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                                                                   Exhibit 10.78

                                                                LOAN NO. 6518303


                         NON-RECOURSE GUARANTY AGREEMENT

     THIS NON-RECOURSE GUARANTY AGREEMENT ("GUARANTY"), dated as of the 26th day
of March, 2004, by INLAND WESTERN SEVERN, L.L.C., a Delaware limited liability
company, having an address of 2901 Butterfield Road, Oak Brook, Illinois 60523
("GUARANTOR"), in favor of JOHN HANCOCK LIFE INSURANCE COMPANY, a Massachusetts
corporation ("LENDER"), and the subsequent owners and holders of the herein
below defined Note.

                                    RECITALS:

     A.   Inland Western Severn NB, L.L.C., a Delaware limited liability company
("BORROWER"), has requested a loan (the "LOAN") from Lender in the amount of
$6,067,183.00 (the "LOAN AMOUNT") to be evidenced by the Promissory Note, dated
as of the date hereof, executed by Borrower, payable to Lender in the Loan
Amount (the "NOTE"), which Note has been guaranteed by Guarantor pursuant to the
certain Payment Guaranty ("PAYMENT GUARANTY") executed by Guarantor in favor of
Lender, and which Payment Guaranty is secured by, INTER ALIA, that certain
Indemnity Deed of Trust, Assignment of Leases and Rents, Security Agreement and
Fixture Filing (the "DEED OF TRUST"), dated as of the date hereof, executed by
Guarantor in favor of a trustee named therein for the benefit of Lender covering
certain property more particularly described in the Deed of Trust;

     B.   Section 30 of the Note sets forth certain amounts, obligations and
other liabilities for which Borrower is fully liable to Lender (the
"NON-RECOURSE CARVEOUT OBLIGATIONS"), notwithstanding limitations on Borrower's
liability pursuant to said Section 19 of the Note; and

     C.   As a condition to making the Loan, Lender has required that Guarantor
further expressly and explicitly and separately guarantee the payment of the
Non-Recourse Carveout Obligations and performance of the obligations set forth
in Section 1 below (the "GUARANTEED OBLIGATIONS").

                                   AGREEMENT:

     NOW, THEREFORE, as a material inducement to Lender to agree to make the
Loan to Borrower, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Guarantor hereby does irrevocably
and unconditionally warrant and represent unto and covenant with Lender as
follows:

     1.   GUARANTY.  Guarantor hereby (a) guarantees unto Lender the full and
timely payment of the amounts due, or to become due, to Lender under the
Non-Recourse Carveout Obligations and (b) agrees with Lender to pay to Lender
(i) the amounts due under the Non-Recourse Carveout Obligations within five (5)
days from the date Lender notifies Guarantor of Borrower's failure to pay the
same, if and when the same becomes due, and at the place specified in the Note
for payment and (ii) Lender's reasonable attorneys' fees and all court costs
incurred by Lender in enforcing or protecting any of

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                                                                LOAN NO. 6518303


Lender's rights, remedies or recourses hereunder. Subject to the continuing
obligations of Guarantor under the Payment Guaranty, Guarantor is not
guaranteeing payment of any portion of the indebtedness or performance of any
portion of the obligations under the documents evidencing, securing,
guaranteeing or executed in connection with the Loan (the "LOAN DOCUMENTS"),
other than the Non-Recourse Carveout Obligations.

     2.   GUARANTOR'S REPRESENTATIONS AND WARRANTIES. Guarantor hereby warrants
and represents unto Lender as follows:

          (a)  that this Guaranty constitutes the legal, valid and binding
obligation of Guarantor and is fully enforceable against Guarantor in accordance
with its terms;

          (b)  Guarantor is solvent and the execution of this Guaranty does not
render Guarantor insolvent. Any and all financial statements, balance sheets,
net worth statements and other financial data which have heretofore been
furnished to Lender with respect to Guarantor fairly and accurately present the
financial condition of Guarantor as of the date they were furnished to Lender
and, since that date, there has been no material adverse change in the financial
condition of Guarantor;

          (c)  that there are no legal proceedings or material claims or demands
pending against or, to the best of Guarantor's knowledge threatened against,
Guarantor or any of its assets;

          (d)  that the execution and delivery of this Guaranty and the
assumption of liability hereunder have been in all respects authorized and
approved by Guarantor; Guarantor has full authority and power to execute this
Guaranty and to perform its obligations hereunder; and

          (e)  that neither the execution nor the delivery of this Guaranty nor
the fulfillment and compliance with the provisions hereof will conflict with,
result in a breach of, constitute a default under or result in the creation of
any lien, charge, or encumbrance upon any property or assets of Guarantor under
any agreement or instrument to which Guarantor is now a party or by which it may
be bound.

