginaw, Michigan

                                       -3-
<PAGE>

                           (i)      Payment of all obligations at any time owing
                  under the Notes under the terms of the Credit Agreement; and

                           (ii)     Payment and performance of all obligations
                  of Mortgagor under this Mortgage; and

                           (iii)    Payment and performance of all obligations
                  of Mortgagor under the Credit Agreement; and

                           (iv)     Payment and performance of any obligations
                  of Mortgagor under any Loan Documents which are executed by
                  Mortgagor; and

                           (v)      Payment and performance of all obligations
                  of Mortgagor arising from any Rate Management Transactions
                  entered into with the Administrative Agent or any of the
                  Lenders in connection with the Credit Agreement. Rate
                  Management Transactions shall mean an interest rate hedging
                  program through the purchase by Mortgagor from the
                  Administrative Agent or any of the Lenders in connection with
                  an interest rate swap, cap or such other interest rate
                  protection product with respect to the Credit Agreement; and

                           (vi)     Payment and performance of all future
                  advances and other obligations that Mortgagor or any successor
                  in ownership of all or part of the Property may agree to pay
                  and/or perform (whether as principal, surety or guarantor) for
                  the benefit of Mortgagee, when a writing evidences the
                  parties' agreement that the advance or obligation be secured
                  by this Mortgage; and

                           (vii)    Payment and performance of all
                  modifications, amendments, extensions, and renewals, however
                  evidenced, of any of the Secured Obligations.

                  (b)      All persons who may have or acquire an interest in
         all or any part of the Property will be considered to have notice of,
         and will be bound by, the terms of the Secured Obligations and each
         other agreement or instrument made or entered into in connection with
         each of the Secured Obligations. Such terms include any provisions in
         the Note or the Credit Agreement which permit borrowing, repayment and
         reborrowing, or which provide that the interest rate on one or more of
         the Secured Obligations may vary from time to time.

2.       ASSIGNMENT OF RENTS.

         2.1      Assignment. Mortgagor hereby irrevocably, absolutely,
presently and unconditionally assigns to Mortgagee all rents, royalties, issues,
profits, revenue, income, accounts, proceeds and other benefits of the Property,
whether now due, past due or to become due, including all prepaid rents and
security deposits (some or all collectively, as the context may require,
"Rents"); provided, however, that such assignment shall be binding upon
Mortgagor only upon an Event of Default, as defined in Section 6.2 below, and
shall operate against and be binding upon occupiers of the Premises from and
after the date of (a) filing by Mortgagee in the office of the register of deeds
of Saginaw County of a notice of default by Mortgagor under the Mortgage, and
(b) service of a copy of such notice of default upon the occupiers of the
Premises.

Gratiot Center, Saginaw, Michigan

                                       -4-
<PAGE>

         2.2      Collection and Application of Rents. If an Event of Default
has occurred and is continuing, and subject to Mortgagee's compliance with the
provisions of Section 2.1 above, Mortgagee shall have the right, power and
authority to collect any and all Rents. Subject to the preceding sentence, and
in furtherance thereof, Mortgagor hereby appoints Mortgagee its attorney-in-fact
to perform any and all of the following acts, if and at the times when Mortgagee
in its sole discretion may so choose:

                  (a)      Demand, receive and enforce payment of any and all
         Rents; or

                  (b)      Give receipts, releases and satisfactions for any and
         all Rents; or

                  (c)      Sue either in the name of Mortgagor or in the name of
         Mortgagee for any and all Rents.

Mortgagee and Mortgagor agree that Mortgagee's right to the Rents does not
depend on whether or not Mortgagee files foreclosure proceedings, seeks or
obtains the appointment of a receiver, or takes possession of the Property as
permitted under Subsection 6.3(c). In Mortgagee's sole discretion, Mortgagee may
choose to collect Rents either with or without taking possession of the
Property. Mortgagee shall apply all Rents collected by it in the manner provided
under Section 6.6. If an Event of Default occurs while Mortgagee is in
possession of all or part of the Property and is collecting and applying Rents
as permitted under this Mortgage, Mortgagee and any receiver shall nevertheless
be entitled to exercise and invoke every right and remedy afforded any of them
under this Mortgage and at law or in equity.

         2.3      Mortgagee Not Responsible. Under no circumstances shall
Mortgagee have any duty to produce Rents from the Property. Regardless of
whether or not Mortgagee, in person or by agent, takes actual possession of the
Premises and Improvements, unless Mortgagee agrees in writing to the contrary,
Mortgagee is not and shall not be deemed to be:

                  (a)      A "mortgagee in possession" for any purpose; or

                  (b)      Responsible for performing any of the obligations of
         the lessor under any lease; or

                  (c)      Responsible for any waste committed by lessees or any
         other parties, any dangerous or defective condition of the Property, or
         any negligence in the management, upkeep, repair or control of the
         Property, unless caused by the gross negligence, willful misconduct or
         bad faith of Mortgagee; or

                  (d)      Liable in any manner for the Property or the use,
         occupancy, enjoyment or operation of all or any part of it.

         2.4      Leasing. Mortgagor shall not accept any deposit or prepayment
of rents under the leases for any rental period exceeding one (1) month without
Mortgagee's prior written consent. Mortgagor shall not lease the Property or any
part of it except strictly in accordance with the Credit Agreement.

Gratiot Center, Saginaw, Michigan

                                       -5-
<PAGE>

3.       GRANT OF SECURITY INTEREST.

         3.1      Security Agreement. The parties intend for this Mortgage to
create a lien on the Property, and an absolute assignment of the Rents, all in
favor of Mortgagee. The parties acknowledge that some of the Property and some
or all of the Rents may be determined under applicable law to be personal
property or fixtures. To the extent that any Property or Rents may be or be
determined to be personal property, Mortgagor as debtor hereby grants Mortgagee
as secured party a security interest in all such Property and Rents, to secure
payment and performance of the Secured Obligations. This Mortgage constitutes a
security agreement under the Uniform Commercial Code of the State in which the
Property is located, covering all such Property and Rents.

         3.2      Financing Statements. Mortgagor hereby authorizes Mortgagee to
file one or more financing statements. In addition, Mortgagor shall execute such
other documents as Mortgagee may from time to time require to perfect or
continue the perfection of Mortgagee's security interest in any Property or
Rents. As provided in Section 5.10 below, Mortgagor shall pay all fees and costs
that Mortgagee may incur in filing such documents in public offices and in
obtaining such record searches as Mortgagee may reasonably require. In case
Mortgagor fails to execute any financing statements or other documents for the
perfection or continuation of any security interest, Mortgagor hereby appoints
Mortgagee as its true and lawful attorney-in-fact to execute any such documents
on its behalf. If any financing statement or other document is filed in the
records normally pertaining to personal property, that filing shall never be
construed as in any way derogating from or impairing this Mortgage or the rights
or obligations of the parties under it.

4.       FIXTURE FILING.

         This Mortgage constitutes a financing statement filed as a fixture
filing under Article 9 of the Uniform Commercial Code in the State in which the
Property is located, as amended or recodified from time to time, covering any
Property which now is or later may become fixtures attached to the Premises or
Improvements. For this purpose, the respective addresses of Mortgagor, as
debtor, and Mortgagee, as secured party, are as set forth in the preambles of
this Mortgage.

