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 GGP Reports Third Quarter 2016 Results and Raises Dividend 16%
   Monday, October 31, 2016 4:01:00 PM ET

General Growth Properties, Inc. (the "Company" or "GGP") (GGP ) today reported results for the three and nine months ended September 30, 2016.

Highlights

-- Company Same Store Net Operating Income ("Company Same Store NOI") increased 3.8% and 4.2% from the prior year period for the three and nine months ended September 30, 2016, respectively.

-- Company earnings before interest, taxes, depreciation and amortization ("Company EBITDA") increased 4.6% and 10.3% from the prior year period for the three and nine months ended September 30, 2016, respectively.

-- Same Store leased percentage was 96.7% at quarter end.

-- Initial rental rates for signed leases that have commenced in the trailing 12 months on a suite-to-suite basis increased 12.0% when compared to the rental rate for expiring leases.

-- Tenant sales (all less anchors) increased 1.4% on a trailing 12-month basis.(1)

-- The Company formed a joint venture with Simon Property Group and Authentic Brands Group LLC to acquire Aeropostale, Inc. GGP’s total investment was $20.4 million.

-- During and subsequent to quarter end, the Company acquired five anchor boxes from Macy’s for approximately $48 million.

-- The Company declared a fourth quarter common stock dividend, an increase of 16% over the prior year.

GAAP Operating Results

For the three months ended September 30, 2016, net income attributable to GGP was $674 million, or $0.70 per diluted share, as compared to $124 million, or $0.13 per diluted share, in the prior year period. For the nine months ended September 30, 2016, net income attributable to GGP was $1.1 billion, or $1.09 per diluted share, as compared to $1.2 billion, or $1.23 per diluted share, in the prior year period. Net income attributable to GGP in 2016 and 2015 for the three and nine months was impacted primarily by the gains related to the sales of a partial interest in two properties.

Company Operating Results

For the three months ended September 30, 2016, Company Funds From Operations ("Company FFO") was $336 million, or $0.35 per diluted share, as compared to $341 million, or $0.36 per diluted share, in the prior year period, a decrease of 2.0%. For the nine months ended September 30, 2016, Company FFO was $1.1 billion, or $1.10 per diluted share, as compared to $969 million, or $1.01 per diluted share, in the prior year period, an increase of 9.2%.

1 Excludes Christiana Mall due to unusual changes in sales productivity.

Investment Activities

Development

The Company’s development and redevelopment activities total $1.0 billion, of which approximately $0.6 billion is under construction and $0.4 billion is in the pipeline.

Financing Activities

During the third quarter, the Company repaid the mortgage loan on the Mall of Louisiana for approximately $202 million with an interest rate of 5.8%, repaid the mortgage loan on Apache Mall for approximately $93 million with an interest rate of 4.3%, and repaid $90 million that was outstanding on the credit facility.

Dividends

On October 31, 2016, the Company’s Board of Directors declared a fourth quarter common stock dividend of $0.22 per share payable on January 6, 2017, to stockholders of record on December 15, 2016. This represents an increase of $0.03 per share or 16% growth over the dividend declared for the fourth quarter of 2015.

The Board of Directors also declared a quarterly dividend on the 6.375% Series A Cumulative Redeemable Preferred Stock of $0.3984 per share payable on January 3, 2017, to stockholders of record on December 15, 2016.

Guidance

                                                                           For the year ending                 For the three months
Earnings Guidance                                                           December 31, 2016                                   ending December 31, 2016
---------------------------------------------------------------- -------------------- -----------------------------------                     -----------------------------------
                                                                                      
---------------------------------------------------------------- -------------------- -----------------------------------                     -----------------------------------
Net income attributable to GGP                                                         $1.31- $1.33                                           $0.22 - $0.24
Preferred stock dividends                                                                     (0.02 )                                                 (0.01 )
                                                                                      ------------- --------------------                      ------------- --------------------
Net income attributable to common stockholders                                        $1.29 - $1.31                                           $0.21 - $0.23
Gain from change in control of investment properties and other,                               (0.72 )                                                     -
provision for impairment and redeemable noncontrolling interests
Depreciation, including share of JVs                                                           0.92                                 0.20  
                                                                                      ------------- --------------------                      ------------- --------------------
NAREIT FFO                                                                            $1.49 - $1.51                                           $0.41 - $0.43
Adjustments (1)                                                                                0.03                                 0.01  
                                                                                      ------------- --------------------                      ------------- --------------------
Company FFO per diluted share                                                         $1.52 - $1.54                        $0.42 - $0.44  
                                                                                      ------------- --------------------                      ------------- --------------------

-- Includes impact of straight-line rent, above/below market rent, gain/loss on foreign currency and the related provision for income taxes, and other items. For discussion on the purpose and use of these adjustments please see the Non-GAAP Supplemental Financial Measures and Definitions section.

The guidance estimate reflects management’s view of current and future market conditions, including assumptions with respect to Company Same Store NOI and Operating Income growth, rental rates, occupancy levels, retail sales, variable expenses, interest rates and the earnings impact of the events referenced in this release and previously disclosed. The guidance also reflects management’s view of capital market conditions. The estimates do not include future gains or losses, or the impact on operating results from future property acquisitions or dispositions or capital market activity. Earnings per share estimates may be subject to fluctuations as a result of several factors, including any gains or losses associated with disposition activity. By definition, FFO and Company FFO exclude real estate-related depreciation and amortization, provisions for impairment, or gains or losses associated with property disposition activities. This guidance is a forward-looking statement and is subject to the risks and other factors described elsewhere in this release and in the Company’s annual and quarterly periodic reports filed with the Securities and Exchange Commission.