     3.   WAIVER. Guarantor hereby waives (a) all notices of acceptance hereof,
protest, demand and dishonor, presentment, notice of nonpayment, notice of
intention to accelerate maturity, notice of acceleration of maturity and all
notices and demands of any kind now or hereafter provided for by any statute or
rule of law other than the five (5) day notice referred to in PARAGRAPH 1 above,
(b) any and all requirements that Lender institute any action or proceeding, or
exhaust or attempt to enforce any or all of Lender's right, remedies or
recourses against Borrower or anyone else or in respect of any mortgaged
property or collateral covered by any Loan Documents, or join Borrower or any
other persons liable on the Non-Recourse Carveout Obligations in any action to
enforce this Guaranty as a condition precedent to bringing an action against
Guarantor upon this Guaranty, it being expressly agreed that the liability of
Guarantor hereunder shall be primary and not secondary, (c) any defense arising
by reason of any disability,

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                                                                LOAN NO. 6518303


insolvency, lack of authority or power, death, insanity, minority, dissolution
or any other defense of Borrower, or any other surety, co-maker, endorser or
guarantor of the Non-Recourse Carveout Obligations (even though rendering same
void, unenforceable or otherwise uncollectible), it being agreed that Guarantor
shall remain liable hereon regardless of whether Borrower or any other such
person be found not liable thereon for any reason, (d) all suretyship defenses
of every kind and nature and (e) any claim Guarantor might otherwise have
against Lender by virtue of Lender's invocation of any right, remedy or recourse
permitted it hereunder or under the Loan Documents. This is a guaranty of
payment and not a guaranty of collection.

     4.   SUBSEQUENT ACTS. Guarantor hereby agrees with Lender that (a) the
payments called for and provisions contained in the Loan Documents, including
specifically (but without limitation) the Note, may be renewed, extended,
rearranged, modified, released or canceled, (b) all or any part of any mortgaged
property and collateral for the indebtedness may be released from, and any new
or additional security may be added to, the lien and security interest of the
Loan Documents, (c) any additional parties who may become personally liable for
repayment of the Note may hereafter be released from their liability hereunder
and thereon and (d) Lender may take, or delay in taking or refuse to take, any
and all action with reference to the Note and the other Loan Documents
(regardless of whether same might vary the risk or alter the rights, remedies or
recourses of Guarantor), including specifically (but without limitation) the
settlement or compromise of any amount allegedly due thereunder, all without
notice or consideration to or the consent of Guarantor, and no such acts shall
in any way release, diminish or affect the absolute nature of Guarantor's
obligations and liabilities hereunder. It is the intent of Guarantor and Lender
that such obligations and liabilities hereunder are primary, absolute and
unconditional under any and all circumstances and that, until the Non-Recourse
Carveout Obligations are fully and finally satisfied, such obligations and
liabilities shall not be discharged or released, in whole or in part, by any act
or occurrence which, but for this PARAGRAPH 4, might be deemed a legal or
equitable discharge or release of Guarantor.

     5.   REMEDIES CUMULATIVE. Guarantor hereby agrees with Lender that all
rights, remedies and recourses afforded to Lender by reason of this Guaranty or
otherwise are (a) separate and cumulative and may be pursued separately,
successively or concurrently, as occasion therefor shall arise, and (b)
non-exclusive and shall in no way limit or prejudice any other legal or
equitable right, remedy or recourse which Lender may have.

     6.   SUBORDINATION AND NO SUBROGATION. If, for any reason whatsoever,
Borrower now is or hereafter becomes indebted to Guarantor, such indebtedness
and all interest thereon, shall, at all times, be subordinate in all respects to
the Loan Documents, and Guarantor shall not be entitled to enforce or receive
payment thereof until the Non-Recourse Carveout Obligations have been fully
satisfied. Notwithstanding anything to the contrary contained in this Guaranty
or any payments made by Guarantor hereunder, Guarantor shall not have any right
of subrogation in or under the Loan Documents or to participate in any way
therein or in any right, title or interest in and to any mortgaged

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                                                                LOAN NO. 6518303


property or any collateral for the Loan, all such rights of subrogation and
participation, together with any other contractual, statutory or common law
right which Guarantor may have to be reimbursed for any payments Guarantor may
make to Lender pursuant to this Guaranty, being hereby expressly waived and
released until the Loan is paid in full.

     7.   LAW GOVERNING AND SEVERABILITY. This Guaranty shall be governed by and
construed in accordance with the laws of the State of Maryland without regard to
conflict of law provisions thereof and is intended to be performed in accordance
with, and only to the extent permitted by, such laws. If any provision of this
Guaranty or the application thereof to any person or circumstance, for any
reason and to any extent, shall be invalid or unenforceable, neither the
remainder of this Guaranty nor the application of such provision to any other
persons or circumstances shall be affected thereby, but rather the same shall be
enforced to the greatest extent permitted by law.

     8.   SUCCESSORS AND ASSIGNS. This Guaranty and all the terms, provisions
and conditions hereof shall be binding upon Guarantor and the Guarantor's heirs,
legal representatives, successors and assigns and shall inure to the benefit of
Lender, its successors and assigns and all subsequent holders of the Note.

