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                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-K

(MARK ONE)
[X]    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
       ACT OF 1934 For the fiscal year ended December 31, 1999
                                       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 1-11656

                                    GENERAL GROWTH PROPERTIES, INC.
                         (Exact name of registrant as specified in its charter)
<TABLE>
<CAPTION>
<S>                                                              <C>
                    Delaware                                                        42-1283895
                    --------                                                        ----------
        (State or other jurisdiction of                                          (I.R.S. Employer
        incorporation or organization)                                        Identification Number)

         110 N. Wacker Dr., Chicago, IL                                               60606
         ------------------------------                                               -----
     (Address of principal executive offices)                                       (Zip Code)

                 (312) 960-5000
                 --------------
(Registrant's telephone number, including area code)

SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:

               TITLE OF EACH CLASS                                  NAME OF EACH EXCHANGE ON WHICH REGISTERED
               -------------------                                  -----------------------------------------
            Common Stock, $.10 par value                                       New York Stock Exchange

       Depositary Shares, each representing                                    New York Stock Exchange
    1/40 of a share of 7.25% Preferred Income
          Equity Redeemable Stock, Series A

          Preferred Stock Purchase Rights                                      New York Stock Exchange
</TABLE>

SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:    None

       Indicate by check mark whether the registrant  (1) has filed all reports
       required to be filed by Section 13 or 15(d) of the Securities  Exchange
       Act of 1934 during the preceding 12 months (or for such shorter  period
       that the registrant was required to file such reports),  and (2) has been
       subject to such filing requirements for the past 90 days.
       YES    X      NO
           ------       ------

[X]    Indicate by a check mark if disclosure of delinquent filers pursuant to
       Item 405 of Regulation S-K (ss. 229.405 of this chapter) is not contained
       herein, and will not be contained, to the best of registrant's knowledge,
       in definitive proxy or information statements incorporated by reference
       in Part III of this Form 10-K or any amendment to this Form 10-K.

As of March 14, 2000, the aggregate market value of the 48,959,071 shares of
Common Stock held by non-affiliates of the registrant was $1,395,333,523, based
upon the closing price on the New York Stock Exchange composite tape on such
date. (For this computation, the registrant has excluded the market value of all
shares of its Common Stock reported as beneficially owned by executive officers
and directors of the registrant and certain other stockholders; such exclusion
shall not be deemed to constitute an admission that any such person is an
"affiliate" of the registrant). As of March 14, 2000, there were 51,927,576
shares of Common Stock outstanding.

                       DOCUMENTS INCORPORATED BY REFERENCE
Portions of the proxy statement for the annual stockholders meeting to be held
on May 9, 2000 are incorporated by reference into Part III.


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                      PART I All references to numbered Notes are to specific
            ITEM 1. BUSINESS footnotes to the Consolidated Financial Statements
                             of the Company (as defined below) included in this
                             Annual Report on Form 10-K and the descriptions
                             included in such Notes are incorporated into the
                             applicable Item response by reference. The
                             following discussion should be read in conjunction
                             with such Consolidated Financial Statements and
                             related Notes.

             FORWARD LOOKING Forward looking statements contained in this Annual
                 INFORMATION Report on Form 10-K may include certain forward-
                             looking information statements, within the meaning
                             of Section 27A of the Securities Act of 1933, as
                             amended, and Section 21E of the Securities
                             Exchange Act of 1934, as amended, including
                             (without limitation) statements with respect to
                             anticipated future operating and financial
                             performance, growth and acquisition opportunities
                             and other similar forecasts and statements of
                             expectation. Words such as "expects",
                             "anticipates", "intends", "plans", "believes",
                             "seeks", "estimates" and "should" and variations of
                             these words and similar expressions, are intended
                             to identify these forward-looking statements.
                             Forward looking statements made by General Growth
                             Properties, Inc. ("General Growth"), its Operating
                             Partnership (as defined below) and subsidiaries
                             (collectively, the "Company") and its management
                             are based on estimates, projections, beliefs and
                             assumptions of management at the time of such
                             statements and are not guarantees of future
                             performance. The Company disclaims any obligation
                             to update or revise any forward-looking statement
                             based on the occurrence of future events, the
                             receipt of new information or otherwise.

                             Actual future performance, outcomes and results may
                             differ materially from those expressed in
                             forward-looking statements made by the Company and
                             its management as a result of a number of risks,
                             uncertainties and assumptions. Representative
                             examples of these factors include (without
                             limitation) general industry and economic
                             conditions, interest rate trends, cost of capital
                             and capital requirements, availability of real
                             estate properties, competition from other companies
                             and venues for the sale/distribution of goods and
                             services, changes in retail rent rates in the
                             Company's markets, shifts in customer demands,
                             tenant bankruptcies, changes in vacancy rates at
                             the Company's properties, changes in operating
                             expenses, including employee wages, benefits and
                             training, governmental and public policy changes,
                             changes in applicable laws, rules and regulations
                             (including changes in tax laws), the ability to
                             obtain suitable equity and/or debt financing, and
                             the continued availability of financing in the
                             amounts and on the terms necessary to support the
                             Company's future business.

                     GENERAL General Growth Properties, Inc. was formed in 1986
                             by Martin Bucksbaum and Matthew Bucksbaum (the
                             "Original Stockholders"). On April 15, 1993, an
                             initial public offering of the common stock (the
                             "Common Stock") of General Growth and certain
                             related transactions were completed. Concurrently,
                             General Growth (as general partner) and the
                             Original Stockholders (as limited partners) formed
                             GGP Limited Partnership (the "Operating
                             Partnership"). As of December 31, 1999, the Company
                             owned 100% of fifty-two regional mall shopping
                             centers (the "Wholly-Owned Centers"); 50% of the
                             stock of GGP/Homart, Inc. ("GGP/Homart"), 50% of
                             the stock of GGP/Homart II, L.L.C. ("GGP/Homart
                             II"), 51% of the stock of GGP Ivanhoe, Inc. ("GGP
                             Ivanhoe"), and 51% of the stock of GGP Ivanhoe III,
                             Inc. ("GGP Ivanhoe III"), 50% of each of two
                             regional mall shopping centers, Quail Springs Mall
                             and Town East Mall, and a non-voting preferred
                             stock interest in General Growth Management, Inc.
                             ("GGMI") (collectively, the "Unconsolidated Joint
                             Ventures"). The 50% interest in the twenty-three
                             centers owned by GGP/Homart, the 50% interest in
                             the seven centers owned by GGP/Homart II, the 51%
                             ownership interest in the two centers owned by GGP
                             Ivanhoe,

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                             the 51% ownership interest in the eight
                             centers owned by GGP Ivanhoe III, and the 50%
                             ownership interest in both Quail Springs Mall and
                             Town East Mall comprise the "Unconsolidated
                             Centers". Together, the Wholly-Owned Centers and
                             the Unconsolidated Centers comprise the "Company
                             Portfolio" or the "Portfolio Centers". On December
                             31, 1999, General Growth owned an approximate 72%
                             general partnership interest in the Operating
                             Partnership, and various minority holders,
                             including the Original Stockholders and subsequent
                             contributors of properties to the Company, owned
                             the remaining 28% limited partnership interest. See
                             Item 7 and the Consolidated Financial Statements
                             and Notes included in Item 8 of this Annual Report
                             on Form 10-K for certain financial and other
                             information required by this Item 1.

                             On December 22, 1995 the Company, jointly with four
                             other investors, acquired 100% of the stock in
                             GGP/Homart which owned substantially all of the
                             regional mall assets and liabilities of Homart
                             Development Co., an indirect wholly-owned
                             subsidiary of Sears, Roebuck & Co. The Company
                             acquired approximately 38.2% of GGP/Homart for
                             approximately $178 million including certain
                             transaction costs. All of the stockholders of
                             GGP/Homart committed to contribute up to $80.0
                             million of additional capital and, as of December
                             31, 1997 this commitment had been fulfilled. During
                             1999, three of the original four other investors,
                             in independent transactions and pursuant to their
                             respective exchange rights, exchanged their
                             interests in GGP/Homart for Common Stock of General
                             Growth. As a result of these transactions, the
                             Company currently owns a 50% interest in
                             GGP/Homart.

                             On December 22, 1995, GGP Management, Inc. ("GGP
                             Management") was formed to manage, lease, develop
                             and operate enclosed malls. The Operating
                             Partnership owned 100% of the non-voting preferred
                             stock ownership interest in GGP Management
                             representing 95% of the equity interest. Key
                             employees of the Company held the remaining 5%
                             ownership interest therein in the form of common
                             stock entitled to all of the voting rights in GGP
                             Management. In August of 1996, GGP Management
                             acquired GGMI through arm's length negotiations for
                             approximately $51.5 million, which was accounted
                             for as a purchase, by completing the following
                             steps: GGP Management borrowed approximately $39.9
                             million from the Operating Partnership, and used
                             the loan proceeds to acquire 1,555,855 newly-issued
                             shares of Common Stock from the Company. GGP
                             Management then exchanged the 1,555,855 shares of
                             Common Stock and 453,791 Operating Partnership
                             Units (contributed by the Operating Partnership)
                             for 100% of the outstanding shares in GGMI. GGP
                             Management was then merged into GGMI with GGMI as
                             the surviving entity.

                             As a result of these transactions, the Operating
                             Partnership owns all of the non-voting preferred
                             stock ownership interest in GGMI representing 95%
                             of the equity interest. Certain key employees of
                             the Company hold the remaining 5% equity interest
                             through ownership of 100% of the common stock,
                             which is entitled to all voting rights in GGMI.
                             GGMI cannot distribute funds until its available
                             cash flow exceeds all accumulated preferred
                             dividends owed to the preferred stockholder. As of
                             December 31, 1999, no such distributions by GGMI
                             have been made. Any dividends in excess of the
                             preferred cumulative dividend are allocated 95% to
                             the preferred stockholder and 5% to the common
                             stockholders. The interest only loans from the
                             Operating Partnership to GGMI bear interest at
                             rates ranging from 8% to 14% per annum and mature
                             in 2016. GGMI may make principal payments on the
                             loans if it has sufficient cash flow. GGMI manages,
                             leases, and performs various other services for the
                             Portfolio Centers and other properties owned by
                             unaffiliated parties.

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                             On September 17, 1997, GGP Ivanhoe indirectly
                             acquired The Oaks Mall in Gainesville, Florida and
                             Westroads Mall in Omaha, Nebraska. The purchase
                             price for the two properties was approximately $206
                             million of which $125 million was financed through
                             property level indebtedness. The Company
                             contributed approximately $43 million for its 51%
                             ownership interest in GGP Ivanhoe. Ivanhoe, Inc. of
                             Montreal, Canada ("Ivanhoe") owns the remaining 49%
                             ownership interest in GGP Ivanhoe.

                             Effective as of June 30, 1998, GGP Ivanhoe III
                             acquired the U.S. Prime Property, Inc. ("USPPI")
                             real estate portfolio through a merger of a
                             wholly-owned subsidiary of GGP Ivanhoe III into
                             USPPI. The common stock of GGP Ivanhoe III, which
                             has elected to be taxed as a REIT, is owned 51% by
                             the Company and 49% by Ivanhoe. The aggregate
                             consideration paid pursuant to the merger agreement
                             was approximately $625 million (less certain
                             adjustments, including a credit of approximately
                             $64 million for outstanding mortgage indebtedness
                             and accrued interest thereon as well as credits for
                             tenant allowances, construction costs, commissions,
                             due diligence items and certain miscellaneous
                             items). The acquisition was financed with a $392
                             million interim loan, which was replaced in 1999,
                             and capital contributions from the Company and the
                             joint venture partner in proportion to their
                             respective stock ownership. The properties acquired
                             include Landmark Mall in Alexandria, Virginia; the
                             Mayfair Mall and adjacent office buildings in
                             Wauwatosa (Milwaukee), Wisconsin; the Meadows Mall
                             in Las Vegas, Nevada; the Northgate Mall in
                             Chattanooga, Tennessee; Oglethorpe Mall in
                             Savannah, Georgia; and the Park City Center in
                             Lancaster, Pennsylvania. During 1999, GGP Ivanhoe
                             III acquired Oak View Mall in Omaha, Nebraska and
                             Eastridge Mall in San Jose, California. The
                             aggregate purchase price for the two properties was
                             approximately $160 million, financed by capital
                             contributions of the partners, a new $83 million
                             long-term mortgage loan and certain short-term
                             financing.

                             In November 1999, the Company formed GGP/Homart II,
                             a new joint venture with the New York State Common
                             Retirement Fund, the Company's venture partner in
                             GGP/Homart. GGP/Homart II owns three regional malls
                             contributed by the New York State Common Retirement
                             Fund (Alderwood Mall in Lynnwood (Seattle),
                             Washington; Carolina Place in Charlotte, North
                             Carolina; and Montclair Plaza in Montclair (Los
                             Angeles), California), and three regional malls
                             (Altamonte Mall in Orlando, Florida; Natick Mall in
                             Natick, Massachusetts; Northbrook Court in
                             Northbrook, Illinois) and one mall (Stonebriar
                             Centre in Frisco (Dallas), Texas) currently under
                             construction contributed by the Company as more
                             fully described in Note 3.

             BUSINESS OF THE The Company is primarily engaged in the ownership,
                     COMPANY operation, management, leasing, acquisition,
                             development, expansion and financing of regional
                             mall shopping centers in the United States.  Most
                             of the shopping centers in the Company Portfolio
                             are strategically located in major and middle
                             markets where they have strong competitive
                             positions. A detailed listing starting on page 15
                             of this report contains information on each
                             regional mall shopping center in the Company
                             Portfolio including location, year opened, square
                             footage, anchors, and anchor vacancies. The Company
                             Portfolio's geographic diversification should
                             mitigate the effects of regional economic
                             conditions and local factors.

                             The Company makes all key strategic decisions for
                             the Portfolio Centers. However, in connection with
                             the Unconsolidated Centers, such strategic
                             decisions are made jointly with the respective
                             stockholders or joint venture partners. The Company
                             is also the

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                             asset manager of the Portfolio Centers, executing
                             the strategic decisions and overseeing the
                             day-to-day activities performed by GGMI. GGMI
                             performs day-to-day property management functions
                             including leasing, construction management, data
                             processing, maintenance, accounting, marketing,
                             promotion and security pursuant to the management
                             agreements. As of December 31, 1999 GGMI was the
                             property manager for all of the Wholly-Owned
                             Centers and thirty-nine of the Unconsolidated
                             Centers. The remaining three centers, owned by
                             GGP/Homart through joint ventures, are managed by
                             certain joint venture partners of GGP/Homart.
                             During February 2000, the venture partner's 50%
                             interest in Lakeland Square, one of the three
                             centers not managed by GGMI, was purchased by
                             GGP/Homart. As a result, GGMI took over management
                             of this mall in February 2000.

                             The majority of the income from the Portfolio
                             Centers is derived from rents received through long
                             term leases with retail tenants. The long-term
                             leases require the tenants to pay base rent which
                             is a fixed amount specified in the lease. The base
                             rent is often subject to scheduled increases
                             defined in the lease. Another component of income
                             is percentage rent. Percentage rent is paid by the
                             tenant if their sales exceed an agreed upon minimum
                             annual amount. Percentage rent is calculated by
                             multiplying the sales in excess of the minimum
                             annual amount by a percentage defined in the lease.
                             Long-term leases generally contain a provision for
                             the lessor to recover certain expenses incurred in
                             the day-to-day operations including common area
                             maintenance and real estate taxes. The recovery is
                             generally related to the tenant's pro-rata share of
                             space in the property.

                             The evolution of the shopping center business
                             necessitates the implementation of new approaches
                             to shopping center management and leasing.
                             Management's strategies to increase shareholder
                             value and cash flow include the integration of mass
                             merchandise retailers with traditional department
                             stores, specialty leasing, entertainment-oriented
                             tenants, proactive property management and leasing,
                             operating cost reductions including those resulting
                             from economies of scale, strategic expansions and
                             acquisitions, e-business initiatives and selective
                             new shopping center developments. Management
                             believes that these approaches should enable the
                             Company to operate and grow successfully in today's
                             value-oriented and technological environment.
                             Following is a summary of recent acquisition,
                             development and expansion and redevelopment
                             activity.

                             As used in this Annual report, the term "GLA"
                             refers to gross leaseable retail space, including
                             Anchors and mall tenant areas; the term "Mall GLA"
                             refers to gross leaseable retail space, excluding
                             Anchors; the term "Anchor" refers to a department
                             store or other large retail store; the term "Mall
                             Stores" refers to stores (other than Anchors) that
                             are typically specialty retailers who lease space
                             in shopping centers; and the term "Freestanding
                             GLA" means gross leaseable area of freestanding
                             retail stores in locations that are not attached to
                             the primary complex of buildings that comprise a
                             regional mall shopping center.

               ACQUISITIONS  The Company continues to seek to acquire properties
                             that provide opportunities for enhanced
                             profitability and appreciation in value and
                             corresponding increases in shareholder value. In
                             1999, the Company acquired 100% ownership interests
                             in three regional malls and partial ownership
                             interests in five additional regional malls for an
                             aggregate investment by the Company of
                             approximately $1,170 million. The following is a
                             summary description of the acquisitions made by the
                             Company since December 31, 1998.

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                             On January 11, 1999, the Company acquired a 100%
                             ownership interest in the Crossroads Mall in
                             Kalamazoo, Michigan for a purchase price of
                             approximately $68 million. The Company utilized a
                             $45 million long-term mortgage loan and interim
                             loan proceeds to finance this acquisition.

                             On July 30, 1999, the Company acquired 100% of the
                             Ala Moana Center in Honolulu, Hawaii, as more fully
                             described in Note 3. The transaction was funded by
                             a new $438 million short-term first mortgage loan
                             and approximately $294 million in cash including a
                             portion of the net proceeds of the 1999 Offering as
                             further described in Note 1. The Company repaid the
                             short-term mortgage loan in August 1999 through the
                             issuance of $500 million of commercial
                             mortgage-backed securities maturing September 2004
                             (assuming the exercise of extension options
                             aggregating two years) as more fully described in
                             Note 5. The Company may discuss with institutional
                             investors the formation of a new joint venture to
                             own the property. The terms of any joint venture
                             and the Company's interest in any joint venture,
                             have not been determined and the Company may not
                             ultimately elect to form any such joint venture.

                             On September 28, 1999 the Company, through GGP
                             Ivanhoe III, acquired the Oak View Mall and on
                             December 22, 1999 acquired the Eastridge Mall in
                             San Jose, California. The aggregate purchase price
                             for the two properties was approximately $160
                             million, financed by capital contributions from the
                             partners, a new $83 million long-term mortgage loan
                             and approximately $30 million of other short-term
                             floating rate financing.

                             In October 1999, the Company acquired a 100%
                             interest in the Baybrook Mall in Houston, Texas.
                             The aggregate purchase price was approximately $133
                             million, which was paid with a new 10 year $95
                             million mortgage on the property and proceeds of
                             other new secured financing.

                             In November 1999, the Company formed GGP/Homart II,
                             a new joint venture with the New York State Common
                             Retirement Fund, its venture partner in GGP/Homart.
                             GGP/Homart II owns six operating regional malls and
                             one regional mall currently under construction as
                             more fully described in Note 4.

                             The Company's management feels that it has a
                             competitive advantage with respect to the
                             acquisition of regional mall shopping centers for
                             the following reasons:

                             -        The funds necessary for a cash acquisition
                                      of a shopping center may be available to
                                      the Company from a combination of sources,
                                      including mortgage or unsecured financing
                                      or the issuance of public or private debt
                                      or equity.

                             -        The Company has the flexibility to pay for
                                      an acquisition with a combination of cash,
                                      Preferred or Common Stock or common units
                                      of limited partnership interest in the
                                      Operating Partnership (the "Units"). This
                                      creates the opportunity for a
                                      tax-advantaged transaction for the seller

                             -        Management's expertise allows it to
                                      evaluate proposed acquisitions for their
                                      increased profit potential. Additional
                                      profit can originate from many sources
                                      including expansions, remodeling,
                                      re-merchandising, and more efficient
                                      management of the property

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                DEVELOPMENT  The Company intends to pursue development when
                             warranted by the potential financial returns.
                             RiverTown Crossings in Grandville, Michigan was
                             completed and opened in November 1999. GGP/Homart
                             II is currently developing an enclosed shopping
                             center in Frisco (Dallas), Texas and the Company is
                             preparing to develop (with a joint venture partner)
                             an enclosed regional mall in Westlake (Dallas),
                             Texas as described below.

                             RiverTown Crossings in Grandville, Michigan is an
                             approximately 1,100,000 square foot regional mall
                             including five anchor stores. The funding for the
                             development of this project came from a
                             construction loan, the Company's line of credit
                             facility ("Credit Facility") and retained cash flow
                             of the Company. RiverTown Crossings was 100% leased
                             at its grand opening.

                             The Company broke ground on the construction of the
                             Stonebriar Centre in Frisco, Texas in October 1998.
                             Upon its scheduled completion in August of 2000,
                             this 1,600,000 square foot regional mall shopping
                             center will initially feature five department store
                             anchors, a 24 screen AMC theater, approximately
                             350,000 square feet of Mall Stores and up to
                             150,000 square feet of big box or large format
                             retailers. Plans also include a possible second
                             phase expansion to include two additional
                             department stores. As of December 31, 1999,
                             approximately $73 million of construction costs has
                             been spent, primarily funded by the Company's
                             Credit Facility and other joint venture and secured
                             financing and retained cash flow. This mall was
                             contributed to GGP/Homart II in 1999 as part of the
                             joint venture formation transaction discussed
                             above.

                             During 1999, the Company formed a joint venture to
                             develop an enclosed mall in Westlake (Dallas),
                             Texas. As of December 31, 1999, the Company has
                             invested approximately $12.8 million in the joint
                             venture. The Company is currently obligated to fund
                             pre-development costs (estimated to be
                             approximately $1.5 million, most of which remains
                             to be incurred) and actual development costs have
                             not yet been finalized. The retail site, part of a
                             planned community which is expected to contain a
                             resort hotel, a golf course, luxury homes and
                             corporate offices, is currently planned to contain
                             up to 1.6 million square feet of tenant space
                             including up to six anchor stores and a
                             multi-screen theater. There can be no assurance
                             that development of this site will proceed beyond
                             the pre-development phase.

              EXPANSIONS AND During 1999, 21 major projects were underway or
                 RENOVATIONS completed. The expansion and renovation of a
                             Portfolio Center often increases customer traffic,
                             trade area penetration and typically improves the
                             competitive position of the property.  Four of the
                             larger renovation and expansion projects
                             undertaken or completed in 1999 are described
                             below.

                             The redevelopment of an Anchor location at the
                             Northridge Fashion Center, a 1,465,261 square foot
                             center located in Northridge (Los Angeles),
                             California was completed in the summer of 1999. The
                             project included adding a 48,000 square foot
                             theater complex and a new outdoor retail /
                             entertainment area containing approximately 168,000
                             square feet of Mall Stores.

                             Eden Prairie Mall, located in Eden Prairie,
                             Minnesota, a suburb of Minneapolis, was previously
                             a four-anchor center with approximately 325,000
                             square feet of Mall Stores. Phase I of the
                             renovation commenced in early 1999 consisting of a
                             new 160,000 square foot building with a
                             multi-screen theater, 4 restaurants and a Barnes
                             and Noble bookstore. Construction of Phase II of
                             the project recently commenced and will consist

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<PAGE>   8

                             of a Von Maur anchor store and a new 500 car
                             parking structure. Both phases are scheduled to be
                             completed in early 2001.

                             Market Place Mall is an 821,117 square foot
                             enclosed mall located in Champaign, Illinois and
                             anchored by Bergner's, JCPenney and Sears. The
                             renovation and expansion of the mall consisting of
                             a new 150,000 square foot Famous-Barr department
                             store, approximately 43,000 square feet of
                             additional Mall Store space, a new food court, a
                             new service center and other customer amenities was
                             recently completed.

                             Park Mall, an 965,371 square foot center located in
                             Tucson, Arizona is undergoing a remodeling and
                             expansion to 1,350,000 square feet. The mall has
                             added a new Dillards store to the existing anchors,
                             Macy's and Sears. The project also includes a food
                             court, a multiplex theater and an outdoor plaza for
                             fine dining, and is expected to be completed during
                             2001.

       THE PORTFOLIO CENTERS All of the 93 Portfolio Centers are shopping
                             centers with at least one major department store
                             as an Anchor and a wide variety of smaller Mall
                             Stores. Most of the Portfolio Centers have three
                             or four Anchors and additional Freestanding Stores.
                             Each Portfolio Center provides ample parking for
                             shoppers. The Portfolio Centers:

                             -        Range in size between approximately
                                      184,000 and 1,780,000 square feet of total
                                      GLA and between approximately 125,000 and
                                      867,000 square feet of Mall and
                                      Freestanding GLA. The smallest Portfolio
                                      Center has approximately 20 stores, and
                                      the largest has over 265 stores;

                             -        Have  approximately  380  Anchors,
                                      operating  under  approximately  60 trade
                                      names; and

                             -        Have approximately 9,500 Mall and
                                      Freestanding Stores.

                             The average size of the 93 Portfolio Centers is
                             approximately 890,000 square feet of GLA, including
                             all Anchors, Mall Stores and Freestanding Stores.
                             The average Mall and Freestanding GLA per Portfolio
                             Center is approximately 385,000 square feet.

                             As of December 31, 1999, the Wholly-Owned Centers
                             contained approximately 41.9 million square feet of
                             GLA consisting of Anchors (whether owned or
                             leased), Mall Stores and Freestanding Stores. The
                             Unconsolidated Centers contained approximately 41.3
                             million square feet of GLA.

                             The Company's share of total revenues from the
                             Portfolio Centers and GGMI increased to $907
                             million in 1999 from $627.9 million in 1998. No
                             single Portfolio Center generated more than 7% of
                             the Company's total 1999 pro rata revenues. In
                             1999, total Mall Store sales from the Portfolio
                             Centers increased by approximately 10.1% in
                             comparison to the total Mall Store sales in 1998.

                                    8 of 39

<PAGE>   9




                             The table below shows tenants, by trade name, with
                             more than .75% of annualized effective rents as
                             compared to consolidated effective rents on an
                             annualized basis in the Wholly-Owned Centers at
                             December 31, 1999. In addition, similar percentages
                             existed in the Portfolio Centers as of December 31,
                             1999.

                                                                    % OF TOTAL
                                TENANT NAME                     ANNUALIZED RENTS
                                -----------                     ----------------

                                JCPenney                              1.69%
                                Sears                                 1.43%
                                Victoria's Secret (1)                 1.18%
                                Express (1)                           1.18%
                                Footlocker                            1.17%
                                Gap                                   1.01%
                                Lane Bryant (1)                       0.96%
                                Payless                               0.94%
                                Lerner New York (1)                   0.92%
                                Kay-Bee Toys                          0.92%
                                Disney Store                          0.86%
                                Disc Jockey                           0.82%
                                The Limited (1)                       0.79%

                            (1) Under common ownership by The Limited, Inc.


                    MALL AND The Portfolio Centers have a total of
         FREESTANDING STORES approximately 9,500 Mall and Freestanding Stores.
                             The following table reflects the tenant
                             representation by category in the Wholly-Owned
                             Centers as of December 31, 1999. In addition,
                             similar tenant representation by category
                             existed in the Portfolio Centers as of December 31,
                             1999.

<TABLE>
<CAPTION>
                                                % OF SQ. FT. IN
                                                 WHOLLY-OWNED
                             TENANT CATEGORIES      CENTERS                 TYPES OF TENANTS/PRODUCTS SOLD
                             -----------------      -------      --------------------------------------------------
<S>                                                <C>          <C>
                                Specialty             21%        Photo studios, beauty and nail salons, pharmacy
                                                                 and sundries, variety stores, pet stores,
                                                                 newsstands, jewelry repair, shoe repair, tailor,
                                                                 video games, shops for home/bath/kitchen, rugs,
                                                                 fabric stores, beds/waterbeds, luggage, perfume,
                                                                 tobacco, toys, arcades, cameras, sunglasses,
                                                                 books
                             --------------------------------------------------------------------------------------
                                Women's Apparel       19%        Women's apparel
                                Apparel               16%        Unisex apparel, children's apparel, lingerie, and
                                                                 formalwear
                             --------------------------------------------------------------------------------------
                                Shoes                 12%        Shoes
                             --------------------------------------------------------------------------------------
                                Food                   8%        Restaurant, food court
                             --------------------------------------------------------------------------------------
                                Gifts                  7%        Cards, candles, engraving stores, other gift or
                                                                 novelty
                             --------------------------------------------------------------------------------------
                                Music/Electronics      6%        Music, electronics, computer and software, video
                                                                 rental
                             --------------------------------------------------------------------------------------
                                Sporting Goods         4%        Sports apparel, sports and exercise equipment
                             --------------------------------------------------------------------------------------
</TABLE>

                                    9 of 39

<PAGE>   10


<TABLE>
<S>                                                <C>          <C>

                                Jewelry                3%        Fine jewelry and costume jewelry
                             --------------------------------------------------------------------------------------
                                Men's Apparel          2%        Men's apparel
                             --------------------------------------------------------------------------------------
                                Specialty Food         2%        Candy, coffee, nuts, chocolate, health
                                                                 food/vitamins
                             --------------------------------------------------------------------------------------

                                Total                100%
</TABLE>



                             Specialty tenants include Mastercuts, One Hour
                             Photo, California Nails, Lechter's, Kay-Bee Toys,
                             Dollar Tree, Pottery Barn and many others. Typical
                             tenants in the Women's Apparel category include The
                             Limited, Casual Corner, Lane Bryant and Victoria's
                             Secret. The Apparel category typically includes
                             tenants such as The Gap, Eddie Bauer, American
                             Eagle, Old Navy and J.Crew. The Shoes category
                             includes tenants such as Footlocker and Payless
                             Shoesource. The Food category includes restaurants
                             such as Ruby Tuesday and Max and Erma's, fast food
                             restaurants such as Arby's, and food court tenants
                             such as Sbarro. Typical tenants in the Gifts
                             Category include Disney, Things Remembered,
                             Kirlin's Hallmark and Spencer Gifts. The
                             Music/Electronics category includes tenants such as
                             Camelot Music, Radio Shack, and Suncoast Pictures.
                             Sporting Goods include tenants such as Champs, Big
                             5 Sports and Scheel's Sports. Jewelry tenants
                             typically include Zales, Friedman's Jewelers and
                             Kay Jewelers. The Men's Apparel category includes
                             tenants such as The Men's Warehouse and Nicks for
                             Men. Specialty Food tenants include General
                             Nutrition Center, Mr. Bulky, and Barnie's Coffee
                             and Tea Company.

                 COMPETITION The Portfolio Centers compete with numerous
                             shopping alternatives in seeking to attract
                             retailers to lease space as retailers themselves
                             face increasing competition from discount
                             shopping centers, outlet malls, discount shopping
                             clubs, direct mail, internet sales and
                             telemarketing. The nature and extent of competition
                             varies from property to property within the Company
                             Portfolio. Below is a description of the type of
                             competition that three of the Portfolio Centers
                             face from other retail locations within their trade
                             area. These examples are representative of the
                             comparative environment in which the Company
                             operates.

                             Northridge Fashion Center is a 1.5 million square
                             foot, two-story enclosed regional shopping center
                             located in Northridge, California, 25 miles
                             northwest of Los Angeles. The mall opened in 1971
                             and was extensively rebuilt and retrofitted after
                             damage from the Northridge earthquake in 1994.
                             Northridge serves a ten-mile radius trade area
                             which includes over 1.1 million people. Major
                             employees in the area include Walt Disney, Boeing
                             and Hughes Electronics. The mall currently has four
                             Anchor tenants: Robinson-May, JCPenney, Macy's, and
                             Sears. The mall has over 180 mall shops with
                             national retailers such as Old Navy, Borders Books
                             and Zainy Brainy. Northridge's regional mall
                             competition within its trade area consists of
                             Topanga Plaza, a four Anchor mall built in 1964
                             located four miles southwest of the center and
                             Sherman Oaks Fashion Center, a two Anchor enclosed
                             mall built in 1963, 10 miles southeast of
                             Northridge. The mall also faces competition from
                             neighborhood strip shopping centers which are
                             located within a few miles of the center.