Investor Conference Call

On Tuesday, November 1, 2016, the Company will host a conference call at 8:00 a.m. Central (9:00 a.m. Eastern). The conference call will be accessible by telephone and through the Internet. Interested parties can access the call by dialing 877.845.1018 (international 707.287.9345). A live webcast of the conference call will be available in listen-only mode in the Investors section at www.ggp.com. Interested parties should access the conference call or website 10 minutes prior to the beginning of the call in order to register. For those unable to listen to the call live, a replay will be available after the conference call event. To access the replay, dial 855.859.2056 (international 404.537.3406) conference ID 87693982.

Supplemental Information

The Company has prepared a supplemental information report available on www.ggp.com in the Investors section. This information also has been furnished with the Securities and Exchange Commission as an exhibit on Form 8-K.

Forward-Looking Statements

Certain statements made in this press release may be deemed "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Although the Company believes the expectations reflected in any forward-looking statement are based on reasonable assumptions, it can give no assurance that its expectations will be attained, and it is possible that actual results may differ materially from those indicated by these forward-looking statements due to a variety of risks, uncertainties and other factors. Such factors include, but are not limited to, the Company’s ability to refinance, extend, restructure or repay near and intermediate term debt, its indebtedness, its ability to raise capital through equity issuances, asset sales or the incurrence of new debt, retail and credit market conditions, impairments, its liquidity demands, and economic conditions. The Company discusses these and other risks and uncertainties in its annual and quarterly periodic reports filed with the Securities and Exchange Commission. The Company may update that discussion in its periodic reports, but otherwise takes no duty or obligation to update or revise these forward-looking statements, whether as a result of new information, future developments, or otherwise.

Investors and others should note that we post our current Investor Presentation on the Investors page of our website at www.ggp.com. From time to time, we update that Investor Presentation and when we do, it will be posted on the Investors page of our website at ggp.com. It is possible that the updates could include information deemed to be material information. Therefore, we encourage investors, the media and others interested in our company to review the information we post on the Investors page of our website at www.investor.ggp.com from time to time.

General Growth Properties, Inc.

General Growth Properties, Inc. is an S&P 500 company focused exclusively on owning, managing, leasing and redeveloping high-quality retail properties throughout the United States. GGP is headquartered in Chicago, Illinois, and publicly traded on the NYSE under the symbol GGP.

Non-GAAP Supplemental Financial Measures and Definitions

Proportionate or At Share Basis

The following Non-GAAP supplemental financial measures are all presented on a proportionate basis. The proportionate financial information presents the consolidated and unconsolidated properties at the Company’s ownership percentage or "at share". This form of presentation offers insights into the financial performance and condition of the Company as a whole, given the significance of the Company’s unconsolidated property operations that are owned through investments accounted for under GAAP using the equity method.

The proportionate financial information is not, and is not intended to be, a presentation in accordance with GAAP. The non-GAAP proportionate financial information reflects our proportionate economic ownership of each asset in our property portfolio that we do not wholly own. The amounts shown in the columns labeled "Consolidated Properties at Share" reflect the Company’s Consolidated Properties at our proportionate share (excluding noncontrolling interests and unconsolidated properties). The amounts in the column labeled "Unconsolidated Properties" were derived on a property-by-property basis by including our share of each line item from each individual entity. This provides visibility into our share of the operations of our joint ventures.

We do not control the unconsolidated joint ventures and the presentations of the assets and liabilities and revenues and expenses do not represent our legal claim to such items. The operating agreements of the unconsolidated joint ventures generally provide that partners may receive cash distributions (1) to the extent there is available cash from operations, (2) upon a capital event, such as a refinancing or sale or (3) upon liquidation of the venture. The amount of cash each partner receives is based upon specific provisions of each operating agreement and varies depending on factors including the amount of capital contributed by each partner and whether any contributions are entitled to priority distributions. Upon liquidation of the joint venture and after all liabilities, priority distributions and initial equity contributions have been repaid, the partners generally would be entitled to any residual cash remaining based on their respective legal ownership percentages.

We provide Non-GAAP proportionate financial information because we believe it assists investors and analysts in estimating our economic interest in our unconsolidated joint ventures when read in conjunction with the Company’s reported results under GAAP. Other companies in our industry may calculate their proportionate interest differently than we do, limiting the usefulness as a comparative measure. Because of these limitations, the Non-GAAP proportionate financial information should not be considered in isolation or as a substitute for our financial statements as reported under GAAP.

Net Operating Income ("NOI"), Company NOI and Company Same Store NOI

The Company defines NOI as proportionate income from operations and after operating expenses have been deducted, but prior to deducting financing, property management, administrative and income tax expenses. NOI excludes management fees and other corporate revenue and reductions in ownership as a result of sales or other transactions. The Company considers NOI a helpful supplemental measure of its operating performance because it is a direct measure of the actual results of our properties. Because NOI excludes reductions in ownership as a result of sales or other transactions, management fees and other corporate revenue, general and administrative and property management expenses, interest expense, retail investment property impairment or non-recoverable development costs, depreciation and amortization, gains and losses from property dispositions, allocations to noncontrolling interests, provision for income taxes, preferred stock dividends, and extraordinary items, it provides a performance measure that, when compared year over year, reflects the revenues and expenses directly associated with owning and operating commercial real estate properties and the impact on operations from trends in occupancy rates, rental rates and operating costs.