     9.   PARAGRAPH HEADINGS. The paragraph headings inserted in this Guaranty
have been included for convenience only and are not intended, and shall not be
construed, to limit or define in any way the substance of any paragraph
contained herein.

     10.  EFFECT OF BANKRUPTCY. This Guaranty shall continue to be effective or
reinstated, as the case may be, if at any time payment to Lender of all or any
part of the Non-Recourse Carveout Obligations is rescinded or must otherwise be
restored or refunded by Lender pursuant to any insolvency, bankruptcy,
reorganization, receivership or other debtor relief proceeding involving
Borrower. In the event that Lender must rescind or restore any payment received
by Lender in satisfaction of the Non-Recourse Carveout Obligations, as set forth
herein, any prior release or discharge of the terms of this Guaranty given to
Guarantor by Lender shall be without effect and this Guaranty shall remain in
full force and effect.

     11.  NOTICES. All notices given hereunder shall be deemed effective if
given in accordance with the notice provisions of the Deed of Trust, provided,
however, that the notices given to Guarantor shall be sent to the following
address: 2901 Butterfield Road, Oak Brook, Illinois 60523.

     12.  BENEFIT. Guarantor warrants and represents that Guarantor has
received, or will receive, direct or indirect benefit from the execution and
delivery of this Guaranty.

     13.  NO REPRESENTATIONS BY LENDER. Neither Lender nor anyone acting on
behalf of Lender has made any representation, warranty or statement to Guarantor
to induce Guarantor to execute and deliver this Guaranty.

     14.  APPLICATION OF FORECLOSURE PROCEEDS. In the event of any foreclosure
sales of the mortgaged property and collateral covered by the Loan Documents,
the

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proceeds of such sales shall be applied first to the discharge of that portion
of the indebtedness then remaining unpaid as to which Guarantor is not fully
personally liable pursuant to this Guaranty, it being the express intention of
the parties that the application of the proceeds of such foreclosure sales shall
be in such a manner as not to extinguish or reduce Guarantor's personal
liability hereunder until all of the indebtedness as to which Guarantor is not
personally liable hereunder has been paid in full. Nothing contained in this
PARAGRAPH 14 shall be construed to require that Lender foreclose the liens and
security interests created in the Loan Documents as a condition precedent to
bringing an action against Guarantor upon this Guaranty, or as an agreement that
Guarantor's liability is limited to any deficiency remaining after such a
foreclosure.

     15.  JOINT AND SEVERAL LIABILITY. If more than one person is included in
the definition of Guarantor, the liability of all such persons hereunder shall
be joint and several.

     16.  WAIVER OF JURY TRIAL. GUARANTOR AND LENDER DO HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVE THEIR RIGHT TO A TRIAL BY JURY WITH RESPECT
TO ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH
THIS GUARANTY OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENT (WHETHER
ORAL OR WRITTEN) OR ANY ACTION OF EITHER PARTY ARISING OUT OF OR RELATED IN ANY
MANNER TO THIS GUARANTY (INCLUDING WITHOUT LIMITATION, ANY ACTION TO RESCIND OR
CANCEL THIS GUARANTY AND ANY CLAIMS OR DEFENSES ASSERTING THAT THIS GUARANTY WAS
FRAUDULENTLY INDUCED OR IS OTHERWISE VOID OR VOIDABLE). THIS WAIVER IS A
MATERIAL INDUCEMENT FOR THE DELIVERY AND ACCEPTANCE OF THIS GUARANTY AND SHALL
SURVIVE THE CLOSING OR ANY TERMINATION OF THIS GUARANTY.

          17.  COUNTERPARTS. To facilitate execution, this Guaranty may be
executed in as many counterparts as may be convenient or required. It shall not
be necessary that the signature of, or on behalf of, each party, or that the
signature of all persons required to bind any party, appear on each counterpart.
All counterparts shall collectively constitute a single instrument. It shall not
be necessary in making proof of this Guaranty to produce or account for more
than a single counterpart containing the respective signatures of, or on behalf
of, each of the parties hereto. Any signature page to any counterpart may be
detached from such counterpart without impairing the legal effect of the
signatures thereon and thereafter attached to another counterpart identical
thereto except having attached to it additional signature pages.

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                                                                LOAN NO. 6518303


     IN WITNESS WHEREOF, the Guarantor has executed (or has caused to be
executed) this Guaranty under seal.

                            INLAND WESTERN SEVERN, L.L.C.,
                            a Delaware limited liability company

                            By:   Inland Western Retail Real Estate Trust, Inc.,
                                  a Maryland corporation, its Sole Member


                                  By: /s/ Valerie Medina
                                     ----------------------
                                  Name: Valerie Medina
                                       --------------------
                                  Title: Asst. Secretary
                                        -------------------

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