5.       RIGHTS AND DUTIES OF THE PARTIES.

         5.1      Representations and Warranties. Mortgagor represents and
warrants that:

                  (a)      Mortgagor lawfully possesses and holds fee simple
         title to all of the Premises and Improvements;

                  (b)      Mortgagor has or will have good title to all Property
         other than the Premises and Improvements;

                  (c)      Mortgagor has the full and unlimited power, right and
         authority to encumber the Property and assign the Rents;

                  (d)      This Mortgage creates a first and prior lien on the
         Property;

Gratiot Center, Saginaw, Michigan

                                      -6-
<PAGE>

                  (e)      The Property includes all property and rights which
         may be reasonably necessary or desirable to promote the present and any
         reasonable future beneficial use and enjoyment of the Premises and
         Improvements;

                  (f)      Mortgagor owns any Property which is personal
         property free and clear of any security agreements, reservations of
         title or conditional sales contracts, and there is no financing
         statement affecting such personal property on file in any public
         office; and

                  (g)      Mortgagor's place of business, or its chief executive
         office if it has more than one place of business, is located at the
         address specified below.

         5.2      Taxes, and Assessments. Mortgagor shall, prior to delinquency,
pay or cause to be paid each installment of all taxes and special assessments of
every kind, now or hereafter levied against the Property or any part thereof,
without notice or demand, and shall provide Mortgagee with evidence of the
payment of same. Mortgagor shall pay all taxes and assessments which may be
levied upon Mortgagee's or the Lenders' interest herein or upon this Mortgage or
the debt secured hereby (excluding any income taxes or similar charges imposed
upon Mortgagee or the Lenders), without regard to any law that may be enacted
imposing payment of the whole or any part thereof upon the Mortgagee or any
Lender. Notwithstanding anything contained in this Section to the contrary,
Mortgagor shall have the right to pay or cause to be paid any such tax or
special assessment under protest or to otherwise contest any such tax or special
assessment but only if (i) such contest has the effect of preventing the
collection of such tax or special assessment so contested and also prevent the
sale or forfeiture of the Property or any part thereof or any interest therein,
(ii) Mortgagor promptly notifies Mortgagee in writing of its intent to contest
such tax or special assessment, and (iii) if so requested in writing by
Mortgagee, Mortgagor has deposited security in form and amount reasonably
satisfactory to Mortgagee, and increases the amount of such security so
deposited promptly after Mortgagee's request therefor. Mortgagor shall prosecute
or cause the prosecution of all such contest actions in good faith and with due
diligence.

         5.3      Performance of Secured Obligations. Mortgagor shall promptly
pay and perform each Secured Obligation in accordance with its terms.

         5.4      Liens, Charges and Encumbrances. Mortgagor shall immediately
discharge any lien on the Property which Mortgagee has not consented to in
writing in accordance with the terms of Section 6.16 of the Credit Agreement.

         5.5      Damages, Restoration, and Insurance Proceeds. As long as no
Event of Default has occurred and is then continuing, all insurance proceeds for
losses at the Property of less than $500,000.00 shall be adjusted with and
payable to the Mortgagor. In case of loss, Mortgagee shall have the right (but
not the obligation) to participate in and reasonably approve the settlement of
any insurance claim in excess of $500,000.00 and all claims thereafter, and
Mortgagee is at all times authorized to collect and receive any insurance money
for those claims which Mortgagee is entitled to approve the settlement of
hereunder however, notwithstanding the forgoing, if the Property is damaged and
the Borrower elects to release the Property from the Collateral Pool in
accordance with the terms of Section 2.7(c) of the Credit Agreement, upon such
release, all insurance proceeds for such damage to the Property shall be payable
to the Mortgagor.

Gratiot Center, Saginaw, Michigan

                                       -7-
<PAGE>

         At the election of Mortgagee, such insurance proceeds may be applied to
reduce the outstanding balance of the indebtedness under the Credit Agreement or
to pay for costs of repair and restoration of the Property; provided, however,
that so long as no Event of Default has occurred and is then continuing,
Mortgagee shall make such insurance proceeds available to pay for such costs of
repair and restoration. If Mortgagee is entitled to and does elect to apply
insurance proceeds in payment or reduction of the indebtedness secured hereby,
then Mortgagee shall reduce the then outstanding balance of the Advances by the
amount of the insurance proceeds received and so applied by Mortgagee. In the
event that Mortgagee does not elect to apply the insurance proceeds to the
indebtedness secured hereby as set forth above, such insurance proceeds shall be
used to reimburse Mortgagor for the cost of rebuilding or restoring the
Premises. The Premises shall be so restored or rebuilt as to be substantially
the same quality and character as the Premises were prior to such damage or
destruction in accordance with the original plans and specifications or to such
other condition as Mortgagee shall reasonably approve in writing.

         If Mortgagee elects to make the proceeds available for repair and
restoration, any request by Mortgagor for a disbursement by Mortgagee of fire or
casualty insurance proceeds and funds deposited by Mortgagor with Mortgagee
pursuant to this Section 5.5 shall be treated by Mortgagee as if such request
were for an Advance under the Credit Agreement, and the disbursement thereof
shall be conditioned upon the Borrower's compliance with and satisfaction of the
same conditions precedent as would be applicable under the Credit Agreement for
such an Advance, and during any such period that funds are available to the
Borrower for application to restore the Property, the amount of the Borrowing
Base attributable to the Property shall be determined in accordance with the
terms of the Credit Agreement. Additionally, such disbursement shall also be
conditioned upon Borrower's providing to Administrative Agent: updated title
insurance, satisfactory evidence, as reasonably determined by Administrative
Agent, that the Premises shall be so restored or rebuilt as to be of at least
equal value and quality and substantially the same character as the Premises
were prior to such damage or destruction in accordance with the original plans
and specifications or to such other condition as Administrative Agent shall
reasonably approve in writing, satisfactory evidence of the estimated cost of
completion thereof and with such architect's certificates, waivers of lien,
contractors' sworn statements and other evidence of cost and of payments as
Administrative Agent may reasonably require and approve. The undisbursed balance
of insurance proceeds shall at all times be sufficient to pay for the cost of
completion of the work free and clear of liens and if such proceeds are
insufficient, Mortgagor shall deposit the amount of such deficiency with
Mortgagee prior to the disbursement by Mortgagee of (i) any insurance proceeds
or (ii) any additional Advances under the Credit Agreement for such purpose.

         5.6      Condemnation Proceeds. Mortgagor hereby assigns, transfers and
sets over unto Mortgagee its entire interest in the proceeds (the "Condemnation
Proceeds") of any award or any claim for damages for any of the Property taken
or damaged under the power of eminent domain or by condemnation or any
transaction in lieu of condemnation ("Condemnation"), unless, notwithstanding
the forgoing, (i) such taking, damage or condemnation does not cause a material
diminution in the value of the Premises or (ii) Mortgagor elects to release the
Property in accordance with the terms of Section 2.7(c) of the Credit Agreement,
in which case, upon such release, all Condemnation Proceeds for damages to the
Property shall be payable to the Mortgagor. Mortgagee shall make available to
Mortgagor the Condemnation Proceeds for the restoration of the Premises if
Mortgagor satisfies all of the conditions set forth in this Section 5.6

Gratiot Center, Saginaw, Michigan

                                       -8-
<PAGE>

hereof for disbursement of insurance proceeds. In all other cases Mortgagee
shall have the right, at its option, to apply the Condemnation Proceeds upon or
in reduction of the indebtedness secured hereby, whether due or not. If
Mortgagee is entitled to and does elect to apply Condemnation Proceeds upon or
in reduction of the indebtedness secured hereby, then Mortgagee shall reduce the
then outstanding balance of the Advances under the Credit Agreement by the
amount of the Condemnation Proceeds received and so applied by Mortgagee and the
Borrowing Base reduced. If the Condemnation Proceeds are required to be used as
aforesaid to reimburse Mortgagor for the cost of rebuilding or restoring
buildings or improvements on the Property, or if Mortgagee elects that the
Condemnation Proceeds be so used, and the buildings and other improvements shall
be rebuilt or restored, the Condemnation Proceeds shall be paid out in the same
manner as is provided in this Section 5.6 hereof for the payment of insurance
proceeds toward the cost of rebuilding or restoration of such buildings and
other improvements. Any surplus which may remain out of the Condemnation
Proceeds after payment of such cost of rebuilding or restoration shall, at the
option of Mortgagee, be applied on account of the indebtedness secured hereby or
be paid to any other party entitled thereto.

