10-Q

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

Form 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended: March 31, 2005
Commission File No. 1-11530

Taubman Centers, Inc. (Exact name of registrant as specified in its charter)

Michigan	38-2033632
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)

200 East Long Lake Road, Suite 300, P.O. Box 200, Bloomfield Hills, Michigan	48303-0200
(Address of principal executive offices)	(Zip Code)
(248) 258-6800
(Registrant’s telephone number, including area code)

        Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes     X. No      .

        Indicate by a check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).

Yes     X. No      .

        As of May 3, 2005, there were outstanding 50,691,245 shares of the Company’s common stock, par value $0.01 per share.

PART 1. FINANCIAL INFORMATION

Item 1. Financial Statements

The following consolidated financial statements of Taubman Centers, Inc. (the Company) are provided pursuant to the requirements of this item.

Consolidated Balance Sheet as of March 31, 2005 and December 31, 2004	2
Consolidated Statement of Operations and Comprehensive Income for the three months ended
March 31, 2005 and 2004	3
Consolidated Statement of Cash Flows for the three months ended March 31, 2005 and 2004	4
Notes to Consolidated Financial Statements	5

1

TAUBMAN CENTERS, INC.
CONSOLIDATED BALANCE SHEET

(in thousands, except share data)

	March 31 2005			December 31 2004
Assets:
Properties	$	2,955,032		$	2,936,964
Accumulated depreciation and amortization		(581,376	)		(558,891	)
	$	2,373,656		$	2,378,073
Investment in Unconsolidated Joint Ventures (Note 5)		27,680			23,567
Cash and cash equivalents (Note 6)		31,384			29,081
Accounts and notes receivable, less allowance for doubtful accounts of $9,104
and $8,661 in 2005 and December 31, 2004		30,774			32,124
Accounts and notes receivable from related parties		1,549			1,636
Deferred charges and other assets		58,717			61,586
	$	2,523,760		$	2,526,067
Liabilities:
Notes payable (Note 6)	$	1,952,266		$	1,930,439
Accounts payable and accrued liabilities		202,505			223,331
Dividends and distributions payable		14,243			13,892
	$	2,169,014		$	2,167,662
Commitments and contingencies (Notes 6 and 9)
Preferred Equity of TRG (Notes 1 and 7)	$	29,217		$	29,217
Partners' Equity of TRG allocable to minority partners (Note 1)
Shareowners' Equity:
Series A Cumulative Redeemable Preferred Stock, $0.01 par value, 8,000,000
shares authorized, $200 million liquidation preference, 8,000,000 shares
issued and outstanding at March 31, 2005 and December 31, 2004	$	80		$	80
Series B Non-Participating Convertible Preferred Stock, $0.001 par and
liquidation value, 40,000,000 shares authorized, 31,063,970 and 29,714,937
shares issued and outstanding at March 31, 2005 and December 31, 2004		31			30
Series G Cumulative Redeemable Preferred Stock, 4,000,000 shares
authorized, no par, $100 million liquidation preference, 4,000,000 shares issued
and outstanding at March 31, 2005 and December 31, 2004
Common Stock, $0.01 par value, 250,000,000 shares authorized, 49,976,870
and 48,745,625 shares issued and outstanding at March 31, 2005 and
December 31, 2004		500			487
Additional paid-in capital		736,714			729,481
Accumulated other comprehensive income (loss)		(10,368	)		(11,387	)
Dividends in excess of net income		(401,428	)		(389,503	)
	$	325,529		$	329,188
	$	2,523,760		$	2,526,067

See notes to consolidated financial statements.

2

TAUBMAN CENTERS, INC.
CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME

(in thousands, except share data)

	Three Months Ended March 31
	2005			2004
Revenues:
Minimum rents	$	63,078		$	53,637
Percentage rents		1,696			1,033
Expense recoveries		34,637			31,000
Management, leasing, and development services		2,200			4,984
Other		10,228			10,678
	$	111,839		$	101,332
Operating Expenses:
Recoverable expenses	$	31,697		$	27,786
Other operating		10,502			8,152
Costs related to unsolicited tender offer, net of recoveries (Note 4)					(1,000	)
Management, leasing, and development services		1,195			4,796
General and administrative		5,959			6,458
Interest expense		25,540			22,572
Depreciation and amortization		27,800			22,959
	$	102,693		$	91,723
Income before equity in income of Unconsolidated Joint Ventures and
minority and preferred interests	$	9,146		$	9,609
Equity in income of Unconsolidated Joint Ventures (Note 5)		9,070			9,593
Income before minority and preferred interests	$	18,216		$	19,202
Minority interest in consolidated joint ventures		(6	)		(178	)
Minority interest in TRG:
TRG income allocable to minority partners		(5,165	)		(5,619	)
Distributions in excess of income allocable to minority partners		(4,010	)		(3,224	)
TRG Series C, D, and F preferred distributions (Notes 1 and 7)		(615	)		(2,250	)
Net income	$	8,420		$	7,931
Series A and G preferred stock dividends		(6,150	)		(4,150	)
Net income allocable to common shareowners	$	2,270		$	3,781
Net income	$	8,420		$	7,931
Other comprehensive income (loss):
Realized loss on interest rate instruments					(6,054	)
Unrealized gain on interest rate instruments		700			1,860
Reclassification adjustment for amounts recognized in net income		319			315
Comprehensive income	$	9,439		$	4,052
Basic earnings per common share (Note 10) -
Net income	$	0.05		$	0.08
Diluted earnings per common share (Note 10) -
Net income	$	0.05		$	0.07
Cash dividends declared per common share	$	0.285		$	0.27
Weighted average number of common shares outstanding		49,643,865			50,196,580

See notes to consolidated financial statements.

3

TAUBMAN CENTERS, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS

(in thousands)

	Three Months Ended March 31
	2005			2004
Cash Flows From Operating Activities:
Income before minority and preferred interests	$	18,216		$	19,202
Adjustments to reconcile income before minority and preferred interests
to net cash provided by operating activities:
Depreciation and amortization		27,800			22,959
Depreciation included in recoverable expenses		1,471			1,026
Provision for losses on accounts receivable		1,694			1,083
Gains on sales of land		(2,303	)		(3,155	)
Settlement of swap agreement					(6,054	)
Other		916			1,205
Increase (decrease) in cash attributable to changes in assets and liabilities:
Receivables, deferred charges and other assets		697			(633	)
Accounts payable and other liabilities		(19,579	)		(32,461	)
Net Cash Provided by Operating Activities	$	28,912		$	3,172
Cash Flows From Investing Activities:
Additions to properties	$	(24,734	)	$	(22,755	)
Proceeds from sales of land		3,300			5,445
Acquisition of interests in centers (Note 3)					(3,288	)
Contributions to Unconsolidated Joint Ventures (Note 5)		(8,019	)		(33,000	)
Distributions from Unconsolidated Joint Ventures in excess of income		4,000			6,922
Net Cash Used In Investing Activities	$	(25,453	)	$	(46,676	)
Cash Flows From Financing Activities:
Debt proceeds	$	28,881		$	492,500
Debt payments		(6,904	)		(433,529	)
Debt issuance costs		(2	)		(2,727	)
Issuance of common stock pursuant to Continuing Offer (Note 9)		38			1,187
Issuance of partnership units (Note 8)		6,663			2,644
Distributions to minority and preferred interests		(9,790	)		(11,093	)
Cash dividends to preferred shareowners		(6,150	)		(4,150	)
Cash dividends to common shareowners		(13,892	)		(13,437	)
Net Cash Provided By (Used In) Financing Activities	$	(1,156	)	$	31,395
Net Increase (Decrease) In Cash and Cash Equivalents	$	2,303		$	(12,109	)
Cash and Cash Equivalents at Beginning of Period		29,081			30,403
Cash and Cash Equivalents at End of Period	$	31,384		$	18,294

See notes to consolidated financial statements.

4

TAUBMAN CENTERS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 1 – Interim Financial Statements

General

        Taubman Centers, Inc. (the Company or TCO), a real estate investment trust, or REIT, is the managing general partner of The Taubman Realty Group Limited Partnership (the Operating Partnership or TRG). The Operating Partnership is an operating subsidiary that engages in the ownership, management, leasing, acquisition, development, and expansion of regional retail shopping centers and interests therein. The Operating Partnership’s owned portfolio as of March 31, 2005 included 21 urban and suburban shopping centers in nine states. Two new centers are under construction in New Jersey and North Carolina.

        In 2005, the Company formed Taubman Asia, which will be the platform for its future expansion into the Asia-Pacific region. Taubman Asia will be headquartered in Hong Kong and will seek opportunities in Asia to augment the Company’s existing development and acquisition activities.

Consolidation

        The consolidated financial statements of the Company include all accounts of the Company, TRG, and its consolidated subsidiaries, including The Taubman Company LLC (the Manager). The Company also consolidates the accounts of the owner of the Oyster Bay project, which qualifies as a variable interest entity under FASB Interpretation No. 46 “Consolidation of Variable Interest Entities” (FIN 46R) and in which the Operating Partnership holds the majority variable interest. All intercompany transactions have been eliminated.

        Investments in entities not controlled by the Company but over which the Company may exercise significant influence (Unconsolidated Joint Ventures) are accounted for under the equity method. The Company has evaluated its investments in the Unconsolidated Joint Ventures and has concluded that the ventures are not variable interest entities as defined in FIN 46R. Accordingly, the Company continues to account for its interests in these ventures under the guidance in Statement of Position 78-9 (SOP 78-9). The Company’s partners or other owners in these Unconsolidated Joint Ventures have important rights, as contemplated by paragraphs .09 and .10 of SOP 78-9, including approval rights over annual operating budgets, capital spending, financing, admission of new partners/members, or sale of the properties and the Company has concluded that the equity method of accounting is appropriate for these interests. Specifically, the Company’s 79% investment in Westfarms is through a general partnership in which the other general partners have approval rights over annual operating budgets, capital spending, refinancing, or sale of the property. Under the equity method of accounting, the investments in Unconsolidated Joint Ventures are initially recorded at cost, and subsequently increased for additional contributions and allocations of income and reduced for distributions received.

Ownership

        Besides the Company’s common stock, there are three classes of preferred stock (Series A, B and G) outstanding. Dividends on the Series A and Series G preferred stocks are cumulative and are payable in arrears on or before the last day of each calendar quarter. The Company owns corresponding Series A and Series G Preferred Equity interests in the Operating Partnership that entitle the Company to income and distributions (in the form of guaranteed payments) in amounts equal to the dividends payable on the Company’s Series A and Series G Preferred Stock.

        The Company also is obligated to issue to partners in the Operating Partnership other than the Company, upon subscription, one share of nonparticipating Series B Preferred Stock. The Series B Preferred Stock entitles its holders to one vote per share on all matters submitted to the Company’s shareholders and votes together with the common stock on all matters as a single class. The holders of Series B Preferred Stock are not entitled to dividends or earnings. Under certain circumstances, the Series B Preferred Stock is convertible into common stock at a ratio of 14,000 shares of Series B Preferred Stock for one share of common stock.

5

TAUBMAN CENTERS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (CONTINUED)

The Operating Partnership

        At March 31, 2005, the Operating Partnership’s equity included three classes of preferred equity (Series A, F, and G) and the net equity of the partnership unitholders. Net income and distributions of the Operating Partnership are allocable first to the preferred equity interests, and the remaining amounts to the general and limited partners in the Operating Partnership in accordance with their percentage ownership. The Series A and Series G Preferred Equity are owned by the Company and are eliminated in consolidation. The Series F Preferred Equity is owned by an institutional investor.

        Because the net equity of the Operating Partnership unitholders is less than zero, the interest of the noncontrolling unitholders is presented as a zero balance in the consolidated balance sheet as of March 31, 2005 and December 31, 2004. The income allocated to the noncontrolling unitholders is equal to their share of distributions. The net equity of the Operating Partnership is less than zero because of accumulated distributions in excess of net income and not as a result of operating losses. Distributions to partners are usually greater than net income because net income includes non-cash charges for depreciation and amortization.

        The Company’s ownership in the Operating Partnership at March 31, 2005 consisted of a 62% managing general partnership interest, as well as the Series A and G Preferred Equity interests. The Company’s average ownership percentage in the Operating Partnership for both the three months ended March 31, 2005 and 2004 was 61%. At March 31, 2005, the Operating Partnership had 81,074,049 units of partnership interest outstanding, of which the Company owned 49,976,870.

Finite Life Entity

        SFAS No. 150, “Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity” establishes standards for classifying and measuring as liabilities certain financial instruments that embody obligations of the issuer and have characteristics of both liabilities and equity. At March 31, 2005, the Company held a controlling majority interest in a consolidated entity with a specified termination date in 2080. The minority owner’s interest in this entity is to be settled upon termination by distribution or transfer of either cash or specific assets of the underlying entity. The estimated fair value of this minority interest was approximately $45.6 million at March 31, 2005, compared to a book value of zero.

Other

        The unaudited interim financial statements should be read in conjunction with the audited financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2004. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) necessary for a fair presentation of the financial statements for the interim periods have been made. The results of interim periods are not necessarily indicative of the results for a full year.

        Dollar amounts presented in tables within the notes to the financial statements are stated in thousands, except share data or as otherwise noted. Certain reclassifications have been made to 2004 amounts to conform to current year classifications.

Note 2 – Income Taxes

        The Company’s taxable REIT subsidiaries are subject to corporate level income taxes, which are provided for in the Company’s financial statements. The Company’s deferred tax assets and liabilities reflect the impact of temporary differences between the amounts of assets and liabilities for financial reporting purposes and the bases of such assets and liabilities as measured by tax laws. Deferred tax assets are reduced, if necessary, by a valuation allowance to the amount where realization is more likely than not assured after considering all available evidence. The Company’s temporary differences primarily relate to deferred compensation and depreciation. During the three months ended March 31, 2005, the Company’s federal income tax expense was zero as a result of a net operating loss incurred from its taxable REIT subsidiaries. As of March 31, 2005, the Company had a net deferred tax asset of $3.1 million, after a valuation allowance of $9.8 million. As of December 31, 2004, the net deferred tax asset was $3.4 million, after a valuation allowance of $9.4 million.