The Company also considers Company NOI to be a helpful supplemental measure of its operating performance because it excludes from NOI items such as straight-line rent, and amortization of intangibles resulting from acquisition accounting and other capital contribution or restructuring events. However, due to the exclusions noted, Company NOI should only be used as an alternative measure of the Company’s financial performance.

We present Company NOI, Company EBITDA and Company FFO (as defined below); as we believe certain investors and other users of our financial information use these measures of the Company’s historical operating performance.

Adjustments to NOI, EBITDA and FFO, including debt extinguishment costs, market rate adjustments on debt, straight-line rent, intangible asset and liability amortization, real estate tax stabilization, gains and losses on foreign currency and other items that are not a result of normal operations, assist management and investors in distinguishing whether increases or decreases in revenues and/or expenses are due to growth or decline of operations at the properties or from other factors. In addition, the Company’s leases include step rents that increase over the term of the lease to compensate the Company for anticipated increases in market rentals over time. The Company’s leases do not include significant front loading or back loading of payments or significant rent-free periods. Therefore, we find it useful to evaluate rent on a contractual basis as it allows for comparison of existing rental rates to market rental rates. Management has historically made these adjustments in evaluating our performance, in our annual budget process and for our compensation programs.

The Company defines Company Same Store NOI as Company NOI excluding periodic effects of acquisitions of new properties and certain redevelopments (for the list of properties included in Company Same Store NOI see the Property Schedule in our Supplemental Information). We do not include an acquired property in our Company Same Store NOI until the operating results for that property have been included in our consolidated results for one full calendar year. Properties that we sell are excluded from Company NOI and Company Same Store NOI for all periods once the transaction has closed.

The Company considers Company Same Store NOI a helpful supplemental measure of its operating performance because it assists management and investors in distinguishing whether increases or decreases in revenues and/or expenses are due to growth or decline of operations at comparable properties or from other factors, such as the effect of acquisitions. For these reasons, we believe that Company Same Store NOI, when combined with GAAP operating income provides useful information to investors and management.

Other REITs may use different methodologies for calculating, NOI, Company NOI and Company Same Store NOI, and accordingly, the Company’s Company Same Store NOI may not be comparable to other REITs. As a result of the elimination of corporate-level costs and expenses and depreciation and amortization, the Company Same Store NOI we present does not represent our total revenues, expenses, operating profit or net income and should not be used to evaluate our performance as a whole. Management compensates for these limitations by separately considering the impact of these excluded items, to the extent they are material, to operating decisions or assessments of our operating performance. Our consolidated GAAP statements of operations include such amounts, all of which should be considered by investors when evaluating our performance.

Earnings Before Interest Expense, Income Tax, Depreciation, and Amortization ("EBITDA") and Company EBITDA

The Company defines EBITDA as NOI less certain property management and administrative expenses, net of management fees and other corporate revenues. EBITDA is a commonly used measure of performance in many industries, but may not be comparable to measures calculated by other companies. Management believes EBITDA provides useful information to investors regarding our results of operations because it helps us and our investors evaluate the ongoing operating performance of our properties after removing the impact of our capital structure (primarily interest expense) and our asset base (primarily depreciation and amortization). Management also believes the use of EBITDA facilitates comparisons between us and other equity REITs, retail property owners who are not REITs and other capital-intensive companies. Management uses Company EBITDA to evaluate property-level results and as one measure in determining the value of acquisitions and dispositions and, like FFO and Same Store NOI (discussed below), it is widely used by management in the annual budget process and for compensation programs. Please see adjustments discussion above for the purpose and use of the adjustments included in Company EBITDA.

EBITDA and Company EBITDA, as presented, may not be comparable to similar measures calculated by other companies. This information should not be considered as an alternative to net income, operating profit, cash from operations or any other operating performance measure calculated in accordance with GAAP.

Funds From Operations ("FFO") and Company FFO

The Company determines FFO based upon the definition set forth by National Association of Real Estate Investment Trusts ("NAREIT"). The Company determines FFO to be its share of consolidated net income (loss) computed in accordance with GAAP, excluding real estate related depreciation and amortization, excluding gains and losses from extraordinary items, excluding cumulative effects of accounting changes, excluding gains and losses from the sales of, or any impairment charges related to, previously depreciated operating properties, plus the allocable portion of FFO of unconsolidated joint ventures based upon the Company’s economic ownership interest, and all determined on a consistent basis in accordance with GAAP. As with the Company’s presentation of NOI, FFO has been reflected on a proportionate basis.

The Company considers FFO a helpful supplemental measure of the operating performance for equity REITs and a complement to GAAP measures because it is a recognized measure of performance by the real estate industry. FFO facilitates an understanding of the operating performance of the Company’s properties between periods because it does not give effect to real estate depreciation and amortization since these amounts are computed to allocate the cost of a property over its useful life. Since values for well-maintained real estate assets have historically increased or decreased based upon prevailing market conditions, the Company believes that FFO provides investors with a clearer view of the Company’s operating performance.

We calculate FFO in accordance with standards established by NAREIT, which may not be comparable to measures calculated by other companies who do not use the NAREIT definition of FFO or do not calculate FFO in accordance with NAREIT guidance. In addition, although FFO is a useful measure when comparing our results to other REITs, it may not be helpful to investors when comparing us to non-REITs. As with the presentation of Company NOI and Company EBITDA, we also consider Company FFO, which is not in accordance with NAREIT guidance and may not be comparable to measures calculated by other REITs, to be a helpful supplemental measure of our operating performance. Please see adjustments discussion above for the purpose and use of the adjustments included in Company FFO.