         5.7      Maintenance and Preservation of Property.

                  (a)      Mortgagor shall insure the Property as required by
         Schedule 11 of the Credit Agreement and keep the Property in good
         condition and repair.

                  (b)      Except as required by the terms of any lease approved
         by Administrative Agent, Mortgagor shall not remove or demolish the
         Property or any material part of it in any way, or materially alter,
         restore or add to the Property, or initiate or allow any material
         change or variance in any zoning or other Premises use classification
         which adversly affects the Property or any material part of it, except
         with Mortgagee's express prior written consent in each instance; the
         term "materially" or "material" as used in this Section 5.7(b) shall
         mean having a monetary effect in an amount greater than (i) $500,000
         with respect to any Community Center and (ii) $1,000,000 with respect
         to any Regional Mall.

                  (c)      Mortgagor shall not commit or allow any act upon or
         use of the Property which would violate: (i) any applicable Laws or
         order of any Governmental Authority, whether now existing or later to
         be enacted and whether foreseen or unforeseen; or (ii) any public or
         private covenant, condition, restriction or equitable servitude
         affecting the Property. Mortgagor shall not bring or keep any article
         on the Property or cause or allow any condition to exist on it, if that
         could invalidate or would be prohibited by any insurance coverage
         required to be maintained by Mortgagor on the Property or any part of
         it under the Credit Agreement.

                  (d)      Mortgagor shall not commit or allow waste of the
         Property, including those acts or omissions characterized under the
         Credit Agreement as waste which arises out of Materials of
         Environmental Concern.

                  (e)      Mortgagor shall perform all other acts which from the
         character or use of the Property may be reasonably necessary to
         maintain and preserve its value.

Gratiot Center, Saginaw, Michigan

                                       -9-
<PAGE>

         5.8      Releases, Extensions, Modifications and Additional Security.
From time to time, Mortgagee may perform any of the following acts without
incurring any liability or giving notice to any person:

                  (a)      Release any person liable for payment of any Secured
         Obligation;

                  (b)      Extend the time for payment, or otherwise alter the
         terms of payment, of any Secured Obligation;

                  (c)      Accept additional real or personal property of any
         kind as security for any Secured Obligation, whether evidenced by deeds
         of trust, mortgages, security agreements or any other instruments of
         security;

                  (d)      Alter, substitute or release any property securing
         the Secured Obligations;

                  (e)      Consent to the making of any plat or map of the
         Property or any part of it;

                  (f)      Join in granting any easement or creating any
         restriction affecting the Property; or

                  (g)      Join in any subordination or other agreement
         affecting this Mortgage or the lien of it; or

                  (h)      Release the Property or any part of it.

         5.9      Release. If (a) Mortgagor shall fully pay all principal and
interest on the Notes, and all other indebtedness secured hereby and comply with
all of the other terms and provisions hereof to be performed and complied with
by Mortgagor, and terminate the obligations of the Lenders to make additional
advances under the Credit Agreement; or (b) Mortgagor shall comply with the
terms and conditions as set forth in Section 2.7(c) of Credit Agreement for
release of this Mortgage, Mortgagee, upon written request of Mortgagor stating
that the requirements of either clause (a) or clause (b) above have been
satisfied, shall release this Mortgage and the lien thereof by proper instrument
upon payment and discharge of the amounts required under the Credit Agreement
and payment of any filing fee in connection with such release. Mortgagor shall
pay any costs of preparation and recordation of such release.

         5.10     Compensation, Exculpation, Indemnification.

                  (a)      Mortgagor agrees to pay fees required by and pursuant
         to the Credit Agreement, for any services that Mortgagee may render in
         connection with this Mortgage, including Mortgagee's providing a
         statement of the Secured Obligations or providing the release pursuant
         to Section 5.9 above. Mortgagor shall also pay or reimburse all of
         Mortgagee's costs and expenses which may be incurred in rendering any
         such services. Mortgagor further agrees to pay or reimburse Mortgagee
         for all costs, expenses and other advances which may be incurred or
         made by Mortgagee in any efforts to enforce any terms of this Mortgage,
         including any rights or remedies afforded to Mortgagee under Section
         6.4, whether any lawsuit is filed or not, or in defending any action or
         proceeding arising under or relating to this Mortgage, including
         attorneys' fees and other legal costs, costs of any Foreclosure Sale
         (as defined in Subsection 6.4(i) below) and any cost of evidence of
         title. If Mortgagee chooses to dispose of Property

Gratiot Center, Saginaw, Michigan

                                      -10-
<PAGE>

         through more than one Foreclosure Sale, Mortgagor shall pay all costs,
         expenses or other advances that may be incurred or made by Mortgagee in
         each of such Foreclosure Sales. In any suit to foreclose the lien
         hereof or enforce any other remedy of Mortgagee under this Mortgage or
         the Note, there shall be allowed and included as additional
         indebtedness in the decree for sale or other judgment or decree all
         expenditures and expenses which may be paid or incurred by or on behalf
         of Mortgagee for reasonable attorneys' costs and fees (including the
         costs and fees of paralegals), survey charges, appraiser's fees,
         inspecting engineer's and/or architect's fees, fees for environmental
         studies and assessments and all additional expenses incurred by
         Mortgagee with respect to environmental matters, outlays for
         documentary and expert evidence, stenographers' charges, publication
         costs, and costs (which may be estimated as to items to be expended
         after entry of the decree) of procuring all such abstracts of title,
         title searches and examinations, title insurance policies, and similar
         data and assurances with respect to title as Mortgagee may deem
         reasonably necessary either to prosecute such suit or to evidence to
         bidders at any sale which may be had pursuant to such decree the true
         condition of the title to, the value of or the environmental condition
         of the Property. All expenditures and expenses of the nature in this
         Subsection mentioned, and such expenses and fees as may be incurred in
         the protection of the Property and maintenance of the lien of this
         Mortgage, including the fees of any attorney (including the costs and
         fees of paralegals) employed by Mortgagee in any litigation or
         proceeding affecting this Mortgage, the Note or the Property, including
         probate and bankruptcy proceedings, or in preparation for the
         commencement or defense of any proceeding or threatened suit or
         proceeding, shall be immediately due and payable by Mortgagor, with
         interest thereon at the Default Rate and shall be secured by this
         Mortgage.