                             Northbrook Court is a two-story, 978,000 square
                             foot regional mall located in Northbrook, Illinois.
                             The mall contains 128 mall shops, and three Anchor
                             department stores. The mall is anchored by Lord &
                             Taylor, Marshall Fields and Neiman-Marcus. The
                             property includes a 14-screen General Cinema
                             Theater and national retailers such as Abercrombie
                             & Fitch, Ann Taylor, The Gap and J.Crew. Northbrook
                             Court faces

                                    10 of 39
<PAGE>   11

                             competition from two regional malls in
                             its primary trade area. Old Orchard Shopping Center
                             is a recently renovated open-air regional shopping
                             mall located eight miles southeast of Northbrook
                             Court. Old Orchard features five Anchor department
                             stores and includes 1.8 million square feet of
                             leaseable area. Hawthorn Center, a 1.06 million
                             square foot regional mall located ten miles
                             northwest of Northbrook Court, includes three
                             Anchor department stores. The secondary competition
                             for Northbrook Court consists of discount
                             retailers, numerous strip shopping centers located
                             within a few miles of the center, and a super
                             regional mall (Woodfield Mall), a 2.1 million
                             square foot mall located fifteen miles southwest of
                             Northbrook Court.

                             Park City Center is a 1.5 million square foot,
                             single-level, regional shopping center located in
                             Lancaster, Pennsylvania, in Pennsylvania Dutch
                             Country. Park City is anchored by Boscov's, The Bon
                             Ton, Kohl's, Sears and JCPenney as well as over 165
                             specialty mall shops. Park City is the only
                             enclosed regional shopping center in Lancaster, is
                             the only enclosed mall within 25 miles and is the
                             largest retail venue in the area. Park City opened
                             in 1970 and renovations were made in 1988 and 1997,
                             including a new food court and carousel. Park
                             City's trade area includes over 277,000 people and
                             major employers include Armstrong World Industries,
                             RR Donnelly and the County of Lancaster. The
                             Center's primary competition is from a number of
                             smaller factory outlet/power centers. Examples of
                             such centers include Red Rose Commons, built in
                             1998, located two miles northeast of Park City and
                             which features a Circuit City, a Home Depot and a
                             Linen's and Things. An additional competitor is
                             Tanger Factory Outlet Center, located seven miles
                             east of the mall and featuring Ann Taylor, J. Crew
                             and Coach outlet stores. These centers typically
                             target discount shoppers and do not offer a broad
                             selection of merchandise or price points and
                             therefore do not pose a significant competitive
                             threat to Park City.

               ENVIRONMENTAL Under various federal, state and local laws and
                     MATTERS and regulations, an owner of real estate is liable
                             for the costs of removal or remediation of certain
                             hazardous or toxic substances on such property.
                             These laws often impose such liability without
                             regard to whether the owner knew of, or was
                             responsible for, the presence of such hazardous or
                             toxic substances. The costs of remediation or
                             removal of such substances may be substantial, and
                             the presence of such substances, or the failure to
                             promptly remediate such substances, may adversely
                             affect the owner's ability to sell such real estate
                             or to borrow using such real estate as collateral.
                             In connection with its ownership and operation of
                             the Portfolio Centers, General Growth, the
                             Operating Partnership or the relevant property
                             venture through which the property is owned, may be
                             potentially liable for such costs.

                             All of the Portfolio Centers have been subject to
                             Phase I environmental assessments, which are
                             intended to discover information regarding, and to
                             evaluate the environmental condition of, the
                             surveyed and surrounding properties. The Phase I
                             assessments included a historical review, a public
                             records review, a preliminary investigation of the
                             site and surrounding properties, screening for the
                             presence of asbestos, polychlorinated biphenyls
                             ("PCBs") and underground storage tanks and the
                             preparation and issuance of a written report, but
                             do not include soil sampling or subsurface
                             investigations. Where the Phase I assessment so
                             recommended, a Phase II assessment was conducted to
                             further investigate any issues raised by the Phase
                             I assessment. In each case where Phase I and/or
                             Phase II assessments resulted in specific
                             recommendations for remedial actions, management
                             has either taken or scheduled the recommended
                             action.

                                    11 of 39

<PAGE>   12

                             Neither the Phase I nor the Phase II assessments
                             have revealed any environmental liability that the
                             Company believes would have a material effect on
                             the Company's business, assets or results of
                             operations, nor is the Company aware of any such
                             liability. Nevertheless, it is possible that these
                             assessments do not reveal all environmental
                             liabilities or that there are material
                             environmental liabilities of which the Company is
                             unaware. Moreover, no assurances can be given that
                             (i) future laws, ordinances or regulations will not
                             impose any material environmental liability or (ii)
                             the current environmental condition of the
                             Portfolio Centers will not be adversely affected by
                             tenants and occupants of the Portfolio Centers, by
                             the condition of properties in the vicinity of the
                             Portfolio Centers (such as the presence of
                             underground storage tanks) or by third parties
                             unrelated to the Company.

                  EMPLOYEES  As of March 14, 2000, the Company and GGMI had
                             3,311 full-time employees. Certain employees at
                             three of the Portfolio Centers are subject to
                             collective bargaining agreement. The Company's
                             management believes that their employee relations
                             are satisfactory and there has not been a
                             labor-related work stoppage at any of its Centers.

                  INSURANCE  The Company has comprehensive liability, fire,
                             flood, earthquake, extended coverage and rental
                             loss insurance with respect to the Portfolio
                             Centers. The Company's management believes that all
                             of the Portfolio Centers are adequately covered by
                             insurance.

         QUALIFICATION AS A  General Growth currently qualifies as a real estate
                REAL ESTATE  investment trust pursuant to the requirements
       INVESTMENT TRUST AND  contained in Sections 856-858 of the Internal
              TAXABILITY OF  Revenue Code of 1986, as amended (the "Code"). If,
               DISTRIBUTONS  as General Growth contemplates, such qualification
                             continues, General Growth will not be taxed on its
                             real estate investment trust taxable income. During
                             1999, General Growth distributed (or was deemed to
                             have distributed) 100% of its taxable income to its
                             preferred and common stockholders. Cash
                             distributions in the amount of $1.98 per share of
                             Common Stock were paid in 1999, of which $1.31
                             (66.0%) was ordinary income, $0.06 (3.0%) was
                             long-term capital gain from sales of property, and
                             $0.61 (31%) was a return of capital based on the
                             taxable income of General Growth.


                     ITEM 2. The Company's investment in real estate as of
                 PROPERTIES  December 31, 1999 consisted of its interests in
                             the Portfolio Centers, developments in progress
                             and certain other real estate. In most cases, the
                             land underlying the Portfolio Centers is also owned
                             by the Company; however, at a few of the centers,
                             all or part of the underlying land is owned by a
                             third party that leases the land pursuant to a
                             ground lease.

                    LEASING  The Portfolio Centers average Mall Store rent per
                             square foot from leases that expired in 1999 was
                             $26.04. As a result of market rents being higher
                             than the rents under many of the expiring leases,
                             the average Mall Store rent per square foot on new
                             and renewal leases during 1999 was $33.78, or $7.74
                             per square foot more than the average for expiring
                             leases. The following schedule shows lease
                             expirations over the next five years.

                                    12 of 39

<PAGE>   13



                               PORTFOLIO CENTERS
                      FIVE YEAR LEASE EXPIRATION SCHEDULE

<TABLE>
<CAPTION>

                                   ALL EXPIRATIONS                           EXPIRATIONS @ SHARE (1)
                       ------------------------------------          ------------------------------------
                       BASE RENT        FOOTAGE    RENT/PSF          BASE RENT       FOOTAGE     RENT/PSF
                       ------------------------------------          ------------------------------------
<S>             <C>                 <C>            <C>          <C>              <C>             <C>
WHOLLY OWNED
       2000         $20,127,300.00     782,173.00   $25.73       $20,127,300.00     782,173.00    $25.73
       2001          20,899,225.00     931,839.00    22.43        20,899,225.00     931,839.00     22.43
       2002          27,211,128.00   1,281,682.00    21.23        27,211,128.00   1,281,682.00     21.23
       2003          29,124,286.00   1,314,672.00    22.15        29,124,286.00   1,314,672.00     22.15
       2001          24,077,853.00   1,036,164.00    23.24        24,077,853.00   1,036,164.00     23.24
                   ---------------   ------------   ------      ---------------   ------------    ------
PORTFOLIO TOTAL    $121,439,792.00   5,346,530.00   $22.71      $121,439,792.00   5,346,530.00    $22.71

UNCONSOLIDATED (2)
       2000         $21,282,042.00     650,044.00   $32.74       $10,548,325.00     321,699.00    $32.79
       2001          19,320,350.00     659,709.00    29.29         9,480,249.00     325,664.00     29.11
       2002          27,225,308.00     926,648.00    29.38        13,415,471.00     456,514.00     29.39
       2003          25,895,624.00     970,500.00    26.68        12,709,996.00     476,496.00     26.67
       2004          24,717,558.00     964,780.00    25.62        12,007,839.00     473,629.00     25.35
                   ---------------   ------------   ------      ---------------   ------------    ------
PORTFOLIO TOTAL    $118,440,882.00   4,171,681.00   $28.39      $ 58,161,880.00   2,054,002.00    $28.32
                   ---------------   ------------   ------      ---------------   ------------    ------

GRAND TOTAL        $239,880,674.00   9,518,211.00   $25.20      $179,601,672.00   7,400,532.00    $24.27
                   ===============   ============   ======      ===============   ============    ======
</TABLE>

    (1) Expirations at share reflect the Company's direct or indirect ownership
        interest in a joint venture.
    (2) Excludes the three malls managed by joint venture partners of GGP/Homart
        (Arrowhead Towne Center, Lakeland Square and Superstition Springs).


                                    13 of 39

<PAGE>   14


COMPANY PORTFOLIO    At December 31, 1999, the Company had direct or indirect
             DEBT    ("pro rata") mortgage debt of approximately $4,332,695. The
                     ratio of pro rata floating rate debt to total pro rata debt
                     and preferred stock was 41.4% at December 31, 1999. The
                     following table reflects the maturity dates of the
                     Company's pro rata debt and the related interest rates.




                             COMPANY PORTFOLIO DEBT
             MATURITY AND CURRENT AVERAGE INTEREST RATE SUMMARY (A)
                             AS OF DECEMBER 31, 1999
                             (Dollars in Thousands)
<TABLE>
<CAPTION>
                                                     UNCONSOLIDATED
                             WHOLLY-OWNED             JOINT VENTURE             COMPANY
                               CENTERS                PROPERTIES (B)         PORTFOLIO DEBT
                        --------------------       ------------------       -----------------
                                     CURRENT                  CURRENT                 CURRENT
                                     AVERAGE                  AVERAGE                 AVERAGE
                        MATURING    INTEREST       MATURING  INTEREST       MATURING  INTEREST
         YEAR           AMOUNT(C)     RATE          AMOUNT     RATE          AMOUNT    RATE
         ----             ------    --------        ------   --------        ------   ------
<S>                    <C>          <C>         <C>          <C>          <C>         <C>
         2000          $  318,000     7.74%        $93,000    7.51%       $  411,000   7.69%
         2001             369,862     7.52%         15,300    7.15%          385,162   7.50%
         2002                 -0-      -0-%        124,228    6.72%          124,228   6.72%
         2003                 -0-      -0-%        410,596    7.23%          410,596   7.23%
         2004          1,064,973      7.38%        202,188    7.46%        1,267,161   7.39%
         Subsequent    $1,366,699     7.14%        367,849    7.47%        1,734,548   7.21%
                       ----------    ------      ---------    -----       ----------  ------

         Totals        $3,119,534     7.33%     $1,213,161    7.31%       $4,332,695   7.32%
                       ==========    ======     ==========    =====       ==========  ======

         Floating      $1,394,680     7.67%       $540,030    7.41%       $1,934,710   7.60%
         Fixed Rate     1,724,854     7.05%        673,131    7.23%        2,397,985   7.10%
                      -----------    ------      ---------    -----       ----------- ------

         Totals        $3,119,534     7.33%     $1,213,161    7.31%       $4,332,695   7.32%
                       ==========    ======     ==========    =====       ==========  ======
</TABLE>


     (a)  Excludes principal amortization.
     (b)  Unconsolidated properties debt reflects the Company's share of debt
          (based on its respective equity ownership interests in the
          Unconsolidated Joint Ventures) relating to the properties owned by the
          Unconsolidated Joint Ventures.


                                    14 of 39
<PAGE>   15
PROPERTY DATA     The following tables set forth certain information regarding
                  the Wholly-Owned Centers and the Unconsolidated Centers as
                  of December 31, 1999. The first table depicts the
                  Wholly-Owned Centers and the second table depicts the
                  Unconsolidated Centers.


<TABLE>
<CAPTION>
                                                 WHOLLY-OWNED CENTERS
                                                 --------------------
                                                TOTAL GLA/MALL
                                  YEAR         AND FREESTANDING
  NAME OF CENTER/            OPENED/REMODELED         GLA                                                          ANCHOR
    LOCATION (1)               OR EXPANDED     (SQUARE FEET) (2)                   ANCHORS                       VACANCIES
---------------------      ------------------  -----------------     ----------------------------------------    ---------
<S>                        <C>                 <C>                   <C>                                         <C>
Ala Moana Center                  1959/           1,779,099/         JCPenney, Liberty House,                      None
 Honolulu, Hawaii        1966, 1987, 1989, 1999      769,355         Neiman Marcus, Sears

Apache Mall                      1969/              753,690/         Dayton's, JCPenney, Montgomery Ward,          None
 Rochester, Minnesota           1985, 1992           257,424         Sears

Baybrook Mall                     1978/           1,086,938/         Dillards, Mervyn's, Montgomery Ward, Sears    None
 Houston, Texas                 1984, 1985           343,415

Bayshore Mall                     1987/             613,707/         Gottschalks, JCPenney, Sears, Mervyn's        None
 Eureka, California               1989              343,692

Bellis Fair Mall                  1988/             762,955/         JCPenney, Mervyn's, Sears,                    None
 Bellingham, Washington           N/A                349,792         Target, The Bon Marche

Birchwood Mall                    1990/             714,462/         Hudson's, JCPenney, Sears,                    None
 Port Huron, Michigan          1991, 1997            288,328         Target, Younkers

The Boulevard Mall               1968/            1,211,693/         Dillard's, JCPenney, Macy's, Sears            None
 Las Vegas, Nevada                1992               423,657

Capital Mall                      1978/             528,829/         Dillard's, JCPenney, Sears                    None
 Jefferson City, Missouri       1985, 1992           305,384

Century Mall                     1975/             722,728/          JCPenney, McRae's, Rich's, Sears              None
 Birmingham, Alabama            1990, 1994          234,252

Chapel Hills Mall                1982/            1,173,027/         Dillard's, Foley's, JCPenney, KMart,          None
 Colorado Springs, CO        1986, 1997, 1998        426,869         Mervyn's, Sears

Coastland Center                  1977/            925,006/          Burdines, Dillard's, JCPenney, Sears          None
 Naples, Florida                1985, 1996          334,616

Colony Square Mall                1981/             547,516/         Elder-Beerman, JCPenney, Lazarus,             None
 Zanesville, Ohio                 1987               289,512         Sears

Columbia Mall                     1985/             731,924/         Dillard's, JCPenney, Sears, Target            None
 Columbia, Missouri               1987               316,480

Coral Ridge Mall                  1998/             998,294/         Dillard's, JCPenney, Scheel's,                None
 Iowa City, Iowa                   N/A               361,256         Sears, Target, Younkers

The Crossroads                  1980/1982,          765,882/         Hudson's, JCPenney, Mervyn's,                 None
 Kalamazoo, Michigan            1988, 1998           262,922         Sears

Cumberland Mall                   1973/            1,199,672/        JCPenney, Macy's, Rich's, Sears               None
 Atlanta, Georgia                  N/A               365,557
</TABLE>

                                    15 of 39

<PAGE>   16
<TABLE>
<CAPTION>

                                                TOTAL GLA/MALL
                                  YEAR         AND FREESTANDING
  NAME OF CENTER/            OPENED/REMODELED         GLA                                                         ANCHOR
    LOCATION (1)               OR EXPANDED     (SQUARE FEET) (2)                   ANCHORS                       VACANCIES
---------------------         ---------------- -----------------     ----------------------------------------    ---------
<S>                           <C>              <C>                   <C>                                         <C>
Eagle Ridge Mall                 1996/              629,841/         Dillard's, JCPenney, Sears                    None
 Winter Haven, Florida             N/A              317,589

Eden Prairie Mall                 1976/            861,380/          Kohl's, Mervyn's, Sears, Target               None
 Eden Prairie, Minnesota       1989, 1994            325,572

Fallbrook Mall                    1966/           1,024,763/         Burlington Coat Factory, JCPenney, Kmart,     None
 West Hills, (Los Angeles),       1985              472,749          Mervyn's, Target
 California

Fox River Mall                    1984/           1,101,979/         Dayton's, JCPenney, Sears,                    None
 Appleton, Wisconsin            1991, 1998           537,065         Target, Younkers

Gateway Mall                     1990/              631,543/         Sears, Target, The Emporium                   None
 Springfield/Eugene, Oregon        N/A               348,278

Grand Traverse Mall               1992/             577,785/         Hudson's, JCPenney, Target                    None
 Traverse City, Michigan          N/A               312,436

Greenwood Mall                   1979/             753,397/          Dillard's, Famous-Barr, JCPenney, Sears,      None
 Bowling Green, Kentucky          1987               352,774

Knollwood Mall                    1955/            500,074/          Cub Foods, Kohl's                             None
 St. Louis Park,                  1981              289,474
 (Minneapolis), Minnesota

Lakeview Mall                     1983/            621,510/          Hudson's, JCPenney, Sears                     None
 Battle Creek, Michigan           1998              329,917

Lansing Mall                     1969/             830,845/          Hudson's, JCPenney, Mervyn's,                 None
 Lansing, Michigan                N/A               387,443          Younkers

Lockport Mall                    1971/             345,796/          Hills, Montgomery Ward, The Bon Ton           None
 Lockport, New York               1984               125,399

Mall of the Bluffs                1986/            669,050/          Dillard's, JCPenney, Sears, Target            None
 Council Bluffs, Iowa           1988, 1998          355,176
 (Omaha, Nebraska)

Mall St. Vincent                 1977/              567,819/         Dillard's, Sears                              None
 Shreveport, Louisiana            1991              219,819

Market Place Mall                 1975/           1,067,973/         Bergner's, Famous-Barr, JCPenney,             None
 Champaign, Illinois         1987, 1994, 1999        391,342         Kohl's, Sears

McCreless Mall                   1962/              476,799/         Beall's, Montgomery Ward                      None
 San Antonio, Texas               1997              290,941

Northridge Fashion Center         1971/           1,465,261/         JCPenney, Macy's, Robinson's-May,             None
 Northridge, California         1995, 1997           658,343         Sears

Oakwood Mall                     1986/             786,464/          Dayton's, JCPenney,                           None
 Eau Claire, Wisconsin         1991, 1997           321,388          Scheel's All Sports, Sears, Target
</TABLE>


                                    16 of 39
<PAGE>   17

<TABLE>
<CAPTION>
                                                 TOTAL GLA/MALL
                                  YEAR          AND FREESTANDING
  NAME OF CENTER/             OPENED/REMODELED         GLA                                                        ANCHOR
    LOCATION (1)               OR EXPANDED     (SQUARE FEET) (2)                   ANCHORS                       VACANCIES
---------------------       ------------------ -----------------     ----------------------------------------    ---------
<S>                         <C>                <C>                   <C>                                         <C>
Park Mall                        1974/              965,371/         Dillards, Macy's, Sears                       None
 Tucson, Arizona                  1998               345,371

Piedmont Mall                    1984/             661,606/          Belk, Hills, Belk Men's,                      None
 Danville, Virginia               1995               188,986         JCPenney, Sears

Pierre Bossier Mall               1982/             643,396/         Dillard's, JCPenney, Sears,                   None
 Bossier City, Louisiana        1985, 1992          261,492          Service Merchandise, Stage

The Pines                        1986/              609,047/         Dillard's, JCPenney,                          None
 Pine Bluff, Arkansas             1990               269,338         Sears, Wal-Mart

Regency Square Mall               1967/           1,400,320/         Belk, Dillard's, JCPenney,                    None
 Jacksonville, Florida       1992, 1998, 1999        588,689         Montgomery Ward, Sears

Rio West Mall                     1981/             445,270/         Beall's, JCPenney, KMart                      None
 Gallup, New Mexico             1991, 1998          264,137

River Falls Mall                 1990/              748,298/         Bacon's, Toys "R" Us, Wal-Mart                None
 Clarksville, Indiana             N/A                403,260
 (Louisville, Kentucky)

River Hills Mall                 1991/              646,284/         Herberger's, JCPenney,                        None
Mankato, Minnesota               1996                284,235         Sears ,Target

Riverlands Shopping Center       1965/              183,808/         Winn-Dixie                                    None
 LaPlace, Louisiana               1984               136,874         (3)

RiverTown Crossings               1999/           1,125,410/         Hudson's, JCPenney, Kohl's, Sears,            None
 Grand Rapids, Michigan            N/A               510,138         Younkers

Sooner Fashion Square             1976/             480,090/         Dillard's, JCPenney, Sears,                   None
 Norman, Oklahoma                 1999               175,136         Stein Mart, Service Merchandise

Southlake Mall                    1976/           1,026,030/         JCPenney, Macy's, Rich's, Sears               None
 Morrow, Georgia                1995, 1999           287,530

SouthShore Mall                  1981/              337,807/         JCPenney, KMart, Sears                        None
 Aberdeen, Washington             N/A                148,480

Southwest Plaza                   1983/           1,238,089/         Dillards, Foley's, JCPenney,                  None
 Littleton, Colorado            1994, 1995           600,912         Montgomery Ward, Sears

Spring Hill Mall                  1980/           1,075,394/         Carson Pirie Scott, JCPenney, Kohl's,         None
 West Dundee, Illinois          1992, 1996           393,814         Marshall Field's, Sears

Valley Hills Mall                1978/              619,921/         Belk, JCPenney, Sears                         None
 Hickory, North Carolina     1988, 1990, 1996        207,625

Valley Plaza Mall                 1967/           1,158,818/         Gottschalks, JCPenney,                        None
 Bakersfield, California     1988, 1997, 1998        432,129         Macy's, Robinson's-May, Sears
</TABLE>


                                    17 of 39
<PAGE>   18

<TABLE>
<CAPTION>
                                                TOTAL GLA/MALL
                                  YEAR         AND FREESTANDING
NAME OF CENTER/             OPENED/REMODELED         GLA                                                          ANCHOR
    LOCATION (1)               OR EXPANDED     (SQUARE FEET) (2)                   ANCHORS                       VACANCIES
---------------------       ----------------   -----------------     ---------------------------------           ---------
<S>                         <C>                <C>                   <C>                                         <C>
West Valley Mall                 1995/             687,400/          Gottschalks, JCPenney, Ross Dress             None
 Tracy, California                1997              336,585          for Less, Sears, Target

Westwood Mall                    1972/              453,167/         Elder-Beerman, JCPenney,                      None
 Jackson, Michigan             1978, 1993           135,073          Montgomery Ward
</TABLE>


(1)  In certain cases, where a Center's location is part of a larger
     metropolitan area, the metropolitan area is identified in parentheses.
(2)  Includes square footage added in redevelopment/expansion projects.
(3)  Winn-Dixie does not occupy its space but is currently paying rent under a
     lease, which expires in October 2002.





                                    18 or 39
<PAGE>   19


<TABLE>
<CAPTION>
                                                UNCONSOLIDATED CENTERS

                                                 OWNERSHIP        TOTAL GLA/MALL
                                 YEAR OPENED/     INTEREST %     AND FREESTANDING
  NAME OF CENTER/                 REMODELED      OF OPERATING        GLA                                           ANCHOR
   LOCATION (1)                  OR EXPANDED     PARTNERSHIP     SQUARE FEET(2)         ANCHORS                   VACANCIES
-------------------------      -------------    -------------   ----------------- ---------------------          ---------
<S>                            <C>              <C>             <C>               <C>                            <C>
Alderwood Mall                    1979/             50           1,046,967/       JCPenney, Lamonts, Nordstrom,    None
 Lynnwood (Seattle),            1995, 1996                          305,232       Sears, The Bon Marche
 Washington

Altamonte Mall                    1974/             50           1,070,548/       Burdine's, Dillard's,            None
 Orlando, Florida                 1989                              392,000       JCPenney, Sears

Arrowhead Towne Center            1993/           16.7           1,130,901/       Dillard's, JCPenney, Mervyn's,   None
 Glendale, Arizona                 N/A                              392,954       Montgomery Ward,
                                                                                  Robinson's-May

Bay City Mall                     1991/             50             527,273/       JCPenney, Sears,                 None
 Bay City, Michigan               1993                              211,622       Target, Younkers

Brass Mill Center/Commons        1997/              50           1,043,522/       Filene's, JCPenney,              One
 Waterbury, Connecticut           N/A                               598,884       Sears

Carolina Place                    1991/             50           1,091,307/       Belk's, Dillards, Hecht's,       None
 Charlotte, North Carolina        1994                              317,805       JCPenney, Sears

Chula Vista Center                1962/             50             882,501/       JCPenney, Macy's,                None
 Chula Vista, California       1993, 1994                           328,401       Mervyn's, Sears

Columbiana Centre                 1990/             50             817,847/       Belk, Dillards,                  None
 Columbia, South Carolina         1992                              258,870       Parisian, Sears

Deerbrook Mall                    1984/             50           1,196,155/       Dillard's, JCPenney, Foley's,    None
 Humble (Houston), Texas        1996, 1997                          456,562       Mervyn's, Sears

Eastridge Mall                    1970/             51           1,380,683/       JCPenney, Macy's, Sears          One
 San Jose, California           1982, 1995                          523,202

Lakeland Square                   1988/             25             904,993/       Belk, Burdines, Dillard's,       None
 Lakeland, Florida                1994                             291,862        JCPenney, Mervyn's, Sears

Landmark Mall                    1965/              51             969,508/       Hecht's, JCPenney, Sears         None
 Alexandria, VA                  1989, 1991                         338,502

Mayfair Mall                      1958/             51          1,366,043/        Marshall Fields,                 None
 Wauwatosa, Wisconsin           1986, 1994                         866,733        The Boston Store

Meadows Mall                     1978/              51             947,507/       Dillard's, JCPenney, Macy's,     None
 Las Vegas, Nevada              1987, 1997                          310,654       Sears

Montclair Plaza                   1968/             50           1,496,089/       JCPenney, Macy's,                None
 Montclair (Los Angeles)          1985                              511,617       Montgomery Ward, Nordstrom,
 California                                                                       Robinson's-May, Sears

Moreno Valley Mall                1992/             50           1,035,508/       Harris, JCPenney,                None
 Moreno Valley, California        N/A                               429,974       Robinson's-May, Sears

Natick Mall                       1966/             50          1,154,701/        Filene's, Lord & Taylor,         None
 Natick, Massachusetts             1994                            428,039        Macy's, Sears
</TABLE>

                                    19 of 39

<PAGE>   20

<TABLE>
<CAPTION>
                                                 OWNERSHIP      TOTAL GLA/MALL
                              YEAR OPENED/      INTEREST %     AND FREESTANDING
NAME OF CENTER/                 REMODELED      OF OPERATING           GLA                                              ANCHOR
 LOCATION (1)                  OR EXPANDED      PARTNERSHIP     SQUARE FEET(2)         ANCHORS                       VACANCIES
-------------------------      -----------      -----------     --------------    ---------------------              ---------
<S>                            <C>              <C>             <C>               <C>                                <C>
Neshaminy Mall                    1968/             25            975,469/        Boscov's, Sears,                      One
 Bensalem, Pennsylvania         1995, 1998                         371,874        Strawbridge

Newgate Mall                      1981/             50             726,918/       Dillard's, Mervyn's,
 Ogden, Utah                    1994, 1998                          316,754       Oshman's, Sears                       None

New Park Mall                    1980/              50           1,131,329/       JCPenney, Macy's, Mervyn's,           None
 Newark, California               1993                              387,865       Sears, Target

Northbrook Court                  1976/             50             977,507/       Lord & Taylor, Marshall Fields,       None
 Northbrook, Illinois           1995, 1996                          441,230       Neiman Marcus

Northgate Mall                   1972/              51            858,309/        JCPenney, Proffitt's, Sears           None
 Chattanooga, Tennessee           1991                             415,689

North Point Mall                  1993/             50           1,362,631/       Dillard's, JCPenney, Lord &           None
 Alpharetta (Atlanta), Georgia     N/A                              396,344       Taylor, Parisian, Rich's, Sears

Oaks Mall (2)                    1978/              51             907,628/       Belk, Burdines, Dillard's,            None
 Gainesville, Florida              N/A                              349,761       JCPenney, Sears

Oak View Mall                     1991/             51             869,242/       Dillard's, JCPenney,                  None
 Omaha, Nebraska                   N/A                              264,982       Sears, Younkers

Oglethorpe Mall                   1969/             51            970,843/        Belk, JCPenney, Rich's, Sears         None
 Savannah, Georgia           1989, 1990, 1992                      434,259

Park City Center                  1970/             51           1,397,994/       Boscov's, JCPenney,                   None
 Lancaster, Pennsylvania        1988, 1997                         533,637        Kohl's, Sears, The Bon-Ton

The Parks at Arlington            1988/             50          1,191,471/        Dillard's, Foley's, JCPenney,         None
 Arlington, Texas                 N/A                              360,526        Mervyn's, Sears

The Pavilions at Buckland Hills  1990/             N/A (3)         961,105/       Dick's Sporting Goods, Filene's,      None
 Manchester, Connecticut          1994                              327,583       Filene's Home Store, JCPenney,
                                                                                  Lord & Taylor, Sears

Pembroke Lakes Mall              1992/              50           1,063,860/       Burdine's, Dillard's, Dillard's       None
 Pembroke Pines, Florida           N/A                             352,585        (Men's & Home Furnishings),
                                                                                  JCPenney, Sears

Prince Kuhio Plaza               1985/              50            517,264/        JCPenney, Liberty House,              One
 Hilo, Hawaii                  1994, 1999                          281,144        Sears

Quail Springs                    1980/              50           1,019,817/       Dillard's, Foley's,                   None
 Oklahoma City, Oklahoma     1992, 1998, 1999                       331,964       JCPenney, Sears

Steeplegate Mall                  1990/             50            447,649/        JCPenney, Sears,                      None
 Concord, New Hampshire           N/A                              191,237        The Bon Ton

Superstition Springs              1990/           16.7          1,073,726/        Dillard's, JCPenney, Mervyn's,        None
 East Mesa, Arizona               1994                             367,032        Robinson's-May, Sears

Town East Mall                    1971/             50          1,242,873/        Dillard's, Foley's, JCPenney,         None
 Mesquite, Texas                  1986                             433,487        Sears
</TABLE>


<PAGE>   21

<TABLE>
<CAPTION>
                                                 OWNERSHIP      TOTAL GLA/MALL
                              YEAR OPENED/      INTEREST %     AND FREESTANDING
NAME OF CENTER/                 REMODELED      OF OPERATING           GLA                                         ANCHOR
 LOCATION (1)                  OR EXPANDED      PARTNERSHIP     SQUARE FEET(2)         ANCHORS                   VACANCIES
-------------------------     ------------     ------------    ---------------    ---------------------          ---------
<S>                           <C>              <C>             <C>                <C>                            <C>
Tysons Galleria                  1988/             50             808,473/        Macy's, Neiman Marcus,           None
 McLean, Virginia              1994, 1997                          296,540        Saks Fifth Avenue

Vista Ridge Mall                  1989/            40           1,059,133/        Dillard's, Foley's,              None
 Lewisville, Texas               1991                               386,071       JCPenney, Sears

Washington Park Mall              1984/            50              351,483/       Dillard's, JCPenney,             None
 Bartlesville, Oklahoma          1986                               157,187       Sears

West Oaks Mall                   1996/             50            1,075,960/       Dillard's, JCPenney,             None
 Ocoee (Orlando), Florida         N/A                               432,478       Parisian, Sears

Westroads Mall                    1968/            51           1,079,188/        JCPenney, The Jones Store,       None
 Omaha, Nebraska                1995, 1999                         382,778        Von Maur, Younkers

The Woodlands Mall               1994/             25            1,178,455/       Dillard's, Foley's, JCPenney,    None
 The Woodlands,                   1998                              350,377       Mervyn's, Sears
 (Houston), Texas

MALLS UNDER DEVELOPMENT

Stonebriar Centre                 2000/            50            1,600,000/        (4)                             (4)
 Frisco (Dallas), Texas            N/A                              612,000
</TABLE>


(1)  In certain cases where a Center's location is part of a larger metropolitan
     area, the metropolitan area is identified in parenthesis.
(2)  Includes square footage added in redevelopment/expansion projects.
(3)  GGP/Homart's participation is subordinated to certain preferred returns to
     its Joint Venture Partners.
(4)  Upon completion, this mall will contain up to five major department stores,
     currently expected to be Foley's, JCPenney, Sears, Macy's, and Nordstrom.