6

TAUBMAN CENTERS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (CONTINUED)

Note 3 – Acquisitions and New Center Development

        In January 2005, the Company entered into an agreement to invest in The Pier at Caesars (“The Pier”), located in Atlantic City, New Jersey, with Gordon Group Holdings LLC (“Gordon”), who is developing the center. The Pier is currently under construction, and is expected to open in 2006. Under the agreement, the Company will have a 30% interest in The Pier. The Company’s capital contribution in The Pier will be made in three steps, with the initial investment of $4 million made at closing. A second payment equal to 70% of the Company’s projected required total investment (less the initial $4 million payment) is expected to be made within six months after the project opens. The third and final payment will be made shortly after the completion of the project’s stabilization year (2007) based on its actual net operating income (NOI) and debt levels. The investment in The Pier is accounted for under the equity method (Note 5). During construction of the project, Gordon will loan the venture the funding for capital expenditures in excess of the construction loan financing. Interest on the loan will be accruable at the short-term applicable federal rate (AFR) under Section 1274(d) of the Internal Revenue Code and will be repaid before any distributions to the venture partners. The contributions of the Company will be used to repay the principal portion of the loan. Consequently, the Company expects that its share of distributions and income will initially be less than its residual 30% interest.

        In July 2004, the Company acquired an additional 23.6% interest in International Plaza, increasing its ownership in the center to 50.1%. As a result of the acquisition, the Company has a controlling interest in the center and began consolidating its results as of the purchase date. Prior to the acquisition date, the Company accounted for International Plaza on the equity method. As of March 31, 2005, the Operating Partnership has a preferred investment in International Plaza of $30 million, on which an annual preferential return of 8.25% will accrue. In addition to the preferred return on the investment, the Operating Partnership is entitled to receive the balance of its preferred investment before any available cash will be utilized for distribution to the non-preferred partner.

        In January 2004, the Company purchased the additional 30% ownership of Beverly Center with consideration including both cash and the issuance of partnership units. The Company already recognized 100% of the financial results of the center in its financial statements.

        The Company’s approximately $79 million balance of development pre-construction costs as of March 31, 2005 consists of costs relating to its Oyster Bay project in the Town of Oyster Bay, New York. Both Neiman Marcus and Lord & Taylor have committed to the project and retailer interest has been very strong. Although the Company still needs to obtain the necessary entitlement approvals to move forward with the project, the Company is encouraged by six straight favorable court decisions. In February 2005, the Company had its hearing on the seventh round of court actions, and is awaiting the ruling. The Company expects continued success with the ongoing litigation, but if the Company is ultimately unsuccessful in the litigation process, it is anticipated that its recovery on this asset would be significantly less than its current investment. Given the current status, the Company believes the center could open as early as 2007 and the Company is hopeful that it will begin construction soon. The acquisition of the land occurred in May 2004 and the Company has completed the demolition of the existing industrial buildings on the site.

Note 4 – Unsolicited Tender Offer

        During the three months ended March 31, 2004 the Company received $1.0 million in insurance recoveries relating to an unsolicited tender offer and related litigation, which were withdrawn and ended in October 2003.

7

TAUBMAN CENTERS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (CONTINUED)

Note 5 — Investments in Unconsolidated Joint Ventures

        The Company has investments in joint ventures that own shopping centers. The Operating Partnership is the managing general partner or managing member of these Unconsolidated Joint Ventures, except for the ventures that own Arizona Mills, The Mall at Millenia, The Pier at Caesars, and Waterside Shops at Pelican Bay.

Shopping Center	Ownership as of March 31, 2005 and December 31, 2004
Arizona Mills		50	%
Cherry Creek Shopping Center		50
Fair Oaks		50
The Mall at Millenia		50
The Pier at Caesars (under construction)		(Note 3)
Stamford Town Center		50
Sunvalley		50
Waterside Shops at Pelican Bay		25
Westfarms		79
Woodland		50

        The Company’s carrying value of its Investment in Unconsolidated Joint Ventures differs from its share of the partnership equity reported in the combined balance sheet of the Unconsolidated Joint Ventures due to (i) the Company’s cost of its investment in excess of the historical net book values of the Unconsolidated Joint Ventures and (ii) the Operating Partnership’s adjustments to the book basis, including intercompany profits on sales of services that are capitalized by the Unconsolidated Joint Ventures. The Company’s additional basis allocated to depreciable assets is recognized on a straight-line basis over 40 years. The Operating Partnership’s differences in bases are amortized over the useful lives of the related assets.

        Combined balance sheet and results of operations information is presented in the following table for the Unconsolidated Joint Ventures, followed by the Operating Partnership’s beneficial interest in the combined information. The combined information of the Unconsolidated Joint Ventures as of March 31, 2005 excludes the balances of The Pier at Caesars, currently under construction (Note 3). Beneficial interest is calculated based on the Operating Partnership’s ownership interest in each of the Unconsolidated Joint Ventures. The accounts of International Plaza, formerly an Unconsolidated Joint Venture, are included in these results through the date of its acquisition (Note 3).

8

TAUBMAN CENTERS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (CONTINUED)

	March 31 2005			December 31 2004
Assets:
Properties	$	1,088,131		$	1,080,482
Accumulated depreciation and amortization		(367,389	)		(360,830	)
	$	720,742		$	719,652
Cash and cash equivalents		22,998			25,173
Accounts and notes receivable		20,151			22,866
Deferred charges and other assets		25,779			26,213
	$	789,670		$	793,904
Liabilities and accumulated deficiency in assets:
Notes payable	$	1,006,026		$	1,008,604
Accounts payable and other liabilities		48,714			53,706
TRG's accumulated deficiency in assets		(174,949	)		(176,396	)
Unconsolidated Joint Venture Partners' accumulated
deficiency in assets		(90,121	)		(92,010	)
	$	789,670		$	793,904
TRG's accumulated deficiency in assets (above)	$	(174,949	)	$	(176,396	)
TRG's investment in The Pier at Caesars		4,482
TRG basis adjustments, including elimination of
intercompany profit		82,740			83,796
TCO's additional basis		115,407			116,167
Investment in Unconsolidated Joint Ventures	$	27,680		$	23,567

	Three Months Ended March 31
	2005			2004
Revenues	$	70,869		$	80,032
Recoverable and other operating expenses	$	24,582		$	28,245
Interest expense		16,775			20,181
Depreciation and amortization		11,376			12,893
Total operating costs	$	52,733		$	61,319
Net income	$	18,136		$	18,713
Net income allocable to TRG	$	9,165		$	9,669
Realized intercompany profit and depreciation of TRG's
additional basis		665			684
Depreciation of TCO's additional basis		(760	)		(760	)
Equity in income of Unconsolidated Joint Ventures	$	9,070		$	9,593
Beneficial interest in Unconsolidated Joint Ventures' operations:
Revenues less recoverable and other operating expenses	$	25,898		$	27,866
Interest expense		(9,329	)		(10,574	)
Depreciation and amortization		(7,499	)		(7,699	)
Equity in income of Unconsolidated Joint Ventures	$	9,070		$	9,593

9

TAUBMAN CENTERS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (CONTINUED)

Note 6 – Beneficial Interest in Debt and Interest Expense

        The Operating Partnership’s beneficial interest in the debt, capital lease obligations, capitalized interest, and interest expense of its consolidated subsidiaries and its Unconsolidated Joint Ventures is summarized in the following table. The Operating Partnership’s beneficial interest excludes debt and interest related to the minority interests in International Plaza (49.9% as of July 2004, Note 3), MacArthur Center (5%), and The Mall at Wellington Green (10%).

	At 100%		At Beneficial Interest
	Consolidated Subsidiaries	Unconsolidated Joint Ventures	Consolidated Subsidiaries	Unconsolidated Joint Ventures
Debt as of:
March 31, 2005	$1,952,266	$1,006,026	$1,839,028	$561,989
December 31, 2004	1,930,439	1,008,604	1,816,751	563,490
Capital lease obligations:
March 31, 2005	$     13,052	$       1,919	$     12,341	$    1,095
December 31, 2004	14,167	2,145	13,381	1,228
Capitalized interest:
Three months ended March 31, 2005	$       2,377		$       2,377
Three months ended March 31, 2004	1,100		1,100
Interest expense:
Three months ended March 31, 2005	$     25,540	$     16,775	$     24,274	$    9,329
Three months ended March 31, 2004	22,572	20,181	22,308	10,574

        Payments of principal and interest on the loans in the following table are guaranteed by the Operating Partnership as of March 31, 2005.

Center	Loan balance as of 3/31/05	TRG's beneficial interest in loan balance as of 3/31/05	Amount of loan balance guaranteed by TRG as of 3/31/05	% of loan balance guaranteed by TRG		% of interest guaranteed by TRG
	(in millions of dollars)
Dolphin Mall	142.9	142.9	142.9	100	%	100	%
The Mall at Millenia	1.5	0.8	0.8	50		50
Northlake Mall	54.8	54.8	54.8	100		100
The Mall at Wellington Green (Note 12)	140.0	126.0	140.0	100		100
The Shops at Willow Bend	146.4	146.4	146.4	100		100

        The Northlake Mall loan agreement provides for a reduction of the amounts guaranteed as certain center performance and valuation criteria are met.

        Payments of rent and all other sums payable related to the Oyster Bay agreements are guaranteed by the Operating Partnership. As of March 31, 2005, the balances of the senior loan and owner equity contribution were $46.1 million and $2.2 million, respectively.

        The Company is required to escrow cash balances for specific uses stipulated by its lenders, including ground lease payments, taxes, insurance, debt service, capital improvements, leasing costs, and tenant allowances. As of March 31, 2005 and December 31, 2004 the Company’s cash balances restricted for these uses were $13.4 million and $9.7 million, respectively.

10

TAUBMAN CENTERS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (CONTINUED)

Note 7 – Equity Transactions

        In November 2004, the Company completed the issuance of the $100 million Series G Preferred Stock. This stock has a fixed 8.0% coupon and no stated maturity, sinking fund, or mandatory redemption requirements. Proceeds from the issuance of the Series G Preferred Stock were used to redeem the Operating Partnership’s Series C and Series D Preferred Equity.

        During 2004, under an existing buyback program, the Company repurchased 2,447,781 shares of its common stock at an average price of $20.50. For each share of stock repurchased, an equal number of Operating Partnership units were redeemed. Cumulatively, since the program’s inception in March 2000, the Company had repurchased approximately 9.6 million shares for a total of $150 million, the maximum amount permitted under the program. Repurchases of common stock were financed through general corporate funds, including equity issuances, and through borrowings under existing lines of credit.

        In May 2004, the Company completed a $30 million private placement of Series F Preferred Equity in the Operating Partnership. The Series F Preferred Equity was purchased by an institutional investor, and has a fixed 8.2% coupon and no stated maturity, sinking fund, or mandatory redemption requirements.

Note 8 – Share-Based Compensation

        The Company’s incentive option plan (the Plan), which is shareholder approved, permits the grant of options to employees of the Manager. As of March 31, 2005, options for 1.7 million Operating Partnership units may be issued under the Plan. In 2005, the Company granted selected executives option awards for 570,000 Operating Partnership units, believing that such awards provide additional incentive for achievement of financial goals and offers additional alignment of management interests with those of its shareholders. Option awards are granted with an exercise price equal to the market price of the Company common stock at the date of grant; a third of those option awards generally vest at each of the third, fifth, and seventh years of the anniversaries of the grant, if continuous service has been provided for those periods. In addition to service vesting requirements, options issued in 2005 have other vesting restrictions dependent on the Company’s market performance in comparison to its competitors. The options have ten-year contractual terms. Generally, option holders are required to convert their units to Company shares under the Continuing Offer. As of March 31, 2005, the 2005 grants are the only options outstanding.

        The Company has initially estimated the value of the options issued in March 2005 at approximately $2.5 million, or $4.34 per option, using a Black-Scholes valuation model based on the following assumptions: expected volatility of 18.4%, expected dividends of 4.3%, expected term of 8.5 years, and a risk-free rate of 4.2%. The Company is in the process of finalizing its valuation of these options, giving effect to the vesting conditions that are dependent on the Company’s market performance in comparison to its competitors. Compensation cost relating to these options recognized during the three months ended March 31, 2005 was less than $0.1 million, with the estimated remaining unrecognized service cost of $2.4 million expected to be recognized over the three, five, and seven year service periods (representing an average remaining service period of five years). The finalization of the valuation will not materially affect the compensation cost recognized during the three months ended March 31, 2005.

        A summary of option activity under the Plan as of March 31, 2005, and changes during the quarter then ended is presented below:

Options	Units of Partnership Interest		Weighted-Average Exercise Price	Weighted-Average Remaining Contractual Term
Outstanding at January 1, 2005	559,442		$     11.98
Granted	570,000		$     29.38
Exercised	(559,442	)	$     11.98
Outstanding at March 31, 2005	570,000		$     29.38	9.9 years
Exercisable at March 31, 2005	0

        As of March 31, 2005, the 2005 options had no intrinsic value.

        Cash received from option exercises under the Plan for the three months ended March 31, 2005 and 2004 was $6.7 million and $3.8 million, respectively.

11

TAUBMAN CENTERS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (CONTINUED)

Note 9 — Commitments and Contingencies

        At the time of the Company’s initial public offering and acquisition of its partnership interest in the Operating Partnership, the Company entered into an agreement (the Cash Tender Agreement) with A. Alfred Taubman, who owns an interest in the Operating Partnership, whereby he has the annual right to tender to the Company units of partnership interest in the Operating Partnership (provided that the aggregate value is at least $50 million) and cause the Company to purchase the tendered interests at a purchase price based on a market valuation of the Company on the trading date immediately preceding the date of the tender. The Company will have the option to pay for these interests from available cash, borrowed funds, or from the proceeds of an offering of the Company’s common stock. Generally, the Company expects to finance these purchases through the sale of new shares of its stock. The tendering partner will bear all market risk if the market price at closing is less than the purchase price and will bear the costs of sale. Any proceeds of the offering in excess of the purchase price will be for the sole benefit of the Company. At A. Alfred Taubman’s election, his family and certain others may participate in tenders.