FFO and Company FFO do not represent cash flow from operations as defined by GAAP, should not be considered as an alternative to net income determined in accordance with GAAP as a measure of operating performance, and is not an alternative to cash flows as a measure of liquidity or indicative of funds available to fund our cash needs. In addition, Company FFO per diluted share does not measure, and should not be used as a measure of, amounts that accrue directly to stockholders’ benefit.

Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures

The Company presents NOI, EBITDA and FFO as they are financial measures widely used in the REIT industry. In order to provide a better understanding of the relationship between the Company’s non-GAAP financial measures of NOI, Company NOI, EBITDA, Company EBITDA, FFO and Company FFO, reconciliations have been provided as follows: a reconciliation of GAAP operating income to Company NOI and Company Same Store NOI, a reconciliation of GAAP net income attributable to GGP to EBITDA and Company EBITDA, and a reconciliation of GAAP net income attributable to GGP to FFO and Company FFO. None of the Company’s non-GAAP financial measures represents cash flow from operating activities in accordance with GAAP, none should be considered as an alternative to GAAP net income (loss) attributable to GGP and none are necessarily indicative of cash flow. In addition, the Company has presented such financial measures on a consolidated and unconsolidated basis (at the Company’s proportionate share) as the Company believes that given the significance of the Company’s operations that are owned through investments accounted for by the equity method of accounting, the detail of the operations of the Company’s unconsolidated properties provides important insights into the income and FFO produced by such investments.

GAAP FINANCIAL STATEMENTS
 
Consolidated Balance Sheets
(In thousands)
                                                                                                                           
                                                                                                                                               ------------------------------------------------------------------------- -----------------------------------------------------
                                                                                                                                                                September 30, 2016                                      December 31, 2015
                                                                                                                                               -----------------------------------------------------                     -----------------------------------------------------
Assets:
Investment in real estate:
                     Land                                                                                                                                         $  2,972,931                                                              $  3,596,354
                     Buildings and equipment                                                                                                                        15,497,006                                                                16,379,789
                     Less accumulated depreciation                                                                                                                  (2,611,194 )                                                              (2,452,127 )
                     Construction in progress                                                                                                       344,479                             308,903  
                                                                                                                                               -------------------- ---------- --------------------                      -------------------- ---------- --------------------
                                                        Net property and equipment                                                                                  16,203,222                                                                17,832,919
                     Investment in and loans to/from Unconsolidated Real Estate Affiliates                                                        3,844,177                           3,506,040  
                                                                                                                                               -------------------- ---------- --------------------                      -------------------- ---------- --------------------
                                                        Net investment in real estate                                                                               20,047,399                                                                21,338,959
Cash and cash equivalents                                                                                                                                              656,769                                                                   356,895
Accounts and notes receivable, net                                                                                                                                     883,072                                                                   949,556
Deferred expenses, net                                                                                                                                                 215,947                                                                   214,578
Prepaid expenses and other assets                                                                                                                                      910,002                                                                   997,334
Assets held for disposition                                                                                                                               -                             216,233  
                                                                                                                                               -------------------- ---------- --------------------                      -------------------- ---------- --------------------
                                                        Total assets                                                                                              $ 22,713,189                                           $ 24,073,555  
                                                                                                                                               -------------------- ---------- --------------------                      -------------------- ---------- --------------------
Liabilities:
Mortgages, notes and loans payable                                                                                                                                $ 12,460,027                                                              $ 14,216,160
Investment in Unconsolidated Real Estate Affiliates                                                                                                                     39,500                                                                    38,488
Accounts payable and accrued expenses                                                                                                                                  646,216                                                                   784,493
Dividend payable                                                                                                                                                       184,634                                                                   172,070
Deferred tax liabilities                                                                                                                                                 1,365                                                                     1,289
Junior Subordinated Notes                                                                                                                                              206,200                                                                   206,200
Liabilities held for disposition                                                                                                                          -                              58,934  
                                                                                                                                               -------------------- ---------- --------------------                      -------------------- ---------- --------------------
                                                        Total liabilities                                                                        13,537,942                          15,477,634  
                                                                                                                                               -------------------- ---------- --------------------                      -------------------- ---------- --------------------
Redeemable noncontrolling interests:
                     Preferred                                                                                                                                         159,260                                                                   157,903
                     Common                                                                                                                         131,583                             129,724  
                                                                                                                                               -------------------- ---------- --------------------                      -------------------- ---------- --------------------
                                                        Total redeemable noncontrolling interests                                                   290,843                             287,627  
                                                                                                                                               -------------------- ---------- --------------------                      -------------------- ---------- --------------------
 Equity:
                     Preferred stock                                                                                                                                   242,042                                                                   242,042
                     Stockholders’ Equity                                                                                                                            8,594,582                                                                 8,028,001
                     Noncontrolling interests in consolidated real estate affiliates                                                                                    20,264                                                                    24,712
                     Noncontrolling interests related to long-term incentive plan common                                                             27,516                              13,539  
                     units
                                                                                                                                               -------------------- ---------- --------------------                      -------------------- ---------- --------------------
                                                        Total equity                                                                              8,884,404                           8,308,294  
                                                                                                                                               -------------------- ---------- --------------------                      -------------------- ---------- --------------------
                                                        Total liabilities, redeemable noncontrolling interests and equity                                         $ 22,713,189                                           $ 24,073,555  
                                                                                                                                               -------------------- ---------- --------------------                      -------------------- ---------- --------------------
GAAP FINANCIAL STATEMENTS
 
Consolidated Statements of Income
(In thousands, except per share)
                                                                                                                                                                            