                                    21 of 39
<PAGE>   22


ANCHORS   Anchors have traditionally been a major factor in the public's
          image of an enclosed shopping center. Anchors are generally department
          stores whose merchandise appeals to a broad range of shoppers. Anchors
          either own their stores, the land under them and adjacent parking
          areas, or enter into long-term leases at rates that are generally
          lower than the rents charged to Mall Store tenants. Although the
          Portfolio Centers receive a smaller percentage of their operating
          income from Anchors than from Mall Stores, strong Anchors play an
          important part in maintaining customer traffic and making the
          Portfolio Centers desirable locations for Mall Store tenants.

          The following table indicates the parent company of each Anchor and
          sets forth the number of stores and square feet owned or leased by
          each Anchor at the Portfolio Centers as of December 31, 1999.


<TABLE>
<CAPTION>
                          GENERAL GROWTH PROPERTIES, INC.
                                 PORTFOLIO ANCHORS
                              AS OF DECEMBER 31, 1999

                                                    TOTAL       SQUARE FEET
              NAME                                 STORES         (000'S)
              ----                                 ------        --------
<S>                                                <C>           <C>
 Sears                                                82         11,568

 JCPenney                                             77          9,030

 Dillard's Inc.
   Dillard's                                          37          5,975
   Dillard's Home Store                                1             22
   Dillard's Men's Store                               2            213
   Bacon's                                             1            187
                                                    ----         ------
     Sub-Total Dillard's Inc.                         41          6,397
                                                    ====         ======
 Dayton Hudson Corporation
   Target                                             15          1,650
   Mervyn's                                           17          1,409
   Marshall Fields                                     3            693
   Dayton's                                            3            432
   Hudson's                                            6            692
                                                    ----         ------
     Sub-Total Dayton Hudson Corporation              44          4,876
                                                    ====         ======

 May Department Stores Company
   Foley's                                            10          1,423
   Robinson's-May                                      6            946
   Filene's                                            3            520
   Filene's Home Store                                 1             36
   Lord & Taylor                                       4            457
   Strawbridge's                                       1            218
   Hecht's                                             2            345
   Famous-Barr                                         1            122
   The Jones Store                                     1            153
                                                    ----         ------
     Sub-Total May Department Stores Company          29          4,220
                                                    ====         ======

 Federated Department Stores, Inc.
   Macy's                                             13          2,294
   Rich's                                              5            937
   Burdines                                            5            681
   The Bon Marche                                      2            321
   Lazarus                                             1             50
                                                    ----         ------
     Sub-Total Federated Department Stores, Inc.      26          4,283
                                                    ====         ======
</TABLE>


                                    22 of 39


<PAGE>   23

                         GENERAL GROWTH PROPERTIES, INC.
                                PORTFOLIO ANCHORS
                             AS OF DECEMBER 31, 1999
                                   (continued)

<TABLE>
<CAPTION>
                                                    TOTAL       SQUARE FEET
            NAME                                   STORES         (000'S)
            ----                                   ------         -------
<S>                                                <C>            <C>
 Saks Incorporated
   Younkers                                            8            983
   Parisian                                            3            395
   Carson Pirie Scott                                  1            138
   Boston Store                                        1            211
   Bergners                                            1            154
   McRae's                                             1            124
   Saks Fifth Avenue                                   1            120
   Proffitt's                                          1             90
   Herberger's                                         1             71
                                                    ----          -----
     Sub-Total Saks Incorporated                      18          2,286
                                                    ====          =====

 Montgomery Ward & Co.                                 7            907

 Belk
   Belk                                                8          1,105
   Belk Men's                                          1             34
                                                    ----          -----
      Sub-Total Belk                                   9          1,139
                                                    ====          =====

 Kohl's                                                6            515
 Neiman-Marcus                                         3            422
 Boscov                                                2            413
 Liberty House                                         2            377
 KMart                                                 4            356
 The Bon Ton                                           3            312
 Joslins                                               3            301
 Gottschalks                                           3            268
 Nordstrom                                             2            245
 Wal-Mart                                              2            196
 Bullock's                                             1            190
 Von Maur                                              1            179
 Hills Department Store                                2            176
 Scheel's All Sports                                   2            154
 Harris                                                1            150
 Elder-Beerman                                         2            141
 Cub Foods                                             1            130
 Costner-Knott                                         2            122
 JLHudson                                              1            122
 Burlington Coat Factory                               1            101
 Service Merchandise                                   2             93
 Goody's                                               3             83
 Ames                                                  1             81
 Dick's Sporting Goods                                 1             80
 Biggs                                                 1             78
 Oshman's                                              1             64
 Lamont's                                              1             60
 Beall's                                               2             56
 The Emporium                                          1             50
 Toys "R" Us                                           1             47
 Winn-Dixie                                            1             47
 Stein Mart                                            1             39
 Office Depot                                          1             35
 Stage                                                 1             35
 Ross Dress for Less                                   1             28
</TABLE>

                                    23 of 39

<PAGE>   24


GROUND LEASES  The Company currently leases the land under Rio West Mall,
               a portion of the Northridge Fashion Center, a portion of
               the Fallbrook Mall land and a portion of the SouthShore and
               Bayshore parking areas. In addition, Prince Kuhio Plaza, one of
               the Homart Centers, and the office building owned and used by the
               Company as its headquarters are subject to long-term ground
               leases. The leases generally contain various purchase options in
               favor of the Company and typically provide for a right of first
               refusal in favor of the Company in the event of a proposed sale
               of the property by the Landlord.

               For other information concerning the Portfolio Centers see "Item
               1 - Business - Business of the Company" and for additional
               information concerning the mortgage debt encumbering the GGP
               Centers, see Note 5. As stated in Item 1 above, management of the
               Company believes that each of the properties in the Company
               Portfolio is adequately insured.


ITEM 3. LEGAL  The Company is not currently involved in any material litigation
  PROCEEDINGS  nor, to the Company's knowledge, is any material litigation
               currently threatened against the Company, the properties or any
               of the Unconsolidated Joint Ventures other than routine
               litigation arising in the ordinary course of business, most of
               which is expected to be covered by liability insurance. For
               information about certain environmental matters, see "Item 1 -
               Business - Environmental Matters."

      ITEM 4.  No matters were submitted to General Growth's stockholders
SUBMISSION OF  during the fourth quarter of fiscal 1999.
 MATTERS TO A
      VOTE OF
     SECURITY
      HOLDERS

      PART II  The Common Stock is listed on the New York Stock Exchange
       ITEM 5. ("NYSE") and trades under the symbol "GGP". As of March 14, 2000,
   MARKET FOR  the 51,927,576 outstanding shares of Common Stock were held by
 REGISTRANT'S  approximately 1,107 stockholders of record. The closing price
COMMON EQUITY  per share of the Common Stock on the NYSE on such date was
  AND RELATED  $28.50 per share.
  STOCKHOLDER
      MATTERS

               Set forth below are the high and low sales prices per share of
               Common Stock as reported on the composite tape, and the
               distributions per share of Common Stock declared for each such
               period.

<TABLE>
<CAPTION>
                                          PRICE
           1999                           -----               DECLARED
       QUARTER ENDING             HIGH           LOW       DISTRIBUTION
       --------------             ----         ------      ------------
<S>                               <C>          <C>         <C>
        March 31                  $38.44       $31.25         $.49
        June 30                   $38.63       $31.13         $.49
        September 30              $35.63       $31.06         $.49
        December 31               $31.69       $25.00         $.51
</TABLE>

                                    24 of 39

<PAGE>   25
<TABLE>
<CAPTION>
                                           PRICE
              1998                         -----               DECLARED
         QUARTER ENDING             HIGH           LOW       DISTRIBUTION
         --------------             ----         ------      ------------
<S>                                 <C>          <C>         <C>
          March 31                  $38.00       $34.88         $.47
          June 30                   $38.63       $34.44         $.47
          September 30              $38.69       $33.19         $.47
          December 31               $37.94       $32.88         $.47
</TABLE>

<TABLE>
<CAPTION>
                                           PRICE
              1997                         -----               DECLARED
         QUARTER ENDING             HIGH           LOW       DISTRIBUTION
         --------------             ----           ---       ------------
<S>                                 <C>          <C>         <C>
          March 31                  $32.13       $30.25         $.45
          June 30                   $33.75       $31.13         $.45
          September 30              $37.00       $32.44         $.45
          December 31               $38.25       $31.81         $.45
</TABLE>


ITEM 6.  SELECTED FINANCIAL DATA
(Dollars in Thousands, except per Share Amounts)

The following table sets forth selected financial data for the Company which is
derived from and therefore should be read in conjunction with the audited
Consolidated Financial Statements and the related Notes and Management's
Discussion and Analysis of Financial Condition and Results of Operations
contained in this Annual Report.

<TABLE>
<CAPTION>
                                                    1999         1998         1997          1996         1995
                                                  --------     --------     --------      --------     -------
<S>                                               <C>          <C>          <C>           <C>          <C>
         OPERATING DATA
         Revenue                                  $ 612,342    $ 426,576    $ 291,147     $217,405     $167,396
         Operating Expenses                         206,088      151,784      109,677       75,954       63,968
         Depreciation and Amortization              112,874       75,227       48,509       39,809       30,855
         Interest Expense, Net                      169,502      109,840       70,252       66,439       46,334
         Equity in Net Income of
           Unconsolidated Affiliates                 19,689       11,067       19,344       17,589        9,274

         Net gain on sales including
          CenterMark in 1997, 1996 & 1995         $   4,412    $     196    $  58,647     $ 43,821     $ 33,397
                                                  ---------    ---------    ---------     --------     --------

         Income Before Minority Interest            147,979      100,988      140,700       96,613       68,910
         Minority Interest                          (33,058)     (29,794)     (49,997)     (34,580)     (25,856)
                                                  ---------    ---------    ---------     --------    ---------

         Income Before Extraordinary Items          114,921       71,194       90,703       62,033       43,054
         Extraordinary Items                        (13,796)      (4,749)      (1,152)      (2,291)           -
                                                  ---------    ---------    ---------     -------- -----------
         Net Income                                 101,125       66,445       89,551       59,742       43,054
                                                  ---------    ---------    ---------     --------       ------
         Convertible Preferred Stock Dividends      (24,467)     (13,433)          --           --           --
         Net Income available
           to common stockholders                 $  76,658    $  53,012    $  89,551     $ 59,742      $43,054
                                                  =========    =========    =========     ========      =======

         Earnings Before Extraordinary Item
           Per Share - Basic                           1.97         1.60         2.78         2.20         1.69
         Earnings Before Extraordinary Item
           Per Share - Diluted                         1.96         1.59         2.76         2.20         1.69
         Net Earnings Per Share - Basic                1.67         1.46         2.75         2.12         1.69
         Net Earnings Per Share - Diluted              1.66         1.46         2.73         2.12         1.69
         Distributions Declared Per Share              1.98         1.88         1.80         1.72         1.66
</TABLE>


                                    25 of 39

<PAGE>   26

<TABLE>

<S>                                            <C>             <C>            <C>          <C>            <C>
         CASH FLOW DATA
         Operating Activities                  $    222,134    $   118,304    $  101,149   $   67,202     $   60,660
         Investing Activities                    (1,254,697)    (1,513,147)     (183,535)     (29,285)      (469,204)
         Financing Activities                     1,038,526      1,388,575        92,337      (40,268)       421,225

         FUNDS FROM OPERATIONS (1)
         Operating Partnership                 $    274,234    $   192,274    $  147,625   $  114,721     $   85,138
         Minority Interest                          (82,631)       (69,182)      (52,890)     (42,115)       (32,409)
         Funds From Operations - Company            191,603        123,092        94,735       72,606         52,729

         BALANCE SHEET DATA
         Investment in Real Estate Assets-Cost $  5,023,690    $ 4,063,097    $2,157,251   $1,828,184     $1,547,621
         Total Assets                             4,954,895      4,027,474     2,097,719    1,757,717      1,455,982
         Total Debt                               3,119,534      2,648,776     1,275,785    1,168,522      1,027,932
         Convertible Preferred Stock                337,500        337,500            --           --             --
         Stockholders' Equity                       927,758        585,707       498,505      330,267        229,383

</TABLE>

(1)  Funds from Operations (as defined below) does not represent cash flow from
     operations as defined by Generally Accepted Accounting Principles ("GAAP")
     and is not necessarily indicative of cash available to fund all cash
     requirements.


      FUNDS FROM    Funds from Operations is used by the real estate industry
      OPERATIONS    and investment community as a primary measure of the
                    performance of real estate companies. The National
                    Association of Real Estate Investment Trusts ("NAREIT")
                    defines Funds from Operations as net income (loss) (computed
                    in accordance with GAAP), excluding gains (or losses) from
                    debt restructuring and sales of properties, plus real estate
                    related depreciation and amortization and after adjustments
                    for unconsolidated partnerships and joint ventures. In
                    calculating its Funds from Operations, the Company also
                    excludes gains on land sales, if any. The NAREIT definition
                    of Funds from Operations does not exclude the aforementioned
                    item. The Company's Funds from Operations may not be
                    directly comparable to similarly titled measures reported by
                    other real estate investment trusts. Funds from Operations
                    does not represent cash flow from operating activities in
                    accordance with GAAP and should not be considered as an
                    alternative to net income (determined in accordance with
                    GAAP) as an indication of the Company's financial
                    performance or to cash flow from operating activities
                    (determined in accordance with GAAP) as a measure of the
                    Company's liquidity, nor is it indicative of funds available
                    to fund the Company's cash needs, including its ability to
                    make cash distributions.


RECONCILIATION OF NET INCOME DETERMINED IN ACCORDANCE WITH GENERALLY ACCEPTED
ACCOUNTING PRINCIPLES TO FUNDS FROM OPERATIONS:

<TABLE>
<CAPTION>
                                                                        1999        1998        1997
                                                                      --------    --------    --------
<S>                                                                   <C>         <C>         <C>
   Net Income available to common stockholders                        $  76,658   $ 53,012    $ 89,551

   Extraordinary item - charges related to early retirement of debt      13,796      4,749       1,152

   Allocations to Operating Partnership unitholders                      33,058     29,794      49,997

   Net gain on sales                                                    (4,412)       (196)    (63,813)

   Depreciation and amortization                                        155,134    104,915      70,738
                                                                      ---------   --------    --------

   Funds From Operations                                              $ 274,234   $192,274    $147,625
                                                                      =========   ========    ========
</TABLE>


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<PAGE>   27

                         GENERAL GROWTH PROPERTIES, INC.




ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
         CONDITION AND RESULTS OF OPERATIONS

                             All references to numbered Notes are to specific
                             footnotes to the Consolidated Financial Statements
                             of the Company included in this Annual Report,
                             which descriptions are incorporated into the
                             applicable response by reference. The following
                             discussion should be read in conjunction with such
                             Consolidated Financial Statements and related
                             Notes. Capitalized terms used but not defined in
                             this Management's Discussion of Financial Condition
                             and Results of Operations have the same meanings as
                             in such Notes.

  CERTAIN INFORMATION ABOUT  As of December 31, 1999, the Company owned 100% of
  THE COMPANY PORTFOLIO      the fifty-two Wholly-Owned Centers, 50% of the
                             stock of GGP/Homart, 50% of the stock of GGP/Homart
                             II, 51% of the stock of GGP Ivanhoe, 51% of the
                             stock of GGP Ivanhoe III, 50% of Quail Springs Mall
                             and Town East Mall, (collectively, the "Company
                             Portfolio") and a non-voting preferred stock
                             ownership interest (representing 95% of the equity
                             interest) in GGMI. The Company is also in the
                             process of constructing one additional center as
                             discussed below. Reference is made to Notes 3 and 4
                             for a further discussion of such entities owned by
                             the Company. As of December 31, 1999 GGP/Homart
                             owned interests in twenty-three shopping centers,
                             GGP/Homart II owned interests in seven shopping
                             centers (including one currently under
                             construction), GGP Ivanhoe owned interests in two
                             shopping centers, and GGP Ivanhoe III owned
                             interests in eight shopping centers.

                             As used in this annual report, the term "GLA"
                             refers to gross leaseable retail space, including
                             Anchors and mall tenant areas; the term "Mall GLA"
                             refers to gross leaseable retail space, excluding
                             Anchors; the term "Anchor" refers to a department
                             store or other large retail store; the term "Mall
                             Stores" refers to stores (other than Anchors) that
                             are typically specialty retailers who lease space
                             in shopping centers; and the term "Freestanding
                             GLA" means gross leaseable area of freestanding
                             retail stores in locations that are not attached to
                             the primary complex of buildings that comprise a
                             regional mall shopping center.

                             The Mall Store and Freestanding Store portions of
                             the centers in the Company Portfolio which were not
                             undergoing redevelopment on December 31, 1998, had
                             an occupancy rate of approximately 88.6% as of such
                             date. On December 31, 1999, the Mall Store and
                             Freestanding Store portions of the centers in the
                             Company Portfolio which were not undergoing
                             redevelopment were approximately 90.1% occupied,
                             representing an increase of 1.5% over 1998.

                             Total annualized sales averaged $341 per square
                             foot for the Company Portfolio for the year ended
                             December 31, 1999. For the year ended December 31,
                             1999, total Mall Store sales for the Company
                             Portfolio increased by 10.1% over the same period
                             in 1998. Comparable Mall Store sales are current
                             sales of those certain tenants that were open
                             during the previous measuring period compared to
                             the sales of those same tenants for the previous
                             measuring period. Therefore, Comparable Mall Store
                             sales in the year ended December 31, 1999 are of
                             those tenants that were also operating in the year
                             ended December 31, 1998. Comparable Mall Store
                             sales in the year ended December 31, 1999 increased
                             by 6.1% over the same period in 1998.

                             The average Mall Store rent per square foot from
                             leases that expired in the year ended December 31,
                             1999 was $26.04. The Company Portfolio benefited
                             from increasing rents inasmuch as the average Mall
                             Store rent per square foot on new and renewal
                             leases



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<PAGE>   28
                        GENERAL GROWTH PROPERTIES, INC.

                             executed during 1999 was $33.78, or $7.74 per
                             square foot above the average for expiring leases.

                             Revenues are primarily derived from fixed minimum
                             rents, percentage rents and recoveries of operating
                             expenses from tenants. Inasmuch as the Company's
                             financial statements reflect the use of the equity
                             method to account for its investments in
                             GGP/Homart, GGP/Homart II, GGP Ivanhoe, GGP Ivanhoe
                             III, GGMI, Quail Springs Mall and Town East Mall,
                             the discussion of results of operations which
                             follows relates primarily to the revenues and
                             expenses of the Wholly-Owned Centers.


RESULTS OF                   COMPARISON OF YEAR ENDED 1999 TO YEAR ENDED
OPERATIONS OF THE            DECEMBER 31, 1998 Total revenues for 1999 were
COMPANY                      $612.3 million, which represents an increase of
                             $185.7 million or approximately 43.5% from $426.6
                             million in 1998. Approximately $168.2 million of
                             the increase was from properties acquired or
                             developed after January 1, 1998. Minimum rent
                             during 1999 increased $118.5 million or 44.1% from
                             $269.0 million in 1998 to $387.5 million. $103.8
                             million of the increase in minimum rent resulted
                             from the acquisition and development of properties
                             after January 1, 1998. Tenant recoveries (amounts
                             received from tenants related to property operating
                             costs) increased by $49.7 million or 38.0% from
                             $130.9 million to $180.6 million in 1999. The
                             increase in tenant recoveries was generated by a
                             combination of new acquisitions and increased
                             recoverable operating costs at the comparable
                             centers (properties owned for the entire time
                             during current and prior periods). Percentage rents
                             and other income increased $16.8 million or 76.4%
                             from $22.0 million in 1998 to $38.8 million in 1999
                             primarily due to the acquisition of new properties
                             and improved performance at the comparable centers.
                             Fee income increased slightly during 1999 as
                             compared to the year ended December 31, 1998
                             primarily due to fee revenue generated by asset
                             management services performed for the
                             Unconsolidated Joint Ventures.

                             Total expenses, including depreciation and
                             amortization, increased by approximately 40.5% or
                             $92 million, from $227.0 million in 1998 to $319
                             million in 1999. Approximately $86.5 million or
                             94.0% of the increase in total expenses related to
                             properties acquired and developed since January 1,
                             1998. The remaining $5.5 million of the increase
                             was primarily accounted for by increased operating
                             costs, the majority of which were recoverable from
                             tenants. The increase in total expenses consists of
                             $12 million of real estate taxes, $2.3 million of
                             management fees, $36.6 million of property
                             operating costs, $2.0 million of provision for
                             doubtful accounts, $1.3 million of general and
                             administrative and $37.6 million of depreciation
                             and amortization.

                             Interest expense increased by $60.2 million or
                             47.8% from $125.8 million in 1998 to $186 million
                             in 1999. Debt used to fund acquisitions generated a
                             $53.9 million increase in interest expense in 1999
                             compared to 1998. This increase was partially
                             offset by the use of a portion of the proceeds of
                             the Company's public offering of Common Stock to
                             repay existing indebtedness. The note receivable
                             from GGMI generated $11.4 million of interest
                             income in 1999, an increase of $0.7million from
                             $10.7 million in 1998.

                             Equity in net income of unconsolidated affiliates
                             during 1999 increased by $8.6 million to $19.7
                             million from $11.1 million in 1998. The Company's
                             equity in the earnings of GGP/Homart increased
                             approximately $1.1 million, primarily due to the
                             increase in average property occupancy, an increase
                             in the ownership interest of GGP/Homart in The
                             Parks at Arlington and an increase in the Company's
                             ownership interest in


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<PAGE>   29
                        GENERAL GROWTH PROPERTIES, INC.


                             GGP/Homart in 1999 versus 1998. The Company's
                             equity in the earnings of GGMI resulted in an
                             increase of approximately $3.9 million, primarily
                             due to reduced write-offs of terminated third-party
                             management contracts. GGP Ivanhoe III accounted for
                             an increase of approximately $1.2 million due
                             primarily to the acquisition of USPPI in June 1998
                             as described more fully in Note 4.

                             Net income after extraordinary items increased by
                             approximately $34.7 million in 1999 to $101.1
                             million, from $66.4 million in 1998. The increase
                             resulted from a combination of the above items.

                             COMPARISON OF YEAR ENDED DECEMBER 31, 1998 TO YEAR
                             ENDED DECEMBER 31, 1997 Total revenues for 1998
                             were $426.6 million, which represents an increase
                             of $135.5 million or approximately 46.5% from
                             $291.1 million in 1997. Approximately $128.8
                             million or 95.1% of the increase was from
                             properties acquired or developed after January 1,
                             1997. Minimum rent during 1998 increased $93.2
                             million or 53.0% from $175.8 million in 1997 to
                             $269.0 million. The acquisition and development of
                             properties after January 1, 1997 generated a $77.5
                             million increase in minimum rents. Expansion space,
                             specialty leasing and a combination of occupancy,
                             rental charges and allowance reserve adjustments at
                             the comparable centers accounted for the remaining
                             increase in minimum rents. Tenant recoveries
                             increased by $33.6 million or 34.5% from $97.3
                             million to $130.9 million in 1998. The increase in
                             tenant recoveries was generated by a combination of
                             new acquisitions and increased recoverable
                             operating costs at the comparable centers.
                             Percentage rents and other income increased $8.4
                             million or 61.8% from $13.6 million in 1997 to
                             $22.0 million in 1998 as a result of the
                             acquisition of new properties and improved
                             performance at the comparable centers. Fee income
                             during 1998 was comparable to the year ended
                             December 31, 1997. The fee revenue was primarily
                             generated by asset management services performed
                             for GGP/Homart.

                             Total expenses, including depreciation and
                             amortization, increased by approximately 43.5% or
                             $68.8 million, from $158.2 million in 1997 to
                             $227.0 million in 1998. Virtually all of the
                             increase in total expenses was attributable to
                             properties acquired and developed since January 1,
                             1997. The increase in total expenses from the new
                             properties consists of $13.4 million of real estate
                             taxes, $1.0 million of management fees, $32.3
                             million of property operating costs, $0.9 million
                             of provision for doubtful accounts, and $21.1
                             million of depreciation and amortization.

                             Net interest expense increased by $39.5 million or
                             56.2% from $70.3 million in 1997 to $109.8 million
                             in 1998, substantially all due to indebtedness
                             incurred in connection with the acquisition of new
                             properties in 1997 and 1998. The note receivable
                             from GGMI generated $10.7 million of interest
                             income in 1998, an increase of $4.3 million from
                             $6.4 million in 1997. The change was due to the
                             increase in the outstanding balance of the note,
                             the proceeds of which were primarily used to
                             finance the cost of the Company's new corporate
                             headquarters building in downtown Chicago.

                             Equity in net income of unconsolidated affiliates
                             during 1998 decreased by $8.2 million to $11.1
                             million from $19.3 million in 1997. GGP/Homart
                             accounted for an increase of approximately $1.4
                             million and the remaining property joint ventures
                             accounted for an aggregate increase of $6.8
                             million. The Company's ownership interest in GGMI
                             resulted in a decrease of $16.4 million, caused
                             primarily by increased write-offs of terminated
                             third-party management contracts.


                                    29 of 39

<PAGE>   30

                        GENERAL GROWTH PROPERTIES, INC.


                             Net income decreased by approximately $23.2 million
                             in 1998 to $66.4 million, from $89.6 million in
                             1997. Net income in 1997 included a $58.6 million
                             gain on the January 1997 sale of the remaining
                             investment in CenterMark. 1997 net income without
                             the CenterMark gain (net of minority interest)
                             would have been $52.9 million and 1998 net income
                             increased by $13.5 million compared to this amount,
                             primarily as a result of net income from newly
                             acquired properties and higher income on comparable
                             centers.

LIQUIDITY AND CAPITAL        As of December 31, 1999, the Company held
RESOURCES OF THE COMPANY     approximately $25.6 million of unrestricted cash
                             and cash equivalents. The Company uses operating
                             cash flow as the principal source of internal
                             funding for short-term liquidity and capital needs
                             such as tenant construction allowances and minor
                             improvements made to individual properties that are
                             not recoverable through common area maintenance
                             charges to tenants. External funding alternatives
                             for longer-term liquidity needs such as
                             acquisitions, new development, expansions and major
                             renovation programs at individual centers include
                             construction loans, mini-permanent loans, long-term
                             project financing, joint venture financing with
                             institutional partners, additional Operating
                             Partnership level or Company level equity
                             securities, unsecured Company level debt or secured
                             loans collateralized by individual shopping
                             centers. Currently, the Company has access to the
                             public equity and debt markets through a currently
                             effective shelf registration statement under which
                             up to $329.2 million in equity or debt securities
                             may be issued from time to time. The Company also
                             has a $200 million unsecured credit facility (the
                             "Credit Facility") which matures on July 31, 2000.
                             As of December 31, 1999, $160 million of the Credit
                             Facility was drawn.

                             As of December 31, 1999, the Company had
                             consolidated debt of approximately $3,120 million,
                             of which $1,725 million is comprised of debt
                             bearing interest at a fixed rate, with the
                             remaining $1,395 million bearing interest at
                             floating rates. Reference is made to Note 5 and
                             Items 2 and 7A of the Company's Annual Report on
                             Form 10-K for additional information regarding the
                             Company's debt and the potential impact on the
                             Company of interest rate fluctuations.

                             The following summarizes certain significant
                             financing and refinancing transactions completed
                             since December 31,1998:

                             In January 1999, the Company obtained a $30 million
                             short-term unsecured bank loan which bore interest
                             at a floating market rate. The bank loan was repaid
                             on May 21,1999 in conjunction with the replacement
                             of the $55 million negative pledge (i.e., the
                             promise not to encumber) of Coastland Mall with a
                             ten-year 7.0% mortgage loan in the principal amount
                             of $87 million collateralized by the Coastland
                             Mall.

                             In January 1999, the Company obtained an additional
                             $83.7 million floating rate interim loan (scheduled
                             to mature June 1, 1999 but partially repaid in May,
                             1999 with the remainder subsequently extended to
                             November 1999, and repaid as discussed below).

                             On January 11, 1999, the Company acquired The
                             Crossroads Mall in Kalamazoo, Michigan. The
                             aggregate purchase price was approximately $68
                             million, which was funded from the Company's new
                             short-term floating rate interim loan described
                             above. In May 1999, the Company obtained a new $45
                             million mortgage loan collateralized by The
                             Crossroads Mall to replace a portion of the $83.7
                             million of interim financing. The new mortgage loan
                             bears interest at 7.40% and matures in June 2009.


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<PAGE>   31

                        GENERAL GROWTH PROPERTIES, INC.

                             The Company is currently negotiating a $90 million
                             construction loan facility to finance the
                             renovation currently underway at Park Mall in
                             Tucson, Arizona (the final phase of which is
                             expected to be completed in 2001). In conjunction
                             with such negotiations, the Company obtained in
                             April 1999 a $25 million short-term bank loan,
                             which was increased to $50 million in October 1999.
                             The loan is currently scheduled to mature on March
                             31, 2000, and the Company expects to obtain an
                             extension of the maturity date. The Company is
                             seeking a floating rate construction loan, which is
                             expected to be replaced at project completion with
                             permanent long-term mortgage non-recourse financing
                             (see Note 5).

                             On April 29, 1999, the Company finalized the terms
                             of a new $110 million construction loan facility
                             that will be used to fund the remaining
                             construction costs for RiverTown Crossings Mall (a
                             recently completed project in Grandville (Grand
                             Rapids), Michigan as more fully described in Note
                             2). Loan amounts drawn on the facility
                             (approximately $88 million) bear interest at a rate
                             per annum equal to LIBOR plus 175 basis points. The
                             Company expects to refinance this loan facility by
                             the scheduled maturity of June 29, 2001 with
                             permanent long-term financing collateralized by the
                             center (see Note 5).

                             On July 1, 1999, the Company obtained approximately
                             $57 million of permanent long term mortgage
                             financing. The new mortgage loan, collateralized by
                             the Apache Mall, bears interest at 7.0% and is
                             scheduled to mature August 1, 2009.

                             On July 1, 1999, the Company obtained an extension
                             of the maturity date of approximately $833 million
                             of indebtedness (comprised of acquisition financing
                             of $441 million and $392 million for MEPC and
                             USPPI, respectively) from its scheduled maturity
                             date on July 1, 1999 to October 1, 1999. In
                             September 1999 the Company issued approximately
                             $700 million of commercial mortgage backed
                             securities maturing October 2004 assuming the
                             exercise of no-cost extension options aggregating
                             two years (the GGP-Ivanhoe CMBS as more fully
                             described in Note 5). The Company used the proceeds
                             from the issuance of the GGP Ivanhoe CMBS to repay
                             most of the $441 million of the MEPC Acquisition
                             Financing and, with capital contributions from
                             Ivanhoe, the $392 million interim loan
                             collateralized by the USPPI portfolio. In September
                             1999, the Company also obtained a $95 million
                             unsecured interim loan to provide among other
                             things, the remaining amount to retire the MEPC
                             Acquisition Financing. The unsecured interim loan,
                             as more fully described in Note 5, required
                             periodic principal payments ($12 million paid as of
                             December 31, 1999) until its July, 2000 maturity
                             and was fully repaid in January 2000 as described
                             below.

                             During July 1999, General Growth completed the 1999
                             Offering as more fully described in Note 1. General
                             Growth received net proceeds of approximately
                             $330.3 million from the sale of 10,000,000 shares
                             of Common Stock which were ultimately used to pay a
                             portion of the purchase price for the Ala Moana
                             Center.

                             On July 26, 1999, the Company obtained a ten-year
                             loan in the principal amount of $100 million
                             collateralized by a mortgage encumbering Cumberland
                             Mall in Atlanta, Georgia. The loan proceeds were
                             used to repay a portion of the MEPC Acquisition
                             Financing which had been collateralized by a
                             mortgage on the MEPC Portfolio (which includes
                             Cumberland Mall).



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<PAGE>   32

                        GENERAL GROWTH PROPERTIES, INC.


                             On July 30, 1999, the Company obtained a three
                             month loan (with an additional three-month
                             extension option) in the principal amount of $25
                             million collateralized by a negative pledge (i.e.,
                             the promise not to encumber) of Eagle Ridge Mall in
                             Lake Wales, Florida. This loan was repaid in
                             October 1999 with a portion of the proceeds of the
                             $130 million two-year mortgage pool financing
                             described below and in Note 5. The proceeds of the
                             loan were distributed to the Operating Partnership
                             to fund ongoing acquisition and development
                             activity.