        Based on a market value at March 31, 2005 of $27.74 per common share, the aggregate value of interests in the Operating Partnership that may be tendered under the Cash Tender Agreement was approximately $705 million. The purchase of these interests at March 31, 2005 would have resulted in the Company owning an additional 31% interest in the Operating Partnership.

        The Company has made a continuing, irrevocable offer to all present holders (other than certain excluded holders, including A. Alfred Taubman), assignees of all present holders, those future holders of partnership interests in the Operating Partnership as the Company may, in its sole discretion, agree to include in the continuing offer, and all existing and future optionees under the Operating Partnership’s incentive option plan to exchange shares of common stock for partnership interests in the Operating Partnership (the Continuing Offer). Under the Continuing Offer agreement, one unit of the Operating Partnership interest is exchangeable for one share of the Company’s common stock.

        In the fourth quarter of 2004, the Company ceased management of nine shopping centers and underwent a restructuring. A restructuring charge of $5.7 million was recognized in that period, substantially all of which represented employee severance payments and benefits. The remaining accrual for the unpaid balance of the restructuring charge was $0.3 million and $1.4 million as of March 31, 2005 and December 31, 2004, respectively.

        There are two shareholder class and derivative actions outstanding, which were initiated at the time of the unsolicited tender offer. Counsel for the plaintiffs in those cases and counsel for defendants have agreed to present to the Court for its approval a settlement of both cases, the terms of which are not material to the Company.

        Neither the Company, its subsidiaries, nor any of its joint ventures is presently involved in any material litigation, nor, to its knowledge, is any material litigation threatened against the Company, its subsidiaries, or any of the properties. Except for routine litigation involving present or former tenants (generally eviction or collection proceedings), substantially all litigation is covered by liability insurance.

        Refer to Note 6 for the Operating Partnership’s guarantees of certain notes payable.

Note 10 — Earnings Per Share

        Basic earnings per share amounts are based on the weighted average of common shares outstanding for the respective periods. Diluted earnings per share amounts are based on the weighted average of common shares outstanding plus the dilutive effect of common stock equivalents. Common stock equivalents include outstanding partnership units exchangeable for common shares under the Continuing Offer, outstanding options for units of partnership interest under the Operating Partnership’s incentive option plan, and unissued partnership units under unit option deferral elections. In computing the potentially dilutive effect of these common stock equivalents, they are assumed to be exchanged for common shares under the Continuing Offer, increasing the weighted average number of shares outstanding. The potentially dilutive effects of partnership units outstanding and/or issuable under the unit option deferral elections are calculated using the if-converted method, while the effects of partnership units that would result from the exercise of options are calculated using the treasury stock method.

12

TAUBMAN CENTERS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (CONTINUED)

        There were options for 0.6 million units of partnership interest issued during 2005 that were excluded from the computation of diluted earnings per share in 2005, as their effect was antidilutive. Options for 0.6 million units of partnership interest that were exercised during the first quarter of 2005 had a dilutive effect on earnings per share. Additionally, as of March 31, 2005, there were 12.9 million partnership units outstanding and 0.9 million unissued partnership units under unit option deferral elections currently receiving income allocations equal to distributions paid (Note 1), which may be exchanged for common shares of the Company under the Continuing Offer (Note 9). These outstanding units and unissued units could only be dilutive to earnings per share if the minority interests’ ownership share of the Operating Partnership’s income was greater than their share of distributions.

	Three Months Ended March 31
	2005		2004
Net income allocable to common shareowners	$	2,270	$	3,781
Shares - basic		49,643,865		50,196,580
Dilutive effect of options		147,853		622,004
Shares - diluted		49,791,718		50,818,584
Income per common share - basic	$	0.05	$	0.08
Income per common share - diluted	$	0.05	$	0.07

Note 11 – New Accounting Pronouncements

        In December 2004, the FASB issued Statement No. 123 (Revised) “Share-Based Payment”. This Statement establishes standards for the accounting for transactions in which an entity exchanges its equity instruments for goods or services. It also addresses transactions in which an entity incurs liabilities in exchange for goods or services that are based on the fair value of the entity’s equity instruments or that may be settled by the issuance of those equity instruments. This Statement requires a public entity to measure the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award (with limited exceptions). That cost will be recognized over the period during which an employee is required to provide service in exchange for the award—the requisite service period (usually the vesting period). No compensation cost is recognized for equity instruments for which employees do not render the requisite service. A public entity will initially measure the cost of employee services received in exchange for an award of liability instruments based on its current fair value; the fair value of that award will be remeasured subsequently at each reporting date through the settlement date. Changes in fair value during the requisite service period will be recognized as compensation cost over that period. Statement No. 123 (Revised) will be effective for the Company in 2006. The Company is in the process of evaluating the impact of this Statement on its future results of operations. The Company currently applies Statement No. 123 “Accounting for Stock-Based Compensation,” including its provisions for the expense recognition of options (Note 8).

Note 12 – Subsequent Event

        In April 2005, the Company entered into a rate lock agreement at 5.44% with the lender to hedge the planned $200 million ten year non-recourse refinancing of the existing $140 million loan on The Mall at Wellington Green. The planned financing is expected to close in May 2005.

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

        The following Management’s Discussion and Analysis of Financial Condition and Results of Operations contains various “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements represent our expectations or beliefs concerning future events, including the following: statements regarding future developments and joint ventures, rents and returns, statements regarding the continuation of trends, and any statements regarding the sufficiency of our cash balances and cash generated from operating and financing activities for our future liquidity and capital resource needs. We caution that although forward-looking statements reflect our good faith beliefs and best judgment based upon current information, these statements are qualified by important factors that could cause actual results to differ materially from those in the forward-looking statements, including those risks, uncertainties, and factors detailed from time to time in reports filed with the SEC, and in particular those set forth under the headings “General Risks of the Company” and “Environmental Matters” in our Annual Report on Form 10-K. The following discussion should be read in conjunction with the accompanying Consolidated Financial Statements of Taubman Centers, Inc. and the Notes thereto.

General Background and Performance Measurement

        Taubman Centers, Inc. (“we”, “us”, “our” or “TCO”) owns a managing general partner’s interest in The Taubman Realty Group Limited Partnership (the Operating Partnership or TRG), through which we conduct all of our operations. The Operating Partnership owns, develops, acquires, and operates regional shopping centers nationally. The Consolidated Businesses consist of shopping centers that are controlled by ownership or contractual agreement, development projects for future regional shopping centers, variable interest entities for which we are the primary beneficiary, and The Taubman Company LLC (the Manager). Shopping centers owned through joint ventures that are not controlled by us but over which we have significant influence (Unconsolidated Joint Ventures) are accounted for under the equity method.

        References in this discussion to “beneficial interest” refer to our ownership or pro-rata share of the item being discussed. Also, the operations of the shopping centers are often best understood by measuring their performance as a whole, without regard to our ownership interest. Consequently, in addition to the discussion of the operations of the Consolidated Businesses, the operations of the Unconsolidated Joint Ventures are presented and discussed as a whole.

Current Operating Trends

        Tenant sales and sales per square foot information are operating statistics used in measuring the productivity of the portfolio and are based on reports of sales furnished by mall tenants. Our tenant sales statistics have continued to improve through the first quarter of 2005, with sales per square foot increasing 7.2% over the first quarter of 2004. Tenant sales have increased every month over the past two years. Sales directly impact the amount of percentage rents certain tenants and anchors pay. The effects of increases or declines in sales on our operations are moderated by the relatively minor share of total rents (approximately three percent) percentage rents represent. However, a sustained trend in sales does impact, either negatively or positively, our ability to lease vacancies and negotiate rents at advantageous rates.

        As anticipated, occupancy trends continued to show improvement in the first quarter of 2005. Ending occupancy increased to 88.4% from 86.2% in the first quarter of 2004, resulting in higher rental income. This was the third straight quarter of year-over-year occupancy gains and the trend is expected to continue through 2005. Refer to “Seasonality” for occupancy and leased space statistics. Increased income from temporary in-line tenants and specialty leasing, which have become an integral part of our business, continues to contribute to growth. Temporary tenants, defined as those with lease terms less than 12 months, are not included in occupancy or leased space statistics. As of March 31, 2005, approximately 2.2% of space was occupied by temporary tenants, an increase of 0.5%, from 1.7% at March 31, 2004. Including temporary tenants, occupancy was 90.6% at March 31, 2005, an increase from 87.9% at March 31, 2004. Lease cancellation income can also moderate the effect of vacancies. During the first quarter of 2005, we recognized our approximately $2.8 million and $0.8 million share of the Consolidated Businesses’ and Unconsolidated Joint Ventures’ lease cancellation revenue. For 2005, we expect our share of lease cancellation revenue to be approximately $7 million.

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        As leases have expired in the shopping centers, we have generally been able to rent the available space, either to the existing tenant or a new tenant, at rental rates that are higher than those of the expired leases. In periods of increasing sales, such as those we are currently experiencing, rents on new leases will tend to rise as tenants’ expectations of future growth become more optimistic. In periods of slower growth or declining sales, rents on new leases will grow more slowly or may decline for the opposite reason. However, center revenues nevertheless increase as older leases roll over or are terminated early and replaced with new leases negotiated at current rental rates that are usually higher than the average rates for existing leases. Rent per square foot information for comparable centers in our consolidated businesses and unconsolidated joint ventures follows:

	Three Months Ended March 31
	2005		2004
Average rent per square foot:
Consolidated Businesses	$              41.48	$	40.60
Unconsolidated Joint Ventures	42.40		42.64
Opening base rent per square foot:
Consolidated Businesses	$              45.23	$	47.56
Unconsolidated Joint Ventures	53.01		51.22
Square feet of GLA opened	235,006		194,508
Closing base rent per square foot:
Consolidated Businesses	$              43.55	$	46.29
Unconsolidated Joint Ventures	43.31		54.27
Square feet of GLA closed	383,348		334,487
Releasing spread per square foot:
Consolidated Businesses	$                1.68	$	1.27
Unconsolidated Joint Ventures	9.70		(3.05	)

        The spread between opening and closing rents may not be indicative of future periods, as this statistic is not computed on comparable tenant spaces, and can vary significantly from period to period depending on the total amount, location, and average size of tenant space opening and closing in the period.

Seasonality

        The regional shopping center industry is seasonal in nature, with mall tenant sales highest in the fourth quarter due to the Christmas season, and with lesser, though still significant, sales fluctuations associated with the Easter holiday and back-to-school events. While minimum rents and recoveries are generally not subject to seasonal factors, most leases are scheduled to expire in the first quarter, and the majority of new stores open in the second half of the year in anticipation of the Christmas selling season. Additionally, most percentage rents are recorded in the fourth quarter. Accordingly, revenues and occupancy levels are generally highest in the fourth quarter. Included in revenues are gains on sales of peripheral land and lease cancellation income that may vary significantly from quarter to quarter.

	1st Quarter 2004	2nd Quarter 2004	3rd Quarter 2004	4th Quarter 2004	Total 2004	1st Quarter 2005
	(in thousands)
Mall tenant sales	$    796,868	$    833,223	$    829,775	$   1,268,144	$   3,728,010	$    887,132
Revenues:
Consolidated Businesses	$    101,332	$      98,937	$    110,901	$       120,283	$       431,453	$    111,839
Unconsolidated Joint Ventures	80,032	79,623	69,446	83,688	312,789	70,869
Occupancy (1):
Ending occupancy	86.2%	86.5%	87.9%	89.6%	89.6%	88.4%
Average occupancy	86.4	86.3	87.3	89.2	87.4	88.6
Leased space	89.3	89.4	90.2	90.7	90.7	90.5

(1) Statistics include anchor spaces at value centers (Arizona Mills, Dolphin Mall, and Great Lakes Crossing).

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        Because the seasonality of sales contrasts with the generally fixed nature of minimum rents and recoveries, mall tenant occupancy costs (the sum of minimum rents, percentage rents, and expense recoveries) relative to sales are considerably higher in the first three quarters than they are in the fourth quarter.

	1st Quarter 2004	2nd Quarter 2004	3rd Quarter 2004	4th Quarter 2004	Total 2004	1st Quarter 2005
Consolidated Businesses:
Minimum rents	11.6%	11.1%	11.1%	7.8%	10.0%	10.8%
Percentage rents	0.3		0.1	0.5	0.2	0.3
Expense recoveries	5.5	5.8	5.3	3.9	5.0	4.8
Mall tenant occupancy costs	17.4%	16.9%	16.5%	12.2%	15.2%	15.9%
Unconsolidated Joint Ventures:
Minimum rents	10.9%	10.4%	11.2%	7.2%	9.7%	10.2%
Percentage rents	0.4	0.1		0.5	0.3	0.3
Expense recoveries	4.9	4.6	4.3	4.0	4.4	4.0
Mall tenant occupancy costs	16.2%	15.1%	15.5%	11.7%	14.4%	14.5%

Recent Events

        Recent events relating to our operations include the following. In April 2005, we announced the formation of Taubman Asia, which will be the platform for our future expansion into the Asia-Pacific region. Taubman Asia will be headquartered in Hong Kong and will seek projects that leverage our strong retail planning, design and operational capabilities. Taubman Asia, along with Morgan Stanley Real Estate Fund, is currently evaluating opportunities in the region, including the previously announced New Songdo City project in Incheon, South Korea.

        In January 2005, we entered into an agreement and made an initial contribution relating to The Pier at Caesars, currently under construction. Refer to Liquidity and Capital Resources regarding The Pier.

        In July 2003, The May Department Stores Company (May) announced that it intends to divest 32 of its 86 Lord & Taylor stores, including four at our centers. In March 2005, we announced a plan to form a venture with May to find a replacement for the Lord & Taylor store at The Shops at Willow Bend, which closed in April 2005. Also in March, we announced that Nordstrom will take over space previously occupied by Lord & Taylor at Cherry Creek Shopping Center. The 120,000 square foot store is tentatively scheduled to open in 2006. At International Plaza, a 120,000 square foot Robb & Stucky furniture and design studio showroom opened in February 2005, occupying the first level and part of the second level of the former Lord & Taylor space. At the Mall at Wellington Green, a 140,000 square foot City Furniture and Ashley Furniture Home Store has signed a lease and is expected to open in October 2005.