                  (b)      Mortgagee shall not be directly or indirectly liable
         to Mortgagor or any other person as a consequence of any of the
         following:

                           (i)      Mortgagee's exercise of or failure to
                  exercise any rights, remedies or powers granted to Mortgagee
                  in this Mortgage;

                           (ii)     Mortgagee's failure or refusal to perform or
                  discharge any obligation or liability of Mortgagor under any
                  agreement related to the Property or under this Mortgage; or

                           (iii)    Any loss sustained by Mortgagor or any third
                  party resulting from Mortgagee's failure to lease the
                  Property, or from any other act or omission of Mortgagee in
                  managing the Property, after an Event of Default, unless the
                  loss is caused by the willful misconduct, gross negligence, or
                  bad faith of Mortgagee.

         Mortgagor hereby expressly waives and releases all liability of the
         types described above, and agrees that no such liability shall be
         asserted against or imposed upon Mortgagee.

                  (c)      Mortgagor agrees to indemnify Mortgagee against and
         hold it harmless from all losses, damages, liabilities, claims, causes
         of action, judgments, court costs, attorneys' fees and other legal
         expenses, cost of evidence of title, cost of evidence of value, and
         other costs and expenses which it may suffer or incur, unless caused by
         the gross negligence, willful misconduct or bad faith of the Mortgagee:

Gratiot Center, Saginaw, Michigan

                                      -11-
<PAGE>

                           (i)      In performing any act required or permitted
                  by this Mortgage or any of the other Loan Documents or by law;

                           (ii)     Because of any failure of Mortgagor to
                  perform any of its obligations; or

                           (iii)    Because of any alleged obligation of or
                  undertaking by Mortgagee to perform or discharge any of the
                  representations, warranties, conditions, covenants or other
                  obligations in any document relating to the Property other
                  than the Loan Documents.

         This agreement by Mortgagor to indemnify Mortgagee shall survive the
         release and cancellation of any or all of the Secured Obligations and
         the full or partial release of this Mortgage.

                  (d)      Mortgagor shall pay all obligations to pay money
         arising under this Section 5.9 immediately upon demand by Mortgagee.
         Each such obligation shall be added to, and considered to be part of,
         the principal of the Note, and shall bear interest from the date the
         obligation arises at the Default Rate.

         5.11     Defense and Notice of Claims and Actions. At Mortgagor's sole
expense, Mortgagor shall protect, preserve and defend the Property and title to
and right of possession of the Property, and the security of this Mortgage and
the rights and powers of Mortgagee created under it, against all adverse claims.
Mortgagor shall give Mortgagee prompt notice in writing if any claim is asserted
which does or could affect any such matters, or if any action or proceeding is
commenced which alleges or relates to any such claim.

         5.12     Subrogation. Mortgagee shall be subrogated to the liens of all
encumbrances, whether released of record or not, which are discharged in whole
or in part by Mortgagee in accordance with this Mortgage or with the proceeds of
any loan secured by this Mortgage.

         5.13     Site Visits, Observation and Testing. Mortgagee and its agents
and representatives shall have the right at any reasonable time to enter and
visit the Property for the purpose of performing appraisals, observing the
Property, and conducting non-invasive tests (unless Mortgagee has a good faith
reason to believe that the taking and removing soil or groundwater samples is
required, and in such case, conducting such tests) on any part of the Property.
Mortgagee has no duty, however, to visit or observe the Property or to conduct
tests, and no site visit, observation or testing by Mortgagee, its agents or
representatives shall impose any liability on any of Mortgagee, its agents or
representatives. In no event shall any site visit, observation or testing by
Mortgagee, its agents or representatives be a representation that Materials of
Environmental Concern are or are not present in, on or under the Property, or
that there has been or shall be compliance with any law, regulation or ordinance
pertaining to Materials of Environmental Concern or any other applicable
governmental law. Neither Mortgagor nor any other party is entitled to rely on
any site visit, observation or testing by any of Mortgagee, its agents or
representatives. Neither Mortgagee, its agents or representatives owe any duty
of care to protect Mortgagor or any other party against, or to inform Mortgagor
or any other party of, any Materials of Environmental Concern or any other
adverse condition affecting the Property. Mortgagee shall give Mortgagor
reasonable notice before entering the Property. Mortgagee shall make reasonable
efforts to avoid interfering with Mortgagor's use of the

Gratiot Center, Saginaw, Michigan

                                      -12-
<PAGE>

Property in exercising any rights provided in this Section 5.13. Notwithstanding
the foregoing, all rights granted to Mortgagee under this Section 5.13 are
subject to all rights of tenants to the Property.

         5.14     Notice of Change. Mortgagor shall give Mortgagee prior written
notice of any change in: (a) the location of its place of business or its chief
executive office if it has more than one place of business; (b) the location of
any of the Property, including the Books and Records; and (c) Mortgagor's name
or business structure. Unless otherwise approved by Mortgagee in writing, all
Property that consists of personal property (other than the Books and Records)
will be located on the Premises and all Books and Records will be located at
Mortgagor's place of business or chief executive office if Mortgagor has more
than one place of business.

6.       TRANSFERS, DEFAULT AND REMEDIES.

         6.1      Transfers. Mortgagor acknowledges that Mortgagee is making one
or more advances under the Credit Agreement in reliance on the expertise, skill
and experience of Mortgagor; thus, the Secured Obligations include material
elements similar in nature to a personal service contract. In consideration of
Mortgagee's reliance, Mortgagor agrees that Mortgagor shall not make any
transfer of the Property or transfer of its interests therein, except for leases
in the ordinary course (a "Transfer"), unless the Transfer is preceded by
Mortgagee's express written consent to the particular transaction and
transferee. Mortgagee may withhold such consent in its sole discretion.

         6.2      Events of Default. Mortgagor will be in default under this
Mortgage upon the occurrence of any one or more of the following events (some or
all collectively, "Events of Default;" any one singly, an "Event of Default"):

                  (a)      If a default shall occur with respect to covenants,
agreements and obligations of Mortgagor under this Mortgage involving the
payment of money (other than a default in the payment of principal when due as
provided in Section 7.1 of the Credit Agreement) and shall continue for a period
of five (5) business days after the due date thereof; or

                  (b)      If there is a failure to perform or observe any of
the other covenants, agreements and conditions contained in this Mortgage in
accordance with the terms hereof, and such default continues unremedied for a
period of thirty (30) days after written notice from Mortgagee to defaulting
Mortgagor of the occurrence thereof; or

                  (c)      An "Event of Default" occurs under the Credit
Agreement or any other Loan Document.

         6.3      Remedies. At any time after an Event of Default, Mortgagee
shall be entitled to invoke any and all of the rights and remedies described
below, in addition to all other rights and remedies available to Mortgagee at
law or in equity. All of such rights and remedies shall be cumulative, and the
exercise of any one or more of them shall not constitute an election of
remedies.

                  (a)      Acceleration. Upon the occurrence and continuation of
         any Event of Default above under subsections 6.2 (a) or 6.2 (b) above,
         the Property shall no longer be

Gratiot Center, Saginaw, Michigan

                                      -13-
<PAGE>

         eligible to be included in the calculation of the Borrowing Base unless
         the Required Lenders consent to its continued inclusion. Upon the
         occurrence of an Event of Default under subsection 6.2 (c) above, or if
         upon removal of the Property from the Borrowing Base, the Borrower does
         not reduce the outstanding balance of the Loans to be less than or
         equal to the recomputed Borrowing Base within the time period allowed
         under Section 2.7(b) of the Credit Agreement, then the whole of said
         principal sum hereby secured shall, at once either automatically or at
         the option of Mortgagee as described in Section 8.1 of the Credit
         Agreement, become immediately due and payable, together with accrued
         interest thereon, without any presentment, demand, protest or notice of
         any kind to Mortgagor.