                             During July 1999, the $100 million loan
                             collateralized by Northbrook Court was extended
                             from its scheduled maturity of August 1, 1999 to
                             November 30, 1999. Due to the formation of Homart
                             II as described below and in Note 4, this $100
                             million loan was repaid by GGP/Homart II on
                             November 30, 1999 with the proceeds from new
                             commercial mortgage-backed securities,
                             collateralized by a portion of GGP/Homart II's
                             portfolio of properties (including Northbrook
                             Court).

                             On July 30, 1999, the Company acquired 100% of the
                             Ala Moana Center in Honolulu, Hawaii, as more fully
                             described in Note 3. The transaction was funded by
                             a new $438 million short-term first mortgage loan
                             and approximately $294 million in cash including a
                             portion of the net proceeds of the 1999 Offering as
                             further described in Note 1. The Company repaid the
                             short-term mortgage loan in August 1999 through the
                             issuance of $500 million of commercial
                             mortgage-backed securities maturing September 2004
                             (assuming the exercise of no-cost extension options
                             aggregating two years) as more fully described in
                             Note 5. The Company may discuss with institutional
                             investors the formation of a new joint venture to
                             own the property. The terms of any joint venture
                             and the Company's interest in any joint venture,
                             have not been determined and the Company may not
                             ultimately elect to form any such joint venture.

                             On September 28, 1999 GGP Ivanhoe III acquired the
                             Oak View Mall in Omaha, Nebraska, and on December
                             22, 1999 it acquired the Eastridge Mall in San
                             Jose, California. The aggregate purchase price for
                             the two properties was approximately $160 million,
                             financed by capital contributions from its
                             partners, a new $83 million long-term mortgage loan
                             and approximately $30 million of other short-term
                             floating rate debt.

                             Additionally, in September 1999, the Company agreed
                             to advance approximately $31 million collateralized
                             by a second mortgage on the Crossroads Center in
                             St. Cloud (Minneapolis), Minnesota. In connection
                             with the second mortgage, the Company may be
                             required to or may elect to acquire the property in
                             April 2000 as more further described in Note 3.

                             In October 1999, the Company acquired the Baybrook
                             Mall in Houston, Texas. The aggregate purchase
                             price was approximately $133 million, which was
                             paid with the proceeds of a ten year $95 million
                             mortgage on the property and the proceeds of other
                             new secured financing.

                             In October 1999, the Company obtained a $130
                             million two-year term loan collateralized by six
                             properties which is scheduled to mature in October
                             2001 as more fully described in Note 5.


                                    32 of 39



<PAGE>   33

                        GENERAL GROWTH PROPERTIES, INC.


                             In November 1999, the Company formed GGP/Homart II,
                             a new joint venture with the New York State Common
                             Retirement Fund, its venture partner in GGP/Homart.
                             GGP/Homart II owns three regional malls contributed
                             by New York State Common Retirement Fund and three
                             operating regional malls and one mall currently
                             under construction contributed by the Company (Note
                             4).

                             In January 2000, the Company obtained a new $200
                             million unsecured short-term bank loan. The initial
                             funding of $120 million on this loan was used to
                             fund ongoing redevelopment projects and repay the
                             interim loan obtained in September 1999. This loan
                             bears interest at LIBOR plus 150 basis points and
                             matures concurrently with the July 2000 maturity of
                             the Company's Credit Facility. The Company
                             currently expects to jointly refinance these
                             obligations when due with a new revolving credit
                             facility and term loans.

                             Approximately $318 million of the Company's debt is
                             scheduled to mature in 2000. Although agreements to
                             refinance all of such indebtedness have not yet
                             been reached, the Company anticipates that all of
                             its debt will be repaid on a timely basis. Other
                             than as described above or in conjunction with
                             possible future acquisitions, there are no current
                             plans to incur additional debt or raise equity
                             capital. If additional capital is required, the
                             Company believes that it can obtain an interim bank
                             loan, obtain additional mortgage financing on
                             under-leveraged assets, enter into new joint
                             venture partnership arrangements or raise
                             additional debt or equity capital. However, there
                             can be no assurance that the Company can obtain
                             such financing on satisfactory terms. The Company
                             will continue to monitor its capital structure,
                             investigate potential joint venture arrangements
                             and purchase additional properties if they can be
                             acquired and financed on terms that the Company
                             reasonably believes will enhance long-term
                             stockholder value. When property operating cash
                             flow has been increased, the Company will consider
                             the refinancing of portions of its long-term
                             floating rate debt to pooled or property-specific
                             non-recourse fixed-rate mortgage financing.

                             Net cash provided by operating activities was
                             $222.1 million in 1999, an increase of $103.8
                             million from $118.3 million in the same period in
                             1998. Net income before allocations to the minority
                             interest increased $48 million, which was primarily
                             due to earnings attributable to properties acquired
                             in 1999 and 1998. Another significant change in
                             cash provided by operating activities was a $37.6
                             million net change in cash flows from operating
                             activities in 1999 as compared to 1998 related to
                             depreciation and amortization.

SUMMARY OF INVESTING         Net cash used by investing activities was $1,254.7
ACTIVITIES                   million in 1999 compared to $1,513.1 million of
                             cash used in 1998. Cash flow from investing
                             activities was impacted by acquisitions,
                             development and improvements to real estate
                             properties, which utilized cash of approximately
                             $1,248.4 million in 1999 and $1,360.1 million in
                             1998.

                             Net cash used by investing activities in 1998 was
                             $1,513.1 million, compared to a use of $183.5
                             million in 1997. Cash flow from investing
                             activities was affected by the timing of
                             acquisitions, development and improvements to real
                             estate properties, requiring a use of cash of
                             approximately $1,360.1 million in 1998 compared to
                             $200.6 million in 1997. The proceeds from the sale
                             of CenterMark provided funds of $130.5 million in
                             1997.


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<PAGE>   34

                        GENERAL GROWTH PROPERTIES, INC.


SUMMARY OF FINANCING         Financing activities provided cash of $1,038.5
ACTIVITIES                   million in 1999, compared to $1,388.6 million in
                             1998. The Common Stock offering in July 1999
                             provided net proceeds of approximately $330.3
                             million which, as described in Note 1, was utilized
                             to reduce outstanding indebtedness and to fund the
                             acquisition of the Ala Moana Center. As also
                             described in Note 1, the Company completed a public
                             offering of preferred stock in June 1998, the net
                             proceeds of which (approximately $322.7 million)
                             were used primarily to reduce acquisition-related
                             financing and amounts drawn on the Company's Credit
                             Facility. Such payments are reflected in the use of
                             cash for financing activities for principal
                             payments on mortgage notes and other debt in 1999
                             and 1998. An additional significant contribution of
                             cash from financing activity is financing from
                             mortgages and acquisition debt, which had a
                             positive impact of $1,736 million in 1999 versus
                             approximately $2,093 million in 1998. The
                             additional financing was used to repay existing
                             indebtedness and to fund the acquisitions and
                             redevelopment of real estate as discussed above.
                             The remaining use of cash consisted primarily of
                             increased distributions (including dividends paid
                             to preferred stockholders in 1999 and 1998).

                             Financing activities in 1998 provided $1,388.6
                             million of cash compared to a $92 million source of
                             cash flow in 1997. Distributions to common
                             stockholders and the minority interest in the
                             Operating Partnership were $103.1 million in 1998
                             compared to $88.9 million in 1997. The increase in
                             distributions is due to the increased distribution
                             rate and additional shares of Common Stock and
                             Operating Partnership Units outstanding during 1998
                             compared to 1997. Net proceeds from the issuance of
                             common stock during 1997 provided $165.8 million of
                             cash flow. Net borrowing activity provided $29.6
                             million of cash flow in 1998 compared to $37.7
                             million in 1997. The purchase of treasury stock
                             used $5.7 million of cash flow during 1997.

                             General Growth has, effective January 1, 2000,
                             established a Dividend Reinvestment and Stock
                             Purchase Plan ("DRSP"). General Growth has reserved
                             for issuance up to 1,000,000 shares of Common Stock
                             for issuance under the DRSP. The DRSP will, in
                             general, allow participants in the plan to make
                             purchases of Common Stock from dividends received
                             or additional cash investments. Although the
                             purchase price of the Common Stock will be
                             determined by the current market price, the
                             purchases will be made without fees or commissions.
                             General Growth will satisfy DRSP Common Stock
                             purchase needs through the issuance of new shares
                             of Common Stock or by repurchases of currently
                             outstanding Common Stock. Any new issuances of
                             Common Stock pursuant to the DRSP will not reduce
                             amounts otherwise available under the Company's
                             currently effective shelf-registration described
                             above.

REIT REQUIREMENTS            In order to remain qualified as a real estate
                             investment trust for federal income tax purposes,
                             the Company must distribute 100% of capital gains
                             and at least 95% of its ordinary taxable income to
                             stockholders. The following factors, among others,
                             will affect operating cash flow and, accordingly,
                             influence the decisions of the Board of Directors
                             regarding distributions: (i) scheduled increases in
                             base rents of existing leases; (ii) changes in
                             minimum base rents and/or percentage rents
                             attributable to replacement of existing leases with
                             new or renewal leases; (iii) changes in occupancy
                             rates at existing centers and procurement of leases
                             for newly developed centers; and (iv) the Company's
                             share of operating cash flow generated by GGMI and
                             the Unconsolidated Joint Ventures, to the extent
                             distributed to the Company, less oversight costs
                             and debt service on additional loans that were
                             incurred to finance Company acquisitions. The


                                    34 of 39



<PAGE>   35

                        GENERAL GROWTH PROPERTIES, INC.


                             Company anticipates that its operating cash flow,
                             and potential new debt or equity from future
                             offerings, new financings or refinancings will
                             provide adequate liquidity to conduct its
                             operations, fund general and administrative
                             expenses, fund operating costs and interest
                             payments and allow distributions to the Company's
                             preferred and common stockholders in accordance
                             with the requirements of the Internal Revenue Code
                             of 1986, as amended, for continued qualification as
                             a real estate investment trust and to avoid any
                             Company level federal income or excise tax.

RECENTLY ISSUED ACCOUNTING   As more fully described in Note 12, certain
PRONOUNCEMENTS               accounting  pronouncements  were issued in 1999,
                             which became effective in 1999 or will become
                             effective in 2000. The Company does not expect the
                             application of such new pronouncements to have a
                             significant impact on its annual reported results
                             of operations.

YEAR 2000 DISCLOSURES        The Year 2000 problem resulted from the use of a
                             two digit year date instead of a four digit date in
                             the programs that operate computers (information
                             technology or "IT" systems) and other devices (i.e.
                             "non-IT" systems such as elevators, utility
                             monitoring systems and time clocks that use
                             computer chips). Systems with a Year 2000 problem
                             had programs that were written to assume that the
                             first two digits for any date used in the program
                             would always be "19". Unless corrected, this
                             assumption could have resulted in problems when the
                             century date occurred. On that date, these computer
                             programs could have misinterpreted the date January
                             1, 2000, as January 1, 1900. This could have caused
                             systems to incorrectly process critical financial
                             and operational information, generate erroneous
                             information or fail altogether. The Year 2000 issue
                             was expected to affect almost all companies and
                             organizations.

THE COMPANY'S YEAR 2000      The Company recently upgraded its major information
EXPERIENCE:                  systems, including its databases and primary
                             accounting software, which were fully operational
                             prior to December 31, 1999. These upgrades were
                             performed primarily for the purpose of routine
                             improvements to the Company's information systems
                             and were initiated in advance of any concern for
                             the Year 2000 issue. The Company also evaluated
                             several other smaller non-IT systems (i.e. time
                             keeping systems, elevators, etc.) to verify that
                             they were Year 2000 compliant. The non-IT systems
                             evaluation process resulted in upgrades or
                             replacements purchased for certain non-IT systems
                             found to be not Year 2000 compliant. The cost of
                             the required upgrades was not significant.

                             As of the date of this report, the Company's IT
                             systems and non-IT systems have not encountered any
                             significant Year 2000 operating problems. In
                             addition, there were no significant third-party
                             Year 2000 operating problems that had any impact on
                             the Company's operations. Therefore, the Company
                             does not expect to incur any significant additional
                             costs relating the Year 2000 issue.

ECONOMIC CONDITIONS          Inflation has been relatively low and has not had a
                             significant detrimental impact on the Company.
                             Should inflation rates increase in the future,
                             substantially all of the Company's tenant leases
                             contain provisions designed to mitigate the
                             negative impact of inflation. Such provisions
                             include clauses enabling the Company to receive
                             percentage rents 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. In addition,
                             many of the leases are for terms of less than 10
                             years which may enable the Company to replace or
                             renew expiring leases with new leases at higher
                             base and/or percentage rents, if rents under the
                             expiring leases are below the then-existing market
                             rates. Finally, most of the existing leases require
                             the tenants to pay their share of certain


                                    35 of 39



<PAGE>   36

                        GENERAL GROWTH PROPERTIES, INC.


                             operating expenses, including common area
                             maintenance, real estate taxes and insurance,
                             thereby reducing the Company's exposure to
                             increases in costs and operating expenses resulting
                             from inflation.

                             Inflation also poses a potential threat to the
                             Company due to the possibility of future increases
                             in interest rates. Such increases would adversely
                             impact the Company due to the amount of its
                             outstanding floating rate debt. However, in recent
                             years, the Company's ratio of interest expense to
                             cash flow has continued to decrease. Therefore, the
                             relative risk the Company bears due to interest
                             expense exposure has been declining. In addition,
                             the Company has a policy of replacing floating rate
                             debt with fixed rate debt as market conditions
                             allow. (See also Note 5).

                             A number of local, regional and national retailers,
                             including tenants of the Company, filed for
                             bankruptcy protection during the last few years.
                             Most of the bankrupt retailers reorganized their
                             operations and/or sold stores to stronger
                             operators. Although some leases were terminated
                             pursuant to the lease cancellation rights afforded
                             by the bankruptcy laws, the impact on Company
                             earnings was negligible. Over the last three years,
                             the provision for doubtful accounts has averaged
                             only $3.3 million per year, which represents less
                             than 1% of average total revenues of $443.4
                             million.

                             The Company and its affiliates currently have
                             interests in 93 shopping centers. The Portfolio
                             Centers are diversified both geographically and by
                             property type (both major and middle market
                             properties) and this may mitigate the impact of a
                             potential economic downturn at a particular
                             property or in a particular region of the country.

                             The shopping center business is seasonal in nature.
                             Mall stores typically achieve higher sales levels
                             during the fourth quarter because of the holiday
                             selling season. Although the Company has a
                             year-long temporary leasing program, a significant
                             portion of the rents received from short-term
                             tenants are collected during the months of November
                             and December. Thus, occupancy levels and revenue
                             production are generally highest in the fourth
                             quarter of each year and lower during the first and
                             second quarters of each year.

                             The Internet and electronic retailing are growing
                             at significant rates. In 1999 the Company launched
                             a new website - Mallibu.com - and has engaged in a
                             number of other e.business initiatives. Although
                             the amount of retail sales conducted solely via the
                             Internet is expected to rise in the future, the
                             Company believes that traditional retailing and
                             "e-tailing" will converge such that the regional
                             mall will continue to be a vital part of the
                             overall mix of shopping alternatives for the
                             consumer.


ITEM 7A. QUANTITATIVE AND    The Company has not entered into any transactions
QUALITATIVE DISCLOSURES      using derivative commodity instruments. The Company
ABOUT MARKET RISK            is subject to market risk associated with changes
                             in interest rates. The economy is currently in a
                             period of rising interest rates. Interest rate
                             exposure is principally limited to the $1,395
                             million of consolidated debt of the Company
                             outstanding at December 31, 1999 that is priced at
                             interest rates that float with the market. A 25
                             basis point movement in the interest rate on the
                             floating rate debt would result in an approximate
                             $3.5 million annualized increase or decrease in
                             interest expense and a corresponding opposite
                             effect on cash flows. Additionally, approximately
                             $859 million of such floating rate consolidated
                             debt is comprised of commercial mortgage-backed
                             securities which are subject to interest rate cap
                             agreements, the effect of which is to limit the
                             interest rate the Company would be


                                    36 of 39



<PAGE>   37

                        GENERAL GROWTH PROPERTIES, INC.


                             required to pay on such debt to no more than
                             approximately 9% per annum. The remaining $1,725
                             million of consolidated debt is fixed rate debt.
                             The Company has an ongoing program of refinancing
                             its floating and fixed rate debt and believes that
                             this program allows it to vary its ratio of fixed
                             to floating rate debt and to stagger its debt
                             maturities in order to respond to changing market
                             rate conditions. Reference is made to Item 2 above
                             and Note 5 for additional debt information.


ITEM 8. FINANCIAL            Reference is made to the Index on page F-1 to
STATEMENTS AND               Financial Statements and Financial Statement
SUPPLEMENTARY DATA           Schedules for the required information.


ITEM 9. CHANGES IN AND       None.
DISAGREEMENTS WITH
ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE


PART III

ITEM 10. DIRECTORS AND       The information which appears under the captions
EXECUTIVE OFFICERS OF THE    "Proposal No. 1 - Election of Directors" and
COMPANY                      "Executive Officers" in the Company's definitive
                             proxy statement for its 2000 Annual Meeting of
                             Stockholders is incorporated by reference into this
                             Item 10.


ITEM 11. EXECUTIVE           The information which appears under the caption
COMPENSATION                 "Executive Compensation" in the Company's
                             definitive proxy statement for its 2000 Annual
                             Meeting of Stockholders is incorporated by
                             reference into this Item 11; provided, however,
                             that neither the Report of the Compensation
                             Committee of the Board of Directors on Executive
                             Compensation nor the Performance Graph set forth
                             therein shall be incorporated by reference herein,
                             in any of the Company's previous filings under the
                             Securities Act of 1933, as amended, or the
                             Securities Exchange Act of 1934, as amended, or in
                             any of the Company's future filings.


ITEM 12. SECURITY            The information which appears under the captions
OWNERSHIP OF CERTAIN         "Certain Relationships and Related Transactions"
BENEFICIAL OWNERS AND        and "Common Stock Ownership of Management" in the
                             Company's definitive proxy statement for its 2000
                             Annual Meeting of Stockholders is incorporated by
                             MANAGEMENT reference into this Item 12.


                                    37 of 39

<PAGE>   38

                        GENERAL GROWTH PROPERTIES, INC.


ITEM 13. CERTAIN             The information which appears under the caption
RELATIONSHIPS AND RELATED    "Compensation Committee Interlocks and Insider
TRANSACTIONS                 Participation" and "Certain Relationships and
                             Related Transactions" in the Company's definitive
                             proxy statement for its 2000 Annual Meeting of
                             Stockholders is incorporated by reference into this
                             Item 13.


PART IV

ITEM 14. EXHIBITS,           (a)  Financial Statements and Financial Statement
FINANCIAL STATEMENTS,        Schedules.
SCHEDULES AND REPORTS ON
                             The financial statements and schedules
                             listed in the accompanying Index to FORM 8-K
                             Consolidated Financial Statements and Financial
                             Statement Schedules are filed as part of this
                             Annual Report on Form 10-K.

                             (b) The following reports on Form 8-K were filed by
                             the Company during the last quarter of the period
                             covered by this report.

                                  1)  Current Report on Form 8-K dated November
                                      23, 1999, as amended by Form 8-K/A dated
                                      January 11, 2000, concerning the formation
                                      of GGP/Homart II. Financial statements
                                      relating to the formation of GGP/Homart II
                                      and other recent acquisitions of the
                                      Company were filed with this 8-K, as
                                      amended.

                             (c)  Exhibits.

                             See Exhibit Index on page S-1



                                    38 of 39

<PAGE>   39

                        GENERAL GROWTH PROPERTIES, INC.


                                   SIGNATURES

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

         GENERAL GROWTH PROPERTIES, INC.

<TABLE>

<S>                                                                                    <C>
By:  /s/ John Bucksbaum
---------------------------------
John Bucksbaum,
Chief Executive Officer                                                                 March 14, 2000
</TABLE>


Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the registrant and
in the capacities and on the dates indicated.
<TABLE>
<CAPTION>

SIGNATURE                                            TITLE                                DATE

<S>                                    <C>                                             <C>
 /s/ Matthew Bucksbaum
---------------------------------
Matthew Bucksbaum                       Chairman of the Board                           March 14, 2000


 /s/ Robert Michaels
---------------------------------
Robert Michaels                         President and Director                          March 14, 2000


 /s/ Bernard Freibaum
---------------------------------
Bernard Freibaum                        Executive Vice President, Chief Financial
                                        Officer and Principal Accounting Officer        March 14, 2000


 /s/ Anthony Downs
---------------------------------
Anthony Downs                           Director                                        March 14, 2000


 /s/ Morris Mark
---------------------------------
Morris Mark                             Director                                        March 14, 2000


 /s/ Beth Stewart
---------------------------------
Beth Stewart                            Director                                        March 14, 2000


 /s/ Lorne Weil
---------------------------------
A. Lorne Weil                           Director                                        March 14, 2000
</TABLE>


                                    39 of 39
<PAGE>   40


                         GENERAL GROWTH PROPERTIES, INC.



                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
                      AND CONSOLIDATED FINANCIAL STATEMENT
                                    SCHEDULE


The following financial statements and financial statement schedule are included
in Item 8 of this Annual Report on Form 10-K:

General Growth Properties, Inc.

<TABLE>
<CAPTION>
Financial Statements                                                                            Page(s)

<S>                                                                                      <C>
  Report of Independent Accountants                                                              F-2

  Consolidated Balance Sheets as of December 31, 1999 and 1998                                   F-3

  Consolidated Statements of Operations and Comprehensive Income
     for the years ended December 31, 1999, 1998 and 1997.                                       F-4

  Consolidated Statements of Stockholders' Equity for the
     years ended December 31, 1999, 1998 and 1997                                                F-5

  Consolidated Statements of Cash Flows for the years ended
     December 31, 1999, 1998 and 1997                                                            F-8

  Notes to Consolidated Financial Statements                                             F-9 to F-31


Financial Statement Schedule

  Report of Independent Accountants                                                             F-32

  Schedule III - Real Estate and Accumulated Depreciation                                       F-33
</TABLE>



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


                                      F-1

<PAGE>   41





                        REPORT OF INDEPENDENT ACCOUNTANTS


To the Board of Directors and Stockholders
General Growth Properties, Inc.


In our opinion, the accompanying consolidated balance sheets and the related
consolidated statements of operations and comprehensive income, of stockholders'
equity and of cash flows present fairly, in all material respects, the
consolidated financial position of General Growth Properties, Inc. as of
December 31, 1999 and 1998 and the consolidated results of their operations and
their cash flows for each of the three years in the period ended December 31,
1999, in conformity with accounting principles generally accepted in the United
States. These financial statements are the responsibility of the Company's
management; our responsibility is to express an opinion on these financial
statements based on our audits. We conducted our audits in accordance with
auditing standards generally accepted in the United States, which require that
we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used and the
significant estimates made by management, and evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion expressed above.





Chicago, Illinois                                     PricewaterhouseCoopers LLP
February 8, 2000



                                      F-2

<PAGE>   42


                         GENERAL GROWTH PROPERTIES, INC.

                           CONSOLIDATED BALANCE SHEETS
                           DECEMBER 31, 1999 AND 1998
              (Dollars in thousands, except for per share amounts)

<TABLE>
<CAPTION>
ASSETS                                                                          DECEMBER 31,
------                                                                  -----------------------------
                                                                           1999               1998
                                                                        ----------         ----------
<S>                                                                    <C>                <C>
Investment in Real Estate:
Land                                                                    $  640,276         $  364,699
Buildings and equipment                                                  3,664,832          3,222,237
Less accumulated depreciation                                            (376,673)          (301,789)
Developments in progress                                                    21,443             89,860
                                                                        ----------         ----------
    Net property and equipment                                           3,949,878          3,375,007
Investment in Unconsolidated Real Estate Affiliates                        666,074            386,301
Mortgage note receivable                                                    31,065                  -
                                                                        ----------         ----------
    Net Investment in Real Estate                                        4,647,017          3,761,308

Cash and cash equivalents                                                   25,593             19,630
Tenant accounts receivable, net                                             84,123             74,585
Deferred expenses, net                                                      93,536             71,593
Investment in and note receivable from
 General Growth Management, Inc.                                            65,307             84,716
Prepaid expenses and other assets                                           39,319             15,642
                                                                        ==========         ===========
                                                                        $4,954,895         $4,027,474
                                                                        ==========         ==========
</TABLE>


                      LIABILITIES AND STOCKHOLDERS' EQUITY
<TABLE>

<S>                                                                    <C>                <C>
Mortgage notes and other debts payable                                  $3,119,534         $2,648,776
Distributions payable                                                       42,695             33,757
Accounts payable and accrued expenses                                      170,868            122,303
                                                                        ----------         ----------
                                                                         3,333,097          2,804,836
                                                                        ----------         ----------
Minority interest in Operating Partnership                                 356,540            299,431
                                                                        ----------         ----------

Commitments and contingencies                                                    -                  -
Convertible Preferred Stock: $100 par value; 5,000,000
 shares authorized; 345,000 designated as PIERS (Note 1)
 which are convertible and carry a $1,000 liquidation value, 337,500
 of which were issued and outstanding at
 December 31, 1999 and 1998                                                337,500            337,500
                                                                        ----------         ----------

Stockholders' Equity:
 Common stock: $0.10 par value; 210,000,000 shares
  authorized; 51,697,425 and 39,000,972 shares issued
  and outstanding at December 31, 1999 and 1998, respectively                5,170              3,900
 Additional paid-in capital                                              1,199,921            843,238
 Retained earnings (deficit)                                              (272,199)          (258,267)
 Notes receivable - common stock purchase                                   (3,420)            (3,164)
 Accumulated equity in other comprehensive loss of unconsolidated
   affiliate                                                                (1,714)                 -
                                                                        ----------         ----------
Total Stockholders' Equity                                                 927,758            585,707
                                                                        ----------         ----------
                                                                        $4,954,895         $4,027,474
                                                                        ==========         ==========
</TABLE>


The accompanying notes are an integral part of these consolidated financial
statements.


                                      F-3

<PAGE>   43


                         GENERAL GROWTH PROPERTIES, INC.

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                            AND COMPREHENSIVE INCOME
              (Dollars in thousands, except for per share amounts)


<TABLE>
<CAPTION>
                                                                        YEARS ENDED DECEMBER 31,
                                                                 1999              1998              1997
                                                               --------          --------          --------
Revenues:
<S>                                                            <C>               <C>               <C>
     Minimum rents                                             $387,547          $268,976          $175,830
     Tenant recoveries                                          180,584           130,903            97,291
     Percentage rents                                            27,011            16,226             7,976
     Other                                                       11,795             5,796             5,577
     Fee Income                                                   5,405             4,675             4,473
                                                               --------          --------          --------
         Total Revenues                                         612,342           426,576           291,147
                                                               --------          --------          --------

Expenses:
     Real estate taxes                                           45,572            33,548            20,761
     Management fee to affiliate                                  6,612             4,288             3,308
     Property operating                                         143,622           106,986            79,175
     Provision for doubtful accounts                              4,425             2,451             3,025
     General and administrative                                   5,857             4,511             3,408
     Depreciation and amortization                              112,874            75,227            48,509
                                                               --------          --------          --------
         Total Expenses                                         318,962           227,011           158,186
                                                               --------          --------          --------
         Operating Income                                       293,380           199,565           132,961

Interest income                                                  16,482            16,011             8,523
Interest expense                                               (185,984)         (125,851)          (78,775)
Equity in net income (loss) of unconsolidated affiliates         19,689            11,067            19,344
Net gain on sales                                                 4,412               196            58,647
                                                               --------          --------          --------
Income before extraordinary items &
     allocation to minority interest                            147,979           100,988           140,700
Income allocated to minority interest                           (33,058)          (29,794)          (49,997)
                                                               --------          --------          --------
Income before extraordinary items                               114,921            71,194            90,703
Extraordinary Items                                             (13,796)           (4,749)           (1,152)
                                                               --------          --------          --------
     Net Income                                                 101,125            66,445            89,551
Convertible Preferred Stock Dividends                           (24,467)          (13,433)                -
                                                               --------          --------          --------
     Net income available to common stockholders               $ 76,658          $ 53,012          $ 89,551
                                                               ========          ========          ========
Earnings before extraordinary item per share - basic           $   1.97          $   1.60          $   2.78
                                                               ========          ========          ========
Earnings before extraordinary item per share - diluted         $   1.96          $   1.59          $   2.76
                                                               ========          ========          ========

Net earnings per share - basic                                 $   1.67          $   1.46          $   2.75
                                                               ========          ========          ========
Net earnings per share - diluted                               $   1.66          $   1.46          $   2.73
                                                               ========          ========          ========

Net Income                                                     $101,125          $ 66,445          $ 89,551
Other comprehensive income (loss):
     Equity in unrealized loss on available-for-sale
       securities of unconsolidated affiliate, net of
       minority interest                                         (1,714)                -                 -
                                                               ========          ========          ========
Comprehensive income                                           $ 99,411          $ 66,445          $ 89,551
                                                               ========          ========          ========
</TABLE>



The accompanying notes are an integral part of these consolidated financial
statements.


                                      F-4

<PAGE>   44


                         GENERAL GROWTH PROPERTIES, INC.


                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
              (Dollars in Thousands, except for Per Share Amounts)



<TABLE>
<CAPTION>
                                                                 ADDITIONAL  RETAINED               EMPLOYEE      TOTAL
                                              COMMON STOCK        PAID-IN   EARNINGS    TREASURY     STOCK     STOCKHOLDERS'
                                         SHARES       AMOUNT      CAPITAL   (DEFICIT)    STOCK       LOANS        EQUITY
                                       ----------     -------    --------   ---------   --------    -------    -------------

<S>                                   <C>            <C>        <C>        <C>         <C>         <C>        <C>
Balance, December 31, 1996             30,789,185     $ 3,079    $595,628   $(268,440)  $      -    $     -    $330,267
                                                                               89,551                            89,551
Net income
Cash distributions declared
    ($1.80 per share)                                                         (59,779)                          (59,779)
Issuance of common stock,
    less $533 of issuance costs         4,927,680         493     165,270                                       165,763
Issuance of common stock for services       2,000                      50                                            50
Exercise of stock options                  44,500                     147        (471)     1,185                    861
Purchase treasury stock                  (171,213)                                        (5,748)                (5,748)
Conversion of  operating partnership
    units to common stock                  42,825           5         776                                           781
Adjustment for minority interest
    in operating partnership                                      (23,241)                                      (23,241)
                                       ----------     -------    --------   ---------    -------    -------    ---------


Balance, December 31, 1997             35,634,977     $ 3,577    $738,630   $(239,139)   $(4,563)   $     -    $498,505

Net income                                                                     66,445                            66,445
Cash distributions declared
    ($1.88 per share)                                                         (68,940)                          (68,940)
PIERS Dividends                                                               (13,433)                          (13,433)
Cost of issuance of preferred stock                               (14,814)                                      (14,814)
Exercise of stock options,
    net of employee stock loans           166,000          14       2,526        (530)    1, 154     (3,164)          -
Purchase treasury stock                   (32,350)                                        (1,136)                (1,136)
Conversion of operating partnership
    units to common stock               3,232,345         309      47,932      (2,670)     4,545                 50,116
Adjustment for minority interest
    in operating partnership                                       68,964                                        68,964
</TABLE>



----------
continued on next page



                                      F-5

<PAGE>   45
                        GENERAL GROWTH PROPERTIES, INC.

                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
              (Dollars in Thousands, except for Per Share Amounts)
                                  - continued -
<TABLE>
<CAPTION>


                                                               ADDITIONAL   RETAINED              EMPLOYEE      TOTAL
                                              COMMON STOCK      PAID-IN     EARNINGS    TREASURY   STOCK   STOCKHOLDERS'
                                          SHARES       AMOUNT   CAPITAL     (DEFICIT)     STOCK    LOANS      EQUITY
                                        ----------     ------  ----------   ---------     -----   -------  -------------

<S>                                   <C>            <C>      <C>          <C>           <C>     <C>         <C>
Balance, December 31, 1998              39,000,972     $3,900  $  843,238   $(258,267)    $   -   $(3,164)    $585,707
                                        ----------     ------  ----------   ---------     -----   -------     --------


Net income                                                                    101,125                          101,125
Cash distributions declared
    ($1.98 per share)                                                         (90,590)                         (90,590)
PIERS Dividends                                                               (24,467)                         (24,467)
Issuance of common stock,
    net of $1,929 of issuance costs     10,000,000      1,000     329,296                                      330,296
Exercise of stock options,
    net of employee stock loans             60,000          6       1,134                            (380)         760
Reduction in employee stock loans
Conversion of operating partnership                                                                   124          124
    units to common stock
Conversion of interests
    in GGP/Homart to Common Stock        2,603,291        261      90,252                                       90,513
Conversion of operating partnership
    units to common stock                   33,162          3         519                                          522
Adjustment for minority interest
    in operating partnership                                      (64,518)                                     (64,518)
                                        ----------     ------  ----------   ---------     -----   -------     --------

    Totals                              51,697,425     $5,170  $1,199,921   $(272,199)    $   -   $(3,420)    $929,472
                                        ==========     ======  ==========   =========     =====   =======     ========

Accumulated equity in other
    comprehensive loss of
    unconsolidated affiliate                                                                                    (1,714)
                                                                                                              --------

Balance, December 31, 1999                                                                                    $927,758
                                                                                                              ========
</TABLE>



The accompanying notes are an integral part of these consolidated financial
statements.