                                                                 ---------------------------------------------------------------------------------------------------------------------------                     -----------------------------------------------------------------------------------------------------------------------------
                                                                                                                     Three Months Ended                                                                                                                                Nine Months Ended
                                                                 ---------------------------------------------------------------------------------------------------------------------------                     -----------------------------------------------------------------------------------------------------------------------------
                                                                                 September 30, 2016                                   September 30, 2015                                                       September 30, 2016                                    September 30, 2015
                                                                 ---------------------------------------------------                     ---------------------------------------------------                     ----------------------------------------------------                     ----------------------------------------------------
                                                                                                                                                                                                                                                                                           
Revenues:
  Minimum rents                                                                     $  347,676                                                              $  358,716                                                              $ 1,082,220                                                              $ 1,094,384
  Tenant recoveries                                                                    162,031                                                                 172,515                                                                  504,242                                                                  518,040
  Overage rents                                                                          6,505                                                                   6,455                                                                   19,024                                                                   18,755
  Management fees and other corporate revenues                                          20,428                                                                  19,496                                                                   73,087                                                                   65,313
  Other                                                              17,853                            28,142                             57,539                             62,956  
                                                                 -------------------- -------- --------------------                      -------------------- -------- --------------------                      -------------------- --------- --------------------                      -------------------- --------- --------------------
Total revenues                                                      554,493                           585,324                          1,736,112                          1,759,448  
                                                                 -------------------- -------- --------------------                      -------------------- -------- --------------------                      -------------------- --------- --------------------                      -------------------- --------- --------------------
Expenses:
  Real estate taxes                                                                     58,239                                                                  57,942                                                                  173,651                                                                  170,425
  Property maintenance costs                                                            11,576                                                                  11,707                                                                   41,014                                                                   44,491
  Marketing                                                                              2,244                                                                   4,273                                                                    7,036                                                                   12,849
  Other property operating costs                                                        73,479                                                                  79,265                                                                  215,474                                                                  227,874
  Provision for doubtful accounts                                                          574                                                                   1,622                                                                    5,685                                                                    6,199
  (Recovery of) provision for loan loss                                                 (6,659 )                                                                     -                                                                   29,410                                                                        -
  Property management and other costs                                                   37,760                                                                  38,685                                                                  106,787                                                                  121,847
  General and administrative                                                            13,237                                                                  12,627                                                                   41,313                                                                   37,395
  Provisions for impairment                                                             28,276                                                                       -                                                                   73,039                                                                        -
  Depreciation and amortization                                     182,350                           154,228                            499,269                            483,026  
                                                                 -------------------- -------- --------------------                      -------------------- -------- --------------------                      -------------------- --------- --------------------                      -------------------- --------- --------------------
Total expenses                                                      401,076                           360,349                          1,192,678                          1,104,106  
                                                                 -------------------- -------- --------------------                      -------------------- -------- --------------------                      -------------------- --------- --------------------                      -------------------- --------- --------------------
Operating income                                                    153,417                           224,975                            543,434                            655,342  
                                                                 -------------------- -------- --------------------                      -------------------- -------- --------------------                      -------------------- --------- --------------------                      -------------------- --------- --------------------
Interest and dividend income                                                            14,114                                                                  13,232                                                                   43,507                                                                   34,896
Interest expense                                                                      (141,296 )                                                              (144,891 )                                                               (437,338 )                                                               (460,289 )
(Loss) gain on foreign currency                                                           (657 )                                                               (25,092 )                                                                 16,172                                                                  (46,540 )
Gain from changes in control of investment properties and other     620,309                            13,399                            733,416                            622,412  
                                                                 -------------------- -------- --------------------                      -------------------- -------- --------------------                      -------------------- --------- --------------------                      -------------------- --------- --------------------
Income before income taxes, equity in income of Unconsolidated                         645,887                                                                  81,623                                                                  899,191                                                                  805,821
Real Estate Affiliates and allocation to noncontrolling interests
(Provision for) benefit from income taxes                                                  (49 )                                                                17,996                                                                     (728 )                                                                 29,082
Equity in income of Unconsolidated Real Estate Affiliates                               35,651                                                                  16,584                                                                  127,759                                                                   41,115
Unconsolidated Real Estate Affiliates - gain on investment              259                            11,163                             40,765                            320,950  
                                                                 -------------------- -------- --------------------                      -------------------- -------- --------------------                      -------------------- --------- --------------------                      -------------------- --------- --------------------
Net income                                                                             681,748                                                                 127,366                                                                1,066,987                                                                1,196,968
Allocation to noncontrolling interests                               (7,570 )                                             (3,514 )                                             (15,083 )                                             (16,447 )
                                                                 -------------------- -------- --------------------                      -------------------- -------- --------------------                      -------------------- --------- --------------------                      -------------------- --------- --------------------
Net income attributable to GGP                                                         674,178                                                                 123,852                                                                1,051,904                                                                1,180,521
Preferred stock dividends                                            (3,984 )                                             (3,984 )                                             (11,951 )                                             (11,952 )
                                                                 -------------------- -------- --------------------                      -------------------- -------- --------------------                      -------------------- --------- --------------------                      -------------------- --------- --------------------
Net income attributable to common stockholders                                      $  670,194                                           $  119,868                                           $ 1,039,953                                           $ 1,168,569  
                                                                 ==================== ======== ====================                      ==================== ======== ====================                      ==================== ========= ====================                      ==================== ========= ====================
                                                                                                                                                                                                                                  