Results of Operations

Openings and Acquisitions

        In July 2004, we acquired an additional 23.6% interest in International Plaza from an outside owner for $60.2 million in cash, increasing our ownership in the center to 50.1%. As a result of the acquisition, we have a controlling interest in the center and began consolidating its results as of the purchase date. Prior to the acquisition date, we accounted for International Plaza under the equity method of accounting. As of March 31, 2005, the Operating Partnership has a preferred investment in International Plaza of $30 million, on which an annual preferential return of 8.25% will accrue. In addition to the preferred return on our investment, the Operating Partnership is entitled to receive the balance of our preferred investment before any available cash will be utilized for distribution to the non-preferred partner.

        In January 2004, we purchased the additional 30% ownership of Beverly Center from Sheldon Gordon and the estate of E. Phillip Lyon for $3.3 million in cash and 276,724 of newly issued partnership units valued at $27.50 per unit. We already recognized 100% of the financial results of the center in our financial statements.

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Debt and Equity Transactions

        During November 2004, we redeemed the Operating Partnership’s Series C and Series D Preferred Equity, with the proceeds of our issuance of $100 million in Series G Cumulative Redeemable Preferred Stock.

        In May 2004, we completed a $30 million private placement of 8.2% Series F Cumulative Redeemable Preferred Partnership Equity, which was purchased by an institutional investor.

        In January 2004, we issued partnership units in connection with the acquisition of the additional interest in Beverly Center (see Openings and Acquisitions).

        During 2004, under an existing buyback program, we repurchased 2,447,781 shares of our common stock at an average price of $20.50. For each share of our stock repurchased, an equal number of our Operating Partnership units were redeemed. Cumulatively, since the program’s inception in March 2000, we have repurchased approximately 9.6 million shares for a total of $150 million, the maximum amount permitted under our program. Repurchases of common stock have been financed through general corporate funds, including equity issuances, and through borrowings under existing lines of credit.

Unsolicited Tender Offer

        During the three months ended March 31, 2004 we recovered through our insurance $1.0 million of costs incurred in connection with the unsolicited tender offer and related litigation, which were withdrawn and ended during October 2003.

Restructuring

        In October 2004, The Mills Corporation finalized its acquisition of 50 percent interests in nine of the ten General Motors Pension Trusts’ (GMPT) shopping centers that we managed, completing a recapitalization of GMPT’s mall portfolio. In the fourth quarter of 2004, we ceased management of these centers and underwent a personnel restructuring. The impact on 2005 results of operations is expected to be a net reduction of income of approximately $4 million.

Planned Financing

        In April 2005, we entered into a rate lock agreement at 5.44% with the lender to hedge the planned $200 million ten year non-recourse refinancing of the existing $140 million loan on The Mall at Wellington Green. The planned financing is expected to close in May 2005. Excess proceeds from the planned financing will be used to pay down our lines of credit.

New Accounting Pronouncements

        Refer to Note 11 in our financial statements regarding Statement No. 123 (Revised) “Share-Based Payment,” required to be adopted in 2006.

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Presentation of Operating Results

        The following table contains the operating results of our Consolidated Businesses and the Unconsolidated Joint Ventures. Income allocated to the minority partners in the Operating Partnership and preferred interests is deducted to arrive at the results allocable to our common shareowners. Because the net equity of the Operating Partnership is less than zero, the income allocated to the minority partners is equal to their share of distributions. The net equity of these minority partners is less than zero due to accumulated distributions in excess of net income and not as a result of operating losses. Distributions to partners are usually greater than net income because net income includes non-cash charges for depreciation and amortization. Amounts allocable to minority partners in certain consolidated joint ventures are added back or deducted to arrive at our net results. Our average ownership percentage of the Operating Partnership was 61% during the three months ended March 31, 2005 and 2004.

        The results of International Plaza are presented within the Consolidated Businesses for periods beginning July 1, 2004, as a result of our acquisition of a controlling interest in the center. Results of International Plaza prior to the acquisition date are included within the Unconsolidated Joint Ventures.

        The operating results in the following table include the supplemental earnings measures of Beneficial Interest in EBITDA and Funds from Operations (FFO). Beneficial Interest in EBITDA represents the Operating Partnership’s share of the earnings before interest and depreciation and amortization, excluding gains on sales of depreciated operating properties of its consolidated and unconsolidated businesses. We believe Beneficial Interest in EBITDA provides a useful indicator of operating performance, as it is customary in the real estate and shopping center business to evaluate the performance of properties on a basis unaffected by capital structure.

        The National Association of Real Estate Investment Trusts (NAREIT) defines FFO as net income (loss) (computed in accordance with Generally Accepted Accounting Principles (GAAP)), excluding gains (or losses) from extraordinary items and sales of properties, plus real estate related depreciation and after adjustments for unconsolidated partnerships and joint ventures. We believe that FFO is a useful supplemental measure of operating performance for REITs. Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values instead have historically risen or fallen with market conditions, we and most industry investors and analysts have considered presentations of operating results that exclude historical cost depreciation to be useful in evaluating the operating performance of REITs. We primarily use FFO in measuring performance and in formulating corporate goals and compensation. Our presentation of FFO is not necessarily comparable to the FFO of other REITs due to the fact that not all REITs use the NAREIT definition. FFO should not be considered an alternative to net income as an indicator of our operating performance. Additionally, FFO does not represent cash flows from operating, investing or financing activities as defined by GAAP.

        Prior to the fourth quarter of 2004, we did not include an add-back for depreciation of center replacement assets when computing our Beneficial Interest in EBITDA or FFO. As of the fourth quarter of 2004, we began to include such an add-back and restated previously reported EBITDA and FFO amounts. We did this both to be consistent with industry practice and because we have begun offering our tenants the option to pay a fixed charge or pay their share of common area maintenance (CAM) costs. Assuming tenants sign up for the fixed CAM option, over time there will be significantly less matching of CAM income with CAM capital-related expenses, which was the basis for our prior reporting practice.

        Reconciliations of Net Income to Funds from Operations and Beneficial Interest in EBITDA are presented following the Comparison of the Three Months Ended March 31, 2005 to the Three Months Ended March 31, 2004.

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        Comparison of the Three Months Ended March 31, 2005 to the Three Months Ended March 31, 2004

        The following table sets forth operating results for the three months ended March 31, 2005 and March 31, 2004, showing the results of the Consolidated Businesses and Unconsolidated Joint Ventures:

	Three Months Ended March 31, 2005				Three Months Ended March 31, 2004
	CONSOLIDATED BUSINESSES		UNCONSOLIDATED JOINT VENTURES AT 100% (1)		CONSOLIDATED BUSINESSES		UNCONSOLIDATED JOINT VENTURES AT 100% (1)
	(in millions of dollars)
REVENUES:
Minimum rents	63.1		45.2		53.6		50.5
Percentage rents	1.7		1.3		1.0		1.9
Expense recoveries	34.6		21.2		31.0		25.9
Management, leasing and development services	2.2				5.0
Other	10.2		3.2		10.7		1.7
Total revenues	111.8		70.9		101.3		80.0
OPERATING EXPENSES:
Recoverable expenses (2)	31.7		17.5		27.8		21.4
Other operating	10.5		6.0		8.2		5.3
Costs related to unsolicited tender offer, net of
recoveries					(1.0	)
Management, leasing and development services	1.2				4.8
General and administrative	6.0				6.5
Interest expense	25.5		16.8		22.6		20.2
Depreciation and amortization (3)	27.8		12.1		23.0		13.5
Total operating expenses	102.7		52.3		91.7		60.4
	9.1		18.5		9.6		19.6
Equity in income of Unconsolidated Joint Ventures (3)	9.1				9.6
Income before minority and preferred interests	18.2				19.2
Minority and preferred interests:
TRG preferred distributions	(0.6	)			(2.3	)
Minority share of consolidated joint ventures	(0.0	)			(0.2	)
Minority share of income of TRG	(5.2	)			(5.6	)
Distributions in excess of minority share of income	(4.0	)			(3.2	)
Net income	8.4				7.9
Preferred dividends	(6.2	)			(4.2	)
Net income allocable to common shareowners	2.3				3.8
SUPPLEMENTAL INFORMATION (4):
EBITDA - 100%	64.0		48.2		56.2		54.9
EBITDA - outside partners' share	(3.3	)	(21.9	)	(0.3	)	(26.2	)
Beneficial interest in EBITDA	60.6		26.3		55.8		28.7
Beneficial interest expense	(24.3	)	(9.3	)	(22.3	)	(10.6	)
Non-real estate depreciation	(0.6	)			(0.6	)
Preferred dividends and distributions	(6.8	)			(6.4	)
Funds from Operations contribution	29.0		17.0		26.5		18.2

(1) With the exception of the Supplemental Information, amounts include 100% of the Unconsolidated Joint Ventures. Amounts are net of intercompany transactions. The Unconsolidated Joint Ventures are presented at 100% in order to allow for measurement of their performance as a whole, without regard to our ownership interest. In our consolidated financial statements, we account for investments in the Unconsolidated Joint Ventures under the equity method. The results of International Plaza are presented within the Consolidated Businesses for periods beginning July 1, 2004, as a result of our acquisition of a controlling interest in the center. Results of International Plaza prior to the acquisition date are included within the Unconsolidated Joint Ventures.

(2) Included in recoverable expenses of the Consolidated Businesses and Unconsolidated Joint Ventures (at 100%) are $1.5 million and $0.8 million, respectively, of depreciation of center replacement assets for 2005, and $1.0 million and $1.6 million, respectively, for 2004.

(3) Amortization of our additional basis in the Operating Partnership included in equity in income of Unconsolidated Joint Ventures was $0.8 million in both 2005 and 2004. Also, amortization of the additional basis included in depreciation and amortization was $1.1 million in both 2005 and 2004.

(4) EBITDA and FFO for 2004 have been restated from amounts previously reported to include an add-back of depreciation of center replacement assets recoverable from tenants.

(5) Amounts in this table may not add due to rounding.

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Consolidated Businesses

        Total revenues for the quarter ended March 31, 2005 were $111.8 million, a $10.5 million or 10.4% increase over the comparable period in 2004. Minimum rents increased primarily due to International Plaza, which we began consolidating upon the acquisition of a controlling interest in the center. Minimum rents also increased due to increases in occupancy, tenant rollovers, and income from temporary tenants and specialty retailers. Percentage rents increased due to International Plaza and improving tenant sales. Expense recoveries increased primarily due to International Plaza. Management, leasing, and development revenue decreased primarily due to the loss of revenue from the nine GMPT management contracts, which were cancelled in November 2004. We expect our management, leasing, and development revenues, net of the related expenses, to be as much as $2 million in 2005. Considered in this estimate are leasing commissions still expected to be recognized relating to our previous management of the nine GMPT shopping centers, third party income related to the remaining GMPT center, and revenue from the Salt Lake City development project, as well as other sources of income. Other income decreased primarily due to decreases in gains on peripheral land sales, as well as decreases in lease cancellation revenue. We expect gains on peripheral land sales to be approximately $4 million for 2005.

        Total operating expenses were $102.7 million, an $11.0 million or 12.0% increase over the comparable period in 2004. Recoverable expenses increased primarily due to International Plaza. Other operating expense increased primarily due to increases in development-related costs, expenses related to Asia activities, overhead no longer allocable to the GMPT management contracts, bad debt expense, and International Plaza. We are expecting unfavorable variances in other operating expense throughout 2005. As described under “Recent Events” we are evaluating opportunities in Asia. We expect to incur additional costs in 2005 of approximately $2 million for payroll, consultants, travel, and office expenses in connection with our Asian initiatives. These costs will be accounted for similarly to other predevelopment costs, which are expensed as incurred. During 2004, $1.0 million of insurance proceeds were received relating to costs expended in connection with the unsolicited tender offer. Management, leasing, and development expense decreased primarily due to the cancellation of the GMPT management contracts, with certain overhead costs previously allocated to the contracts now being recognized as other operating expenses or general and administrative expense. General and administrative costs decreased primarily due to the mark to market of deferred long-term compensation bonuses in 2004, most of which were paid in early 2005, partially offset by an increase related to costs previously allocated to the GMPT contracts. We are expecting general and administrative expense of approximately $6 million per quarter in 2005. Interest expense increased due to International Plaza, additional debt used to fund the repurchase of shares and the 2004 payoff of the Woodland and Stamford Town Center mortgages, and increases in floating interest rates, partially offset by a decrease due to the repayment of a $20 million loan bearing interest at 13%. Depreciation expense increased primarily due to International Plaza.

Unconsolidated Joint Ventures

        Total revenues for the three months ended March 31, 2005 were $70.9 million, a $9.1 million or 11.4% decrease from the comparable period in 2004. Minimum rents decreased primarily due to the consolidation of International Plaza, which was partially offset by increases in occupancy, as well as income from specialty retailers and temporary tenants. Expense recoveries decreased primarily due to International Plaza. Other revenue increased primarily due to an increase in lease cancellation revenue.

        Total operating expenses decreased by $8.1 million to $52.3 million for the three months ended March 31, 2005. Recoverable expenses decreased primarily due to International Plaza. Other operating expense increased primarily due to increases in development-related costs, professional fees, and bad debt expense, which were partially offset by International Plaza. Interest expense decreased primarily due to International Plaza and the payoff of debt on Woodland and Stamford Town Center. Depreciation expense decreased primarily due to International Plaza.

        As a result of the foregoing, income of the Unconsolidated Joint Ventures decreased by $1.1 million to $18.5 million. Our equity in income of the Unconsolidated Joint Ventures was $9.1 million, a $0.5 million decrease from the comparable period in 2004.

Net Income

        Our income before minority and preferred interests decreased by $1.0 million to $18.2 million for 2005. After allocation of income to minority and preferred interests, the net income allocable to common shareowners for 2005 was $2.3 million compared to $3.8 million in the comparable period in 2004.