                  (b)      Receiver. Mortgagee shall, as a matter of right,
         without notice and without giving bond to Mortgagor or anyone claiming
         by, under or through Mortgagor, and without regard for the solvency or
         insolvency of Mortgagor or the then value of the Property, to the
         extent permitted by applicable law, be entitled to have a receiver
         appointed for all or any part of the Property and the Rents, and the
         proceeds, issues and profits thereof, with the rights and powers
         referenced below and such other rights and powers as the court making
         such appointment shall confer, and Mortgagor hereby consents to the
         appointment of such receiver and shall not oppose any such appointment.
         Such receiver shall have all powers and duties prescribed by applicable
         law, all other powers which are necessary or usual in such cases for
         the protection, possession, control, management and operation of the
         Property, and such rights and powers as Mortgagee would have, upon
         entering and taking possession of the Property under subsection (c)
         below.

                  (c)      Entry. Mortgagee, in person, by agent or by
         court-appointed receiver, may enter, take possession of, manage and
         operate all or any part of the Property, and may also do any and all
         other things in connection with those actions that Mortgagee may in its
         sole discretion consider necessary and appropriate to protect the
         security of this Mortgage. Such other things may include: taking and
         possessing all of Mortgagor's or the then owner's Books and Records;
         entering into, enforcing, modifying or canceling leases on such terms
         and conditions as Mortgagee may consider proper; obtaining and evicting
         tenants; fixing or modifying Rents; collecting and receiving any
         payment of money owing to Mortgagee; completing any unfinished
         construction; and/or contracting for and making repairs and
         alterations. If Mortgagee so requests, Mortgagor shall assemble all of
         the Property that has been removed from the Premises and make all of it
         available to Mortgagee at the site of the Premises. Mortgagor hereby
         irrevocably constitutes and appoints Mortgagee as Mortgagor's
         attorney-in-fact to perform such acts and execute such documents as
         Mortgagee in its sole discretion may consider to be appropriate in
         connection with taking these measures, including endorsement of
         Mortgagor's name on any instruments.

                  (d)      Cure; Protection of Security. Mortgagee may cure any
         breach or default of Mortgagor, and if it chooses to do so in
         connection with any such cure, Mortgagee may also enter the Property
         and/or do any and all other things which it may in its sole discretion
         consider necessary and appropriate to protect the security of this
         Mortgage, including, without limitation, completing construction of the
         improvements at the Property contemplated by the Credit Agreement. Such
         other things may include: appearing in and/or defending any action or
         proceeding which purports to affect the

Gratiot Center, Saginaw, Michigan

                                      -14-
<PAGE>

         security of, or the rights or powers of Mortgagee under, this Mortgage;
         paying, purchasing, contesting or compromising any encumbrance, charge,
         lien or claim of lien which in Mortgagee's sole judgment is or may be
         senior in priority to this Mortgage, such judgment of Mortgagee or to
         be conclusive as among the parties to this Mortgage; obtaining
         insurance and/or paying any premiums or charges for insurance required
         to be carried under the Credit Agreement; otherwise caring for and
         protecting any and all of the Property; and/or employing counsel,
         accountants, contractors and other appropriate persons to assist
         Mortgagee. Mortgagee may take any of the actions permitted under this
         Subsection 6.3(d) either with or without giving notice to any person.
         Any amounts expended by Mortgagee under this Subsection 6.3(d) shall be
         secured by this Mortgage.

                  (e)      Uniform Commercial Code Remedies. Mortgagee may
         exercise any or all of the remedies granted to a secured party under
         the Uniform Commercial Code in the State in which the Property is
         located.

                  (f)      Foreclosure; Lawsuits. Mortgagee shall have the
         right, in one or several concurrent or consecutive proceedings, to
         foreclose the lien hereof upon the Property or any part thereof, for
         the Secured Obligations, or any part thereof, by any proceedings
         appropriate under applicable law. Mortgagee or its nominee may bid and
         become the purchaser of all or any part of the Property at any
         foreclosure or other sale hereunder, and the amount of Mortgagee's
         successful bid shall be credited on the Secured Obligations. Without
         limiting the foregoing, Mortgagee may proceed by a suit or suits in law
         or equity, whether for specific performance of any covenant or
         agreement herein contained or in aid of the execution of any power
         herein granted, or for any foreclosure under the judgment or decree of
         any court of competent jurisdiction. In addition to the right provided
         in Subsection 6.3(a), upon, or at any time after the filing of a
         complaint to foreclose this Mortgage, Mortgagee shall be entitled to
         the appointment of a receiver of the property by the court in which
         such complaint is filed, and Mortgagor hereby consents to such
         appointment.

                  (g)      Other Remedies. Mortgagee may exercise all rights and
         remedies contained in any other instrument, document, agreement or
         other writing heretofore, concurrently or in the future executed by
         Mortgagor or any other person or entity in favor of Mortgagee in
         connection with the Secured Obligations or any part thereof, without
         prejudice to the right of Mortgagee thereafter to enforce any
         appropriate remedy against Mortgagor. Mortgagee shall have the right to
         pursue all remedies afforded to a mortgagee under applicable law, and
         shall have the benefit of all of the provisions of such applicable law,
         including all amendments thereto which may become effective from time
         to time after the date hereof.

                  (h)      Sale of Personal Property. Mortgagee shall have the
         discretionary right to cause some or all of the Property, which
         constitutes personal property, to be sold or otherwise disposed of in
         any combination and in any manner permitted by applicable law.

                           (i)      For purposes of this power of sale, provided
                  adequate notice has been provided to Mortgagor prior to
                  pursuit of such power of sale, Mortgagee may elect to treat as
                  personal property any Property which is intangible or which
                  can be severed from the Premises or Improvements without
                  causing structural damage. If it chooses to do so, Mortgagee
                  may dispose of any personal property,

Gratiot Center, Saginaw, Michigan

                                      -15-
<PAGE>

                  in any manner permitted by Article 9 of the Uniform Commercial
                  Code of the State in which the Property is located, including
                  any public or private sale, or in any manner permitted by any
                  other applicable law.

                           (ii)     In connection with any sale or other
                  disposition of such Property, Mortgagor agrees that the
                  following procedures constitute a commercially reasonable
                  sale: Mortgagee shall mail written notice of the sale to
                  Mortgagor not later than thirty (30) days prior to such sale.
                  Mortgagee will publish notice of the sale in a local daily
                  newspaper of general circulation. Upon receipt of any written
                  request, Mortgagee will make the Property available to any
                  bona fide prospective purchaser for inspection during
                  reasonable business hours. Notwithstanding, Mortgagee shall be
                  under no obligation to consummate a sale if, in its judgment,
                  none of the offers received by it equals the fair value of the
                  Property offered for sale. The foregoing procedures do not
                  constitute the only procedures that may be commercially
                  reasonable.

                  (i)      Single or Multiple Foreclosure Sales. If the Property
         consists of more than one lot, parcel or item of property, Mortgagee
         may:

                           (i)      Designate the order in which the lots,
                  parcels and/or items shall be sold or disposed of or offered
                  for sale or disposition; and

                           (ii)     Elect to dispose of the lots, parcels and/or
                  items through a single consolidated sale or disposition to be
                  held or made under or in connection with judicial proceedings,
                  or by virtue of a judgment and decree of foreclosure and sale;
                  or through two or more such sales or dispositions; or in any
                  other manner Mortgagee may deem to be in its best interests
                  (any such sale or disposition, a "Foreclosure Sale;" and any
                  two or more, "Foreclosure Sales").