                                                                 ---------------------------------------------------                     ---------------------------------------------------                     ----------------------------------------------------                     ----------------------------------------------------
Basic earnings per share                                                            $     0.76                                           $     0.14                                           $      1.18                                           $      1.32  
                                                                 ==================== ======== ====================                      ==================== ======== ====================                      ==================== ========= ====================                      ==================== ========= ====================
Diluted earnings per share                                                          $     0.70                                           $     0.13                                           $      1.09                                           $      1.23  
                                                                 -------------------- -------- --------------------                      -------------------- -------- --------------------                      -------------------- --------- --------------------                      -------------------- --------- --------------------
NON-GAAP PROPORTIONATE FINANCIAL INFORMATION
 
Reconciliation of GAAP to Non-GAAP Financial Measures
(In thousands, except per share)
                                                                                                                                                         
                                                                                                        --------------------------------------------------------------------------------------------------------------------------                     -----------------------------------------------------------------------------------------------------------------------------
                                                                                                                                                            Three Months Ended                                                                                                                               Nine Months Ended
                                                                                                        --------------------------------------------------------------------------------------------------------------------------                     -----------------------------------------------------------------------------------------------------------------------------
                                                                                                                        September 30, 2016                                   September 30, 2015                                                      September 30, 2016                                    September 30, 2015
                                                                                                        ----------------------------------------------------------------------- --------------------------------------------------                     ------------------------------------------------------------------------ ----------------------------------------------------
Reconciliation of GAAP Operating Income                                                                                                                                                                                                                                                  
to Company Same Store NOI
--------------------------------------------------------------------------------
Operating Income                                                                                                           $  153,417                                                              $ 224,975                                                              $   543,434                                                              $   655,342
Loss (gain) on sales of investment properties                                                                                   1,016                                                                   (854 )                                                                  1,016                                                                     (863 )
Depreciation and amortization                                                                                                 182,350                                                                154,228                                                                  499,269                                                                  483,026
(Recovery of) provision for loan loss                                                                                          (6,659 )                                                                    -                                                                   29,410                                                                        -
Provision for impairment                                                                                                       28,276                                                                      -                                                                   73,039                                                                        -
General and administrative                                                                                                     13,237                                                                 12,627                                                                   41,313                                                                   37,395
Property management and other costs                                                                                            37,760                                                                 38,685                                                                  106,787                                                                  121,847
Management fees and other corporate revenues                                                               (20,428 )                        (19,496 )                                             (73,087 )                          (65,313 )
-----------------------------------------------------------------------------------                     -------------------- -------- -------------------- -------------------- -------------------- ------- --------------------                      -------------------- --------- -------------------- -------------------- -------------------- --------- --------------------
                      Consolidated Properties                                                                                 388,969                                                                410,165                                                                1,221,181                                                                1,231,434
                      Noncontrolling interest in NOI of Consolidated Properties                                                (3,734 )                                                               (4,422 )                                                                (11,080 )                                                                (13,321 )
                      NOI of sold interests                                                                                    (4,556 )                                                              (21,855 )                                                                (42,504 )                                                                (74,458 )
   Unconsolidated Properties                                                            176,701       150,855                            530,938         412,650  
--------------------- -------------------------------------------------------------                     -------------------- -------- -------------------- -------------------- -------------------- ------- --------------------                      -------------------- --------- -------------------- -------------------- -------------------- --------- --------------------
                      Proportionate NOI                                                                                       557,380                                                                534,743                                                                1,698,535                                                                1,556,305
Company adjustments:
                      Minimum rents                                                                                             7,231                                                                  7,148                                                                   14,036                                                                   27,596
                      Real estate taxes                                                                                         1,490                                                                  1,490                                                                    4,469                                                                    4,469
   Property operating expenses                                                              965         1,018                              2,991           3,056  
--------------------- -------------------------------------------------------------                     -------------------- -------- -------------------- -------------------- -------------------- ------- --------------------                      -------------------- --------- -------------------- -------------------- -------------------- --------- --------------------
Company NOI                                                                                                                   567,066                                                                544,399                                                                1,720,031                                                                1,591,426
Company Non-Same Store NOI                                                                                  23,495        20,808                             97,011          33,400  
-----------------------------------------------------------------------------------                     -------------------- -------- -------------------- -------------------- -------------------- ------- --------------------                      -------------------- --------- -------------------- -------------------- -------------------- --------- --------------------
Company Same Store NOI                                                                                                     $  543,571                        $ 523,591                                           $ 1,623,020                        $ 1,558,026  
-----------------------------------------------------------------------------------                     -------------------- -------- -------------------- -------------------- -------------------- ------- --------------------                      -------------------- --------- -------------------- -------------------- -------------------- --------- --------------------
                                                                                                                                                                                                                                                                                                                                 