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Reconciliation of Net Income to Funds from Operations

	Three Months Ended March 31
	2005		2004
	(in millions of dollars)
Net income allocable to common shareowners	2.3		3.8
Add (less) depreciation and amortization (1):
Consolidated businesses at 100%	29.3		24.0
Minority partners in consolidated joint ventures	(2.0	)	0.1
Share of unconsolidated joint ventures	7.9		8.6
Non-real estate depreciation	(0.6	)	(0.6	)
Add minority interests in TRG:
Minority share of income of TRG	5.2		5.6
Distributions in excess of minority share of income of TRG	4.0		3.2
Funds from Operations - TRG (2)	46.0		44.7
Funds from Operations - TCO (2)	28.2		27.3

(1) Depreciation includes $2.8 million and $2.0 million of mall tenant allowance amortization for the three months ended March 31, 2005 and 2004, respectively. Depreciation also includes TRG’s beneficial interest in depreciation of center replacement assets recoverable from tenants of $1.8 million and $1.9 million for the three months ended March 31, 2005 and 2004, respectively.

(2) FFO for the three months ended March 31, 2004 has been restated from previously reported amounts to include the add-back of depreciation of center replacement assets recoverable from tenants. TCO’s share of TRG’s FFO is based on an average ownership of 61% during the three months ended March 31, 2005 and 2004.

(3) Amounts in this table may not add due to rounding.

Reconciliation of Net Income to Beneficial Interest in EBITDA

	Three Months Ended March 31
	2005		2004
	(in millions of dollars)
Net income allocable to common shareowners	2.3		3.8
Add (less) depreciation and amortization:
Consolidated businesses at 100%	29.3		24.0
Minority partners in consolidated joint ventures	(2.0	)	0.1
Share of unconsolidated joint ventures	7.9		8.6
Add minority interests in TRG:
Minority share of income of TRG	5.2		5.6
Distributions in excess of minority share of income of TRG	4.0		3.2
Add (less) preferred interests and interest expense:
Preferred dividends and distributions	6.8		6.4
Interest expense for all businesses	42.3		42.8
Interest expense allocable to minority partners in
consolidated joint ventures	(1.3	)	(0.3	)
Interest expense allocable to outside partners in
unconsolidated joint ventures	(7.4	)	(9.6	)
Beneficial interest in EBITDA - TRG (2)	87.0		84.6

(1) Amounts in this table may not add due to rounding.

(2) Beneficial interest in EBITDA for the three months ended March 31, 2004 has been restated from previously reported amounts to include the add-back of depreciation of center replacement assets recoverable from tenants.

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Liquidity and Capital Resources

        In the following discussion, references to beneficial interest represent the Operating Partnership’s share of the results of its consolidated and unconsolidated businesses. We do not have, and have not had, any parent company indebtedness; all debt discussed represents obligations of the Operating Partnership or its subsidiaries and joint ventures.

        Capital resources are required to maintain our current operations, complete construction on Northlake Mall, which is currently under development, pay dividends, and fund planned capital spending for future developments and other commitments and contingencies. We believe that our net cash provided by operating activities, distributions from our joint ventures, the unutilized portions of our credit facilities, and our ability to access the capital markets assure adequate liquidity to meet current and future cash requirements and will allow us to conduct our operations in accordance with our dividend and financing policies. The following sections contain information regarding our recent capital transactions and sources and uses of cash; beneficial interest in debt and sensitivity to interest rate risk; contractual obligations; covenants, commitments, and contingencies; and historical capital spending. We then provide information regarding our anticipated future capital spending.

Summaries of 2005 Capital Activities and Transactions

        As of March 31, 2005, we had a consolidated cash balance of $31.4 million. Additionally, we have a secured $350 million line of credit. This line had $135.0 million of borrowings as of March 31, 2005. We also have available a second secured bank line of credit of up to $40 million. This line had $10.6 million outstanding as of March 31, 2005. Both lines of credit mature in February 2008.

Operating Activities

        Our net cash provided by operating activities was $28.9 million in 2005, compared to $3.2 million in 2004. In 2005, increases in cash from 2004 related primarily to increases in rents and additional operating cash flows due to International Plaza, which we began consolidating upon the acquisition of a controlling interest in the center. Additionally, in 2004, a swap agreement on the Beverly financing was settled and costs relating to the unsolicited tender offer were paid; similar payments were not made in 2005.

Investing Activities

        Net cash used in investing activities was $25.5 million in 2005 compared to $46.7 million in 2004. Cash used in investing activities was impacted by the timing of capital expenditures, with additions to properties in 2005 and 2004 for the construction of Northlake Mall, as well as other development activities and other capital items. A tabular presentation of 2005 capital spending is shown in Capital Spending. During 2004, $3.3 million was used to acquire an additional interest in Beverly Center. Contributions to Unconsolidated Joint Ventures of $8.0 million in 2005 were made primarily to fund construction at Waterside Shops at Pelican Bay and the purchase of an anchor space at Stamford Town Center, while $33.0 million was contributed in 2004 in connection with the payoff of Woodland’s debt.

        Sources of cash used in funding these investing activities included distributions from Unconsolidated Joint Ventures, as well as the transactions described under Financing Activities. Distributions in excess of earnings from Unconsolidated Joint Ventures provided $4.0 million in 2005 and $6.9 million in 2004. Net proceeds from sales of peripheral land were $3.3 million and $5.4 million in 2005 and 2004, respectively. The timing of land sales is variable and proceeds from land sales can vary significantly from period to period.

Financing Activities

        Net cash used in financing activities was $1.2 million in 2005, compared to $31.4 million of cash provided in 2004. Net cash provided by financing activities was determined by the cash requirements of the investing activities described in the preceding section. Proceeds from the issuance of debt, net of payments and issuance costs, were $22.0 million in 2005, compared to $56.2 million in 2004. Issuance of stock pursuant to the Continuing Offer related to the exercise of employee options contributed $38 thousand in 2005 and $1.2 million in 2004. Issuance of partnership units related to the exercise of employee options contributed $6.7 million and $2.6 million in 2005 and 2004, respectively. Total dividends and distributions paid were $29.8 million and $28.7 million in 2005 and 2004, respectively.

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Beneficial Interest in Debt

        At March 31, 2005, the Operating Partnership’s debt and its beneficial interest in the debt of its Consolidated and Unconsolidated Joint Ventures totaled $2,401.0 million with an average interest rate of 5.74% excluding amortization of debt issuance costs and the effects of interest rate hedging instruments. These costs are reported as interest expense in the results of operations. Interest expense for the three months ended March 31, 2005 includes $0.15 million of non-cash amortization relating to acquisitions. On an annualized basis, interest expense from non-cash amortization relating to acquisitions is equal to $0.6 million, or 0.03% of the average all-in rate. Included in beneficial interest in debt is debt used to fund development and expansion costs. Beneficial interest in construction work in process totaled $182.2 million as of March 31, 2005, which includes $176.4 million of assets on which interest is being capitalized. Beneficial interest in capitalized interest was $2.4 million for the three months ended March 31, 2005. The following table presents information about our beneficial interest in debt as of March 31, 2005 (amounts may not add due to rounding):

	Amount	Interest Rate Including Spread		LIBOR Swap Rate
	(in millions)
Fixed rate debt	$   1,736.5	6.08	%  (1)
Floating rate debt:
Swapped through April 2005	100.0	6.75		5.25	%
Floating month to month	564.5	4.51	(1)
Total floating rate debt	$       664.5	4.84	(1)
Total beneficial interest in debt	$   2,401.0	5.74	(1)
Amortization of financing costs (2)		0.31	%
Average all-in rate		6.05	%

(1) Represents weighted average interest rate before amortization of financing costs.

(2) Financing costs include financing fees, interest rate cap premiums, and losses on settlement of derivatives used to hedge the refinancing of certain fixed rate debt.

        In addition, as of March 31, 2005, $287.5 million of our beneficial interest in floating rate debt is covered under interest rate cap agreements with LIBOR cap rates ranging from 4.6% to 7.0% with terms ending February 2006 through July 2006.

Sensitivity Analysis

        We have exposure to interest rate risk on our debt obligations and interest rate instruments. We use derivative instruments primarily to manage exposure to interest rate risks inherent in variable rate debt and refinancings. We routinely use cap, swap, and treasury lock agreements to meet these objectives. Based on the Operating Partnership’s beneficial interest in floating rate debt in effect at March 31, 2005, excluding debt fixed under interest rate swaps, a one percent increase or decrease in interest rates on this floating rate debt would decrease or increase cash flows by approximately $6.6 million and, due to the effect of capitalized interest, annual earnings by approximately $5.9 million. Based on our consolidated debt and interest rates in effect at March 31, 2005, a one percent increase in interest rates would decrease the fair value of debt by approximately $61.9 million, while a one percent decrease in interest rates would increase the fair value of debt by approximately $66.1 million.

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Contractual Obligations

        In conducting our business, we enter into various contractual obligations, including those for debt, capital leases for property improvements, operating leases for office space and land, purchase obligations (primarily for construction), and other long-term commitments. Disclosure of these items is contained in our Annual Report on Form 10-K. Updates of the 10-K disclosures for debt obligations and planned capital spending, which can vary significantly from period to period, as of March 31, 2005 are provided in the table below:

	Payments due by period
	Total	Less than 1 year (2005)	1-3 years (2006-2007)	3-5 years (2008-2009)	More than 5 years (2010+)
	(in millions of dollars)
Debt (1):
Lines of credit	145.6			145.6
Property level debt	1,806.6	59.7	519.4	453.3	774.3
Interest payments	514.3	80.1	175.5	118.4	140.3
Purchase obligations -
Planned capital spending (2)	116.6	116.6

(1) The settlement periods for debt do not consider extension options. Amounts relating to interest on floating rate debt are calculated based on the debt balances and interest rates as of March 31, 2005.

(2) As of March 31, 2005, we were contractually liable for $30.2 million of this planned spending. See Planned Capital Spending for detail regarding planned funding.

(3) Amounts in this table may not add due to rounding.

        In May 2004, we entered into a series of agreements related to a project at the Town of Oyster Bay, New York (see Planned Capital Spending). The property is being developed in a build-to-suit structure to facilitate a 1031 like-kind exchange in order to provide flexibility for disposing of assets in the future. While we have no specific asset sale in mind, we are committed to recycling our capital over time and believe that this planning will facilitate future transactions. A third party acquired our option to purchase land at the Town of Oyster Bay, New York and reimbursed us for our project costs to date. Subsequently, the third party acquired the land and became the owner of the project. We are the developer of the project and have an option to purchase the project. The owner will provide 3% of project funding and will lease the property to a wholly owned subsidiary of the Operating Partnership. A senior lender will provide 62% of the project costs at a rate of LIBOR plus 2.0%. We will provide 35% of the project funding under a junior subordinated financing at LIBOR plus 2.75% to the owner. We will also guarantee the lease payments and the completion of the project. The lease payments are structured to cover debt service on the senior loan, junior loan, a return (greater of LIBOR plus 4.0% or 8.0%) on the owner’s 3% equity investment during the term of the lease, and repayment of the principal and 3% equity contribution upon termination. As of March 31, 2005, the balances of the senior loan and owner equity contribution were $46.1 million and $2.2 million, respectively; the senior loan is limited to a total commitment of $62 million until municipal approvals have been obtained. We consolidate the owner and other entities described above and the junior loan and other intercompany transactions are eliminated in consolidation.

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Loan Commitments and Guarantees

        Certain loan agreements contain various restrictive covenants, including minimum net worth requirements, minimum debt service coverage ratios, a maximum payout ratio on distributions, a minimum fixed charges coverage ratio, a minimum interest coverage ratio, a maximum leverage ratio, and a minimum debt yield ratio, the latter two being the most restrictive. The Operating Partnership is in compliance with all of its covenants.

        Certain debt agreements, including all construction facilities, contain performance and valuation criteria that must be met for the loans to be extended at the full principal amounts; these agreements provide for partial prepayments of debt to facilitate compliance with extension provisions.

        Payments of principal and interest on the loans in the following table are guaranteed by the Operating Partnership as of March 31, 2005.

Center	Loan balance as of 3/31/05	TRG's beneficial interest in loan balance as of 3/31/05	Amount of loan balance guaranteed by TRG as of 3/31/05	% of loan balance guaranteed by TRG		% of interest guaranteed by TRG
	(in millions of dollars)
Dolphin Mall	142.9	142.9	142.9	100	%	100	%
The Mall at Millenia	1.5	0.8	0.8	50		50
Northlake Mall	54.8	54.8	54.8	100		100
The Mall at Wellington Green	140.0	126.0	140.0	100		100
The Shops at Willow Bend	146.4	146.4	146.4	100		100

        The Northlake Mall loan agreement provides for a reduction of the amounts guaranteed as certain center performance and valuation criteria are met.

        Payments of rent and all other sums payable related to the Oyster Bay agreements are guaranteed by the Operating Partnership. As of March 31, 2005, the balances of the senior loan and owner equity contribution (see Contractual Obligations) were $46.1 million and $2.2 million, respectively.

Cash Tender Agreement

        A. Alfred Taubman has the annual right to tender units of partnership interest in the Operating Partnership (provided that the aggregate value is at least $50 million) and cause us to purchase the tendered interests at a purchase price based on a market valuation of TCO on the trading date immediately preceding the date of the tender (the Cash Tender Agreement). At A. Alfred Taubman’s election, his family, and certain others may participate in tenders. We will have the option to pay for these interests from available cash, borrowed funds, or from the proceeds of an offering of our common stock. Generally, we expect to finance these purchases through the sale of new shares of our stock. The tendering partner will bear all market risk if the market price at closing is less than the purchase price and will bear the costs of sale. Any proceeds of the offering in excess of the purchase price will be for the sole benefit of TCO.

        Based on a market value at March 31, 2005 of $27.74 per common share, the aggregate value of interests in the Operating Partnership that may be tendered under the Cash Tender Agreement was approximately $705 million. The purchase of these interests at March 31, 2005 would have resulted in our owning an additional 31% interest in the Operating Partnership.