                  If Mortgagee chooses to have more than one Foreclosure Sale,
                  Mortgagee at its option may cause the Foreclosure Sales to be
                  held simultaneously or successively, on the same day, or on
                  such different days and at such different times and in such
                  order as Mortgagee may deem to be in its best interests. No
                  Foreclosure Sale shall terminate or affect the liens of this
                  Mortgage on any part of the Property which has not been sold,
                  until all of the Secured Obligations have been paid in full.

         6.4      Credit Bids. At any Foreclosure Sale, any person, including
Mortgagor or Mortgagee, may bid for and acquire the Property or any part of it
to the extent permitted by then applicable law. Instead of paying cash for such
property, Mortgagee may settle for the purchase price by crediting the sales
price of the property against the following obligations:

                  (a)      First, the portion of the Secured Obligations
         attributable to the expenses of sale, costs of any action and any other
         sums for which Mortgagor is obligated to pay or reimburse Mortgagee
         under Section 5.10 of this Mortgage; and

                  (b)      Second, all other Secured Obligations in any order
         and proportions as Mortgagee in its sole discretion may choose.

Gratiot Center, Saginaw, Michigan

                                      -16-
<PAGE>

         6.5      Application of Foreclosure Sale Proceeds. Mortgagee shall
apply the proceeds of any Foreclosure Sale in the following manner:

                  (a)      First, to pay the portion of the Secured Obligations
         attributable to the expenses of sale, costs of any action and any other
         sums for which Mortgagor is obligated to reimburse Mortgagee under
         Section 5.10 of this Mortgage;

                  (b)      Second, to pay the portion of the Secured Obligations
         attributable to any sums expended or advanced by Mortgagee under the
         terms of this Mortgage which then remain unpaid;

                  (c)      Third, to pay all other Secured Obligations in any
         order and proportions as Mortgagee in its sole discretion may choose;
         and

                  (d)      Fourth, to remit the remainder, if any, to the person
         or persons entitled to it.

         6.6      Application of Rents and Other Sums. Mortgagee shall apply any
and all Rents collected by it, and any and all sums other than proceeds of a
Foreclosure Sale which Mortgagee may receive or collect under Section 6.3 above,
in the following manner:

                  (a)      First, to pay the portion of the Secured Obligations
         attributable to the costs and expenses of operation and collection that
         may be incurred by Mortgagee or any receiver;

                  (b)      Second, to pay all other Secured Obligations in any
         order and proportions as Mortgagee in its sole discretion may choose;
         and

                  (c)      Third, to remit the remainder, if any, to the person
         or persons entitled to it.

Mortgagee shall have no liability for any funds which it does not actually
receive.

7.       MISCELLANEOUS PROVISIONS.

         7.1      Additional Provisions. The Loan Documents fully state all of
the terms and conditions of the parties' agreement regarding the matters
mentioned in or incidental to this Mortgage. The Loan Documents also grant
further rights to Mortgagee and contain further agreements and affirmative and
negative covenants by Mortgagor which apply to this Mortgage and to the
Property.

         7.2      No Waiver or Cure.

                  (a)      Each waiver by Mortgagee must be in writing, and no
         waiver shall be construed as a continuing waiver. No waiver shall be
         implied from any delay or failure by Mortgagee to take action on
         account of any default of Mortgagor. Consent by Mortgagee to any act or
         omission by Mortgagor shall not be construed as a consent to any other
         or subsequent act or omission or to waive the requirement for
         Mortgagee's consent to be obtained in any future or other instance.

Gratiot Center, Saginaw, Michigan

                                      -17-
<PAGE>

                  (b)      If any of the events described below occurs, that
         event alone shall not: cure or waive any breach, Event of Default or
         notice of default under this Mortgage or invalidate any act performed
         pursuant to any such default or notice; or nullify the effect of any
         notice of default or sale (unless all Secured Obligations then due have
         been paid and performed and all other defaults under the Loan Documents
         have been cured); or impair the security of this Mortgage; or prejudice
         Mortgagee or any receiver in the exercise of any right or remedy
         afforded any of them under this Mortgage; or be construed as an
         affirmation by Mortgagee of any tenancy, lease or option, or a
         subordination of the lien of this Mortgage.

                           (i)      Mortgagee, its agent or a receiver takes
                  possession of all or any part of the Property in the manner
                  provided in Subsection 6.3(c).

                           (ii)     Mortgagee collects and applies Rents as
                  permitted under Sections 2.3 and 6.6 above, either with or
                  without taking possession of all or any part of the Property.

                           (iii)    Mortgagee receives and applies to any
                  Secured Obligation any proceeds of any Property, including any
                  proceeds of insurance policies, condemnation awards, or other
                  claims, property or rights assigned to Mortgagee under Section
                  5.5 and Section 5.6 above.

                           (iv)     Mortgagee makes a site visit, observes the
                  Property and/or conducts tests as permitted under Section 5.13
                  above.

                           (v)      Mortgagee receives any sums under this
                  Mortgage or any proceeds of any collateral held for any of the
                  Secured Obligations, and applies them to one or more Secured
                  Obligations.

                           (vi)     Mortgagee or any receiver invokes any right
                  or remedy provided under this Mortgage.

         7.3      Powers of Mortgagee.

                  (a)      If Mortgagee performs any act which it is empowered
         or authorized to perform under this Mortgage, including any act
         permitted by Section 5.8 or Subsection 6.3(d) of this Mortgage, that
         act alone shall not release or change the personal liability of any
         person for the payment and performance of the Secured Obligations then
         outstanding, or the lien of this Mortgage on all or the remainder of
         the Property for full payment and performance of all outstanding
         Secured Obligations. The liability of the original Mortgagor shall not
         be released or changed if Mortgagee grants any successor in interest to
         Mortgagor any extension of time for payment, or modification of the
         terms of payment, of any Secured Obligation. Mortgagee shall not be
         required to comply with any demand by the original Mortgagor that
         Mortgagee refuse to grant such an extension or modification to, or
         commence proceedings against, any such successor in interest.

                  (b)      Mortgagee may take any of the actions permitted under
         Subsections 6.3(b) and/or 6.3(c) regardless of the adequacy of the
         security for the Secured Obligations, or whether any or all of the
         Secured Obligations have been declared to be immediately due

Gratiot Center, Saginaw, Michigan

                                      -18-
<PAGE>

         and payable, or whether notice of default and election to sell has been
         given under this Mortgage.

                  (c)      From time to time, Mortgagee may apply to any court
         of competent jurisdiction for aid and direction in executing and
         enforcing the rights and remedies created under this Mortgage.
         Mortgagee may from time to time obtain orders or decrees directing,
         confirming or approving acts in executing and enforcing these rights
         and remedies.

         7.4      Merger. No merger shall occur as a result of Mortgagee's
acquiring any other estate in or any other lien on the Property unless Mortgagee
consents to a merger in writing.

         7.5      Joint and Several Liability. If Mortgagor consists of more
than one person, each shall be jointly and severally liable for the faithful
performance of all of Mortgagor's obligations under this Mortgage.

         7.6      Applicable Law. The creation, perfection and enforcement of
the lien of this Mortgage shall be governed by the law of the State in which the
property is located. Subject to the foregoing, in all other respects, this
Mortgage shall be governed by the substantive laws of the State of Michigan.