Reconciliation of GAAP Net Income
Attributable to GGP to Company EBITDA
--------------------------------------------------------------------------------
Net Income Attributable to GGP                                                                                             $  674,178                                                              $ 123,852                                                              $ 1,051,904                                                              $ 1,180,521
Allocation to noncontrolling interests                                                                                          7,570                                                                  3,514                                                                   15,083                                                                   16,447
Loss (gain) on sales of investment properties                                                                                   1,016                                                                   (854 )                                                                  1,016                                                                     (863 )
Gains from changes in control of investment properties and other                                                             (620,309 )                                                              (13,399 )                                                               (733,416 )                                                               (622,412 )
Unconsolidated Real Estate Affiliates - gain on investment                                                                       (259 )                                                              (11,163 )                                                                (40,765 )                                                               (320,950 )
Equity in income of Unconsolidated Real Estate Affiliates                                                                     (35,651 )                                                              (16,584 )                                                               (127,759 )                                                                (41,115 )
(Recovery of) provision for loan loss                                                                                          (6,659 )                                                                    -                                                                   29,410                                                                        -
Provision for impairment                                                                                                       28,276                                                                      -                                                                   73,039                                                                        -
Provision for (benefit from) income taxes                                                                                          49                                                                (17,996 )                                                                    728                                                                  (29,082 )
Loss (gain) on foreign currency                                                                                                   657                                                                 25,092                                                                  (16,172 )                                                                 46,540
Interest expense                                                                                                              141,296                                                                144,891                                                                  437,338                                                                  460,289
Interest income                                                                                                               (14,114 )                                                              (13,232 )                                                                (43,507 )                                                                (34,896 )
Depreciation and amortization                                                                              182,350       154,228                            499,269         483,026  
-----------------------------------------------------------------------------------                     -------------------- -------- -------------------- -------------------- -------------------- ------- --------------------                      -------------------- --------- -------------------- -------------------- -------------------- --------- --------------------
                      Consolidated Properties                                                                                 358,400                                                                378,349                                                                1,146,168                                                                1,137,505
                      Noncontrolling interest in EBITDA of Consolidated Properties                                             (3,599 )                                                               (4,244 )                                                                (10,665 )                                                                (12,790 )
                      EBITDA of sold interests                                                                                 (4,549 )                                                              (21,638 )                                                                (42,229 )                                                                (73,892 )
   Unconsolidated Properties                                                            167,914       142,465                            504,459         382,201  
--------------------- -------------------------------------------------------------                     -------------------- -------- -------------------- -------------------- -------------------- ------- --------------------                      -------------------- --------- -------------------- -------------------- -------------------- --------- --------------------
                      Proportionate EBITDA                                                                                    518,166                                                                494,932                                                                1,597,733                                                                1,433,024
Company adjustments:
                      Minimum rents                                                                                             7,231                                                                  7,148                                                                   14,036                                                                   27,596
                      Real estate taxes                                                                                         1,490                                                                  1,490                                                                    4,469                                                                    4,469
   Property operating expenses                                                              965         1,018                              2,991           3,056  
--------------------- -------------------------------------------------------------                     -------------------- -------- -------------------- -------------------- -------------------- ------- --------------------                      -------------------- --------- -------------------- -------------------- -------------------- --------- --------------------
Company EBITDA                                                                                                             $  527,852                        $ 504,588                                           $ 1,619,229                        $ 1,468,145  
-----------------------------------------------------------------------------------                     -------------------- -------- -------------------- -------------------- -------------------- ------- --------------------                      -------------------- --------- -------------------- -------------------- -------------------- --------- --------------------
NON-GAAP PROPORTIONATE FINANCIAL INFORMATION
 
Reconciliation of GAAP to Non-GAAP Financial Measures
(In thousands, except per share)
                                                                                                                                                                                                                         
                                                                                                         ---------------------------------------------------------------------------------------------------------------------------------------------------                     ---------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                                                         Three Months Ended                                                                                                                                                       Nine Months Ended
                                                                                                         September 30, 2016                                               September 30, 2015                                                                  September 30, 2016                                               September 30, 2015
                                                                                                         ------------------------------------------------------------   -------------------- ------------------------------------------------------------                        ------------------------------------------------------------   -------------------- ------------------------------------------------------------
Reconciliation of GAAP Net Income                                                                                                                                                                                                                                                                                             
Attributable to GGP to Company FFO
---------------------------------------------------------------------------------
Net Income Attributable to GGP                                                                                              $              674,178                                                              $              123,852                                                              $            1,051,904                                                              $            1,180,521
Redeemable noncontrolling interests                                                                                                          5,051                                                                               1,017                                                                               7,934                                                                               8,532
Provision for impairment excluded from FFO                                                                                                  28,276                                                                                   -                                                                              73,039                                                                                   -
Noncontrolling interests in depreciation of Consolidated Properties                                                                         (1,592 )                                                                            (1,948 )                                                                            (4,875 )                                                                            (5,905 )
Unconsolidated Real Estate Affiliates - gain on investment                                                                                    (259 )                                                                           (11,163 )                                                                           (40,765 )                                                                          (320,950 )
Loss on sales of investment properties                                                                                                       1,017                                                                               2,358                                                                               1,016                                                                               2,349
Preferred stock dividends                                                                                                                   (3,984 )                                                                            (3,984 )                                                                           (11,951 )                                                                           (11,952 )
Gains from changes in control of investment properties and other                                                                          (620,309 )                                                                           (13,399 )                                                                          (733,416 )                                                                          (622,412 )
Depreciation and amortization of capitalized real estate costs -                                                                           178,108                                                                             151,393                                                                             487,804                                                                             474,607
Consolidated Properties
Depreciation and amortization of capitalized real estate costs -                                                         73,888                     68,647                                       209,236                    186,000  
Unconsolidated Properties
---------------------------------------------------------------------------------                        -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- --------------------                      -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- --------------------
    FFO                                                                                                                 334,374                                                                             316,773                                                                           1,039,926                                                                             890,790
Company adjustments:
                       Minimum rents                                                                                                         7,231                                                                               7,148                                                                              14,036                                                                              27,596
                       Property operating expenses                                                                                           1,490                                                                               1,490                                                                               4,469                                                                               4,469
                       Property management and other costs                                                                                     965                                                                               1,018                                                                               2,991                                                                               3,056
                       Interest and dividend income                                                                                           (205 )                                                                              (205 )                                                                              (614 )                                                                              (614 )
                       Market rate adjustments                                                                                              (1,287 )                                                                               (61 )                                                                            (2,092 )                                                                            (1,323 )
                       Write-off of mark-to-market adjustments on extinguished debt                                                         (2,290 )                                                                               102                                                                              (2,290 )                                                                             7,229
                       (Recovery of) provision for loan loss                                                                                (6,659 )                                                                                 -                                                                              21,891                                                                                   -
                       Loss (gain) on foreign currency                                                                                         657                                                                              25,092                                                                             (16,172 )                                                                            46,540
                       Benefit from (provision for) income taxes                                                                             2,093                                                                              (9,924 )                                                                            (2,262 )                                                                           (17,167 )
    FFO from sold interests                                                                             (133 )                                        (686 )                                                           (790 )                                       8,063  
---------------------- -------------------------------------------------------------                     -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- --------------------                      -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- --------------------
Company FFO                                                                                                                 $              336,236                        $              340,747                                           $            1,059,093                        $              968,639  
------------------------------------------------------------------------------------                     -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- --------------------                      -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- --------------------
                                                                                                                                                                                             