                                      F-6

<PAGE>   46
                        GENERAL GROWTH PROPERTIES, INC.

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
              (Dollars in thousands, except for per share amounts)
<TABLE>
<CAPTION>


                            YEARS ENDED DECEMBER 31,
                                                                1999                1998                1997
                                                             ----------          ----------           --------
<S>                                                          <C>                 <C>                  <C>
Cash flows from operating activities:
 Net Income                                                  $  101,125          $   66,445           $ 89,551
 Adjustments to reconcile net income to
     net cash provided by operating activities:
 Minority interest                                               33,058              29,794             49,997
 Net gain on sales                                               (4,412)               (196)           (58,647)
 Extraordinary items                                             10,454                   -                 79
 Equity in net income of unconsolidated affiliates              (19,689)            (11,067)           (19,344)
 Provision for doubtful accounts                                  4,425               2,451              3,025
 Distributions received from unconsolidated affiliates           29,825              21,672             16,506
 Depreciation                                                   105,046              68,494             44,551
 Amortization                                                     7,828               6,733              3,957
Net Changes:
 Tenant accounts receivable                                     (26,856)            (42,187)           (12,490)
 Prepaid expenses and other assets                               (9,183)             (6,557)                46
 Accounts payable and accrued expenses                           (9,487)            (17,278)           (16,082)
                                                             ----------          ----------           --------
       Net cash provided by (used in) operating activities      222,134             118,304            101,149
                                                             ----------          ----------           --------

Cash flows from investing activities:
 Acquisition/development of real estate
     and additions to properties                             (1,248,371)         (1,360,071)          (200,564)
 Increase in investments in unconsolidated affiliates           (55,361)            (92,990)           (86,233)
 Increase in mortgage note receivable                           (31,065)                  -                  -
 Change in notes receivable from General
     Growth Management, Inc.                                      6,671             (33,031)           (24,045)
 Reduction in employee stock loans                                  124                   -                  -
 Proceeds received from sale of CenterMark stock                      -                   -            130,500
 Distributions received from unconsolidated affiliates           89,734               6,485              3,846
 Increase in deferred expenses                                  (16,429)            (33,540)            (7,039)
                                                             ----------          ----------           --------
      Net cash provided by (used in) investing activities    (1,254,697)         (1,513,147)          (183,535)
                                                             ----------          ----------           --------

Cash flows from financing activities:
 Cash distributions paid to common stockholders                (82,439)             (66,639)           (56,989)
 Cash distributions paid to minority interest                  (38,434)             (36,467)           (31,884)
 Proceeds from exercised options                                    760                   -                861
 Proceeds of preferred stock issuance,
     net of issuance costs of $14,814                                 -             322,686                  -
 Proceeds of common stock issuance, net of
     issuance costs of $1,929 in 1999 and $533 in 1997          330,296                   -             165,763
 Capital contribution from minority interest                          -                 119                   -
</TABLE>


continued on next page


                                      F-7

<PAGE>   47
                        GENERAL GROWTH PROPERTIES, INC.

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
              (Dollars in thousands, except for per share amounts)
                                  - continued -

<TABLE>
<CAPTION>

                            YEARS ENDED DECEMBER 31,
                                                                1999                1998                1997
                                                             ----------          ----------           ---------
<S>                                                          <C>                 <C>                  <C>
 Payment of dividends on PIERS                               $  (24,467)         $   (7,316)          $       -
 Proceeds from issuance of mortgage / other
     notes payable                                            1,736,072           2,093,000             832,525
 Principal payments on mortgage notes and
     other debts payable                                       (867,713)           (913,229)           (802,929)
 Purchase of treasury stock                                           -              (1,136)             (5,748)
 Increase in deferred financing costs                           (15,549)             (2,443)             (9,262)
                                                             ----------          ----------           ---------
     Net cash provided by (used in) financing activities      1,038,526           1,388,575              92,337
                                                             ----------          ----------           ---------

Net change in cash and cash equivalents                           5,963              (6,268)              9,951
     Cash and cash equivalents at beginning of year              19,630              25,898              15,947
                                                             ==========          ==========           =========
     Cash and cash equivalents at end of year                $   25,593          $   19,630           $  25,898
                                                             ==========          ==========           =========
Supplemental disclosure of cash flow information:
     Interest paid                                           $  197,178          $  128,987           $  79,787
     Interest capitalized                                        17,166              12,028               4,753
                                                             ==========          ==========           =========

Non-cash investing and financing activities:
 Debt assumed as consideration to seller for purchase
     of real estate                                          $        -          $ 289,530            $185,298
 Treasury stock exchanged for Operating Partnership Units             -              1,875                   -
 Common stock issued in exchange for Operating
     Partnership Units                                              522             48,241                 781
 Common stock issued in exchange for GGP/Homart stock            90,513                  -                   -
 Contribution of property, other assets and related debt,
     net to GGP/Homart II                                       224,033                  -                   -
 Notes receivable issued for exercised stock options                380              3,164                   -
 Operating Partnership Units and common stock
     issued as consideration for purchase of real estate              -            163,514              30,408
 Penalty on retirement of debt                                    8,655                  -                   -
 Distributions payable                                           42,695             33,757              24,421
</TABLE>


The accompanying notes are an integral part of these consolidated financial
statements.


                                      F-8

<PAGE>   48


                         GENERAL GROWTH PROPERTIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              (Dollars in thousands, except for per share amounts)





NOTE 1  ORGANIZATION         GENERAL
                             General Growth Properties, Inc., a Delaware
                             corporation ("General Growth"), was formed in 1986
                             to own and operate regional mall shopping centers.
                             All references to the "Company" in these notes to
                             Consolidated Financial Statements include General
                             Growth and those entities owned or controlled by
                             General Growth (including the Operating Partnership
                             as described below), unless the context indicates
                             otherwise. On April 15, 1993, General Growth
                             completed its initial public offering and a
                             business combination involving entities under
                             varying common ownership. Proceeds from the initial
                             public offering were used to acquire a majority
                             interest in GGP Limited Partnership (the "Operating
                             Partnership") which was formed to succeed to
                             substantially all of the interests in regional mall
                             general partnerships owned and controlled by the
                             Company and its original stockholders. The Company
                             conducts substantially all of its business through
                             the Operating Partnership.

                             During July 1999, General Growth completed a public
                             offering of 10,000,000 shares of Common Stock (the
                             "1999 Offering"). General Growth received net
                             proceeds of approximately $330,296 of which a
                             portion was used to reduce outstanding loans
                             including certain indebtedness to affiliates of the
                             underwriter of the 1999 Offering. In addition, a
                             portion of the proceeds of the 1999 Offering were
                             used to fund a portion of the purchase price of Ala
                             Moana Center (Note 3).

                             REDEEMABLE PREFERRED STOCK
                             During June 1998, General Growth completed a public
                             offering of 13,500,000 depositary shares (the
                             "Depositary Shares"), each representing 1/40 of a
                             share of 7.25% Preferred Income Equity Redeemable
                             Stock, Series A, par value $100 per share
                             ("PIERS"). General Growth received net proceeds of
                             approximately $322,686 which were utilized to fund
                             certain of the acquisitions described in Note 3 and
                             for other working capital needs. The PIERS are
                             convertible at any time, at the option of the
                             holder, into shares of Common Stock at the
                             conversion price of $39.70 per share of Common
                             Stock. In addition, the PIERS have a preference on
                             liquidation of General Growth equal to $1,000 per
                             PIERS (equivalent to $25.00 per Depositary Share),
                             plus accrued and unpaid dividends, if any, to the
                             liquidation date. The PIERS and the Depositary
                             Shares are subject to mandatory redemption by
                             General Growth on July 15, 2008 at a price of
                             $1,000 per PIERS, plus accrued and unpaid
                             dividends, if any, to the redemption date.
                             Accordingly, the PIERS have been reflected in the
                             accompanying financial statements at such
                             liquidation or redemption value.

SHAREHOLDER RIGHTS PLAN      In November  1998,  General  Growth  adopted a
                             shareholder rights plan (the "Plan"), pursuant to
                             which General Growth declared a dividend of one
                             preferred share purchase right (a "Right") for each
                             outstanding share of Common Stock outstanding on
                             December 10, 1998 to the shareholders of record on
                             that date. Prior to becoming exercisable, the
                             Rights trade together with the Common Stock. In
                             general, the Rights will become exercisable if a
                             person or group acquires or announces a tender or
                             exchange offer for 15% or more of the Common Stock.
                             Each Right will initially entitle the holder to
                             purchase from General Growth one one-thousandth of
                             a share of newly-created Series A Junior
                             Participating Preferred Stock, par value $100 per
                             share (the "Preferred Stock"), at an exercise price
                             of $148 per one one-thousandth of a share, subject
                             to adjustment. In the event that a person or group
                             acquires 15% or more of the Common Stock, each
                             Right



                                      F-9


<PAGE>   49

                        GENERAL GROWTH PROPERTIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              (Dollars in thousands, except for per share amounts)

                             will entitle the holder (other than the acquirer)
                             to purchase shares of Common Stock (or, in certain
                             circumstances, cash or other securities) having a
                             market value of twice the exercise price of a Right
                             at such time. Under certain circumstances, each
                             Right will entitle the holder (other than the
                             acquirer) to purchase common stock of the acquirer
                             having a market value of twice the exercise price
                             of a Right at such time. In addition, under certain
                             circumstances, the Board of Directors of General
                             Growth may exchange each Right (other than those
                             held by the acquirer) for one share of Common
                             Stock, subject to adjustment. The Rights expire on
                             November 18, 2008, unless earlier redeemed by the
                             General Growth for $0.01 per Right or such
                             expiration date is extended.

                             OPERATING PARTNERSHIP
                             The Operating Partnership commenced operations on
                             April 15, 1993 and as of December 31, 1999, it
                             owned 100% of fifty-two regional shopping centers
                             (the "Wholly-Owned Centers"); 50% of the stock of
                             GGP/Homart, Inc. ("GGP/Homart"), 50% of the stock
                             of GGP/Homart II, L.L.C. ("GGP/Homart II"), 51% of
                             GGP Ivanhoe, Inc. ("GGP Ivanhoe"), 51% of GGP
                             Ivanhoe III, Inc. ("GGP Ivanhoe III"), 50% of Quail
                             Springs Mall and Town East Mall, (collectively the
                             "Unconsolidated Joint Ventures"), and a 100%
                             non-voting preferred stock interest representing
                             95% of the equity interest in General Growth
                             Management, Inc. ("GGMI"). As of such date,
                             GGP/Homart owned interests in twenty-three shopping
                             centers, GGP/Homart II owned interests in seven
                             shopping centers (including one shopping center
                             under construction), GGP Ivanhoe owned 100% of two
                             shopping centers, and GGP Ivanhoe III (through a
                             wholly owned subsidiary) owned 100% of eight
                             shopping centers.

                             As of December 31, 1999, the Company owned an
                             approximate 72% general partnership interest in the
                             Operating Partnership (excluding its preferred
                             units of partnership interest as discussed below).
                             The remaining approximate 28% minority interest in
                             the Operating Partnership is held by limited
                             partners that include trusts for the benefit of the
                             families of the original stockholders who initially
                             owned and controlled the Company and subsequent
                             contributors of properties to the Company. These
                             minority interests are represented by common units
                             of limited partnership interest in the Operating
                             Partnership (the "Units"). The Units can be
                             redeemed for cash or, at General Growth's election
                             with certain restrictions, for shares of Common
                             Stock on a one-for one basis. The holders of the
                             Units also share equally with General Growth's
                             common stockholders on a per share basis in any
                             distributions by the Operating Partnership on the
                             basis that one Unit is equivalent to one share of
                             Common Stock.

                             In connection with the issuance of the Depositary
                             Shares and in order to enable General Growth to
                             comply with its obligations in respect to the
                             PIERS, the Operating Partnership Agreement was
                             amended to provide for the issuance to General
                             Growth of preferred units of limited partnership
                             interest (the "Preferred Units") in the Operating
                             Partnership which have rights, preferences and
                             other privileges, including distribution,
                             liquidation, conversion and redemption rights, that
                             mirror those of the PIERS. Accordingly, the
                             Operating Partnership is required to make all
                             required distributions on the Preferred Units prior
                             to any distribution of cash or assets to the
                             holders of the Units. At December 31, 1999, 100% of
                             the Preferred Units of the Operating Partnership
                             (337,500) were owned by General Growth.


                                      F-10

<PAGE>   50

                        GENERAL GROWTH PROPERTIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              (Dollars in thousands, except for per share amounts)

                             Changes in outstanding Operating Partnership Units
                             (excluding the Preferred Units) for the three years
                             ending December 31, 1999, are as follows:

<TABLE>
<CAPTION>
                                                                                          UNITS
                                                                                       -----------

<S>                                                                                     <C>
                             December 31, 1996                                          17,934,410

                                 Acquisition of Southlake Mall                             353,537
                                 Acquisition of Valley Hills Mall                          518,833
                                 Conversion to common stock                               (42,825)
                                                                                       -----------

                             December 31, 1997                                          18,763,955
                                 Acquisition of Southwest Plaza                            505,420
                                 Acquisition of Altamonte Mall                           3,683,143
                                 Acquisition of Mall St. Vincent                           111,181
                                 Conversion to common stock                            (3,232,345)
                                                                                       -----------

                             December 31, 1998                                         19,831,354
                                 Conversion to common stock                              (33,162)

                             December 31, 1999                                          19,798,192
                                                                                       ===========
</TABLE>



                             BUSINESS SEGMENT INFORMATION
                             The Financial Accounting Standards Board (the
                             "FASB") issued Statement No. 131, "Disclosures
                             about Segments of an Enterprise and Related
                             Information" ("Statement 131") in June of 1997.
                             Statement 131 requires disclosure of certain
                             operating and financial data with respect to
                             separate business activities within an enterprise.
                             The sole business of General Growth and its
                             consolidated affiliates is the owning and operation
                             of shopping centers. General Growth evaluates
                             operating results and allocates resources on a
                             property-by-property basis. General Growth does not
                             distinguish or group its operations on a geographic
                             basis. Accordingly, General Growth has concluded it
                             has a single reportable segment for Statement 131
                             purposes. Further, all operations are within the
                             United States and no customer or tenant comprises
                             more than 10% of consolidated revenues. Therefore,
                             no additional disclosure due to Statement 131 is
                             currently required.




                                      F-11
<PAGE>   51
                        GENERAL GROWTH PROPERTIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
             (Dollars in thousands, except for per share amounts)



NOTE 2                      PRINCIPLES OF CONSOLIDATION
SUMMARY OF SIGNIFICANT      The accompanying consolidated financial statements
ACCOUNTING                  include the accounts of the Company consisting of
POLICIES                    the fifty-two centers and the unconsolidated
                            investments in GGP/Homart, GGP/Homart II, GGP
                            Ivanhoe, GGP Ivanhoe III, Quail Springs Mall, Town
                            East Mall and GGMI. All significant intercompany
                            balances and transactions have been eliminated.

                            REVENUE RECOGNITION
                            Minimum rent revenues are recognized on a
                            straight-line basis over the term of the related
                            leases. Percentage rents are recognized on an
                            accrual basis (see Note 12). Recoveries from tenants
                            for taxes, insurance and other shopping center
                            operating expenses are recognized as revenues in the
                            period the applicable costs are incurred.

                            The Company provides an allowance for doubtful
                            accounts against the portion of accounts receivable
                            which is estimated to be uncollectible. Such
                            allowances are reviewed periodically based upon the
                            recovery experience of the Company. Accounts
                            receivable in the accompanying consolidated balance
                            sheets are shown net of an allowance for doubtful
                            accounts of $7,600 and $7,737 as of December 31,
                            1999 and 1998, respectively.

                            CASH AND CASH EQUIVALENTS
                            The Company considers all highly liquid investments
                            purchased with original maturities of three months
                            or less to be cash equivalents. The cash and cash
                            equivalents of the Company are held at two financial
                            institutions.

                            DEFERRED EXPENSES
                            Deferred expenses consist principally of financing
                            fees and leasing commissions, which are amortized
                            over the terms of the respective agreements.
                            Deferred expenses in the accompanying consolidated
                            balance sheets are shown at cost, net of accumulated
                            amortization of $38,004 and $30,685 as of December
                            31, 1999 and 1998, respectively.

                            FAIR VALUE OF FINANCIAL INVESTMENTS
                            Statement No. 107, Disclosure about the Fair Value
                            of Financial Instruments, ("SFAS No. 107"), issued
                            by the Financial Accounting Standards Board
                            ("FASB"), requires the disclosure of the fair value
                            of the Company's financial instruments for which it
                            is practicable to estimate that value, whether or
                            not such instruments are recognized in the
                            consolidated balance sheets. SFAS No. 107 does not
                            apply to all balance sheet items and the Company has
                            utilized market information as available or present
                            value techniques to estimate the SFAS No. 107 values
                            required to be disclosed. Since such values are
                            estimates, there can be no assurance that the SFAS
                            No. 107 value of any financial instrument could be
                            realized by immediate settlement of the instrument.
                            The Company considers the carrying value of its cash
                            and cash equivalents to approximate the SFAS No. 107
                            value due to the short maturity of these
                            investments. Based on borrowing rates available to
                            the Company at the end of 1999 for mortgage loans
                            with similar terms and maturities, the SFAS No. 107
                            value of the mortgage notes and other debts payable
                            approximates carrying value at December 31, 1999 and
                            1998. In addition, the Company estimates that the
                            SFAS No. 107 value of its interest rate cap
                            agreements (Note 5) at December 31, 1999 is
                            approximately $7,259. The Company has no other
                            significant financial instruments.


                                      F-12
<PAGE>   52

                        GENERAL GROWTH PROPERTIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
             (Dollars in thousands, except for per share amounts)



                            PROPERTIES
                            Real estate assets are stated at cost. Interest and
                            real estate taxes incurred during construction
                            periods are capitalized and amortized on the same
                            basis as the related assets. The real estate assets
                            of the Company are periodically reviewed for
                            impairment. Depreciation expense is computed using
                            the straight-line method based upon the following
                            estimated useful lives:

<TABLE>
<CAPTION>
                                                                           YEARS
                            <S>                                            <C>

                                 Buildings and improvements                 40

                                 Equipment and fixtures                     10
</TABLE>

                            Construction allowances paid to tenants are
                            capitalized and depreciated over the average lease
                            term. Maintenance and repairs are charged to expense
                            when incurred. Expenditures for improvements are
                            capitalized.

                            INVESTMENTS IN UNCONSOLIDATED AFFILIATES
                            The Company accounts for its investments in
                            unconsolidated affiliates using the equity method
                            whereby the cost of an investment is adjusted for
                            the Company's share of equity in net income or loss
                            from the date of acquisition and reduced by
                            distributions received. The Company generally shares
                            in the profit and losses, cash flows and other
                            matters relating to its unconsolidated affiliates in
                            accordance with its respective ownership
                            percentages. However, due to currently unpaid and
                            accrued preferences on the GGMI preferred stock as
                            described in Note 4, the Company was entitled to
                            100% of the earnings (loss) and cash flows generated
                            by GGMI in 1999, 1998 and 1997. In addition,
                            differences between the Company's carrying value of
                            its investment in the unconsolidated affiliates and
                            the Company's share of the underlying equity of such
                            unconsolidated affiliates are amortized over the
                            respective lives of the unconsolidated affiliates.

                            INCOME TAXES
                            General Growth elected to be taxed as a real estate
                            investment trust under sections 856-860 of the
                            Internal Revenue Code of 1986 (the "Code"),
                            commencing with its taxable year beginning January
                            1, 1993. In order to qualify as a real estate
                            investment trust, General Growth is required to
                            distribute at least 95% of its ordinary taxable
                            income and 100% of capital gains to stockholders and
                            to meet certain asset and income tests as well as
                            certain other requirements. As a real estate
                            investment trust, General Growth will generally not
                            be liable for Federal income taxes, provided it
                            satisfies the necessary requirements. As a result,
                            Federal income taxes related to the distribution in
                            the form of dividends of substantially all of the
                            net taxable income of General Growth as described
                            above are payable by the stockholders of General
                            Growth. Accordingly, the consolidated statements of
                            operations do not reflect a provision for income
                            taxes. State income taxes are not significant.

                            One of the Company's affiliates, GGMI, is a taxable
                            corporation and accordingly, state and Federal
                            income taxes on its net taxable income are payable
                            by GGMI.

                            EARNINGS PER SHARE ("EPS")
                            Basic per share amounts are based on the weighted
                            average of common shares outstanding of 45,940,104
                            for 1999, 36,190,367 for 1998 and 32,622,665 for
                            1997. Diluted per share amounts are based on the
                            total number of weighted average common


                                      F-13
<PAGE>   53

                            shares and dilutive securities (stock options)
                            outstanding of 46,030,559 for 1999, 36,381,914 for
                            1998 and 32,839,637 for 1997. The effect of the
                            issuance of the PIERS is anti-dilutive with respect
                            to the Company's calculation of diluted earnings per
                            share for the year ended December 31, 1999 and 1998
                            and therefore has been excluded. Of the options
                            outstanding, options to purchase 2,000 shares of
                            Common Stock at $37.69 per share (granted in 1999)
                            and 227,500 shares of Common Stock at $36.19 per
                            share (granted in 1998) were not included in the
                            computation of diluted earnings per share because
                            the exercise price of the options was higher than
                            the average market price of the Common Stock for the
                            applicable periods and, therefore, the effect would
                            be anti-dilutive. The outstanding Units have been
                            excluded from the diluted earnings per share
                            calculation as there would be no effect on the EPS
                            amounts since the minority interests' share of
                            income would also be added back to net income.
                            Options to purchase 313,964 shares of Common Stock
                            pursuant to General Growth's 1998 Incentive Stock
                            Plan were granted on March 25, 1999 but were not
                            included in the computation of diluted EPS because
                            the conditions which must be satisfied prior to the
                            issuance of any such shares under the Plan were not
                            achieved during the applicable period.

                            The following are the reconciliations of the
                            numerators and denominators of the basic and diluted
                            EPS:

<TABLE>
<CAPTION>
                                                                                YEAR ENDED
                                                                               DECEMBER 31,
                                                                          1999            1998            1997
<S>                                                                     <C>             <C>             <C>
Numerators:
    Income before extraordinary items                                   $114,921        $ 71,194        $ 90,703
    Dividends on PIERS                                                   (24,467)        (13,433)             --
    Extraordinary items                                                  (13,796)         (4,749)         (1,152)
                                                                        --------        --------        --------
    Net income available to common shareholders for basic
       and diluted EPS                                                  $ 76,658        $ 53,012        $ 89,551
                                                                        --------        --------        --------

Denominators (in thousands):
    Weighted average common shares outstanding for basic EPS              45,940          36,190          32,623
    Effect of dilutive securities - options                                   91             192             217
                                                                        --------        --------        --------
    Weighted average common shares outstanding for diluted EPS            46,031          36,382          32,840
                                                                        ========        ========        ========
</TABLE>

                            MINORITY INTEREST
                            Income before minority interest is allocated to the
                            limited partners (the "Minority Interest") based on
                            their ownership percentage of the Operating
                            Partnership. The ownership percentage is determined
                            by dividing the numbers of Operating Partnership
                            Units held by the Minority Interest by the total
                            Operating Partnership Units (excluding Preferred
                            Units) outstanding. The issuance of additional
                            shares of common stock or Operating Partnership
                            Units changes the percentage ownership of both the
                            Minority Interest and the Company. Since a Unit is
                            generally redeemable for cash or Common Stock at the
                            option of the Company, it may be deemed to be
                            equivalent to a common share. Therefore, such
                            transactions are treated as capital transactions and
                            result in an allocation between stockholders' equity
                            and Minority Interest in the accompanying balance
                            sheets to account for the change in the ownership of
                            the underlying equity in the Operating Partnership.



                                      F-14
<PAGE>   54
                        GENERAL GROWTH PROPERTIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
             (Dollars in thousands, except for per share amounts)



                            ESTIMATES

                            The preparation of financial statements in
                            conformity with generally accepted accounting
                            principles requires management to make estimates and
                            assumptions. These estimates and assumptions affect
                            the reported amounts of assets and liabilities and
                            the disclosure of contingent assets and liabilities
                            at the date of the financial statements and the
                            reported amounts of revenues and expenses during the
                            reporting period. Actual results could differ from
                            those estimates.

                            COMPREHENSIVE INCOME
                            Statement of Financial Accounting Standards No. 130
                            "Reporting Comprehensive Income" requires that the
                            Company disclose comprehensive income in addition to
                            net income. Comprehensive income is a more inclusive
                            financial reporting methodology that encompasses net
                            income and all other changes in equity except those
                            resulting from investments by and distributions to
                            equity holders. One item included in comprehensive
                            income but not net income is unrealized holding
                            gains or losses on marketable securities classified
                            as available-for-sale. Although General Growth and
                            its consolidated affiliates do not have any
                            available-for-sale securities, one of its
                            unconsolidated affiliates received common stock of
                            an unrelated publicly traded entity as part of a
                            1998 transaction. Unrealized holding gains or losses
                            on such securities through December 31, 1998 were
                            not significant and were not reflected. However, the
                            Company has reduced its carrying amount for its
                            investment in such unconsolidated affiliate by
                            $2,436 and reflected $1,714 as other comprehensive
                            loss, net of minority interest of $722, as its
                            equity in such unconsolidated affiliate's cumulative
                            unrealized holding loss on such securities for the
                            year ended December 31, 1999.

                            RECLASSIFICATIONS

                            The consolidated financial statements for prior
                            periods have been reclassified to conform with
                            current classifications with no effect on results of
                            operations.


NOTE 3 PROPERTY             WHOLLY-OWNED PROPERTIES
ACQUISITIONS AND            1999
DEVELOPMENTS                On January 11, 1999, the Company acquired a 100%
                            ownership interest in The Crossroads Mall in
                            Kalamazoo, Michigan. The aggregate purchase price
                            was approximately $68,000 (subject to pro-rations
                            and certain adjustments), which was funded initially
                            from a new $83,655 short-term floating rate interim
                            loan. In May 1999, a new $45,000 ten-year
                            non-recourse mortgage loan collateralized by the
                            property was obtained.

                            On July 30, 1999, the Company acquired a 100%
                            ownership interest in the Ala Moana Center in
                            Honolulu, Hawaii. The price paid to the seller was
                            $810,000 (before closing adjustments, including a
                            credit for the cost to complete an ongoing expansion
                            project), and was funded with the proceeds of a
                            short-term first mortgage loan of approximately
                            $438,000 and approximately $294,000 in cash
                            including a portion of the net proceeds from the
                            1999 Offering. The short-term floating rate loan was
                            fully repaid on August 26,1999 with the proceeds of
                            the issuance of commercial mortgage-backed
                            securities.

                            On October 28, 1999, the Company acquired Baybrook
                            Mall in Houston, Texas. The aggregate consideration
                            paid by the Company was approximately $133,000
                            (subject to



                                      F-15
<PAGE>   55
                        GENERAL GROWTH PROPERTIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
             (Dollars in thousands, except for per share amounts)



                            pro-rations and certain adjustments), which was paid
                            in cash (raised primarily through new long-term
                            financing on other previously unsecured properties),
                            and a new 10-year $95,000 non-recourse loan.

                            1998
                            On April 2, 1998, the Company acquired Southwest
                            Plaza located in Denver, Colorado. On May 8, 1998,
                            the Company completed the acquisition of Northbrook
                            Court Shopping Center located in Northbrook
                            (Chicago), Illinois. The aggregate purchase price
                            for Southwest Plaza and Northbrook Court was
                            approximately $261,000, including approximately
                            $149,000 of assumed debt.

                            On June 2, 1998, the Company acquired the U.S.
                            retail property portfolio (the "MEPC Portfolio") of
                            MEPC plc, a United Kingdom based real estate company
                            ("MEPC"), through the purchase of the stock of the
                            three U.S. subsidiaries of MEPC ("MEPC U.S.
                            Subsidiaries") that directly or indirectly owned the
                            MEPC Portfolio. The Company acquired the MEPC
                            Portfolio for approximately $871,000 (less certain
                            adjustments for tenant allowances, construction
                            costs, MEPC U.S. Subsidiary liabilities and other
                            items). The Company borrowed approximately $830,000
                            to finance the purchase price for the stock, which
                            was paid in cash at closing as more fully described
                            in Note 5. The MEPC Portfolio consists of eight
                            enclosed mall shopping centers: Apache Mall in
                            Rochester, Minnesota; The Boulevard Mall in Las
                            Vegas, Nevada; Cumberland Mall in Atlanta, Georgia;
                            McCreless Mall in San Antonio, Texas; Northridge
                            Fashion Center in Northridge (Los Angeles),
                            California; Regency Square Mall in Jacksonville,
                            Florida; Riverlands Shopping Center in LaPlace,
                            Louisiana and Valley Plaza Mall in Bakersfield,
                            California.

                            On July 21, 1998, the Company acquired Altamonte
                            Mall in Altamonte Springs (Orlando), Florida. The
                            aggregate consideration paid for Altamonte Mall was
                            $169,000 (subject to prorations and certain
                            adjustments), part of which was paid by the payoff
                            of approximately $24,000 of indebtedness assumed at
                            acquisition with cash borrowed under the Company's
                            line of credit facility (the "Credit Facility") as
                            described in Note 5, and the balance of which was
                            paid by the issuance of 3,683,143 Units.

                            On September 3, 1998, the Company acquired Pierre
                            Bossier Mall in Bossier City (Shreveport),
                            Louisiana. The aggregate consideration paid for
                            Pierre Bossier Mall was approximately $52,700
                            (subject to prorations and certain adjustments)
                            which was paid in the form of approximately $10,000
                            in cash (borrowed under the Company's Credit
                            Facility), a new mortgage loan (obtained from an
                            independent third party) of approximately $42,000
                            and the assumption of approximately $700 of existing
                            debt. The Company had previously loaned the sellers
                            approximately $50,000 in early 1999 and received an
                            option to buy the property. In conjunction with the
                            closing of the sale, the loan was fully repaid.

                            On September 15, 1998, the Company acquired Spring
                            Hill Mall in West Dundee (Chicago), Illinois. The
                            aggregate consideration paid by the Company was
                            approximately $124,000 (subject to prorations and
                            certain adjustments) which was paid in the form of
                            approximately $32,000 in cash (borrowed under the
                            Company's Credit Facility) and a new ten year fixed
                            rate $92,000 mortgage loan.

                            On September 18, 1998, the Company acquired
                            Coastland Center in Naples, Florida, for
                            approximately $114,500 in cash (subject to
                            prorations and certain adjustments). The



                                      F-16
<PAGE>   56
                        GENERAL GROWTH PROPERTIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
             (Dollars in thousands, except for per share amounts)



                            aggregate consideration paid was borrowed under the
                            Company's Credit Facility.

                            On October 21, 1998, the Company acquired Mall St.
                            Vincent in Shreveport, Louisiana. The aggregate
                            consideration paid for Mall St. Vincent was $26,400
                            (subject to prorations and certain adjustments)
                            which was paid by issuing 200,052 Units (of which
                            88,871 were immediately redeemed for cash (borrowed
                            under the Company's Credit Facility) upon demand of
                            the holders of such Units) and by assuming
                            approximately $19,200 of mortgage debt.

                            1997
                            On March 31, 1997, the Company acquired Market Place
                            Mall for a cash purchase price of approximately
                            $70,000 (borrowed under the Company's Credit
                            Facility). Market Place Mall is located in
                            Champaign, Illinois.