         7.7      Successors in Interest. The terms, covenants and conditions of
this Mortgage shall be binding upon and inure to the benefit of the heirs,
successors and assigns of the parties. However, this Section 7.7 does not waive
the provisions of Section 6.1 above.

         7.8      Interpretation.

                  (a)      Whenever the context requires, all words used in the
         singular will be construed to have been used in the plural, and vice
         versa, and each gender will include any other gender. The captions of
         the sections of this Mortgage are for convenience only and do not
         define or limit any terms or provisions. The word "include(s)" means
         "include(s), without limitation," and the word "including" means
         "including, but not limited to."

                  (b)      The word "obligations" is used in its broadest and
         most comprehensive sense, and includes all primary, secondary, direct,
         indirect, fixed and contingent obligations. It further includes all
         principal, interest, prepayment charges, late charges, loan fees and
         any other fees and charges accruing or assessed at any time, as well as
         all obligations to perform acts or satisfy conditions.

                  (c)      No listing of specific instances, items or matters in
         any way limits the scope or generality of any language of this
         Mortgage. The Exhibits to this Mortgage are hereby incorporated in this
         Mortgage.

         7.9      In-House Counsel Fees. Whenever Mortgagor is obligated to pay
or reimburse Mortgagee for any attorneys' fees, those fees shall include the
reasonable and customary allocated costs for services of in-house counsel.

         7.10     Waiver of Statutory Rights. To the extent permitted by law,
Mortgagor hereby agrees that it shall not and will not apply for or avail itself
of any appraisement, valuation, stay,

Gratiot Center, Saginaw, Michigan

                                      -19-
<PAGE>

extension or exemption laws, or any so-called "Moratorium Laws," now existing or
hereafter enacted, in order to prevent or hinder the enforcement or foreclosure
of this Mortgage, but hereby waives the benefit of such laws. Mortgagor for
itself and all who may claim through or under it waives any and all right to
have the property and estates comprising the Property marshalled upon any
foreclosure of the lien hereof and agrees that any court having jurisdiction to
foreclose such lien may order the Property sold as an entirety. Mortgagor hereby
waives any and all rights of redemption from sale under any judgment of
foreclosure of this Mortgage on behalf of Mortgagor and on behalf of each and
every person acquiring any interest in or title to the Property of any nature
whatsoever, subsequent to the date of this Mortgage. The foregoing waiver of
right of redemption is made pursuant to the provisions of applicable law.

         7.11     Severability. If any provision of this Mortgage should be held
unenforceable or void, that provision shall be deemed severable from the
remaining provisions and shall in no way affect the validity of this Mortgage
except that if such provision relates to the payment of any monetary sum, then
Mortgagee may, at its option, declare all Secured Obligations immediately due
and payable.

         7.12     Notices. Any notice, demand, request or other communication
which any party hereto may be required or may desire to give hereunder shall be
in writing and shall be deemed to have been properly given (a) if hand
delivered, when delivered; (b) if mailed by United States Certified Mail
(postage prepaid, return receipt requested), three Business Days after mailing
(c) if by Federal Express or other reliable overnight courier service, on the
next Business Day after delivered to such courier service or (d) if by
telecopier on the day of transmission so long as copy is sent on the same day by
overnight courier as set forth below:

Mortgagor:                 Glimcher Properties Limited Partnership
                           150 East Gay Street
                           Columbus, Ohio 43215
                           Attention: General Counsel
                           Telephone: (614) 887-5619
                           Facsimile: (614) 621-8863

With a copy to:            Squire, Sanders, & Dempsey
                           1300 Huntington Center
                           41 South High Street
                           Columbus, Ohio 43215
                           Attention: Kim A. Rieck, Esq.
                           Telephone: (614) 365-2804
                           Facsimile: (614) 365 2499

Mortgagee:                 KeyBank National Association
                           127 Public Square
                           Cleveland, Ohio 44114
                           Attention: Real Estate Capital

Gratiot Center, Saginaw, Michigan

                                      -20-
<PAGE>

                           Phone:     216-689-4660
                           Facsimile: 216-689-4997

With a copy to:            Sonnenschein Nath & Rosenthal, LLP
                           8000 Sears Tower
                           233 South Wacker
                           Chicago, Illinois 60606
                           Attention: Pat Moran, Esq.
                           Telephone 312-876-8132
                           Facsimile 312-876-7932

or at such other address as the party to be served with notice may have
furnished in writing to the party seeking or desiring to serve notice as a place
for the service of notice.

         Any notice or demand delivered to the person or entity named above to
accept notices and demands for Mortgagor shall constitute notice or demand duly
delivered to Mortgagor, even if delivery is refused.

         7.13     Future Advances. This Mortgage is given to, and the parties
intend that it shall secure indebtedness, exclusive of interest thereon, in a
maximum amount equal to the Aggregate Commitment from time to time under the
Credit Agreement which shall be an amount up to $150,000,000 which indebtedness
may include advances made at the request of Mortgagor or its respective
successor(s) in title after this Mortgage is filed of record to the fullest
extent and with the highest priority contemplated by law (including
disbursements that the Lenders may, but shall not be obligated to, make under
this Mortgage, the Loan Documents or any other document with respect thereto)
plus interest thereon, and any disbursements made for the enforcement of this
Mortgage and any remedies hereunder, payment of taxes, special assessments,
utilities or insurance on the Property and interest on such disbursements and
all disbursements by Mortgagee pursuant to applicable law (all such indebtedness
being hereinafter referred to as the maximum amount secured hereby). This
Mortgage shall be valid and have priority to the extent of the maximum amount
secured hereby over all subsequent liens and encumbrances, including statutory
liens, excepting solely taxes and assessments levied on the Property given
priority by law. All future advances under the Credit Agreement, the Notes, this
Mortgage and the other Loan Documents shall have the same priority as if the
future advance was made on the date that this Mortgage was recorded. This
Mortgage secures future advances and is a future advance mortgage, each as
defined in Act No. 348 of the Michigan Public Acts of 1990 (MCLA 565.901 et.
seq.).

         7.14     Mortgagee's Lien for Service Charge and Expenses. At all
times, regardless of whether any Loan proceeds have been disbursed, this
Mortgage secures the payment of any and all loan commissions, service charges,
liquidated damages, expenses and advances due to or incurred by Mortgagee not to
exceed the maximum amount secured hereby. For purposes hereof, all obligations
of Mortgagor to Mortgagee under all Rate Management Transactions and any
indebtedness or obligation contained therein or evidenced thereby shall be
considered an obligation of Mortgagor secured hereby pursuant to the Credit
Agreement; provided however that in no event shall the total amount secured
hereby exceed $150,000,000.

Gratiot Center, Saginaw, Michigan

                                      -21-
<PAGE>

         7.15     Advances. The loan evidenced by the Notes is a "revolving
credit loan". The lien of the Mortgage shall secure all advances made pursuant
to the terms of the Agreement to the same extent as if such future advances were
made on the date of execution of the Mortgage, provided that such advances are
made within twenty (20) years from the date hereof. Although there may be no
indebtedness outstanding on the Note at the time any such advance is made, the
lien of the Mortgage as to third persons without actual notice thereof, shall be
valid as to all such indebtedness and future advances from the time this
Mortgage is filed for record. The total amount of the indebtedness evidenced by
the Notes and secured by the Mortgage may increase or decrease from time to
time, but the total unpaid balance so secured at any one time shall not exceed
the maximum amount specified in Section 7.14 plus interest thereon and any
disbursements made for the payment of taxes, special assessments, insurance or
other disbursements made pursuant to the terms of this Mortgage, the Credit
Agreement, or the other Loan Documents.