NON-GAAP PROPORTIONATE FINANCIAL INFORMATION
 
Reconciliation of GAAP to Non-GAAP Financial Measures
(In thousands, except per share)
                                                                                                                                                                                             
                                                                                                         -----------------------------------------------------------------------------------------------------------------------                     -----------------------------------------------------------------------------------------------------------------------
                                                                                                                                                           Three Months Ended                                                                                                                           Nine Months Ended
                                                                                                         ----------------------------------------------------------------------------------------------------------------                            ----------------------------------------------------------------------------------------------------------------
                                                                                                         September 30, 2016                                 September 30, 2015                                                    September 30, 2016                                 September 30, 2015
                                                                                                         ----------------------------------------------   -------------------- ----------------------------------------------                        ----------------------------------------------   -------------------- ----------------------------------------------
Reconciliation of Net Income Attributable                                                                                                                                                                                                                                           
to GGP per diluted share to Company FFO per diluted share
---------------------------------------------------------------------------------
Net Income Attributable to GGP per diluted share                                                                            $   0.70                                                              $   0.13                                                              $   1.09                                                              $   1.23
Preferred stock dividends                                                                                       -            -                           (0.01 )                         (0.01 )
------------------------------------------------------------------------------------                     -------------------- ------ -------------------- -------------------- -------------------- ------ --------------------                      -------------------- ------ -------------------- -------------------- -------------------- ------ --------------------
Net income attributable to common stockholders per diluted share                                                                0.70                                                                  0.13                                                                  1.08                                                                  1.22
Redeemable noncontrolling interests                                                                                             0.01                                                                     -                                                                  0.01                                                                  0.01
Provision for impairment excluded from FFO                                                                                      0.03                                                                     -                                                                  0.08                                                                     -
Noncontrolling interests in depreciation of Consolidated Properties                                                                -                                                                     -                                                                 (0.01 )                                                               (0.01 )
Unconsolidated Real Estate Affiliates - gain on investment                                                                         -                                                                 (0.01 )                                                               (0.04 )                                                               (0.33 )
Gains from changes in control of investment properties and other                                                               (0.64 )                                                               (0.01 )                                                               (0.76 )                                                               (0.65 )
Depreciation and amortization of capitalized real estate costs                                               0.25         0.22                            0.72         0.69  
------------------------------------------------------------------------------------                     -------------------- ------ -------------------- -------------------- -------------------- ------ --------------------                      -------------------- ------ -------------------- -------------------- -------------------- ------ --------------------
    FFO per diluted share                                                                                    0.35                                                                  0.33                                                                  1.08                                                                  0.93
Company adjustments:
                       Straight-line rent                                                                                       0.01                                                                  0.01                                                                  0.01                                                                  0.03
                       Property operating expenses                                                                                 -                                                                     -                                                                  0.01                                                                     -
                       Write-off of mark-to-market adjustments on extinguished debt                                            (0.00 )                                                                0.00                                                                 (0.00 )                                                                0.01
                       (Recovery of) provision for loan loss                                                                   (0.01 )                                                                   -                                                                  0.02                                                                     -
                       Loss (gain) on foreign currency                                                                             -                                                                  0.03                                                                 (0.02 )                                                                0.05
                       Provision for income taxes                                                                                  -                                                                 (0.01 )                                                                   -                                                                 (0.02 )
    FFO from sold interests                                                              (0.00 )                         (0.00 )                                            (0.00 )                          0.01  
---------------------- -------------------------------------------------------------                     -------------------- ------ -------------------- -------------------- -------------------- ------ --------------------                      -------------------- ------ -------------------- -------------------- -------------------- ------ --------------------
Company FFO per diluted share                                                                                               $   0.35                        $   0.36                                           $   1.10                        $   1.01  
------------------------------------------------------------------------------------                     -------------------- ------ -------------------- -------------------- -------------------- ------ --------------------                      -------------------- ------ -------------------- -------------------- -------------------- ------ --------------------

http://cts.businesswire.com/ct/CT?id=bwnews&sty=20161031006121r1&sid=cmtx6&distro=nx&lang=en

View source version on businesswire.com: http://www.businesswire.com/news/home/20161031006121/en/

SOURCE: General Growth Properties, Inc.

General Growth Properties, Inc. 
Kevin Berry 
SVP Investor and Public Relations 
(312) 960-5529 
kevin.berry@ggp.com


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