                            During the second quarter of 1997, the Company
                            acquired three properties, Century Plaza, Southlake
                            Mall and Eden Prairie Center. Century Plaza located
                            in Birmingham, Alabama, was acquired on May 1, 1997,
                            for $31,800 in cash. Southlake Mall, located in
                            Atlanta, Georgia, was acquired on June 18, 1997, for
                            a purchase price of $67,000 which consisted of
                            $45,100 of mortgage debt assumption, $11,500 of
                            Operating Partnership Units (353,537 units), and
                            $10,400 in cash. The aggregate consideration paid
                            for Eden Prairie Center located in Eden Prairie
                            (Minneapolis), Minnesota was $19,900. It included
                            the assumption of a $16,800 mortgage loan, the
                            payment of $1,100 in cash and the assumption of
                            $2,000 of short-term liabilities.

                            The Company acquired Valley Hills Mall, located in
                            Hickory, North Carolina, on October 23, 1997, for a
                            purchase price of approximately $34,500. The
                            purchase price consisted of approximately $18,900 of
                            Operating Partnership Units (518,833 units) and the
                            assumption of approximately $15,600 of mortgage
                            debt.

                            GENERAL
                            The acquisitions were accounted for utilizing the
                            purchase method and, accordingly, the results of
                            operations are included in the Company's results of
                            operations from the respective dates of acquisition
                            (for pro forma effect, see Note 13). The Company
                            financed the forgoing acquisitions through a
                            combination of secured and unsecured debt, issuance
                            of Operating Partnership Units and the proceeds of
                            the public offerings of Depositary Shares and Common
                            Stock as described in Note 1.

                            MORTGAGE NOTE RECEIVABLE

                            During September 1999, St. Cloud Funding, L.L.C., a
                            wholly-owned subsidiary of the Operating Partnership
                            ("St. Cloud Funding"), agreed to advance
                            approximately $31,000 to an unaffiliated developer
                            in the form of a second mortgage loan (bearing
                            interest at 15% per annum) collateralized by such
                            developer's ownership interest in Crossroads Center
                            in St. Cloud (Minneapolis), Minnesota.
                            Contemporaneously with the loan, St. Cloud Mall
                            L.L.C., all of the interests of which are owned by
                            the Company ("St. Cloud Mall"), was granted an
                            option to acquire the property in 2002. The loan had
                            a scheduled maturity of June 1, 2004 which was
                            accelerated in February 2000 to April 28, 2000. In
                            conjunction with the maturity date modification, a
                            put option agreement now permits the borrower (after
                            March 15, 2000) to require St. Cloud Mall to
                            purchase the property. In addition, St. Cloud Mall's
                            purchase option was advanced to April 2000. Any
                            resulting purchase of the property would occur in
                            April 2000 at a price equal to approximately $2,000
                            plus the then outstanding balances of the first
                            mortgage (approximately $46,600) and St. Cloud
                            Funding's second mortgage.



                                      F-17
<PAGE>   57
                        GENERAL GROWTH PROPERTIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
             (Dollars in thousands, except for per share amounts)



                            DEVELOPMENTS

                            During the three year period ending December 31,
                            1999, the Company was developing or had completed
                            construction at three development sites in the
                            following locations: Coralville (Iowa City), Iowa;
                            Grandville (Grand Rapids), Michigan and Frisco
                            (Dallas), Texas. Coral Ridge Mall, located in
                            Coralville (Iowa City), Iowa was completed and
                            opened as scheduled in July 1998. Construction of
                            the Grandville (Grand Rapids) mall (RiverTown
                            Crossings) commenced in December, 1997, and opened
                            in November 1999. Construction of Stonebriar Centre,
                            currently owned by GGP/Homart II, located in Frisco
                            (Dallas), Texas commenced in October of 1999 with an
                            anticipated completion date in August of 2000.

                            During 1999, the Company formed a joint venture to
                            develop a regional mall in Westlake (Dallas), Texas.
                            As of December 31, 1999, the Company had invested
                            approximately $12,816 in the joint venture. The
                            Company is currently obligated to fund
                            pre-development costs (estimated to be approximately
                            $1,545, most of which remains to be incurred).
                            Actual development costs are not resolved at this
                            time. The retail site, part of a planned community
                            which is expected to contain a resort hotel, a golf
                            course, luxury homes and corporate offices, is
                            currently planned to contain up to 1.6 million
                            square feet of tenant space including up to six
                            anchor stores and a multi-screen theater. There can
                            be no assurance that development of this site will
                            proceed beyond the pre-development phase.

                            The Company also owns and is investigating certain
                            other potential development sites, but active
                            development of these sites has not yet commenced.


NOTE 4                      GGP/HOMART
INVESTMENTS IN              The Company currently owns 50% of GGP/Homart with
UNCONSOLIDATED              the remaining ownership interest held by the New
AFFILIATES                  York State Common Retirement Fund, an institutional
                            investor. The Company's co-investor in GGP/Homart
                            has an exchange right under the GGP/Homart
                            Stockholders Agreement, which permits it to convert
                            its ownership interest in GGP/Homart to shares of
                            Common Stock of General Growth. If such exchange
                            right is exercised, the Company may alternatively
                            satisfy such exchange in cash. In early 1999, the
                            Company received notice that an institutional
                            investor (which then owned an approximate 4.7%
                            interest in GGP/Homart) desired to exercise its
                            exchange right. The Company satisfied the exercise
                            of such exchange right (effective as of January 1,
                            1999) by issuing 1,052,182 shares of Common Stock,
                            thereby increasing its ownership interest in
                            GGP/Homart from approximately 38.2% in 1998 to
                            approximately 42.9% for the first quarter of 1999.
                            During the second quarter of 1999, two other
                            co-investors (which then owned in the aggregate an
                            approximate 7.1% interest in GGP/Homart) notified
                            the Company that they desired to exercise their
                            exchange rights. The Company satisfied the exercise
                            of such exchange rights (effective as of April 1,
                            1999) by issuing an aggregate of 1,551,109 shares of
                            Common Stock, thereby increasing its ownership
                            interest in GGP/Homart to 50%.

GGP/HOMART II               In November 1999, the Company, together with New
                            York State Common Retirement Fund, the Company's
                            co-investor in GGP/Homart, formed GGP/Homart II, a
                            Delaware limited liability company which is owned
                            equally. GGP/Homart II owns 100% interests in
                            Stonebriar Centre in Frisco (Dallas), Texas
                            (currently under construction), Altamonte Mall in
                            Altamonte Springs (Orlando), Florida, Natick Mall in
                            Natick (Boston), Massachusetts and Northbrook Court
                            in Northbrook (Chicago), Illinois which were



                                      F-18
<PAGE>   58
                        GENERAL GROWTH PROPERTIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
             (Dollars in thousands, except for per share amounts)



                            contributed by the Company; and 100% interests in
                            Alderwood Mall in Lynnwood (Seattle), Washington;
                            Carolina Place in Charlotte, North Carolina; and
                            Montclair Plaza in Los Angeles, California which
                            were contributed by the New York State Common
                            Retirement Fund. Certain of the malls were
                            contributed subject to existing financing in order
                            to balance the net equity values of the malls
                            contributed by each of the venture partners.
                            According to the membership agreement between the
                            venture partners, the Company and its joint venture
                            partner share in the profits and losses, cash flows
                            and other matters relating to GGP/Homart II in
                            accordance with their respective ownership
                            percentages. As major operating and capital
                            decisions require the approval of both venture
                            partners, the Company will account for GGP/Homart II
                            using the equity method.

                            GGP IVANHOE III
                            On July 23, 1998, effective as of June 30, 1998, GGP
                            Ivanhoe III acquired the U.S. Prime Property, Inc.
                            ("USPPI") portfolio through a merger of a
                            wholly-owned subsidiary of GGP Ivanhoe III into
                            USPPI. The common stock of GGP Ivanhoe III, which
                            has elected to be taxed as a REIT, is owned 51% by
                            the Company and 49% by an affiliate of Ivanhoe Inc.
                            of Montreal, Quebec, Canada ("Ivanhoe"). The
                            aggregate consideration paid pursuant to the merger
                            agreement was approximately $625,000 (less certain
                            adjustments, including a credit of approximately
                            $64,000 for outstanding mortgage indebtedness and
                            accrued interest thereon and other miscellaneous
                            items). The acquisition was financed with a $392,000
                            acquisition loan bearing interest at LIBOR plus 90
                            basis points which became due July 1, 1999,
                            (subsequently extended and repaid in September 1999
                            as described below) and capital contributions from
                            the Company and the joint venture partner in
                            proportion to their respective stock ownership.
                            Pursuant to the GGP Ivanhoe III stockholders'
                            agreement, the Company initially contributed
                            approximately $91,290 to GGP Ivanhoe III (less
                            certain interest and other credits). The Company's
                            capital contributions were funded primarily with
                            borrowing under the Company's Credit Facility. The
                            properties acquired include: Landmark Mall in
                            Alexandria, Virginia; Mayfair Mall and adjacent
                            office buildings in Wauwatosa (Milwaukee),
                            Wisconsin; Meadows Mall in Las Vegas, Nevada;
                            Northgate Mall in Chattanooga, Tennessee; Oglethorpe
                            Mall in Savannah, Georgia; and Park City Center in
                            Lancaster, Pennsylvania.

                            Effective as of September 28, 1999, GGP Ivanhoe III
                            acquired, through its wholly-owned subsidiary, Oak
                            View Mall in Omaha, Nebraska from an unrelated third
                            party. In addition, on December 22, 1999, GGP
                            Ivanhoe III acquired Eastridge Shopping Center in
                            San Jose, California. The aggregate purchase price
                            for the two properties was approximately $160,000. A
                            portion of the purchase price was financed with an
                            $83,000 ten-year mortgage loan, collateralized by
                            the Oak View Mall which bears interest at 7.71% per
                            annum (and requires monthly payments of principal
                            and interest based upon a 30-year amortization
                            schedule). The remainder of the purchase price was
                            funded by capital contributions from the Company and
                            Ivanhoe in proportion to their respective stock
                            ownership in GGP Ivanhoe III and short-term loans of
                            approximately $30,000 bearing interest at LIBOR
                            (5.82% at December 31, 1999) plus 185 basis points
                            and maturing in June 2001. The Company's capital
                            contributions were funded primarily from proceeds
                            from the Company's Credit Facility.

                            On September 30, 1999, GGP Ivanhoe III repaid the
                            $392,000 acquisition loan with its allocated portion
                            of the proceeds of the issuance of commercial
                            mortgage-backed securities as described in Note 5
                            and capital contributions of approximately $26,000
                            and $25,000 from each of the Company and Ivanhoe,
                            respectively. In conjunction with the



                                      F-19
<PAGE>   59

                        GENERAL GROWTH PROPERTIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
             (Dollars in thousands, except for per share amounts)



                            repayment, GGP Ivanhoe III expensed previously
                            unamortized deferred financing costs, the Company's
                            share of which (approximately $1,799) has been
                            reflected as an extraordinary item for the year
                            ended December 31, 1999.

                            The joint venture partner in GGP Ivanhoe III is also
                            the Company's joint venture partner in GGP Ivanhoe
                            (described below). The Company and Ivanhoe share in
                            the profits and losses, cash flows and other matters
                            relating to GGP Ivanhoe III in accordance with their
                            respective ownership percentages except that certain
                            major operating and capital decisions (as defined in
                            the stockholders' agreement) require the approval of
                            both stockholders. Accordingly, the Company is
                            accounting for GGP Ivanhoe III using the equity
                            method.

                            GGP IVANHOE
                            GGP Ivanhoe owns The Oaks Mall in Gainesville,
                            Florida and Westroads Mall in Omaha, Nebraska. The
                            Company contributed approximately $43,700 for its
                            51% ownership interest in GGP Ivanhoe and Ivanhoe
                            owns the remaining 49% ownership interest. The terms
                            of the stockholders' agreement are similar to those
                            of GGP Ivanhoe III.

                            TOWN EAST MALL / QUAIL SPRINGS MALL
                            The Company owns a 50% interest in Town East Mall,
                            located in Mesquite, Texas and a 50% interest in
                            Quail Springs Mall in Oklahoma City, Oklahoma. The
                            Company shares in the profits and losses, cash flows
                            and other matters relating to Town East Mall and
                            Quail Springs Mall in accordance with its ownership
                            percentage.

                            GGMI

                            The Operating Partnership currently holds all of the
                            non-voting preferred stock ownership interest in
                            GGMI representing 95% of the equity interest.
                            Certain key employees of the Company hold the
                            remaining 5% equity interest through ownership of
                            100% of the common stock of GGMI, which is entitled
                            to all voting rights in GGMI. Accordingly, the
                            Company utilizes the equity method to account for
                            its ownership interest in GGMI. GGMI cannot
                            distribute funds to its common stockholders until
                            its available cash flow exceeds all accumulated
                            preferred dividends owed to the preferred
                            stockholder. As of December 31, 1999, no preferred
                            stock dividends have been paid by GGMI. Due to these
                            currently unpaid and accrued preferences on the
                            preferred stock, the Company has been allocated 100%
                            of the earnings (loss) and cash flows generated by
                            GGMI since 1996. Any dividends in excess of the
                            preferred cumulative dividend are allocated 95% to
                            the preferred stockholder and 5% to the common
                            stockholders. The Operating Partnership also has
                            advanced funds to GGMI at interest rates ranging
                            from 8% to 14% per annum and which mature by 2016.
                            The loans require payment of interest only until
                            maturity, but GGMI may make principal payments on
                            the loans if it has sufficient cash flow. GGMI
                            manages, leases, and performs various other services
                            for the Portfolio Centers and other properties owned
                            by unaffiliated parties.



                                      F-20
<PAGE>   60
                        GENERAL GROWTH PROPERTIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              (Dollars in thousands, except for per share amounts)


  SUMMARIZED FINANCIAL INFORMATION OF INVESTMENT IN UNCONSOLIDATED AFFILIATES

Following is summarized financial information for the Company's unconsolidated
affiliates as of December 31, 1999 and 1998 and for the years ended December 31,
1999, 1998 and 1997.

<TABLE>
<CAPTION>

                     CONDENSED BALANCE SHEETS
                                                                            DECEMBER 31,1999
                                                                GGP/HOMART         GGMI      ALL OTHER JV'S
                                                               -----------     ----------    --------------
<S>                                                            <C>              <C>         <C>
                     Assets:
                     Net investment in real estate              $1,225,379       $15,622       $2,323,587
                     Investment in real estate joint ventures      110,540             0                0
                     Other assets                                  116,817        81,038          345,547
                                                                ----------     ---------     ------------
                                                                $1,452,736       $96,660       $2,669,134
                                                                ==========     =========     ============

                     Liabilities and Owners' Equity:
                     Mortgage and other notes payable             $945,553            $0       $1,375,785
                     Accounts payable and accrued expense           37,941       104,475           78,619
                     Owners' equity                                469,242        (7,815)       1,214,730
                                                                ----------     ---------     ------------
                                                                $1,452,736       $96,660       $2,669,134
                                                                ==========     =========     ============

<CAPTION>
                                                                           DECEMBER 31,1998
                                                               GGP/HOMART         GGMI      ALL OTHER JV'S
                                                               ----------      ---------    --------------
<S>                                                           <C>              <C>          <C>
                     Assets:
                     Net investment in real estate             $1,102,907       $ 39,711         $972,024
                     Investment in real estate joint ventures     124,668            -                  -
                     Other assets                                 123,739         80,901           66,531
                                                               ----------      ---------     ------------

                                                               $1,351,314       $120,612       $1,038,555
                                                               ==========      =========     ============

                     Liabilities and Owners' Equity:
                     Mortgage and other notes payable          $  814,738       $  1,500         $674,627
                     Accounts payable and accrued expenses         39,881        125,997           30,394
                     Owners' equity                               496,695        (6,885)          333,534
                                                               ----------      ---------     ------------

                                                               $1,351,314       $120,612       $1,038,555
                                                               ==========      =========     ============
</TABLE>



                       CONDENSED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>

                                                                     DECEMBER 31,1999
                                                           GGP/HOMART        GGMI    ALL OTHER JV'S
                                                           ----------      --------  --------------
<S>                                                        <C>             <C>       <C>
                     Revenues:
                     Tenant rents                             $224,559           $0        $175,980
                     Fees and other revenues                         0       78,701               0
                                                           -----------     --------     -----------

                     Total Revenues                            224,599       78,701         175,980

                     Operating expenses (1)                    129,465       80,400         100,289
                                                           -----------     --------     -----------
                     Operating Income (loss)                    95,134       (1,699)         75,691

                     Interest expense, net (2)                 (60,814)     (11,040)        (47,382)
                     Equity in net income of unconsolidated
                      real estate affiliates                     5,504            0               0
                     Gain on property sales                        816        5,922               0
                     Income allocated to minority interest        (808)           0          (3,528)
                                                           -----------     --------     -----------

                     Net Income (loss)                         $39,832      ($6,817)        $24,781
                                                           ===========     ========     ===========
</TABLE>

                                      F-21

<PAGE>   61




                         GENERAL GROWTH PROPERTIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              (Dollars in thousands, except for per share amounts)

<TABLE>
<CAPTION>


                                                                       DECEMBER 31,1998
                                                            GGP/HOMART       GGMI   ALL OTHER JV'S
                                                           -----------     -------  --------------
 <S>                                                       <C>             <C>      <C>
                     Revenues:
                     Tenant rents                          $   184,783     $     -        $103,803
                     Fees and other revenues                         -      63,771               -
                                                           -----------     -------     -----------
                     Total Revenues                            184,783      63,771         103,803

                     Operating expenses (1)                    107,717      70,407          54,530
                                                           -----------     -------     -----------
                     Operating Income (loss)                    77,066      (6,636)         49,273

                     Interest expense, net (2)                 (47,799)     (9,999)        (29,882)
                     Equity in net income of
                      unconsolidated real
                      estate affiliates                          5,011           -               -
                     Gain on property sales                     13,182           -               -
                     Income allocated to minority                 (705)          -               -
                      interest                             -----------     -------     -----------

                     Net Income (loss)                        $ 46,755    $(16,635)       $ 19,391
                                                           ===========    ========     ===========

<CAPTION>
                                                                     DECEMBER 31,1997
                                                            GGP/HOMART       GGMI    ALL OTHER JV'S
                                                           -----------     --------  --------------
<S>                                                        <C>             <C>       <C>
                     Revenues:
                     Tenant rents                            $ 159,280        $   -         $28,540
                     Fees and other revenues                         -       62,867               -
                                                             ---------     --------         -------
                     Total Revenues                            159,280       62,867          28,540

                     Operating expenses (1)                     92,498       57,166          15,724
                                                             ---------     --------         -------
                     Operating Income (loss)                    66,782        5,701          12,816

                     Interest expense, net (2)                 (42,980)      (5,895)         (6,787)
                     Equity in net income of
                      unconsolidated real
                      estate affiliates                          5,999            -               -
                     Gain on property sales                     13,767            -               -
                     Income allocated to minority interest        (372)           -               -
                                                             ---------     --------         -------

                     Net Income (loss)                       $  43,196     $  (194)         $ 6,029
                                                             =========     ========         =======

</TABLE>

                     Significant accounting policies used by joint
                     ventures are the same as those used by the Company.


                     (1) Includes depreciation and amortization.
                     (2) Includes extraordinary items.






                                      F-22

<PAGE>   62

                         GENERAL GROWTH PROPERTIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              (Dollars in thousands, except for per share amounts)


 NOTE 5  MORTGAGE  Mortgage  notes and other debts payable at December 31, 1999
  NOTES AND OTHER  and 1998 consisted of the following:
   DEBTS PAYABLE

<TABLE>
<CAPTION>
                                                           DECEMBER 31,
                                                       1999          1998
                                                   ------------    --------
<S>                                               <C>            <C>
                    Fixed-Rate debt
                       Mortgage notes payable        $1,724,854  $2,036,210
                    Variable-Rate debt
                       Mortgage notes payable         1,234,680     412,566
                       Line of credit facility          160,000     200,000
                                                     ----------   ---------

                    Total Variable-Rate debt          1,394,680      612,566
                                                     ----------   ----------

                    Total mortgage notes and         $3,119,534   $2,648,776
                       other debts payable           ==========   ==========
</TABLE>

                   FIXED RATE DEBT
                   MORTGAGE NOTES PAYABLE
                   The fixed-rate mortgage notes bear interest ranging
                   from 6.41% to 10.00% per annum (weighted average of
                   7.05% per annum), require monthly payments of
                   principal and/or interest and have various maturity
                   dates through 2020 (weighted average remaining term
                   of 5.8 years). Certain properties are pledged as
                   collateral for the related mortgage note(s). The
                   mortgage notes payable as of December 31, 1999 are
                   non-recourse to the Company (except to the extent
                   of supplemental guarantees executed by the
                   Company). Certain loans have cross-default
                   provisions and are cross-collateralized as part of
                   a group of properties. Under certain cross-default
                   provisions, a default under any mortgage included
                   in a cross-defaulted package may constitute a
                   default under all such mortgages and may lead to
                   acceleration of the indebtedness due on each
                   property within the collateral package. In general,
                   the cross-defaulted properties are under common
                   ownership. However, GGP Ivanhoe debt collateralized
                   by two GGP Ivanhoe centers totaling $125,000 is
                   cross-defaulted and cross-collateralized with
                   eleven Wholly-Owned centers. GGP Ivanhoe III debt
                   collateralized by five GGP Ivanhoe III centers
                   totaling $341,019 is cross-defaulted and
                   cross-collateralized with four Wholly-Owned
                   Centers.

                   VARIABLE RATE DEBT
                   MORTGAGE NOTES PAYABLE
                   Variable mortgage notes payable at December 31,
                   1999 consist primarily of the approximate $87.8
                   outstanding on the construction loan collateralized
                   by Rivertown Crossings as described below and
                   approximately $858,800 of collateralized
                   mortgage-backed securities as described below. The
                   loans bear interest at a rate per annum equal to
                   LIBOR plus 90 to 250 basis points. The Company
                   currently expects to retire or refinance such
                   obligations when due.

                   MEPC ACQUISITION FINANCING
                   In June 1998 the Company obtained a loan of
                   approximately $830,000 to acquire the MEPC
                   portfolio as described in Note 3. The Company
                   repaid approximately $217,000 of this loan on June
                   10, 1998 from the net proceeds of the public
                   offering of the Depositary Shares as described in
                   Note 1. The loan was collateralized by the MEPC
                   Portfolio and the remaining balance was repaid in
                   1999 as described below. During most of 1998, the
                   Company fixed the annual interest rate with respect
                   to a portion of such loan at 6.7% per annum and the
                   remainder bore interest at a rate per annum equal


                                      F-23


<PAGE>   63


                         GENERAL GROWTH PROPERTIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              (Dollars in thousands, except for per share amounts)


                     to LIBOR plus 90 basis points. During 1999 the
                     entire loan balance bore interest at a rate per
                     annum equal to LIBOR plus 115 basis points, which
                     rate was adjusted monthly. During the first quarter
                     of 1999, the Company reached agreements in
                     principle with other lenders for full replacement
                     financing and notified the current lender that the
                     loan would be fully repaid and not rolled into a
                     new long-term fixed rate financing, as was
                     originally contemplated. Such notification
                     obligated the Company to pay $8,655 to the lender
                     as a loan prepayment fee which the Company paid
                     using the proceeds of the interim loan described
                     below. On July 1, 1999, the Company obtained
                     approximately $57,000 of permanent long term
                     mortgage financing to partially repay the amount
                     scheduled to mature on that date and the maturity
                     date of the remaining indebtedness was extended to
                     October 1, 1999 as described below. The new $57,000
                     mortgage loan, collateralized by the Apache Mall,
                     bears interest at 7.0% per annum and matures August
                     1, 2009. In addition, during July 1999,
                     approximately $15,000 of the amount remaining due
                     was repaid from a portion of the proceeds of the
                     1999 Offering and approximately $100,000 was repaid
                     from a new mortgage loan collateralized by the
                     Cumberland Mall. The Cumberland Mall ten-year loan
                     bears interest at a rate of 7.85% per annum and
                     provides for monthly payments of principal and
                     interest until its maturity on July 31, 2009. The
                     remaining MEPC Acquisition Financing, approximately
                     $441,000, was repaid in September 1999 with the
                     proceeds of the GGP-Ivanhoe CMBS financing and
                     other interim financing described below. In
                     conjunction with the repayment, the Company
                     expensed previously unamortized deferred financing
                     costs of approximately $3,280.

                     COMMERCIAL MORTGAGE-BACKED SECURITIES
                     In August 1999, the Company issued $500,000 of
                     commercial mortgage-backed securities,
                     collateralized by the Ala Moana Center (see Note
                     3), with a maturity date of September 10, 2004
                     assuming the exercise of no-cost extension options
                     aggregating two years. The securities (the "Ala
                     Moana CMBS") are comprised of notes which bear
                     interest at rates per annum ranging from LIBOR plus
                     50 basis points to LIBOR plus 275 basis points
                     (weighted average equal to LIBOR plus 95 basis
                     points), calculated and payable monthly. In
                     conjunction with the issuance of the Ala Moana
                     CMBS, the Company arranged for an interest rate cap
                     agreement, the effect of which will limit the
                     maximum interest rate the Company will be required
                     to pay on the securities to 9% per annum.
                     Approximately $438,000 of the proceeds from the
                     sale of the Ala Moana CMBS was used by the Company
                     to repay the short-term mortgage loan obtained in
                     July, 1999 to enable it to purchase the Ala Moana
                     Center. The remainder was utilized by the Company
                     for general working capital purposes including
                     paydowns on the Company's Credit Facility.

                     In September 1999, the Company issued $700,229 of
                     commercial mortgage backed securities with a
                     maturity date of October 10, 2004, assuming the
                     exercise of no-cost extension options aggregating
                     two years, cross-collateralized and cross-defaulted
                     by a portfolio of nine regional malls and an office
                     complex adjacent to one of the regional malls. The
                     properties in the portfolio are Northridge Fashion
                     Center in Northridge (Los Angeles), California;
                     Mayfair Mall and adjacent office buildings in
                     Wauwatosa (Milwaukee), Wisconsin; Park City Center
                     in Lancaster, Pennsylvania; The Boulevard Mall in
                     Las Vegas, Nevada; Regency Square Mall in
                     Jacksonville, Florida; Valley Plaza Shopping Center
                     in Bakersfield, California; Oglethorpe Mall in
                     Savannah, Georgia; Landmark Mall in Alexandria,
                     Virginia; and Northgate Mall in Chattanooga,
                     Tennessee. The securities (the "GGP-Ivanhoe CMBS")
                     are comprised of notes which bear interest at


                                      F-24


<PAGE>   64




                         GENERAL GROWTH PROPERTIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              (Dollars in thousands, except for per share amounts)



                     rates per annum ranging from LIBOR plus 52 basis points
                     to LIBOR plus 325 basis points (weighted average
                     equal to LIBOR plus approximately 109 basis
                     points), calculated and payable monthly. In
                     conjunction with the issuance of the GGP-Ivanhoe
                     CMBS, the Company arranged for an interest rate cap
                     agreement, the effect of which will limit the
                     maximum interest rate the Company will be required
                     to pay on the securities to 9.03% per annum. The
                     $392,000 interim loan collateralized by the USPPI
                     portfolio described above was repaid with $341,019
                     of the proceeds from the sale of the GGP-Ivanhoe
                     CMBS and capital contributions by the Company (from
                     its Credit Facility) and from Ivanhoe in the ratio
                     of their respective stock ownership percentages.
                     The remaining proceeds from the sale of the
                     GGP-Ivanhoe CMBS along with approximately $81,800
                     of the proceeds from the new $95,000 short term
                     interim financing were used by the Company to repay
                     the $441,000 remaining balance on the MEPC
                     Acquisition Financing.

                     CREDIT FACILITY
                     The Company's $200,000 unsecured revolving credit
                     facility bears interest at a rate per annum equal
                     to LIBOR plus 80 to 120 basis points depending upon
                     the Company's leverage ratio and matures on July
                     31, 2000. The Credit Facility is subject to
                     financial performance covenants including
                     debt-to-market capitalization, minimum earnings
                     before interest, taxes, depreciation and
                     amortization ("EBITDA") ratios and minimum equity
                     values. On December 31, 1999, the Credit Facility
                     had an outstanding balance of $160,000.

                     INTERIM FINANCING
                     In January 1999, the Company obtained an additional
                     $30,000 unsecured bank loan, which bore interest at
                     a floating market rate (average rate equal to 6.46%
                     per annum). The Company had obtained in November
                     1998 a thirteen-month loan in the principal amount
                     of $55,000 collateralized by a negative pledge
                     (i.e., the promise not to encumber) of Coastland
                     Center. These loans were repaid on May 21, 1999
                     with a ten-year 7.0% mortgage loan in the principal
                     amount of $87,000 collateralized by Coastland
                     Center.

                     In January 1999, the Company obtained an additional
                     $83,655 floating rate (7.27% at September 30, 1999)
                     interim loan (originally scheduled to mature June
                     1, 1999) which was expected to be replaced or
                     refinanced by the maturity date with new mortgage
                     financing. During May, 1999, the Company obtained a
                     new $45,000 mortgage loan collateralized by The
                     Crossroads Mall. The loan, which bears interest at
                     7.40% and matures on June 1, 2009, partially repaid
                     the interim loan and the maturity of the remaining
                     balance, approximately $38,655 at June 30, 1999,
                     was extended and repaid in October 1999 with a
                     portion of the proceeds of the six property
                     two-year non-recourse mortgage pool financing
                     described below.

                     In April 1999, the Company obtained a $25,000 bank
                     loan, collateralized by Park Mall in Tucson,
                     Arizona. In October 1999, the loan was increased to
                     $50,000 and the term was extended to March 30,
                     2000. The loan bears interest at a rate per annum
                     equal to LIBOR plus 175 basis points and is
                     expected to be replaced with a $90,000 construction
                     loan facility that will finance a renovation and
                     expansion of Park Mall. The renovation and
                     expansion has already commenced with the entire
                     project expected to be completed in 2001.



                                      F-25

<PAGE>   65


                         GENERAL GROWTH PROPERTIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              (Dollars in thousands, except for per share amounts)



                     On July 30, 1999, the Company obtained a three
                     month loan in the principal amount of $25,000,
                     collateralized by a negative pledge (i.e., the
                     promise not to encumber) of Eagle Ridge Mall in
                     Lake Wales, Florida. The proceeds of the loan were
                     distributed to the Operating Partnership to fund
                     ongoing acquisition and development activity. The
                     short-term loan bore interest at a rate per annum
                     of LIBOR plus 175 basis points. This loan was
                     refinanced in October 1999 with a portion of the
                     proceeds of the six-property two-year non-recourse
                     mortgage pool financing described below.

                     In September 1999, the Company obtained an
                     additional $95,000 unsecured floating rate (LIBOR
                     plus 250 basis points) interim loan which was
                     scheduled to mature July 31, 2000. The loan
                     provided for periodic principal payments ($12,000
                     paid in 1999) to maturity and the majority of the
                     proceeds of this loan were used to repay the
                     remaining balance on the MEPC Acquisition
                     Financing. This loan was repaid in January 2000 as
                     described below.

                     In October 1999, the Company obtained a $130,000
                     two-year loan collateralized by six properties,
                     five regional malls (Knollwood Mall, Eagle Ridge
                     Mall, West Valley Mall, South Shore Mall and
                     Century Mall) and the Company's headquarters, the
                     110 N. Wacker Drive office building in Chicago,
                     Illinois. This loan bears interest at LIBOR plus
                     185 basis points and matures on November 1, 2001.
                     The Company intends to replace this loan on or
                     before maturity with non-recourse long-term
                     mortgage financing.

                     In January 2000, the Company obtained a new
                     $200,000 unsecured short-term bank loan. The
                     initial funding of $120,000 under this loan was
                     used to fund ongoing redevelopment projects and
                     repay the interim loan obtained in September 1999.
                     This loan bears interest at LIBOR plus 150 basis
                     points and matures concurrently with the July 2000
                     maturity of the Company's Credit Facility. The
                     Company currently expects to jointly refinance
                     these obligations when due with a new revolving
                     credit facility and term loans.

                     CONSTRUCTION LOAN
                     During April 1999 the Company obtained a $110,000
                     construction loan facility collateralized by the
                     RiverTown Crossings Mall development in Grandville
                     (Grand Rapids), Michigan. Concurrently with the
                     closing, the Company made an initial loan draw of
                     $30,000. As of December 31, 1999, additional loan
                     draws of approximately $57,862 have been made. The
                     construction loan provides for periodic funding as
                     construction and leasing continues and bears
                     interest at a rate per annum of LIBOR plus 175
                     basis points (150 basis points after achievement of
                     certain debt service ratios). Interest is due
                     monthly but may be added to the periodic loan
                     draws. The loan matures on June 29, 2001 and the
                     Company currently intends to refinance such loan at
                     or prior to maturity with a non-recourse long-term
                     mortgage loan.