         7.16     WAIVER OF TRIAL BY JURY. MORTGAGOR HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHT THAT IT MAY HAVE TO A TRIAL BY
JURY IN ANY LITIGATION ARISING IN ANY WAY IN CONNECTION WITH THIS MORTGAGE, THE
NOTE, OR ANY OF THE OTHER LOAN DOCUMENTS, THE LOAN OR ANY OTHER STATEMENTS OR
ACTIONS OF MORTGAGOR OR MORTGAGEE. MORTGAGOR ACKNOWLEDGES THAT IT HAS BEEN
REPRESENTED IN THE SIGNING OF THIS MORTGAGE AND IN THE MAKING OF THIS WAIVER BY
INDEPENDENT LEGAL COUNSEL SELECTED OF ITS OWN FREE WILL, AND THAT IT HAS
DISCUSSED THIS WAIVER WITH SUCH LEGAL COUNSEL. MORTGAGOR FURTHER ACKNOWLEDGES
THAT (i) IT HAS READ AND UNDERSTANDS THE MEANING AND RAMIFICATIONS OF THIS
WAIVER, (ii) THIS WAIVER IS A MATERIAL INDUCEMENT FOR MORTGAGEE TO MAKE THE
LOAN, ENTER INTO THIS MORTGAGE AND EACH OF THE OTHER LOAN DOCUMENTS, AND (iii)
THIS WAIVER SHALL BE EFFECTIVE AS TO EACH OF SUCH OTHER LOAN DOCUMENTS AS IF
FULLY INCORPORATED THEREIN.

         7.17     Incorporation of Credit Agreement and Environmental Indemnity
Agreement. The terms and provisions of the Credit Agreement and that certain
Environmental Indemnity Agreement (the "Indemnity") dated as of even date
herewith, are incorporated herein by express reference. All advances and
indebtedness arising and accruing under the Credit Agreement from time to time,
whether or not the resulting indebtedness secured hereby may exceed the face
amount of the Notes, shall be secured hereby to the same extent as though said
Credit Agreement were fully incorporated in this Mortgage, and the occurrence of
any Event of Default under said Credit Agreement shall constitute a Event of
Default under this Mortgage entitling Mortgagee to all of the rights and
remedies conferred upon Mortgagee by the terms of both this Mortgage and the
Credit Agreement. Mortgagor hereby agrees to comply with all covenants and
fulfill all obligations set forth in the Credit Agreement and Indemnity which
pertain to the Premises as if Mortgagor were a party to such documents. In the
event of any conflict or inconsistency between the terms of this Mortgage and
the Credit Agreement or Indemnity, the terms and provisions of the Credit
Agreement or Indemnity as the case may be, shall in each instance govern and
control.

         7.18     Inconsistencies. In the event of any inconsistency between
this Mortgage and the Credit Agreement, the terms hereof shall be controlling as
necessary to create, preserve and/or

Gratiot Center, Saginaw, Michigan

                                      -22-
<PAGE>

maintain a valid security interest upon the Property, otherwise the provisions
of the Credit Agreement shall be controlling.

         7.19     Partial Invalidity; Maximum Allowable Rate of Interest.
Mortgagor and Mortgagee intend and believe that each provision in this Mortgage
and the Notes comports with all applicable local, state and federal laws and
judicial decisions. However, if any provision or provisions, or if any portion
of any provision or provisions, in this Mortgage or the Notes is found by a
court of law to be in violation of any applicable local, state or federal
ordinance, statute, law, administrative or judicial decision, or public policy,
and if such court should declare such portion, provision or provisions of this
Mortgage and the Notes to be illegal, invalid, unlawful, void or unenforceable
as written, then it is the intent both of Mortgagor and Mortgagee that such
portion, provision or provisions shall be given force to the fullest possible
extent that they are legal, valid and enforceable, that the remainder of this
Mortgage and the Notes shall be construed as if such illegal, invalid, unlawful,
void or unenforceable portion, provision or provisions were not contained
therein, and that the rights, obligations and interest of Mortgagor and
Mortgagee under the remainder of this Mortgage and the Notes shall continue in
full force and effect. All agreements herein and in the Notes are expressly
limited so that in no contingency or event whatsoever, whether by reason of
advancement of the proceeds hereof, acceleration of maturity of the unpaid
principal balance of the Notes, or otherwise, shall the amount paid or agreed to
be paid to the Holders for the use, forbearance or detention of the money to be
advanced hereunder exceed the highest lawful rate permissible under applicable
usury laws. If, from any circumstances whatsoever, fulfillment of any provision
hereof or of the Notes or any other agreement referred to herein, at the time
performance of such provision shall be due, shall involve transcending the limit
of validity prescribed by law which a court of competent jurisdiction may deem
applicable hereto, then, ipso facto, the obligation to be fulfilled shall be
reduced to the limit of such validity and if from any circumstance the Holders
shall ever receive as interest an amount which would exceed the highest lawful
rate, such amount which would be excessive interest shall be applied to the
reduction of the unpaid principal balance due under the Notes and not to the
payment of interest.

         7.20     UCC Financing Statements. Mortgagor hereby authorizes
Mortgagee to file UCC financing statements to perfect Mortgagee's security
interest in any part of the Property. In addition, Mortgagor agrees to sign any
and all other documents that Mortgagee deems necessary in its sole discretion to
perfect, protect, and continue Mortgagee's lien and security interest on the
Property.

         7.21     Applicable Law. This Mortgage shall be construed, interpreted
and governed by the laws of the State in which the Premises are located.

Gratiot Center, Saginaw, Michigan

                                      -23-
<PAGE>

         IN WITNESS WHEREOF, Mortgagor has executed this Mortgage as of the date
first above written.

                           Mortgagor:

                           GLIMCHER PROPERTIES LIMITED PARTNERSHIP,
                           a Delaware limited partnership,

                                  By: Glimcher Properties Corporation, a
                                  Delaware  corporation,   Sole  General Partner

                                        By: ____________________________________
                                            George A. Schmidt,
                                            Executive Vice President

Gratiot Center, Saginaw, Michigan

                                      -24-
<PAGE>

STATE OF ______________ )
                     ) SS:
COUNTY OF _____________ )

         Before me, a Notary Public in and for said County and State, personally
appeared George A. Schmidt, with whom I am personally acquainted (or proved to
me on the basis of satisfactory evidence), and who, upon oath, acknowledged
himself to be the Executive Vice President of Glimcher Properties Corporation, a
Delaware corporation, the Sole General Partner of Glimcher Properties Limited
Partnership, a Delaware limited partnership, and that he as such Executive Vice
President, who acknowledged execution of the foregoing Mortgage for and on
behalf of said corporation and who, being first duly sworn, stated that he/she
has been duly empowered by said corporation to execute the same.

         WITNESS my hand and Notarial Seal this ______ day of October, 2003

                                                     ___________________________
                                                     Notary Public

                                                     ___________________________
                                                     (Printed Signature)

My Commission Expires:____________

Gratiot Center, Saginaw, Michigan

                                      -25-
<PAGE>

                                    EXHIBIT A

                             DESCRIPTION OF PREMISES

Gratiot Center, Saginaw, Michigan

                                      -26-