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Capital Spending

        Capital spending for routine maintenance of the shopping centers is generally recovered from tenants. Capital spending through March 31, 2005 not recovered from tenants is summarized in the following table:

	2005 (1)
	Consolidated Businesses		Beneficial Interest in Consolidated Businesses		Unconsolidated Joint Ventures	Beneficial Interest in Unconsolidated Joint Ventures
	(in millions of dollars)
Development, renovation, and expansion:
Existing centers	0.1		0.1		9.7	4.4
New centers	15.4	(2)	15.4	(2)
Pre-construction development activities	4.2	(3)	4.2	(3)
Mall tenant allowances (4)	4.0		3.8		1.7	0.9
Corporate office improvements and
equipment	0.5		0.5
Other	0.3		0.3		0.3	0.1
Total	24.6		24.5		11.7	5.4

(1) Costs are net of intercompany profits and are computed on an accrual basis.

(2) Primarily includes costs related to Northlake Mall.

(3) Primarily includes project costs of Oyster Bay.

(4) Excludes initial lease-up costs.

(5) Amounts in this table may not add due to rounding.

        For the three months ended March 31, 2005, in addition to the costs above, we incurred our $0.9 million share of Consolidated Businesses’ and $0.3 million share of Unconsolidated Joint Ventures’ capitalized leasing costs. Our share of the Consolidated Businesses’ asset replacement costs that will be reimbursed by tenants was $0.2 million.

        The following table presents a reconciliation of the Consolidated Businesses’ capital spending shown above to cash additions to properties as presented in our Consolidated Statement of Cash Flows for the quarter ended March 31, 2005:

	(in millions)
Consolidated Businesses' capital spending not recovered from tenants		$24.6
Asset replacement costs reimbursable by tenants		0.1
Differences between cash and accrual basis		0.0
Additions to properties		$24.7

Planned Capital Spending

        In January 2005, we entered into an agreement to invest in The Pier at Caesars (“The Pier”), located in Atlantic City, New Jersey, from Gordon Group Holdings LLC (“Gordon”), who is developing the center. The Pier is currently under construction, and is expected to open in 2006. Under the agreement, we will have a 30% interest in The Pier. Our capital contribution in The Pier will be made in three steps, with the initial investment of $4 million made at closing. A second payment equal to 70% of our projected required total investment (less the initial $4 million payment) is expected to be made within six months after the project opens. The third and final payment will be made shortly after the completion of the project’s stabilization year (2007) based on its actual net operating income (NOI) and debt levels. Our total capital contribution will be computed at a price to be calculated at a seven percent capitalization rate. Depending on the performance of the project, we expect our total cash investment to be in the range of $30 million to $35 million. During construction of the project, Gordon will loan the venture the funding for capital expenditures in excess of the construction loan financing. Interest on the loan will be accruable at the short-term applicable federal rate (AFR) under Section 1274(d) of the Internal Revenue Code and will be repaid before any distributions to the venture partners. The contributions of the Company will be used to repay the principal portion of the loan. Consequently, the Company expects that its share of distributions and income will initially be less than its residual 30% interest.

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        In addition to our acquisition of an interest in The Pier, we have entered into a joint development agreement with Gordon to develop future casino and entertainment oriented retail projects that are not anchored by department stores. The five-year agreement, which includes extension options, requires each party to offer an equal ownership of future development opportunities for such projects to the other company.

        In 2004, we signed a conditional letter of intent regarding a future development in Salt Lake City, Utah. The project would be a reconfiguration of two existing properties, and although the ownership structure and amount of our investment have not yet been finalized, construction is anticipated to begin during the remainder of 2005.

        We are also working on a project to build an approximately 600,000 square foot center, Partridge Creek Fashion Park, in southeastern Michigan. Although a final determination has not been made to go forward with the project, if certain conditions are met and municipal approvals are obtained, we would expect to begin construction in 2005 for a likely 2007 opening.

        We have progressed on the replacement of the four Lord & Taylor stores that were part of May’s July 2003 announcement to close 32 stores in certain geographic regions – refer to “Recent Events”. Together, our share of all costs anticipated for the complete replacement of these four Lord & Taylor stores is expected to be just over $20 million. This amount includes buyout costs, build out costs, tenant allowances, and an estimate for potential costs at Willow Bend. For this investment, we expect to earn a return of over 10%.

        We have announced plans for the addition of a 165,000 square foot Nordstrom, a 60,000 square foot expansion and renovation of Marshall Field’s, and approximately 90,000 square feet of additional new store space at Twelve Oaks Mall. Construction is expected to begin in early 2006 and be completed by fall 2007. While the budget for the expansion has not been finalized, the cost is estimated to be in the range of $50 million to $60 million.

        In addition, at Stamford Town Center we purchased the Filene’s store, which closed in January 2005. The former Filene’s building will be demolished to make way for a mix of retail uses. Plans for the new retail mix are still under discussion. Construction is expected to begin in early 2006, with a 2007 anticipated completion.

        Northlake Mall, a new 1.1 million square foot enclosed center in Charlotte, North Carolina, will be anchored by Dillard’s, Hecht’s, Belk, Dick’s Sporting Goods, and AMC Theatres and will have 0.4 million square feet of Mall GLA. The center is scheduled to open September 15, 2005 and is expected to cost approximately $175 million. We have over 80% of the space committed and nearly all of the remaining space is under negotiation. We expect returns on this investment to be approximately 11% at stabilization. Future construction costs for Northlake Mall will be funded through its construction facility.

        Construction has begun on an expansion and renovation at Waterside Shops at Pelican Bay. The expansion will increase the size of the center to 282,000 square feet and will cost approximately $51 million. We expect a return of approximately 11% on our $13 million share of project costs. The project is scheduled to be completed in October 2005.

        Our approximately $79 million balance of development pre-construction costs as of March 31, 2005 consists of costs relating to our Oyster Bay project in the Town of Oyster Bay, New York. Both Neiman Marcus and Lord & Taylor have committed to the project and retailer interest has been very strong. Although we still need to obtain the necessary entitlement approvals to move forward with the project, we are encouraged by six straight favorable court decisions. In February 2005, we had our hearing on the seventh round of court actions, and are awaiting the ruling. We expect continued success with the ongoing litigation, but if we are ultimately unsuccessful in the litigation process, it is anticipated that our recovery on this asset would be significantly less than our current investment. Given the current status, we believe the center could open as early as 2007 and we are hopeful that we will begin construction soon. The acquisition of the land occurred in May 2004 and we have completed the demolition of the existing industrial buildings on the site. The returns on this project will be somewhat lower than our normal targets due to the significant pre-development and construction costs on this site.

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        The following table summarizes planned capital spending, which is not recovered from tenants, assumes no acquisitions during 2005, and excludes the capital contribution related to The Pier (above), as well as costs related to Partridge Creek Fashion Park and the future development in Salt Lake City:

	2005 (1)
	Consolidated Businesses		Beneficial Interest in Consolidated Businesses	Unconsolidated Joint Ventures		Beneficial Interest in Unconsolidated Joint Ventures
	(in millions of dollars)
Development, renovation, and expansion	93.9	(2)	93.9	78.9	(3)	22.0
Mall tenant allowances	16.4		16.0	12.8		6.5
Pre-construction development and other	30.9	(4)	30.9	0.4		0.2
Total	141.2		140.7	92.1		28.7

(1) Costs are net of intercompany profits.

(2) Primarily includes costs related to Northlake Mall.

(3) Primarily includes costs related to the expansion and renovation of Waterside Shops at Pelican Bay.

(4) Primarily includes costs related to the Oyster Bay project described above.

(5) Amounts in this table may not add due to rounding.

        Estimates of future capital spending include only projects approved by our Board of Directors and, consequently, estimates will change as new projects are approved. Costs of potential development projects, including our exploration of development possibilities in Asia, are expensed until we conclude that it is probable that the project will reach a successful conclusion.

        Disclosures regarding planned capital spending, including estimates regarding capital expenditures, occupancy, and returns on new developments presented above are forward-looking statements and certain significant factors could cause the actual results to differ materially, including but not limited to: (1) actual results of negotiations with anchors, tenants, and contractors, (2) timing and outcome of litigation and entitlement processes, (3) changes in the scope, number, and valuation of projects, (4) cost overruns, (5) timing of expenditures, (6) financing considerations, (7) actual time to complete projects, (8) changes in economic climate, (9) competition from others attracting tenants and customers, (10) increases in operating costs, (11) timing of tenant openings, and (12) early lease terminations and bankruptcies.

Dividends

        We pay regular quarterly dividends to our common and Series A and Series G preferred shareowners. Dividends to our common shareowners are at the discretion of the Board of Directors and depend on the cash available to us, our financial condition, capital and other requirements, and such other factors as the Board of Directors deems relevant. To qualify as a REIT, we must distribute at least 90% of our REIT taxable income to our shareowners, as well as meet certain other requirements. Preferred dividends accrue regardless of whether earnings, cash availability, or contractual obligations were to prohibit the current payment of dividends. The 8.3% Series A preferred stock became callable in October 2002.

        On March 1, 2005, we declared a quarterly dividend of $0.285 per common share payable April 20, 2005 to shareowners of record on March 31, 2005. The Board of Directors also declared a quarterly dividend of $0.51875 per share on our 8.3% Series A Preferred Stock, paid March 31, 2005 to shareowners of record on March 21, 2005. We also declared a quarterly dividend of $0.50 per share on our 8% Series G Preferred Stock, also paid March 31, 2005 to shareowners of record on March 21, 2005.

        The annual determination of our common dividends is based on anticipated Funds from Operations available after preferred dividends, as well as assessments of annual capital spending, financing considerations, and other appropriate factors. Over the past several years, we have determined that the growth in common dividends would be less than the growth in Funds from Operations. We expect to evaluate our policy and the benefits of increasing dividends at a higher rate than historical increases, subject to our assessment of cash requirements.

        Any inability of the Operating Partnership or its Joint Ventures to secure financing as required to fund maturing debts, capital expenditures and changes in working capital, including development activities and expansions, may require the utilization of cash to satisfy such obligations, thereby possibly reducing distributions to partners of the Operating Partnership and funds available to us for the payment of dividends.

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Additional Information

        The Company provides supplemental investor information coincident with its earning announcements that can be found online at www.taubman.com under “Investor Relations.”

Item 3. Quantitative and Qualitative Disclosures About Market Risk

        The information required by this item is included in this report at Item 2 under the caption “Liquidity and Capital Resources – Sensitivity Analysis.”

Item 4. Controls and Procedures

        As of the end of the period covered by this quarterly report, the Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer and Chief Financial and Administrative Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures. Based upon that evaluation, the Company’s Chief Executive Officer and Chief Financial and Administrative Officer concluded that the Company’s disclosure controls and procedures are effective in timely alerting them to material information relating to the Company required to be disclosed in the Company’s periodic SEC reports.

        There were no changes in the Company’s internal control over financial reporting that occurred during the quarter ended March 31, 2005 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

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PART II
OTHER INFORMATION

Item 1. Legal Proceedings

        As a result of an unsolicited tender offer initiated in 2003, there remain two shareholder class and derivative actions. Counsel for the plaintiffs in those cases and counsel for defendants have agreed to present to the Court for its approval a settlement of both cases, the terms of which are not material to the Company.

        Neither we, our subsidiaries, nor any of the joint ventures is presently involved in any material litigation, nor, to our knowledge, is any material litigation threatened against us, our subsidiaries, or any of the properties. Except for routine litigation involving present or former tenants (generally eviction or collection proceedings), substantially all litigation is covered by liability insurance.

Item 6. Exhibits

4
     

10(a)
     

10(b)

12
     

31(a)
     

31(b)
     

32(a)
     

32(b)
     

99 --
  

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- -- Amendment to Secured Revolving Credit Agreement dated as of March 31, 2005, among The
Taubman Realty Group Limited Partnership and Eurohypo AG, New York Branch.

Change of Control Employment Agreement by and between Taubman Centers, Inc.,
Taubman Realty Group Limited Partnership, and Lisa A. Payne.

Form of Change of Control Agreement.

Statement Re: Computation of Taubman Centers, Inc. Ratio of Earnings to Combined
Fixed Charges and Preferred Dividends

Certification of Chief Executive Officer pursuant to 15 U.S.C. Section 10A, as
adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

Certification of Chief Financial Officer pursuant to 15 U.S.C. Section 10A, as
adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Debt Maturity Schedule

30

SIGNATURES

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

Date: May 4, 2005
          TAUBMAN CENTERS, INC.



  By: /s/ Lisa A. Payne
       Lisa A. Payne
       Executive Vice President,
       Chief Financial and Administrative Officer,
       and Director (Principal Financial Officer)

31

EX-4

AMENDMENT TO SECURED REVOLVING CREDIT AGREEMENT

THIS AMENDMENT TO SECURED REVOLVING CREDIT AGREEMENT (this “Amendment”) dated as of March 31, 2005, among THE TAUBMAN REALTY GROUP LIMITED PARTNERSHIP, a limited partnership organized and existing under the laws of the State of Delaware (“Borrower”), EUROHYPO AG, NEW YORK BRANCH, as administrative agent for the Banks (in such capacity, together with its successors in such capacity, “Administrative Agent”), and EUROHYPO AG, NEW YORK BRANCH (in its individual capacity and not as Administrative Agent, “Eurohypo”) and the other lenders signatory hereto.

RECITALS:

A.         Borrower, Administrative Agent and certain lending institutions entered into that certain Secured Revolving Credit Agreement dated as of October 13, 2004 (the “Credit Agreement”) with Borrower. All initially capitalized terms used and not otherwise defined in this Amendment shall have the meanings respectively ascribed to them in the Credit Agreement.

B.         Pursuant to Section 12.02 of the Credit Agreement, this Amendment is subject to the approval of the Required Banks. Borrower, Administrative Agent and the Required Banks have agreed to amend the Credit Agreement as set forth hereinbelow.

NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt and sufficiency of which are acknowledged hereby, the parties hereto agree as follows:

1. Amendments. The Credit Agreement is amended as follows:

(a)        The definition of “Capitalization Value” in Section 1.01 is amended and restated as follows:

“Capitalization Value” means, at any time, the sum of (1) Combined EBITDA for the twelve (12)-month period ending with the most recently ended calendar quarter, capitalized at an annual rate equal to 7.50%, (2) Borrower’s beneficial share of unrestricted Cash and Cash Equivalents (i. e., Cash and Cash Equivalents that are not pledged or the use of which is not restricted by the terms of any document or agreement) of Borrower and its Consolidated Businesses and UJVs and (3) without duplication, the cost basis of properties of Borrower under development. For the purposes of this definition, in no event shall (x) properties under development constitute in excess of 15% of Capitalization Value or (y) leasing commissions payable by third parties and/or management and development fees contribute to greater than 5% of Capitalization Value.