                     LETTERS OF CREDIT
                     As of December 31, 1999 and 1998, the Operating
                     Partnership had outstanding letters of credit of
                     $7,934 and $9,956, respectively, primarily in
                     connection with special real estate assessments and
                     insurance requirements. In addition, the Company
                     obtained a letter of credit of approximately
                     $54,000 related to the funding of the Ala Moana
                     CMBS and pending construction projects at the Ala
                     Moana Center.


                                      F-26


<PAGE>   66


                         GENERAL GROWTH PROPERTIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              (Dollars in thousands, except for per share amounts)


                     Principal amounts due under mortgage notes and other debts
                     payable mature as follows:

                        YEAR                  AMOUNT MATURING
                        ----                  ---------------

                        2000                     $  329,321
                        2001                        382,035
                        2002                         13,094
                        2003                         14,104
                        2004                      1,068,030
                        Subsequent                1,312,950
                                                 ----------
                        Total                    $3,119,534
                                                 ==========

                     Certain mortgage notes payable may be prepaid but
                     are generally subject to a prepayment penalty of a
                     yield-maintenance premium or a percentage of the
                     loan balance.

                     Land, buildings and equipment related to the
                     mortgage notes payable with an aggregate cost of
                     approximately $4,264,000 at December 31, 1999 have
                     been pledged as collateral. In addition, loans
                     totaling approximately $367,117 (collateralized by
                     assets with a total carrying value of approximately
                     $415,845) were supplementally guaranteed by the
                     Company. Certain properties, including those within
                     the portfolios collateralized by commercial
                     mortgage backed securities, are subject to
                     financial performance convenants, primarily EBITDA
                     ratios.


         NOTE 6      The extraordinary items resulted from prepayment
  EXTRAORDINARY      costs and unamortized deferred financing costs
          ITEMS      related to the early extinguishment, primarily
                     through refinancings, of mortgage notes payable.
                     In 1999, the basic and diluted per share impact
                     of the extraordinary items was $.30. The basic
                     per share impact of the extraordinary items in
                     1998 was $.14, and the diluted per share impact
                     was $.13. The basic and diluted per share impact
                     of the extraordinary items was $.03 in 1997.



 NOTE 7 RENTALS      The Company receives rental income from the leasing
UNDER OPERATING      of retail shopping center space  under operating
         LEASES      leases. The minimum future rentals based on operating
                     leases held as of December 31, 1999 are as follows:

                        YEAR                       AMOUNT
                        ----                       ------

                        2000                     $  290,908
                        2001                        281,037
                        2002                        264,223
                        2003                        239,773
                        2004                        216,056
                        Thereafter                  996,515


                     Minimum future rentals do not include amounts,
                     which may be received from certain tenants based
                     upon a percentage of their gross sales or as
                     reimbursement of shopping center operating
                     expenses.


                                      F-27


<PAGE>   67

                         GENERAL GROWTH PROPERTIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              (Dollars in thousands, except for per share amounts)




                     The tenant base includes national and regional
                     retail chains and local retailers, and
                     consequently, the Company's credit risk is
                     concentrated in the retail industry.


    NOTE 8 WITH      GGMI
   TRANSACTIONS      GGMI has been contracted to provide management,
     AFFILIATES      leasing, development and construction management
                     services for the Wholly-Owned Centers. In addition,
                     certain shopping center advertising and payroll
                     costs of the properties are paid by GGMI and
                     reimbursed by the Company. Total costs included in
                     the consolidated financial statements related to
                     agreements with GGMI are as follows:

                                                         YEAR ENDED DECEMBER 31,
                                                        1999       1998     1997
                                                       ------    ------   ------
                        Management and Leasing Fees   $21,201   $15,074  $ 8,285
                        Cost Reimbursements            56,548    41,594   28,099
                        Development Costs               3,499     7,801    2,015


                     NOTES RECEIVABLE
                     In April, May and September, 1998, certain officers
                     of the Company issued to the Company an aggregate
                     of $3,164 of promissory notes in connection with
                     such officers' exercise of options to purchase an
                     aggregate of 166,000 shares of the Company's Common
                     Stock. During 1999, the Company received
                     approximately $62 in payments, made advances of
                     approximately $380 in conjunction with additional
                     advances and stock purchases by such officers and
                     forgave approximately $64 in principal and accrued
                     interest on such notes. The notes, which bear
                     interest at a rate (6.02% per annum at December 31,
                     1999) computed as a formula of a market rate, are
                     collateralized by the shares of common stock issued
                     upon exercise of such options, provide for
                     quarterly payments of interest and are payable to
                     the Company on demand.


NOTE 9 EMPLOYEE      STOCK INCENTIVE PLAN
    BENEFIT AND      The Company's Stock Incentive Plan provides  incentives to
    STOCK PLANS      attract and retain officers and key employees. An aggregate
                     of 3,000,000 shares of Common Stock  have been authorized
                     for issuance  under the plan.  Options  are  granted by the
                     Compensation Committee of the Board of Directors at an
                     exercise  price of not less than 100% of the fair market
                     value of the Common Stock on the date of grant. The term of
                     the option is fixed by the Compensation  Committee,  but no
                     option is exercisable more than 10 years after the date of
                     the grant.  Options  granted to officers and key  employees
                     are for 10-year  terms  and  are  generally  exercisable
                     in  either  33  1/3%  or 20%  annual increments  from the
                     date of the grants.  Options  granted to  non-employee
                     directors are exercisable  in full  commencing  on the date
                     of grant  and  expire  on the tenth anniversary of the date
                     of the grant.



                                      F-28

<PAGE>   68




                         GENERAL GROWTH PROPERTIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              (Dollars in thousands, except for per share amounts)



                     A summary of the status of the Company's Stock
                     Incentive Plan as of December 31, 1999, 1998 and
                     1997 and changes during the year ended on those
                     dates is presented below.

<TABLE>
<CAPTION>

                                                        1999              1998                 1997
                                                 ----------------   -----------------  -----------------
                                                         WEIGHTED            WEIGHTED           WEIGHTED
                                                          AVERAGE            AVERAGE             AVERAGE
                                                         EXERCISE            EXERCISE           EXERCISE
                                                 SHARES   PRICE     SHARES    PRICE     SHARES    PRICE
                                                 ------   -----     ------    -----     ------    -----
<S>                                            <C>       <C>      <C>        <C>      <C>       <C>
                     Outstanding at
                      beginning of year          848,500   $28.99   785,000  $ 24.79    827,500   $24.48
                     Granted                      47,500   $32.42   229,500  $ 36.19      2,000   $31.75
                     Exercised                   (60,000)  $19.00  (166,000) $ 19.06    (44,500)  $19.35
                     Forfeited                    (8,500)  $34.78        --       --         --       --
                                                 -------   ------   -------  -------    -------   ------

                     Outstanding at end of year  827,500   $29.85   848,500  $ 28.99    785,000   $24.79
                                                 =======            =======             =======

                     Exercisable at end of year  595,500   $28.76   414,500  $ 27.57    379,000   $23.85

                     Options available
                      for future grants        1,826,833          1,874,333           2,103,833

                     Weighted average per
                      share fair value of
                      options granted during               $ 2.84             $ 3.18              $ 2.74
                      the year
</TABLE>



                     The following table summarizes information about
                     stock options outstanding pursuant to the Stock
                     Incentive Plan at December 31, 1999:

<TABLE>
<CAPTION>

                                     OPTIONS OUTSTANDING                              OPTIONS EXERCISABLE
                     ---------------------------------------------------------     --------------------------
                                             WEIGHTED AVERAGE
                                       NUMBER      REMAINING  WEIGHTED AVERAGE      OPTIONS    WEIGHTED AVERAGE
                        RANGE OF      OUTSTANDING CONTRACTUAL     EXERCISE        EXERCISABLE      EXERCISE
                     EXERCISE PRICES  AT 12/31/99    LIFE           PRICE         AT 12/31/99       PRICE
                     ---------------  -----------    ----           -----         -----------       -----
<S>                                  <C>          <C>         <C>                <C>           <C>
                     $19.00 - $28.00    557,500    6.79 years       $27.10          457,500         $26.90
                     $31.75 - $37.69    270,000    8.31 years       $35.55          138,000         $34.93
                                        -------                                     -------

                                        827,500    7.28 years       $29.85          595,500         $28.76
                                        =======    ==========       ======          =======         ======
</TABLE>




                     1998 INCENTIVE PLAN
                     General Growth and its stockholders have also
                     approved an incentive stock plan entitled the 1998
                     Incentive Stock Plan (the "1998 Incentive Plan").
                     Under the 1998 Incentive Plan, the Compensation
                     Committee of the Board of Directors of General
                     Growth is authorized to grant to employees, stock
                     incentive awards in the form of threshold-vesting
                     stock options ("TSOs"). The exercise price of the
                     TSOs to be granted to a participant will be the
                     Fair Market Value ("FMV") of a share of Common
                     Stock on the date the TSO is granted. The threshold
                     price (the "Threshold Price") which must be


                                      F-29



<PAGE>   69




                         GENERAL GROWTH PROPERTIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              (Dollars in thousands, except for per share amounts)




                     achieved in order for the TSO to vest will be
                     determined by multiplying the FMV on the date of
                     grant by the Estimated Annual Growth Rate
                     (currently set at 7% in the 1998 Incentive Plan)
                     and compounding the product over a five year
                     period. Shares of the Common Stock must achieve and
                     sustain the Threshold Price for at least 20
                     consecutive trading days at any time over the five
                     years following the date of grant in order for the
                     TSO to vest. All TSOs granted will have a term of
                     10 years but must vest within 5 years of the grant
                     date in order to avoid forfeiture.

                     The purpose of the 1998 Incentive Plan is to give
                     the Company an advantage in attracting, retaining
                     and motivating employees and to provide the Company
                     with the ability to provide competitive incentives
                     which are directly linked to the profitability of
                     the Company's business and increases in stockholder
                     value. Grants under the 1998 Incentive Plan are
                     intended to reinforce the attainment of annual
                     performance goals while encouraging sustained
                     profitable long-term growth.

                     The aggregate number of shares of Common Stock
                     which may be subject to TSOs issued pursuant to the
                     1998 Incentive Plan may not exceed 1,000,000,
                     subject to certain customary adjustments to prevent
                     dilution. The initial grant, TSOs to purchase
                     313,964 shares of Common Stock at an exercise price
                     of $31.69 and with an estimated fair value of
                     $1.36, under the 1998 Incentive Plan was made in
                     1999. None of the TSO's vested or were forfeited
                     during 1999.

                     The fair value of each option grant for 1999, 1998
                     and 1997 for the Stock Incentive Plan and the 1998
                     Incentive Plan was estimated on the date of grant
                     using the Black-Scholes option pricing model with
                     the following assumptions:

                                                    1999       1998       1997
                                                   ------     ------     ------

                        Risk free interest rate     5.21%      5.48%       6.23%
                        Dividend yield              7.22%      7.28%       7.77%
                        Expected life           4.6 years  4.2 years  4.75 years
                        Expected volatility         20.0%      19.4%       18.8%


                     EMPLOYEE STOCK PURCHASE PLAN
                     During 1999, General Growth established the General
                     Growth Properties, Inc. Employee Stock Purchase
                     Plan (the "ESPP") to assist eligible employees in
                     acquiring a stock ownership interest in the General
                     Growth. A maximum of 500,000 shares of Common Stock
                     is reserved for issuance under the ESPP. Under the
                     ESSP, eligible employees make payroll deductions
                     over a six-month purchase period at which time the
                     amounts withheld are used to purchase shares of
                     Common Stock at a purchase price equal to 85% of
                     the lesser of the closing price of a share of
                     Common Stock on the first trading day of the
                     purchase period or the last trading day of the
                     purchase period. The first purchase period under
                     the ESSP ended December 31, 1999. On January 3,
                     2000, 26,205 shares of Common Stock were sold to
                     ESPP participants at a price of $23.80 per share.
                     The fair value of the rights to purchase pursuant
                     to the ESPP was estimated to be $6.16 per share
                     using the Black-Scholes option pricing model, a
                     risk free rate of 4.88%, a dividend yield of 7.22%
                     and expected volatility of 20.0%.


                                      F-30



<PAGE>   70
                        GENERAL GROWTH PROPERTIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
             (Dollars in thousands, except for per share amounts)



                            STOCK OPTION PRO FORMA DATA
                            The Company has applied Accounting Principles Board
                            Opinion 25 in accounting for the Stock Incentive
                            Plan, the 1998 Incentive Plan and the Employee Stock
                            Purchase Plan. Accordingly, no compensation costs
                            have been recognized. Had compensation costs for the
                            Company's plans been determined based on the fair
                            value at the grant date for options granted in 1999,
                            1998 and 1997 in accordance with the method required
                            by Statement of Financial Accounting Standards No.
                            123 "Accounting for Stock-Based Compensation", the
                            Company's net income and net income per share would
                            have been reduced to the pro forma amounts as
                            follows:

<TABLE>
<CAPTION>
                                                                               YEAR ENDED DECEMBER 31,
                                                                       1999             1998             1997
                                                                       ----             ----             ----
                             <S>                                      <C>              <C>              <C>
                             Net Income
                               As Reported                            $76,658          $53,012          $89,551
                               Pro Forma                              $76,160          $52,709          $89,341

                             Net earnings per share - basic
                               As Reported                            $  1.67          $  1.46          $  2.75
                               Pro Forma                              $  1.66          $  1.46          $  2.74

                             Net earnings per share - diluted
                               As Reported                            $  1.66          $  1.46          $  2.73
                               Pro Forma                              $  1.65          $  1.45          $  2.72
</TABLE>


                            MANAGEMENT SAVINGS PLAN

                            The Company sponsors the General Growth Management
                            Savings and Employee Stock Ownership Plan (the
                            "401(k) Plan") which permits all eligible employees
                            to defer a portion of their compensation in
                            accordance with the provisions of Section 401(k) of
                            the Code. Under the 401(k) Plan, the Company may
                            make, but is not obligated to make, contributions to
                            match the contributions of the employees. For the
                            year ending December 31, 1999, 1998 and 1997 the
                            Company made matching contributions of approximately
                            $2,891, $2,042 and $625, respectively.



NOTE 10                     On December 13, 1999, the Company declared a cash
DISTRIBUTIONS               distribution of $.51 per share that was paid on
PAYABLE                     January 31, 2000, to stockholders of record (1,121
                            owners of record) on January 6, 2000, totaling
                            $26,481. In addition, a distribution of $10,097 was
                            paid to the limited partners of the Operating
                            Partnership. Concurrently, the Company declared the
                            fourth quarter 1999 preferred stock dividend, for
                            the period from October 1, 1999 through December 31,
                            1999, in the amount of $0.4531 per share, payable to
                            preferred stockholders of record on January 6, 2000
                            and paid on January 14, 2000. As described in Note
                            1, such preferred stock dividend was in the same
                            amount as the Operating Partnership's distribution
                            to the Company of the same date with respect to the
                            Preferred Units held by the Company.

                            On December 17, 1998, the Company declared a cash
                            distribution of $.47 per share that was paid on
                            January 29, 1999, to stockholders of record (1,106
                            owners of record) on January 6, 1999, totaling
                            $18,330. In addition, a distribution of $9,309 was
                            paid to the



                                      F-31
<PAGE>   71

                        GENERAL GROWTH PROPERTIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
             (Dollars in thousands, except for per share amounts)



                            limited partners of the Operating Partnership.
                            Concurrently, the Company declared the fourth
                            quarter 1999 preferred stock dividend, for the
                            period from October 1, 1999 through December 31,
                            1998, in the amount of $0.4531 per share, payable to
                            preferred stockholders of record on January 6, 1999
                            and paid on January 15, 1999.

                            The allocations of the distributions declared and
                            paid for income tax purposes are as follows:

<TABLE>
<CAPTION>
                                                                         YEAR ENDED DECEMBER 31,
                                                                 1999         1998         1997
                                                                 ----         ----         ----

<S>                                                             <C>           <C>         <C>

                                 Ordinary Income                 66.0%         98.0%       29.8%
                                 Capital Gain                     3.0%          2.0%       70.2%
                                 Return of Capital               31.0%           --%         --%
                                                                -----         -----       -----
                                                                100.0%        100.0%      100.0%
                                                                =====         =====       =====

</TABLE>


NOTE 11                     In the normal course of business, from time to time,
COMMITMENTS AND             the Company is involved in legal actions relating to
CONTINGENCIES               the ownership and operations of its properties. In
                            management's opinion, the liabilities, if any that
                            may ultimately result from such legal actions are
                            not expected to have a material adverse effect on
                            the consolidated financial position, results of
                            operations or liquidity of the Company.

                            The Company leases land at certain properties from
                            third parties. Rental expense including
                            participation rent related to these leases was $375,
                            $292, and $595 for the years ended December 31,
                            1999, 1998, and 1997 respectively. The leases
                            provide for a right of first refusal in favor of the
                            Company in the event of a proposed sale of the
                            property by the landlord.

                            From time to time the Company has entered into
                            contingent agreements for the acquisition of
                            properties. Each acquisition is subject to
                            satisfactory completion of due diligence and, in the
                            case of developments, completion and occupancy of
                            the project.


NOTE 12 RECENTLY            In May, 1998, the Emerging Issues Task Force
ISSUED                      ("EITF") of the FASB issued a consensus opinion
ACCOUNTING                  entitled  "Accounting for Contingent Rent in Interim
PRONOUNCEMENTS              Financial Periods" ("EITF 98-9"). EITF 98-9 was
                            effective as of May 21, 1998 and provided that
                            rental income should be deferred in interim periods
                            by the lessor if the triggering events that create
                            contingent rent have not yet occurred. The Company
                            is entitled to receive contingent rents because a
                            majority of the tenant leases provide for additional
                            rent computed as a percentage of tenant sales
                            revenues above certain annual thresholds
                            (predominantly computed on a calendar year basis).
                            The Company had previously accrued, on an interim
                            basis, such percentage rents based on the prorated
                            annual percentage rent estimated to be due from
                            tenants. The Company, as provided by EITF 98-9,
                            prospectively adopted this consensus and did not
                            record additional percentage rent in the third and
                            fourth quarters of 1998 above amounts recognized in
                            the six months ended June 30, 1998 ($5,013) until
                            such triggering events occurred. Accordingly, the
                            Company recognized approximately $1,300 of
                            percentage rent in the fourth quarter of 1998, which
                            would otherwise have been recognized in previous
                            periods. During the fourth quarter of 1998, EITF
                            98-9 was withdrawn and, pursuant to the guidance
                            issued by the EITF, the Company, effective January
                            1, 1999, reverted back to the original policy of
                            accruing percentage rents on an estimated basis.
                            During December 1999, the Securities and Exchange
                            Commission (the "SEC") issued Staff Accounting
                            Bulletin 101


                                      F-32
<PAGE>   72

                        GENERAL GROWTH PROPERTIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
             (Dollars in thousands, except for per share amounts)



                            "Revenue Recognition". This pronouncement, as
                            subsequently extended to all publicly traded
                            companies by the EITF, among other things,
                            effectively reinstated the provisions of EITF 98-9.
                            The Company will apply this revised accounting
                            effective January 1, 2000. The only material effect
                            of this pronouncement will be to shift the Company's
                            recognition, including amounts from the operations
                            of the Unconsolidated Joint Ventures, of major
                            portions of percentage rent from interim quarters to
                            the fourth quarter of 2000 and subsequent years. The
                            Company's cash collections of percentage rents will
                            not be affected by this accounting recognition
                            change.

                            On June 1, 1999 the FASB issued Statement No. 133
                            "Accounting for Derivative Instruments and Hedging
                            Activities", effective for fiscal years beginning
                            after June 15, 2000. The Company's only hedging
                            activity is the cash value hedge represented by its
                            cap agreements relating to its commercial
                            mortgage-backed securities (Note 5). The interest
                            rate cap agreements place a limit on the effective
                            rate of interest the Company will bear on such
                            floating rate obligations. The Company has concluded
                            that these cap agreements are highly effective in
                            achieving its objective of eliminating its exposure
                            to variability in cash flows relating to these
                            floating rate obligations when LIBOR rates exceed
                            the strike rates of the cap agreements. Therefore,
                            the Company does not believe there will be a
                            material effect of adoption on the Company's
                            financial statements when the standard is effective.


NOTE 13 PRO                 Due to the impact of the public offering of the in
FORMA                       PIERS 1998 and of Common Stock in 1999 and the
FINANCIAL                   acquisitions and other significant transactions
INFORMATION                 during 1997, 1998 and 1999, historical results of
(UNAUDITED)                 operations may not be indicative of future results
                            of operations. The pro forma condensed consolidated
                            statements of operations for the year ended December
                            31, 1999 include adjustments for the 1999 Offering,
                            the acquisition of 100% of The Crossroads Mall, the
                            Ala Moana Center and Baybrook Mall and a 51%
                            interest in Oak View Mall and Eastridge Mall
                            (through GGP Ivanhoe III) and the formation of
                            GGP/Homart II and the exchange of certain interests
                            in GGP/Homart for shares of Common Stock as if such
                            transactions had occurred on January 1, 1999. The
                            pro forma condensed consolidated statements of
                            operations for the year ended December 31, 1998
                            include adjustments for the public offering of the
                            PIERS in 1998 and Common Stock in 1999 and the
                            acquisition of 100% of the three operating
                            properties in 1999 and 51% of the two operating
                            properties acquired by GGP Ivanhoe III, of the
                            GGP/Homart and GGP/Homart II transactions, the
                            acquisition of 100% of Southwest Plaza, Northbrook
                            Court, Altamonte Mall, Pierre Bossier Mall, Spring
                            Hill Mall, Coastland Mall, and Mall St. Vincent, the
                            eight operating properties in the MEPC Portfolio,
                            and a 51% interest in the six operating properties
                            owned by GGP Ivanhoe III as if such transactions
                            occurred on January 1, 1998. The pro forma condensed
                            consolidated statements of operations for the year
                            ended December 31, 1997 include adjustments for the
                            public offering of the PIERS in 1998 and for the
                            acquisition of 100% of the fifteen operating
                            properties in 1998 and 51% of GGP Ivanhoe III and
                            adjustments for the acquisitions of Market Place
                            Shopping Center, Century Plaza, Southlake Mall, Eden
                            Prairie, Valley Hills, a 51% interest in GGP
                            Ivanhoe, and a 50% interest in Town East as if such
                            transactions had occurred on January 1, 1997. The
                            pro forma information is based upon the historical
                            consolidated statements of operations excluding
                            extraordinary items and non-recurring gains on
                            sales, including the gain in 1997 on the sale of a
                            portion of the CenterMark stock and does not purport
                            to present what actual results would have been had
                            the offerings, acquisitions, and related
                            transactions, in fact, occurred at the previously
                            mentioned dates, or to project results for any
                            future period.



                                      F-33
<PAGE>   73

                        GENERAL GROWTH PROPERTIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
             (Dollars in thousands, except for per share amounts)



PRO FORMA FINANCIAL INFORMATION

<TABLE>
<CAPTION>
                                                                        YEARS ENDED
                                                        1999              1998               1997
                                                  ---------------    ---------------     --------------

<S>                                               <C>                <C>                 <C>
Total Revenues:                                      $ 615,616          $ 561,106          $ 482,248

Expenses:
     Property operating                                199,969            191,529            179,091
     Management fees                                     8,348              8,146              5,014
     Depreciation and amortization                     116,356            102,906             87,009
                                                  ---------------    ---------------     --------------
Total expenses                                         324,673            302,581            271,114
                                                  ---------------    ---------------     --------------

Operating income                                       290,943            258,525            211,134
Interest expense, net                                 (183,018)          (179,510)          (160,120)
Equity in net income/(loss) of unconsolidated
affiliates.                                             45,151             43,261             24,067
                                                  ---------------    ---------------     --------------
                                                       153,076            122,276             75,081
Minority interest in operating partnership             (37,342)           (38,701)           (20,981)
                                                  ---------------    ---------------     --------------

Pro forma net income (a)                               115,734             83,575             54,100
Pro forma preferred stock dividends                    (24,467)           (24,467)           (24,467)
                                                  ---------------    ---------------     --------------
Pro forma net income available to common
stockholders                                         $  91,267          $  59,108            $29,633
                                                  ===============    ===============     ==============

Pro forma earnings per share -  basic (b)                $1.77             $ 1.21              $0.91
Pro forma earnings per share -  diluted (b)              $1.76             $ 1.21              $0.90
</TABLE>


(a) The pro forma adjustments include management fee and depreciation
    modifications and adjustments to give effect to the public offering and
    acquisitions activity described above.
(b) Pro forma basic earnings per share are based upon weighted average common
    shares of 51,655,035 for 1999, 48,793,658 for 1998, and 32,622,665 for 1997.
    Pro forma diluted per share amounts are based on the weighted average common
    shares and the effect of dilutive securities (stock options) outstanding of
    51,755,490 for 1999, 48,985,205 for 1998, and 32,839,637 for 1997.



                                      F-34
<PAGE>   74
                        GENERAL GROWTH PROPERTIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
             (Dollars in thousands, except for per share amounts)



NOTE 14  QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

<TABLE>
<CAPTION>
                             YEAR ENDED                                FIRST         SECOND          THIRD         FOURTH
                             DECEMBER 31, 1999                        QUARTER        QUARTER        QUARTER        QUARTER
                             ------------------                       -------        -------        -------        -------
                            <S>                                       <C>            <C>            <C>            <C>

                             Total Revenues                           $134,260       $135,916       $156,027       $186,139

                             Income before minority interest            27,545         33,208         35,770         51,456

                             Income before extraordinary items          23,329         24,415         28,783         38,394

                             Net income applicable to common shares      8,519         18,298         17,573         32,267

                             Earnings before extraordinary item
                              per share-basic (a)                     $   0.43       $   0.44       $   0.45       $   0.62

                             Earnings before extraordinary item
                              per share-diluted (a)                       0.43           0.44           0.45           0.62

                             Net earnings per share-basic (a)             0.21           0.44           0.35           0.62

                             Net earnings per share-diluted (a)           0.21           0.44           0.35           0.62

                             Distributions declared per share         $   0.49       $   0.49       $   0.49       $   0.51

                             Weighted average shares
                              outstanding (in thousands) -basic         40,055         41,638         50,149         51,694

                             Weighted average shares
                              outstanding (in thousands) - diluted      40,252         41,776         50,214         51,695
</TABLE>

<TABLE>
<CAPTION>

                             YEAR ENDED                                FIRST         SECOND          THIRD         FOURTH
                             DECEMBER 31, 1998                        QUARTER        QUARTER       QUARTER(B)     QUARTER(B)
                             ------------------                       -------        -------       ----------     -------
                             <S>                                      <C>            <C>           <C>            <C>


                             Total Revenues                           $80,447        $88,618       $113,055       $144,456

                             Income before minority interest           12,882         27,133         25,395         35,578

                             Income before extraordinary items          8,455         18,141         18,040         26,558

                             Net income applicable to common shares     8,455         16,942         11,923         15,692

                             Earnings before extraordinary item
                              per share-basic (a)                     $  0.24        $  0.47       $   0.33       $   0.56

                             Earnings before extraordinary item
                              per share-diluted (a)                      0.24           0.47           0.33           0.55

                             Net earnings per share-basic (a)            0.24           0.47           0.33           0.42

                             Net earnings per share-diluted (a)          0.24           0.47           0.33           0.42

                             Distributions declared per share         $  0.47        $  0.47       $   0.47       $   0.47

                             Weighted average shares
                              outstanding (in thousands) -basic        35,689         35,877         35,899         37,283

                             Weighted average shares
                              outstanding (in thousands) - diluted     35,936         36,047         35,990         37,450
</TABLE>


                             (a)  Earnings per share for the four quarters do
                                  not add up to the annual earnings per share
                                  due to the issuance of additional stock during
                                  the year.
                             (b)  Application of EITF 98-9 resulted in the
                                  recognition of approximately $1,300 of
                                  percentage rental revenue in the fourth
                                  quarter of 1998, which would have otherwise
                                  been recognized in the third quarter.



                                      F-35
<PAGE>   75





                        REPORT OF INDEPENDENT ACCOUNTANTS



To the Board of Directors and Stockholders
General Growth Properties, Inc.


Our report on the consolidated financial statements of General Growth
Properties, Inc. is included on page F-2 of this Form 10-K. In connection with
our audits of such financial statements, we have also audited the related
financial statement schedule listed in the Index to Consolidated Financial
Statements on page F-1 of this Form 10-K. In our opinion, the financial
statement schedule referred to above, when considered in relation to the basic
consolidated financial statements taken as a whole, presents fairly, in all
material respects, the information required to be included therein.



Chicago, Illinois                                     PricewaterhouseCoopers LLP
February 8, 2000



                                      F-36
<PAGE>   76
<TABLE>
<CAPTION>

                                                          GENERAL GROWTH PROPERTIES, INC.