[The only change is as underlined]

(b)        Section 8.01(4), Relationship of Combined EBITDA to Total Outstanding Indebtedness, is deleted from the Credit Agreement and the following inserted in its place:

(4)        Relationship of Combined EBITDA to Interest Expense. As of the end of any calendar quarter, the ratio of (i) Combined EBITDA to Interest Expense, each for the twelve (12) month period then ended and taken as a whole, to be less than 1.80 to1.00;

(c) The reference to “7.75%” in Section 8.02(1) is amended to “7.50%”.

(d)        The foregoing amendments shall be effective with respect to reporting and calculations for the calendar quarter ending March 31, 2005.

2.          Agreements of Borrower. The Borrower agrees that the Credit Agreement and the other Loan Documents have not previously been modified, are in full force and effect and are ratified and confirmed hereby.

3.          Governing Law. This Amendment shall be governed by and construed in accordance with the laws of the State of New York.

4.          Counterparts. This Amendment may be executed by execution of separate counterparts, all of which taken together shall constitute a binding agreement..

2

IN WITNESS WHEREOF, this Amendment is executed as of the date first above written.

THE TAUBMAN REALTY GROUP LIMITED PARTNERSHIP, a Delaware limited partnership

By	/s/ Steven E. Eder
Name:	Steven E. Eder
Title:	Authorized Signatory

3

Counterpart Signature Page to

Amendment to Secured Revolving Credit Agreement

AGENT AND BANK: EUROHYPO AG, NEW YORK BRANCH

By: /s/ Ben J. Marciano

Name: Ben J. Marciano

Title: Managing Director

By: /s/ Stephen Cox

Name: Stephen Cox

Title: Vice President

Loan Commitment: $50,000,000

4

Counterpart Signature Page to

Amendment to Secured Revolving Credit Agreement

BANK: KEYBANK NATIONAL ASSOCIATION

By: /s/ Michael L Kauffman

Name: Michael L Kauffman

Title: Vice President

Loan Commitment: $37,500,000

5

Counterpart Signature Page to

Amendment to Secured Revolving Credit Agreement

BANK: PNC BANK, NATIONAL ASSOCIATION

By: /s/ James A Colella

Name: James A Colella

Title: Senior Vice President

Loan Commitment: $37,500,000

6

Counterpart Signature Page to

Amendment to Secured Revolving Credit Agreement

BANK: COMMERZBANK AG NEW YORK AND GRAND CAYMAN BRANCHES

By: /s/ Ralph Marra

Name: Ralph Marra

Title: Vice President

By: /s/ Kerstin Micke

Name: Kerstin Micke

Title: Assistant Treasurer

Loan Commitment: $37,500,000

7

Counterpart Signature Page to

Amendment to Secured Revolving Credit Agreement

BANK: HYPO REAL ESTATE CAPITAL CORPORATION

By: /s/ Roy Chin

Name: Roy Chin

Title: Managing Director

By: /s/ Jessica Munzel

Name: Jessica Munzel

Title: Director

Loan Commitment: $37,500,000

8

Counterpart Signature Page to

Amendment to Secured Revolving Credit Agreement

BANK: COMERICA BANK

By: /s/ Kristine L Vigliotti

Name: Kristine L Vigliotti

Title: Vice President

Loan Commitment: $27,000,000

9

Counterpart Signature Page to

Amendment to Secured Revolving Credit Agreement

BANK: PB (USA) REALTY CORPORATION

By: /s/ Perry Forman

Name: Perry Forman

Title: Vice President

Loan Commitment: $27,000,000

10

Counterpart Signature Page to

Amendment to Secured Revolving Credit Agreement

BANK: JPMORGAN CHASE BANK, N.A., a

national banking association, successor

by merger to Bank One, NA

By: /s/ Keith Lightbody

Name: Keith Lightbody

Date: 3/25/05

Loan Commitment: $27,000,000

11

Counterpart Signature Page to

Amendment to Secured Revolving Credit Agreement

BANK: MIDFIRST BANK, A FEDERALLY CHARTERED SAVINGS ASSOCIATION

By: /s/ W. Thomas Portman

Name: W. Thomas Portman

Title: Vice President

Loan Commitment: $20,000,000

12

Counterpart Signature Page to

Amendment to Secured Revolving Credit Agreement

BANK: CALYON NEW YORK BRANCH

By: /s/ John Wain

Name: John Wain

Title: Managing Director

By: /s/ Daniel Reddy

Name: Daniel Reddy

Title: Director

Loan Commitment: $20,000,000

13

Counterpart Signature Page to

Amendment to Secured Revolving Credit Agreement

BANK: FIFTH THIRD BANK (EASTERN MICHIGAN), a Michigan banking corporation

By: /s/ Timothy J Kalil

Name: Timothy J Kalil

Title: Vice President

Loan Commitment: $9,000,000

14

CONSENT OF GUARANTORS

The undersigned, being the Guarantors under that certain Guaranty of Payment dated as of October 13, 2004 (“Guaranty”) executed by them for the benefit of the Administrative Agent and the Banks in connection with the Loans, consent to the foregoing Amendment, ratify and confirm the Guaranty and agree that the Guaranty is in full force and effect.

TWELVE OAKS MALL, LLC, a Michigan limited liability company
By:	The Taubman Realty Group Limited Partnership, a Delaware limited partnership, its sole member
	By         /s/ Steven E. Eder
			Name:  Steven E. Eder
			Title:    Authorized Signatory
FAIRLANE TOWN CENTER LLC, a Michigan limited liability company
By:	The Taubman Realty Group Limited Partnership, a Delaware limited partnership, its sole member
	By         /s/ Steven E. Eder
		Name:  Steven E. Eder
		Title:    Authorized Signatory

15

EX-10

CHANGE OF CONTROL EMPLOYMENT AGREEMENT

AGREEMENT, dated as of the 12thday of May,2003(this “Agreement”), by and between Taubman Centers Inc., a Michigancorporation (together with its successors, “Taubman”), Taubman Realty Group Limited Partnership, a Delaware limited partnership (“TRG”) and Lisa A. Payne (the “Executive”).

WHEREAS, the Board of Directors of Taubman (the “Board”), has determined that it is in the best interests of Taubman and its stockholders to assure that the Company (as defined below) will have the continued dedication of the Executive, notwithstanding the possibility, threat or occurrence of a Change of Control (as defined herein). The Board believes it is imperative to diminish the inevitable distraction of the Executive by virtue of the personal uncertainties and risks created by a pending or threatened Change of Control and to encourage the Executive’s full attention and dedication to the current Company and in the event of any threatened or pending Change of Control, and to provide the Executive with compensation and benefits arrangements upon a Change of Control that ensure that the compensation and benefits expectations of the Executive will be satisfied and that are competitive with those of other corporations. Therefore, in order to accomplish these objectives, the Board has caused Taubman to enter into this Agreement.

NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

Section 1.Certain Definitions. (a) “Effective Date” means the first date during the Coverage Period (as defined herein) on which a Change of Control occurs. Notwithstanding anything in this Agreement to the contrary, if a Change of Control occurs and if the Executive’s employment with the Company is terminated prior to the date on which the Change of Control occurs, and if it is reasonably demonstrated by the Executive that such termination of employment (1) was at the request of a third party that has taken steps reasonably calculated to effect a Change of Control or (2) otherwise arose in connection with or anticipation of a Change of Control, then “Effective Date” means the date immediately prior to the date of such termination of employment.

(b)        “Coverage Period” means the period commencing on the date hereof and ending on the third anniversary of the date hereof; provided, however, that, commencing on the date one year after the date hereof, and on each annual anniversary of such date (such date and each annual anniversary thereof, the “Renewal Date”), unless previously terminated, the Coverage Period shall be automatically extended so as to terminate three years from such Renewal Date, unless, at least 60 days prior to the Renewal Date, Taubman shall give notice to the Executive that the Coverage Period shall not be so extended.

(c)        “Affiliated Company” means any company controlled by, controlling or under common control with Taubman.

(d)        “Change of Control” means the first to occur of any of the following events:

(1)        The acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) other than an Existing Shareholder (a “Person”) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 33% or more of either (A) the

1

then-outstanding shares of common stock of Taubman (the “Outstanding Taubman Common Stock”) or (B) the combined voting power of the then-outstanding voting securities of Taubman entitled to vote generally in the election of directors (the “Outstanding Taubman Voting Securities”); provided, however, that, for purposes of this Section 1(d), the following acquisitions shall not constitute a Change of Control: (i) any acquisition directly from Taubman, (ii) any acquisition by Taubman, (iii) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by Taubman or any Affiliated Company or (iv) any acquisition by any corporation pursuant to a transaction that complies with Sections 1(d)(3)(A), 1(d)(3)(B) and 1(d)(3)(C);

(2)        Any time at which individuals who, as of the date hereof, constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the date hereof whose election, or nomination for election by Taubman’s stockholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board;

(3)        Consummation of a reorganization, merger, statutory share exchange or consolidation or similar corporate transaction involving Taubman or any of its subsidiaries, a sale or other disposition of all or substantially all of the assets of Taubman, or the acquisition of assets or stock of another entity by Taubman or any of its subsidiaries (each, a “Business Combination”), in each case unless, following such Business Combination, (A) all or substantially all of the individuals and entities that were the beneficial owners of the Outstanding Taubman Common Stock and the Outstanding Taubman Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than 50% of the then-outstanding shares of common stock and the combined voting power of the then-outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such Business Combination (including, without limitation, a corporation that, as a result of such transaction, owns Taubman or all or substantially all of Taubman’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership immediately prior to such Business Combination of the Outstanding Taubman Common Stock and the Outstanding Taubman Voting Securities, as the case may be, (B) no Person (excluding any corporation resulting from such Business Combination or any employee benefit plan (or related trust) of Taubman or such corporation resulting from such Business Combination) beneficially owns, directly or indirectly, 33% or more of, respectively, the then-outstanding shares of common stock of the corporation resulting from such Business Combination or the combined voting power of the then-outstanding voting securities of such corporation, except to the extent that such ownership existed prior to the Business Combination, and (C) at least a majority of the members of the board of directors of the corporation resulting from such Business Combination were members of the Incumbent Board at the time of the execution of the initial agreement or of the action of the Board providing for such Business Combination;

(4)        Approval by the stockholdersof Taubman of a complete liquidation or dissolution of Taubman; or

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(5)        Termination, non-renewal, material amendment or material modification of the Master Services Agreement between TRG and The Taubman Company LLC dated as of November 30, 1992, as amended through the date hereof or the Corporate Services Agreement between the Taubman and the Taubman Company LLC dated as of November 30, 1992, as amended through the date hereof, other than any such termination, non-renewal, amendment or modification which has been previously approved by a majority of the Independent Directors (as defined in Taubman’s Restated Articles of Incorporation) serving on the Incumbent Board.

(e) “Company” means Taubman and the Affiliated Companies.

(f)         “Existing Shareholder” means A. Alfred Taubman or any of his issue or any of his or their respective descendants, heirs, beneficiaries or donees or any trust, corporation, partnership, limited liability company or other entity if substantially all of the economic interests in such entity are held by or for the benefit of such persons.

Section 2.Employment Period.Taubman hereby agrees to continue, or to cause one of the Affiliated Companies to continue, the Executive in its employ, subject to the terms and conditions of this Agreement, for the period commencing on the Effective Date and ending on the third anniversary of the Effective Date (the “Employment Period”). The Employment Period shall terminate upon the Executive’s termination of employment for any reason.

Section 3.Terms of Employment. (a) Position and Duties. (1) During the Employment Period, (A) the Executive’s position (including status, offices, titles and reporting requirements), authority, duties and responsibilities shall be at least commensurate in all material respects with the most significant of those held, exercised and assigned at any time during the 120-day period immediately preceding the Effective Date and (B) the Executive’s services shall be performed at the office where the Executive was employed immediately preceding the Effective Date or at any other location less than 35 miles from such office.

(2)        During the Employment Period, and excluding any periods of vacation and sick leave to which the Executive is entitled, the Executive agrees to devote reasonable attention and time during normal business hours to the business and affairs of the Company and, to the extent necessary to discharge the responsibilities assigned to the Executive hereunder, to use the Executive’s reasonable best efforts to perform faithfully and efficiently such responsibilities. During the Employment Period, it shall not be a violation of this Agreement for the Executive to (A) serve on corporate, civic or charitable boards or committees, (B) deliver lectures, fulfill speaking engagements or teach at educational institutions and (C) manage personal investments, so long as such activities do not significantly interfere with the performance of the Executive’s responsibilities as an employee of the Company in accordance with this Agreement. It is expressly understood and agreed that, to the extent that any such activities have been conducted by the Executive prior to the Effective Date, the continued conduct of such activities (or the conduct of activities similar in nature and scope thereto) subsequent to the Effective Date shall not thereafter be deemed to interfere with the performance of the Executive’s responsibilities to the Company.

(b)        Compensation. (1) Base Salary. During the Employment Period, the Executive shall receive an annual base salary (the “Annual Base Salary”) at an annual rate at least equal to 12 times the highest monthly base salary paid or payable, including any base salary that has been earned but deferred, to the Executive by the Company in respect of the 12-

3

month period immediately preceding the month in which the Effective Date occurs. The Annual Base Salary shall be paid at such intervals as the Company pays executive salaries generally. During the Employment Period, the Annual Base Salary shall be reviewed for increase, but not decrease, at least annually, beginning no more than 12 months after the last salary increase awarded to the Executive prior to the Effective Date. Any increase in the Annual Base Salary shall not serve to limit or reduce any other obligation to the Executive under this Agreement. The Annual Base Salary shall not be reduced after any such increase and the term “Annual Base Salary” shall refer to the Annual Base Salary as so increased.