                         SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION AS OF DECEMBER 31, 1999

        Col. A               Col. B                   Col. C                    Col. D                    Col. E
        ------               ------                   ------                    ------                    ------
                                                                     Costs Capitalized
                                                                         Subsequent                Gross Amounts at Which
                                              Initial Cost             To Acquisition            Carried at Close of Period
                                         ------------------------  -----------------------  --------------------------------------
                                                      Buildings
                                                         and                                              Buildings
                           Encumbrances              Improvements                Carrying                   and
Description                     (e)         Land         (a)       Improvements  Costs (b)      Land     Improvements  Total(c)(d)
--------------------       ------------  ---------  -------------  ------------  ---------  ----------   ------------  -----------
<S>                     <C>            <C>          <C>            <C>         <C>         <C>         <C>            <C>
Ala Moana Combined
  Honolulu, HI             500,000,000   336,229,259  473,770,741    10,130,876  1,854,477   336,229,497  485,756,094    21,985,591

Apache Mall
  Rochester, MN             56,811,469     8,110,292   72,992,628     1,106,574          0     8,110,292   74,099,202    82,209,494

Baybrook Mall
  Friendswood, TX           94,932,407    13,300,000  117,162,546       329,842          0    13,300,000  117,492,388   130,792,388

Bayshore Mall,
  Eureka, CA                37,250,000     3,004,345   27,398,907    22,106,509  2,887,090     3,005,040   52,392,506    55,397,546

Bellis Fair Mall,
  Bellingham, WA            73,000,000     7,616,458   47,040,131     8,179,511  6,122,020     7,485,224   61,341,662    68,826,886

Birchwood Mall,
  Port Huron, MI            44,473,981     1,768,935   34,574,635    11,040,651  1,967,320     3,045,616   47,582,606    50,628,222

Boulevard Mall
  Las Vegas, NV             89,382,491    16,490,343  148,413,086     1,406,662          0    16,490,343  149,819,748   166,310,091

Capital Mall
  Jefferson City, MO        16,500,000     4,200,000   14,201,000     5,103,140          0     3,912,935   19,304,140    23,217,075

Century Mall
Birmingham, AL              32,000,000     3,164,000   28,513,908     2,463,506          0     3,164,000   30,977,414    34,141,414

Chapel Hills
  Colorado
  Springs, CO               36,750,000     4,300,000   34,017,000    55,921,010     36,805     4,300,000   89,974,815    94,274,815

Coastland Center
  Naples, FL                86,565,832    11,450,000  103,050,200     2,025,747          0    11,450,000  105,075,947   116,525,947

Colony Square Mall
  Zanesville, OH            25,600,000     1,000,000   24,500,000    11,538,684          0     1,243,184   36,038,684    37,281,868

Columbia Mall
  Columbia, MO              56,100,000     5,383,208   19,663,231     9,695,536  1,368,803     5,383,208   30,727,570    36,110,778

Coral Ridge Mall
  Coralville, IA            81,008,135     3,363,602   64,217,772     7,520,577  4,420,355     3,363,602   76,158,704    79,522,306
</TABLE>


<TABLE>
<CAPTION>


                                          Col. F       Col. G      Col. H        Col. I
                                          ------       ------      ------        -------

                                                                              Life Upon Which
                                                                              Depreciation in
                                                                               Latest Income
                                       Accumulated     Date of       Date       Statement is
Description                            Depreciation  Construction  Acquired      Computed
--------------------                   ------------  ------------  --------   ---------------
<S>                                <C>              <C>           <C>            <C>
Ala Moana Combined
  Honolulu, HI                          6,609,079                     1999           (f)

Apache Mall
  Rochester, MN                         2,813,256                     1998           (f)

Baybrook Mall
  Friendswood, TX                         524,369                     1999           (f)

Bayshore Mall,
  Eureka, CA                           16,068,894     1986-1987                      (f)

Bellis Fair Mall,
  Bellingham, WA                       21,821,145     1987-1988                      (f)

Birchwood Mall,
  Port Huron, MI                       13,695,579     1989-1990                      (f)

Boulevard Mall
  Las Vegas, NV                         5,671,819                     1998           (f)

Capital Mall
  Jefferson City, MO                    3,445,926                     1993           (f)

Century Mall
Birmingham, AL                          2,060,497                     1997           (f)

Chapel Hills
  Colorado
  Springs, CO                          10,208,106                     1993           (f)

Coastland Center
  Naples, FL                            3,114,536                     1998           (f)

Colony Square Mall
  Zanesville, OH                       12,034,612                     1986           (f)

Columbia Mall
  Columbia, MO                         12,595,199     1984-1985                      (f)

Coral Ridge Mall
  Coralville, IA                        3,382,029     1998-1999                      (f)
</TABLE>
<PAGE>   77
<TABLE>
<CAPTION>

        Col. A               Col. B                   Col. C                    Col. D                    Col. E
        ------               ------                   ------                    ------                    ------
                                                                     Costs Capitalized
                                                                         Subsequent                Gross Amounts at Which
                                              Initial Cost             To Acquisition            Carried at Close of Period
                                         ------------------------  -----------------------  --------------------------------------
                                                      Buildings
                                                         and                                              Buildings
                           Encumbrances              Improvements                Carrying                   and
Description                     (e)         Land         (a)       Improvements  Costs (b)      Land     Improvements  Total(c)(d)
--------------------       ------------  ---------  -------------  ------------  ---------  ----------   ------------  -----------
<S>                        <C>          <C>          <C>           <C>          <C>         <C>         <C>            <C>
Crossroads (MI)
  Kalamazoo, MI               44,820,562   6,800,000    61,200,000    1,207,393           0   6,800,000    62,407,393     69,207,393

Cumberland Mall
  Atlanta, GA                 99,720,600  15,198,568   136,787,110      688,747           0  15,198,568   137,475,857    152,674,425

Development in Progress                0  17,936,214     3,506,695            0              17,936,214     3,506,695     21,442,909

Eagle Ridge Mall
  Lake Wales, FL              27,000,000   7,619,865    49,560,538    4,140,109   5,678,662   7,621,768    59,379,309     67,001,077

Eden Prairie Mall
  Eden Prairie, MN                     0     465,063    19,024,047    4,301,120   1,684,662     465,063    25,009,829     25,474,892

Fallbrook Mall,
  West Hills, CA              46,900,000   6,117,338    10,076,520   56,643,397   2,520,315   6,127,138    69,240,232     75,367,370

Fox River Mall
  Appleton, WI                93,200,000   2,700,566    18,291,067   31,931,033   1,820,253   2,700,566    52,042,353     54,742,919

Gateway Mall,
  Springfield, OR             30,750,000   8,728,263    34,707,170   16,751,749   7,520,779   8,749,088    58,979,698     67,728,786

GGPLP Corp.
  Chicago, IL                243,000,000           0       556,740       31,986           0           0       588,726        588,726

110 Building
  Chicago, IL                 20,000,000           0    29,035,510            0           0           0    29,035,510     29,035,510

Grand Traverse Mall,
  Grand Traverse, MI          51,500,000   3,529,966    20,775,772   20,366,714   3,643,793   3,533,745    44,786,279     48,320,024

Greenwood Mall
  Bowling Green, KY           39,500,000   3,200,000    40,202,000   16,660,039           0   3,207,010    56,862,039     60,069,049

Knollwood Mall,
  St. Louis Park, MN          10,000,000           0     9,748,047   24,049,591   2,198,782   7,025,606    35,996,420     43,022,026

Lakeview Square Mall
  Battle Creek, MI            26,676,046   3,578,619    32,209,980    6,882,102           0   3,578,619    39,092,082     42,670,701

Lansing Mall
  Lansing, MI                 43,021,422   6,977,798    62,800,179    3,862,950           0   6,977,798    66,663,129     73,640,927

Lockport Mall,
  Lockport, NY                 9,300,000     800,000    10,000,000    4,221,701      23,656     800,000    14,245,357     15,045,357
</TABLE>

<TABLE>
<CAPTION>


                                          Col. F       Col. G      Col. H        Col. I
                                          ------       ------      ------        -------

                                                                              Life Upon Which
                                                                              Depreciation in
                                                                               Latest Income
                                       Accumulated     Date of       Date       Statement is
Description                            Depreciation  Construction  Acquired      Computed
--------------------                   ------------  ------------  --------   ---------------
<S>                                  <C>            <C>           <C>            <C>
Crossroads (MI)
  Kalamazoo, MI                         1,583,003                    1999           (f)

Cumberland Mall
  Atlanta, GA                           5,203,134                    1998           (f)

Development in Progress                         0

Eagle Ridge Mall
  Lake Wales, FL                        6,559,418      1995-1996                    (f)

Eden Prairie Mall
  Eden Prairie, MN                      1,352,772                    1997           (f)

Fallbrook Mall,
  West Hills, CA                       23,883,518                    1984           (f)

Fox River Mall
  Appleton, WI                         16,809,618      1983-1984                    (f)

Gateway Mall,
  Springfield, OR                      16,319,197      1989-1990                    (f)

GGPLP Corp.
  Chicago, IL                              86,867

110 Building
  Chicago, IL                           1,361,462

Grand Traverse Mall,
  Grand Traverse, MI                   12,037,271      1990-1991                    (f)

Greenwood Mall
  Bowling Green, KY                    10,262,394                    1993           (f)

Knollwood Mall,
  St. Louis Park, MN                   13,477,097                    1978           (f)

Lakeview Square Mall
  Battle Creek, MI                      2,970,710                    1996           (f)

Lansing Mall
  Lansing, MI                           5,181,088                    1996           (f)

Lockport Mall,
  Lockport, NY                          4,681,404                    1986           (f)
</TABLE>
<PAGE>   78
                         GENERAL GROWTH PROPERTIES, INC


<TABLE>
<CAPTION>
      Col. A             Col. B                     Col. C                       Col. D                      Col. E
      ------             ------                     ------                       ------                      ------
                                                                    Costs Capitalized
                                                                        Subsequent                   Gross Amounts at Which
                                            Initial Cost             To Acquisition                Carried at Close of Period
                                      ------------------------   ------------------------     --------------------------------------
                                                    Buildings
                                                      and                                                   Buildings
                        Encumbrances              Improvements                   Carrying                     and
      Description          (e)          Land          (a)        Improvements    Costs (b)       Land      Improvements  Total(c)(d)
--------------------   ------------   ----------  ------------   ------------   ----------    ----------   ------------  -----------
<S>                    <C>            <C>         <C>            <C>            <C>           <C>          <C>           <C>
Mall of the Bluffs,
  Council Bluffs, IA    44,473,981     1,860,116    24,016,343    12,490,311     2,529,093     1,894,220    39,035,747    40,929,967

Mall St. Vincent
  Shreveport, LA        18,980,553     2,640,000    23,760,000     1,001,642             0     2,640,000    24,761,642    27,401,642

Marketplace
Champaign, IL           47,000,000     7,000,000    63,972,357    23,340,190     1,215,376     7,000,000    88,527,923    95,527,923

McCreless Mall
 San Antonio, TX                 0     1,000,000     9,000,002       239,606             0     1,000,000     9,239,608    10,239,608

MEPC Acquisition
  Financing             25,000,000             0             0             0             0             0             0             0

Northridge Fashion
  Center
  Northridge, CA       107,103,159    16,618,095   149,562,583     6,348,900     2,930,658    16,663,260   158,842,141   175,505,401

Oakwood Mall,
  Eau Claire, WI        59,298,641     3,266,669    18,281,160    13,942,471     1,711,573     3,266,669    33,935,204    37,201,873

Park Mall
  Tucson, AZ            50,000,000     4,996,024    44,993,177    34,408,136     3,197,994     4,715,836    82,599,307    87,315,143

Piedmont Mall,
  Danville, VA          16,855,000     2,000,000    38,000,000     2,890,655        20,787     2,000,000    40,911,442    42,911,442

Pierre Bossier Mall
  Bossier City, LA      41,452,426     5,280,707    47,558,468     2,050,544             0     5,283,970    49,609,012    54,892,982

The Pines,
  Pine Bluff, AR        26,750,000     1,488,928    17,627,258     8,514,357     1,365,091     1,247,414    27,506,706    28,754,120

Regency Square Mall
  Jacksonville, FL      87,134,943    16,497,552   148,477,968     2,310,647             0    16,506,853   150,788,615   167,295,468

Rio West Mall,
  Gallup, NM            13,500,000             0    19,500,000     4,567,420             0             0    24,067,420    24,067,420

River Falls Mall,
  Clarksville, IN       28,000,000     3,177,688    54,610,421     6,833,658     5,281,892     3,182,305    66,725,971    69,908,276

River Hills Mall,
  Mankato, MN           51,200,000     3,713,529    29,013,757    18,489,952     2,584,241     4,707,314    50,087,950    54,795,264

Riverlands Shopping
  Center
  LaPlace, LA                    0       500,000     4,500,000       185,285             0       500,000     4,685,285     5,185,285


<CAPTION>
        Col. A             Col. F        Col. G     Col. H        Col. I
        ------             ------        ------     ------        ------


                                                              Life Upon Which
                                                              Depreciation in
                                                               Latest Income
                        Accumulated     Date of      Date       Statement is
      Description       Depreciation  Construction  Acquired     Computed
----------------------  ------------  ------------  --------  ---------------
<S>                     <C>           <C>           <C>       <C>
Mall of the Bluffs,
  Council Bluffs, IA    12,958,603     1985-1986                   (f)

Mall St. Vincent
  Shreveport, LA           849,516                    1998         (f)

Marketplace
Champaign, IL            4,370,612                    1997         (f)

McCreless Mall
 San Antonio, TX           380,970                    1998         (f)

MEPC Acquisition
  Financing                      0

Northridge Fashion
  Center
  Northridge, CA         6,150,945                    1998         (f)

Oakwood Mall,
  Eau Claire, WI        12,589,829     1985-1986                   (f)

Park Mall
  Tucson, AZ             4,300,398                    1996         (f)

Piedmont Mall,
  Danville, VA           4,608,710                    1995         (f)

Pierre Bossier Mall
  Bossier City, LA       1,509,172                    1998         (f)

The Pines,
  Pine Bluff, AR         9,633,578     1985-1986                   (f)

Regency Square Mall
  Jacksonville, FL       5,713,919                    1998         (f)

Rio West Mall,
  Gallup, NM             7,392,436                    1986         (f)

River Falls Mall,
  Clarksville, IN       20,837,281     1989-1990                   (f)

River Hills Mall,
  Mankato, MN           12,558,294     1990-1991                   (f)

Riverlands Shopping
  Center
  LaPlace, LA              206,394                    1998         (f)
</TABLE>


                                      F-39
<PAGE>   79
                         GENERAL GROWTH PROPERTIES, INC

<TABLE>
<CAPTION>
     Col. A                 Col. B                           Col. C                            Col. D
     ------                 ------                           ------                            ------
                                                                                  Costs Capitalized            Gross Amounts at
                                                                                     Subsequent                Which Carried at
                                                 Initial Cost                       To Acquisition             Close of Period
                                         -------------------------------   -------------------------------    -----------------
                                                             Buildings
                                                               and
                        Encumbrances                       Improvements                       Carrying
     Description            (e)               Land             (a)          Improvements      Costs (b)             Land
---------------------- --------------    --------------   --------------   --------------   --------------      --------------
<S>                    <C>               <C>              <C>              <C>              <C>               <C>
Rivertown Crossing
  Grandville, MI           87,861,668        10,972,923       97,141,738                0       12,132,835           10,972,923

Sooner Fashion Mall,
  Norman, OK               20,000,000         2,700,000       24,300,000        8,230,874                0            2,700,000

Southlake Mall,
  Morrow, GA               51,300,000         6,700,000       60,406,902        6,054,951           51,340            6,700,000

SouthShore Mall,
  Aberdeen, WA              9,000,000           650,000       15,350,000        4,886,262                0              650,000

Southwest Plaza
  Littleton , CO           84,961,720         9,000,000      103,983,673        7,078,809                0            9,000,000

Spring Hill
West Dundee, IL            90,816,339        12,400,000      111,643,525        2,472,773                0           12,400,000

St Cloud Mall LLC
St Cloud, Minnesota                 0                 0                0                0                0            2,812,169

Valley Hills,
Harrisonburg, VA           14,984,664         3,443,594       31,025,471        2,697,016                0            5,613,508

Valley Plaza Shopping
Center
Bakersfield, CA            75,197,965        12,685,151      114,166,356       -7,462,342                0           12,685,151

West Valley Mall,
  Tracy, CA                32,000,000         9,295,045       47,789,310        9,107,910        7,686,293            9,295,045

Westwood Mall
  Jackson, MI              20,900,000         2,658,208       23,923,869        2,295,190                0            3,571,208
                       --------------    --------------   --------------   --------------   --------------       --------------

  Grand Totals         $3,119,534,004    $  643,576,931   $3,070,601,498   $  513,282,673   $   84,454,945       $  658,211,969
                       ==============    ==============   ==============   ==============   ==============       ==============
<CAPTION>

     Col. A                  Col. E                           Col. F        Col. G      Col. H         Col. I
     ------                  ------                           ------        ------      ------         ------

                             Gross Amounts at Which
                           Carried at Close of Period
                         -------------------------------                                           Life Upon Which
                                                                                                   Depreciation in
                           Buildings                                                                Latest Income
                              and                           Accumulated       Date of      Date      Statement is
     Description          Improvements      Total(c)(d)     Depreciation   Construction  Acquired      Computed
----------------------   --------------   --------------   --------------  ------------  --------  ---------------
<S>                      <C>              <C>              <C>             <C>           <C>       <C>
Rivertown Crossing
  Grandville, MI           109,274,573      120,247,496          282,091      1998-1999                  (f)

Sooner Fashion Mall,
  Norman, OK                32,530,874       35,230,874        2,211,541                    1996         (f)

Southlake Mall,
  Morrow, GA                66,513,193       73,213,193        3,718,949                    1997         (f)

SouthShore Mall,
  Aberdeen, WA              20,236,262       20,886,262        6,741,260                    1986         (f)

Southwest Plaza
  Littleton , CO           111,062,482      120,062,482        4,240,644                    1998         (f)

Spring Hill
West Dundee, IL            114,116,298      126,516,298        4,295,498                    1998         (f)

St Cloud Mall LLC
St Cloud, Minnesota                  0        2,812,169                0                    1999         (f)

Valley Hills,
Harrisonburg, VA            33,722,487       39,335,995        1,844,486                    1997         (f)

Valley Plaza Shopping
Center
Bakersfield, CA            106,704,014      119,389,165        4,120,658                    1998         (f)

West Valley Mall,
  Tracy, CA                 64,583,513       73,878,558        7,295,145           1995                  (f)

Westwood Mall
  Jackson, MI               26,219,059       29,790,267        2,048,540                    1996         (f)
                        --------------   --------------   --------------

  Grand Totals          $3,668,339,116   $4,326,551,085   $  376,673,468
                        ==============   ==============   ==============
</TABLE>



                                      F-40
<PAGE>   80


                             GENERAL GROWTH PROPERTIES, INC.




                                        GENERAL GROWTH PROPERTIES, INC.
                                            NOTES TO SCHEDULE III
                                            (Dollars in Thousands)

                             (a) See description of mortgage notes payable in
                                 Note 5 of Notes to Consolidated Financial
                                 Statements.

                             (b) Initial cost for constructed malls is cost at
                                 end of first complete calendar year subsequent
                                 to opening.

                             (c) Carrying costs consists of capitalized
                                 construction-period interest and taxes.

                             (d) The aggregate cost of land, buildings and
                                 equipment for federal income tax purposes is
                                 approximately $3,556,155.
<TABLE>
<CAPTION>

                                                        RECONCILIATION OF REAL ESTATE
                                                        -----------------------------

                                                                    1997             1998              1999
                                                                    ----             ----              ----
<S>                                                            <C>                <C>              <C>
                             Balance at beginning of year      $1,555,068         $1,863,485       $3,676,796

                             Additions:                           308,417          1,813,311        1,238,874

                             Reductions:                               --                 --         (589,119)
                                                               ----------         ----------       ----------

                             Balance at close of year          $1,863,485         $3,676,796       $4,326,551
                                                               ==========         ==========       ==========



<CAPTION>
                                                    RECONCILIATION OF ACCUMULATED DEPRECIATION
                                                    ------------------------------------------
                                                                    1996             1998              1999
                                                                    ----             ----              ----

<S>                                                             <C>                <C>              <C>
                             Balance at beginning of year        $188,744          $233,295         $301,789

                             Depreciation Expense                  44,551            68,494          105,046

                             Reductions:                               --                --          (30,162)
                                                                ---------          --------         --------

                             Balance at close of year           $233,295           $301,789         $376,673
                                                                ========           ========         ========
</TABLE>


                             (f) Depreciation is computed based upon the
                                 following estimated lives:
<TABLE>
<CAPTION>
<S>                                                                                               <C>
                                      Buildings, improvements and carrying costs                    40 years
                                      Tenant allowances                                           10 - 40 years
                                      Equipment and fixtures                                        10 years

</TABLE>

                                      F-41

<PAGE>   81


                        GENERAL GROWTH PROPERTIES, INC.




EXHIBIT  INDEX

     2(a) Amended and Restated Stock Purchase Agreement, dated as of October 16,
1995, by and among Sears, Roebuck and Co., Homart Development Co., Homart Newco
One, Inc. and GGP/Homart, Inc.(1)

     2(b) Amendment No. 1 to Amended and Restated Stock Purchase Agreement,
dated as of December 22, 1995, by and among Sears, Roebuck and Co., Homart
Development Co., Homart Newco One, Inc. and GGP/Homart, Inc.(1)

     2(c) Real Estate Purchase Agreement, dated as of July 31, 1995, by and
among Sears, Roebuck and Co., Homart Development Co. and GGP/Homart, Inc.(1)

     2(d) Amendment No. 1 to Real Estate Purchase Agreement, dated as of October
16,  1995,  by and among  Sears, Roebuck and Co., Homart Development Co. and
GGP/Homart, Inc.(1)

     2(e) Amendment No. 2 to Real Estate Purchase Agreement, dated as of
December 22, 1995, by and among Sears, Roebuck and Co., Homart Development Co.
and GGP/Homart, Inc.(1)

     2(f) Mall Purchase Agreement, dated as of December 22, 1995, by and among
Sears, Roebuck and Co., Homart Development Co. and General Growth
Properties-Natick Limited Partnership.(1)

     2(g) Contribution Agreement dated December 6, 1996, between Forbes/Cohen
Properties, a Michigan general partnership, and GGP Limited Partnership, a
Delaware limited partnership.(2)

     2(h) Contribution Agreement dated December 6, 1996, between Lakeview Square
Associates, a Michigan general partnership, and GGP Limited Partnership, a
Delaware limited partnership.(2)

     2(i) Contribution Agreement dated December 6, 1996, between Jackson
Properties, a Michigan general partnership, and GGP limited Partnership, a
Delaware limited partnership.(2)

     2(j) Sale and Contribution Agreement dated June 19, 1997, between CA
Southlake Investors, Ltd., a Georgia limited partnership, and GGP Limited
Partnership, a Delaware limited partnership.(10)

     2(k) Contribution Agreement dated June 10, 1997, among Atlantic Freeholds
II, a Nevada general partnership, Town East Mall, L.P., a Delaware limited
partnership, and Town East Mall Partnership, a Texas general partnership.(10)

     2(l) Purchase and Sale Agreement dated as of March 22, 1997, between
Century Plaza Co., an Alabama general partnership, and Century Plaza L.L.C., a
Delaware limited liability company. (10)

     2(m) Real Estate Purchase Agreement dated March 12, 1997, between Champaign
Venture, an Illinois general partnership, and Champaign Market Place L.L.C., a
Delaware limited liability company. (10)

     2(n) Stock Purchase Agreement dated as of April 17, 1998 and amended June
2, 1998, among MEPC PLC, MEPC North American Properties Limited, U.K.-American
Holdings Limited and GGP Limited Partnership. (16)

     2(o) Purchase and Sale Agreement dated May 8, 1998, among Grosvenor
International Limited,  P.I.C.  Investments, Northbrook Court I L.L.C. and
Northbrook Court II L.L.C. (17)

     2(p) Merger Agreement dated May 14, 1998, among GGP Limited Partnership,
GGP Acquisition  L.L.C. and U.S. Prime Property, Inc. (17)

                                      S-1
<PAGE>   82

                        GENERAL GROWTH PROPERTIES, INC.

     2(q) Sale and Contribution Agreement dated April 2, 1998, between Southwest
Properties Venture and GGP Limited Partnership. (18)

     2(r). Contribution and Exchange Agreement dated as of July 10, 1998 (the
"Contribution Agreement") among Nashland Associates, HRE Altamonte, Inc.,
Altamonte Springs Mall L.P., and GGP Limited Partnership. (21)

     2(s). Purchase and Sale Agreement and Joint Escrow Instructions dated as of
August 21, 1998 by and between Spring Hill Mall Partnership (seller) and Spring
Hill Mall L.L.C., (purchaser). (22)

     2(t). Purchase and Sale Agreement dated as of the 18th day of September,
1998 by and between Coastland Center Joint Venture (seller) and Coastland
Center, L.P. (purchaser). (23)

     2(u)  Purchase and Sale Agreement dated as of May 3, 1999, among D/E Hawaii
Joint Venture, GGP Limited Partnership and General Growth Properties, Inc. (27)

     2(v) Agreement of Purchase and Sale, dated as of July 27, 1999, among Oak
View Mall Corporation, a Delaware corporation, and Oak View Mall, L.L.C., a
Delaware limited liability company. (28)

     2(w) Agreement of Purchase and Sale, dated as of July 22, 1999 between
General Growth Properties, Inc., a Delaware corporation (the "Company"), and
RREEF USA Fund-III, a California group trust. (28)

     2(x) Operating Agreement, dated November 10, 1999, between GGP Limited
Partnership, a Delaware limited partnership, The Comptroller of the State of New
York as Trustee of the Common Retirement Fund ("NYSCRF"), and GGP/Homart II
L.L.C. a Delaware limited liability company ("GGP/ Homart II"). (28)

     2(y) Contribution Agreement dated November 10, 1999, by and between GGP
Limited Partnership, a Delaware limited partnership (the "Operating
Partnership"), and GGP/Homart II (Altamonte Mall). (29)

     2(z) Contribution Agreement dated November 10, 1999, by and between the
Operating Partnership and GGP/Homart II  (Northbrook Court). (29)

     2(aa) Contribution Agreement dated November 10, 1999, by and between the
Operating Partnership and GGP/Homart II  (Natick Trust). (29)

     2(bb) Contribution Agreement dated November 10, 1999, by and between the
Operating Partnership and GGP/Homart II  (Stonebriar Centre). (29)

     2(cc) Contribution Agreement dated November 10, 1999, by and between NYSCRF
and GGP/Homart II (Carolina Place). (29)

     2(dd) Contribution Agreement dated November 10, 1999, by and between NYSCRF
and GGP/Homart II (Alderwood Mall). (29)

     2(ee) Contribution Agreement dated November 10, 1999, by and between NYSCRF
and GGP/Homart II (Montclair Plaza). (29)

     2(ff) Contribution Agreement, dated February 1, 2000, by and between
General Growth Companies, Inc. and GGP Limited Partnership.

     3(a) Amended and Restated Certificate of Incorporation of the Company. (3)

     3(b) Amendment to Amended and Restated Certificate of Incorporation of the
Company.(5)

                                      S-2
<PAGE>   83

                        GENERAL GROWTH PROPERTIES, INC.

     3(c) Amendment to Amended and Restated Certificate of Incorporation of the
Company filed on December 21, 1995.(11)

     3(d) Amendment to Amended and Restated Certificate of Incorporation of the
Company filed on May 20, 1997.(15)

     3(e) Amendment to Second Amendment and Restated Certificate of
Incorporation  of the Company filed on May 17, 1999. (27)

     3(f) Bylaws of the Company.(5)

     3(g) Amendment to Bylaws of the Company.(5)

     4(a) Redemption Rights Agreement, dated July 13, 1995, by and among GGP
Limited Partnership, General Growth Properties, Inc. and the persons listed on
the signature pages thereof.(8)

     4(b) Redemption Rights Agreement dated December 6, 1996, among GGP Limited
Partnership, a Delaware corporation, Forbes/Cohen Properties, a Michigan general
partnership, Lakeview Square Associates, a Michigan general partnership, and
Jackson Properties, a Michigan general partnership.(2)

     4(c) Redemption Rights Agreement, dated June 19, 1997, among GGP Limited
Partnership, a Delaware limited partnership, General Growth Properties, Inc., a
Delaware corporation, and CA Southlake Investors, Ltd., a Georgia limited
partnership.(13)

     4(d) Redemption Rights Agreement dated October 23, 1997, among GGPI, GGPLP
and Peter Leibowits.(15)

     4(e) Form of Indenture.(12)

     4(f) Certificate of Designations, Preferences and Rights of 7.25% Preferred
Equity Redeemable Stock, Series A.
(20)

     4(g) Amendment to Certificate of Designations, Preferences and Rights of
7.25% Preferred Income Equity Redeemable Stock, Series A of General Growth
Properties, Inc. filed on May 17, 1999. (27)

     4(h) Redemption Rights Agreement dated April 2, 1998, among GGP Limited
Partnership, General Growth Properties, Inc. and Southwest Properties Venture.
(17)

     4(i) Indenture and Servicing Agreement dated as of November 25, 1997, among
the Issuers named therein, LaSalle National Bank, as Trustee, and Midland Loan
Services, L.P., as Servicer (the "Indenture Agreement"). (18)

     4(j) Form of Note pursuant to the Indenture Agreement. (18)

     4(k) Mortgage, Deed of Trust, Security Agreement, Assignment of Leases and
Rents, Fixture Filing and Financing Statement, date and effective as of November
25, 1997, among the Issuers, the Trustee and the Deed Trustees named therein.
(18)

     4(l) Rights Agreement, dated November 18, 1998, between General Growth
Properties, Inc. and Norwest Bank Minnesota, N.A., as Rights Agent (including
the Form of Certificate of Designation of Series A Junior Participating
Preferred Stock attached thereto as Exhibit A, the Form of Right Certificate
attached Preferred Stock attached thereto as Exhibit C). (24)

     4(m) Form of Common Stock Certificate. (25)

                                      S-3
<PAGE>   84

                        GENERAL GROWTH PROPERTIES, INC.

     4(n) First Amendment to Rights Agreement, dated as of November 10,1999,
between the Company and Norwest Bank, Minnesota, N.A. (28)

     4(o) Letter Agreement concerning Rights Agreement, dated November 10, 1999,
between the Operating Partnership and NYSCRF. (28)

     10(a) Second Amended and Restated Agreement of Limited Partnership of the
Operating Partnership. (19)

     10(b) Rights Agreement between the Company and the Limited Partners of the
Operating Partnership.(6)

     10(c) Real Estate Management Agreement dated July 1, 1996, between General
Growth Management, Inc. and GGP Limited Partnership.(13)

     10(d)* General Growth Properties, Inc. 1993 Stock Incentive Plan, as
amended.(14)

     10(e) Form of Amended and Restated Agreement of Partnership for each of the
Property Partnerships.(3)

     10(f) Sale-Purchase Agreement dated as of December 30, 1992, by and between
Equitable and the Company.(3)

     10(g) Form of Indemnification Agreement between the Operating Partnership,
Martin Bucksbaum,  Matthew Bucksbaum, Mall Investment L.P. and M. Bucksbaum
Company. (3)

     10(h)  Form of Registration Rights Agreement between the Company and the
Bucksbaums. (3)

     10(i) Form of Registration Rights Agreement between the Company and certain
trustees for the IBM  Retirement Plan. (3)

     10(j) Form of Incidental Registration Rights Agreement between the Company,
Equitable,  Frank Russell and Wells Fargo.(3)

     10(k) Form of Letter Agreements restricting sale of certain shares of
Common Stock.(3)

     10(l)* Letter Agreement dated October 14, 1993, between the Company and
Bernard Freibaum.(6)

     10(m)* Form of Option Agreement between the Company and certain Executive
Officers.(13)

     10(n)* General Growth Properties, Inc. 1998 Incentive Stock Plan.(25)

     23 Consent of PricewaterhouseCoopers LLP - Independent Accountants.

     27 Financial Data Schedule.


(*)  A compensatory plan or arrangement required to be filed.


--------------------------------------------------------------------------------

     (1) Previously filed as an exhibit to the Company's Current Report on Form
8-K dated January 5, 1996, incorporated herein by reference.

                                      S-4
<PAGE>   85

                        GENERAL GROWTH PROPERTIES, INC.

     (2) Previously filed as an exhibit to the Company's Current Report on Form
8-K dated January 3, 1996, incorporated herein by reference.

     (3) Previously filed as an exhibit to the Company's Registration Statement
on Form S-11 (No. 33-56640), incorporated herein by reference.

     (4) Previously filed as an exhibit to the Company's Current Report on Form
8-K dated July 16, 1996, incorporated herein by reference.

     (5) Previously filed as an exhibit to the Company's Annual Report on Form
10-K for the year ended December 31, 1994, incorporated herein by reference.

     (6) Previously filed as an exhibit to the Company's Annual Report on Form
10-K for the year ended December 31, 1993, incorporated herein by reference.

     (7) Previously filed as an exhibit to the Company's Current Report on Form
8-K dated February 25, 1994, incorporated herein by reference.

     (8) Previously filed as an exhibit to the Company's Current Report on Form
8-K dated July 17, 1996, incorporated herein by reference.

     (9) Previously filed as an exhibit to the Company's Registration Statement
on Form S-3 (No. 33-23035), incorporated herein by reference.

     (10) Previously filed as an exhibit to the Company's Current Report on Form
8-K dated June 19, 1997, incorporated herein by reference.

     (11) Previously filed as an exhibit to the Company's Annual Report on Form
10-K for the year ended December 31, 1995, incorporated herein by reference.

     (12) Previously filed as an exhibit to the Company's Registration Statement
on Form S-3 (No. 333-37247) dated October 6, 1997, incorporated herein by
reference.

     (13) Previously filed as an exhibit to the Company's Annual Report on Form
10-K for the year ended December 31, 1996, incorporated herein by reference.

     (14) Previously filed as an exhibit to the Company's Registration Statement
on Form S-8 (No. 333-28449) dated June 3, 1997, incorporated herein by
reference.

     (15) Previously filed as an exhibit to the Company's Annual Report on Form
10-K for the year ended December 31, 1997, incorporated herein by reference.

     (16) Previously filed as an exhibit to the Company's current report on Form
8K dated June 17, 1998, incorporated herein by reference.

     (17) Previously filed as an exhibit to the Company's current report on Form
8K dated May 26, 1998, incorporated herein by reference.

     (18) Previously filed as an exhibit to the Company's current report on Form
8K/A dated June 2, 1998, incorporated herein by reference.

     (19) Previously filed as an exhibit to the Company's current report on Form
10-Q dated May 14, 1998, as amended May 21, 1998, incorporated herein by
reference.

                                      S-5
<PAGE>   86
                        GENERAL GROWTH PROPERTIES, INC.

     (20) Previously filed as an exhibit to the Company's current report on Form
8-K dated August 7, 1998, incorporated herein by reference.

(21) Previously filed as an exhibit to the Company's current report on Form 8K
dated August 5, 1998, incorporated herein by reference.

     (22) Previously filed as an exhibit to the Company's current report on Form
8-K dated September 30, 1998, incorporated herein by reference.

     (23) Previously filed as an exhibit to the Company's current report on Form
8-K dated October 5, 1998, incorporated herein by reference.

     (24) Previously filed as an exhibit to the Company's current report on Form
8-K, dated November 18, 1998, incorporated herein by reference.

     (25) Previously filed as an exhibit to the Company's Annual Report on Form
10-K for the year ended December 31, 1998, incorporated herein by reference.

     (26) Previously filed as an exhibit to the Company's Registration Statement
on Form S-8 (No. 333-74461) dated March 12, 1999, incorporated herein by
reference.

     (27) Previously filed as an exhibit to the Company's Current Report on Form
8-K, dated July 12, 1999, incorporated herein by reference.

     (28) Previously filed as an exhibit to the Company's Current Report on Form
8-K, dated November 23, 1999, incorporated herein by reference.

     (29) Previously filed as an exhibit to the Company's Current Report on Form
8-K/A, dated January 11, 2000, incorporated herein by reference.


                                      S-6