(2)        Annual Bonus. In addition to the Annual Base Salary, the Executive shall be awarded, for each fiscal year ending during the Employment Period, an annual bonus (the “Annual Bonus”) in cash at least equal to the Executive’s highest bonus earned under the Company’s Annual Incentive Plans, or any comparable bonus under any predecessor or successor plan, for the last three full fiscal years prior to the Effective Date (or for such lesser number of full fiscal years prior to the Effective Date for which the Executive was eligible to earn such a bonus, and annualized in the case of any bonus earned for a partial fiscal year) (the “Recent Annual Bonus”). (If the Executive has not been eligible to earn such a bonus for any period prior to the Effective Date, the “Recent Annual Bonus” shall mean the Executive’s target annual bonus for the year in which the Effective Date occurs.) Each such Annual Bonus shall be paid no later than the end of the third month of the fiscal year next following the fiscal year for which the Annual Bonus is awarded, unless the Executive shall elect to defer the receipt of such Annual Bonus.

(3)        Incentive, Savings and Retirement Plans. During the Employment Period, the Executive shall be entitled to participate in all cash incentive, equity incentive, savings and retirement plans, practices, policies, and programs applicable generally to other peer executives of the Company, but in no event shall such plans, practices, policies and programs provide the Executive with incentive opportunities (measured with respect to both regular and special incentive opportunities, to the extent, if any, that such distinction is applicable), savings opportunities and retirement benefit opportunities, in each case, less favorable, in the aggregate, than the most favorable of those provided by the Company for the Executive under such plans, practices, policies and programs as in effect at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, those provided generally at any time after the Effective Date to other peer executives of the Company. Notwithstanding any provision in any plan or award agreement to the contrary, effective as of the Effective Date, each and every stock option, restricted stock award, restricted stock unit award and other equity-based award held by the Executive that is outstanding as of the Change of Control shall immediately vest and become exercisable, and each compensation award (as defined in the Long-Term Performance Compensation Plan (the “LTPC Plan”)) granted under the LTPC Plan outstanding as of the Change of Control shall vest and become immediately payable in full (along with any Premium (as defined in the LTPC Plan) thereon, if the FFO Per Share Growth Rate (as defined in the LTPC Plan) for the three full calendar years preceding the date of the Change of Control equals or exceeds 10%).

(4)        Welfare Benefit Plans. During the Employment Period, the Executive and/or the Executive’s family, as the case may be, shall be eligible for participation in and shall receive all benefits under welfare benefit plans, practices, policies and programs provided by the Company (including, without limitation, medical, prescription, dental, disability, employee life, group life, accidental death and travel accident insurance plans and programs) to the extent ap

4

plicable generally to other peer executives of the Company, but in no event shall such plans, practices, policies and programs provide the Executive with benefits that are less favorable, in the aggregate, than the most favorable of such plans, practices, policies and programs in effect for the Executive at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, those provided generally at any time after the Effective Date to other peer executives of the Company.

(5)        Expenses. During the Employment Period, the Executive shall be entitled to receive prompt reimbursement for all reasonable expenses incurred by the Executive in accordance with the most favorable policies, practices and procedures of the Company in effect for the Executive at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, as in effect generally at any time thereafter with respect to other peer executives of the Company.

(6)        Fringe Benefits. During the Employment Period, the Executive shall be entitled to fringe benefits, including, without limitation, tax and financial planning services, payment of club dues, and, if applicable, use of an automobile and payment of related expenses, in accordance with the most favorable plans, practices, programs and policies of the Company in effect for the Executive at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, as in effect generally at any time thereafter with respect to other peer executives of the Company.

(7)        Office and Support Staff. During the Employment Period, the Executive shall be entitled to an office or offices of a size and with furnishings and other appointments, and to exclusive personal secretarial and other assistance, at least equal to the most favorable of the foregoing provided to the Executive by the Company at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, as provided generally at any time thereafter with respect to other peer executives of the Company.

(8)        Vacation. During the Employment Period, the Executive shall be entitled to paid vacation in accordance with the most favorable plans, policies, programs and practices of the Company as in effect for the Executive at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, as in effect generally at any time thereafter with respect to other peer executives of the Company.

Section 4.Termination of Employment. (a) Death or Disability. The Executive’s employment shall terminate automatically if the Executive dies during the Employment Period. If Taubman determines in good faith that the Disability (as defined herein) of the Executive has occurred during the Employment Period (pursuant to the definition of “Disability”), it may give to the Executive written notice in accordance with Section 11(b) of its intention to terminate the Executive’s employment. In such event, the Executive’s employment with the Company shall terminate effective on the 30th day after receipt of such notice by the Executive (the “Disability Effective Date”), provided that, within the 30 days after such receipt, the Executive shall not have returned to full-time performance of the Executive’s duties. “Disability” means the absence of the Executive from the Executive’s duties with the Company on a full-time basis for 180 consecutive business days as a result of incapacity due to mental or physical illness that is determined to be total and permanent by a physician selected by the Company or its insurers and acceptable to the Executive or the Executive’s legal representative.

5

(b)        Cause. Taubman may terminate the Executive’s employment during the Employment Period with or without Cause. “Cause” means:

(1)the willful and continued failure of the Executive to perform substantially the Executive’s duties (as contemplated by Section 3(a)(1)(A)) with the Company (other than any such failure resulting from incapacity due to physical or mental illness or following the Executive’s delivery of a Notice of Termination for Good Reason), after a written demand for substantial performance is delivered to the Executive by the Board or the Chief Executive Officer of Taubman that specifically identifies the manner in which the Board or the Chief Executive Officer of Taubman believes that the Executive has not substantially performed the Executive’s duties, or

(2)the willful engaging by the Executive in illegal conduct or gross misconduct that is materially and demonstrably injurious to the Company.

For purposes of this Section 4(b), no act, or failure to act, on the part of the Executive shall be considered “willful” unless it is done, or omitted to be done, by the Executive in bad faith or without reasonable belief that the Executive’s action or omission was in the best interests of the Company. Any act, or failure to act, based upon authority given pursuant to a resolution duly adopted by the Board or upon the instructions of the Chief Executive Officer of Taubman or a senior officer of Taubman or based upon the advice of counsel for the Company shall be conclusively presumed to be done, or omitted to be done, by the Executive in good faith and in the best interests of the Company. The cessation of employment of the Executive shall not be deemed to be for Cause unless and until there shall have been delivered to the Executive a copy of a resolution duly adopted by the affirmative vote of not less than three-quarters of the entire membership of the Board (excluding the Executive, if the Executive is a member of the Board) at a meeting of the Board called and held for such purpose (after reasonable notice is provided to the Executive and the Executive is given an opportunity, together with counsel for the Executive, to be heard before the Board), finding that, in the good faith opinion of the Board, the Executive is guilty of the conduct described in Section 4(b)(1) or 4(b)(2), and specifying the particulars thereof in detail.

(c)        Good Reason. The Executive’s employment may be terminated by the Executive for Good Reason or by the Executive voluntarily without Good Reason. “Good Reason” means:

(1)the assignment to the Executive of any duties inconsistent in any respect with the Executive’s position (including status, offices, titles and reporting requirements), authority, duties or responsibilities as contemplated by Section 3(a), or any other diminution in such position, authority, duties or responsibilities (whether or not occurring solely as a result of Taubman’s ceasing to be a publicly traded entity), excluding for this purpose an isolated, insubstantial and inadvertent action not taken in bad faith and that is remedied by the Company promptly after receipt of notice thereof given by the Executive;

(2)any failure by the Company to comply with any of the provisions of Section 3(b), other than an isolated, insubstantial and inadvertent failure not occurring in bad faith and that is remedied by the Company promptly after receipt of notice thereof given by the Executive;

6

(3)the Company’s requiring the Executive (i) to be based at any office or location other than as provided in Section 3(a)(1)(B), (ii) to be based at a location other than the principal executive offices of the Company if the Executive was employed at such location immediately preceding the Effective Date, or (iii) to travel on Company business to a substantially greater extent than required immediately prior to the Effective Date;

(4)any purported termination by the Company of the Executive’s employment otherwise than as expressly permitted by this Agreement; or

(5) any failure by Taubman to comply with and satisfy Section 10(c).

For purposes of this Section 4(c), any good faith determination of Good Reason made by the Executive shall be conclusive. Anything in this Agreement to the contrary notwithstanding, a termination by the Executive for any reason pursuant to a Notice of Termination given during the 90-day period immediately following the Effective Date (a “Window Period Termination”) shall be deemed to be a termination for Good Reason for all purposes of this Agreement. The Executive’s mental or physical incapacity following the occurrence of an event described above in clauses (1) through (5) shall not affect the Executive’s ability to terminate employment for Good Reason.

(d)        Notice of Termination. Any termination by Taubman for Cause, or by the Executive for Good Reason, shall be communicated by Notice of Termination to the other party hereto given in accordance with Section 11(b). “Notice of Termination” means a written notice that (1) indicates the specific termination provision in this Agreement relied upon, (2) to the extent applicable, sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under the provision so indicated, and (3) if the Date of Termination (as defined herein) is other than the date of receipt of such notice, specifies the Date of Termination (which Date of Termination shall be not more than 30 days after the giving of such notice). The failure by the Executive or Taubman to set forth in the Notice of Termination any fact or circumstance that contributes to a showing of Good Reason or Cause shall not waive any right of the Executive or Taubman , respectively, hereunder or preclude the Executive or Taubman , respectively, from asserting such fact or circumstance in enforcing the Executive’s or Taubman’s respective rights hereunder.

(e)        Date of Termination. “Date of Termination” means (1) if the Executive’s employment is terminated by Taubman for Cause, or by the Executive for Good Reason, the date of receipt of the Notice of Termination or any later date specified in the Notice of Termination, (which date shall not be more than 30 days after the giving of such notice), as the case may be, (2) if the Executive’s employment is terminated by Taubman other than for Cause or Disability, the date on which the Company notifies the Executive of such termination, and (3) if the Executive resigns without Good Reason, the date on which the Executive notifies the Company of such termination, and (4) if the Executive’s employment is terminated by reason of death or Disability, the date of death of the Executive or the Disability Effective Date, as the case may be.

Section 5.Obligations of the Company upon Termination. (a) Good Reason; Other Than for Cause, Death or Disability. If, during the Employment Period, Taubman terminates the Executive’s employment other than for Cause or Disability or the Executive terminates employment for Good Reason:

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(1)Taubman shall pay, or shall cause one of the Affiliated Company to pay, to the Executive, in a lump sum in cash within 30 days after the Date of Termination, the aggregate of the following amounts:

(A)the sum of (i) the Executive’s Annual Base Salary through the Date of Termination to the extent not theretofore paid; (ii) the Executive’s business expenses that are reimbursable pursuant to Section 3(b)(5) but have not been reimbursed by the Company as of the Date of Termination; (iii) the Executive’s Annual Bonus for the fiscal year immediately preceding the fiscal year in which the Date of Termination occurs if such bonus has been determined but not paid as of the Date of Termination; (iv) the product of (x) the higher of (I) the Recent Annual Bonus and (II) the Annual Bonus paid or payable, including any bonus or portion thereof that has been earned but deferred (and annualized for any fiscal year consisting of less than 12 full months or during which the Executive was employed for less than 12 full months), for the most recently completed fiscal year during the Employment Period, if any (such higher amount, the “Highest Annual Bonus”) and (y) a fraction, the numerator of which is the number of days in the current fiscal year through the Date of Termination and the denominator of which is 365; and (v) any compensation previously deferred by the Executive (together with any accrued interest or earnings thereon) and any accrued vacation pay, in each case, to the extent not theretofore paid (the sum of the amounts described in subclauses (i), (ii), (iii), (iv) and (v), the “Accrued Obligations”);

(B)(i) in the case of a Window Period Termination, the amount equal to the product of (x) two and (y) the sum of (I) the Executive’s Annual Base Salary and (II) the Executive’s target bonus under the Senior Short Term Incentive Plan or any successor plan for the year in which the Date of Termination occurs, and (ii) in all other cases, the amount equal to the product of (x) two and a half, and (y) the sum of (I) the Executive’s Annual Base Salary and (II) the Highest Annual Bonus; and

(2)other than in the event of a Window Period Termination, for 30 months after the Executive’s Date of Termination, or such longer period as may be provided by the terms of the appropriate plan, program, practice or policy, the Company shall continue benefits to the Executive and/or the Executive’s family at least equal to those that would have been provided to them in accordance with the plans, programs, practices and policies described in Section 3(b)(4) and Section 3(b)(6) if the Executive’s employment had not been terminated or, if more favorable to the Executive, as in effect generally at any time thereafter with respect to other peer executives of the Company and their families; provided, however, that, if the Executive becomes reemployed with another employer and is eligible to receive such benefits under another employer provided plan, the medical and other welfare benefits described herein shall terminate. For purposes of determining eligibility (but not the time of commencement of benefits) of the Executive for retiree benefits pursuant to such plans, practices, programs and policies, the Executive shall be considered to have remained employed until three years after the Date of Termination and to have retired on the last day of such period;

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(3)other than in the event of a Window Period Termination, Taubman shall provide, or shall cause one of the Affiliated Companies to provide, the Executive with outplacement benefits through the services of an independent outplacement consulting firm selected by Taubman during the 12-month period following the Date of Termination; and

(4)to the extent not theretofore paid or provided, Taubman shall timely pay or provide, or shall cause one of the Affiliated Companies to timely pay or provide, to the Executive any Other Benefits (as defined in Section 6).

(b)        Death. If the Executive’s employment is terminated by reason of the Executive’s death during the Employment Period, Taubman shall provide, or shall cause one of the Affiliated Companies to provide, the Executive’s estate or beneficiaries with the Accrued Obligations and the timely payment or delivery of the Other Benefits, and shall have no other severance obligations under this Agreement. The Accrued Obligations shall be paid to the Executive’s estate or beneficiary, as applicable, in a lump sum in cash within 30 days of the Date of Termination. With respect to the provision of the Other Benefits, the term “Other Benefits” as utilized in this Section 5(b) shall include, without limitation, and the Executive’s estate and/or beneficiaries shall be entitled to receive, benefits at least equal to the most favorable benefits provided by the Company to the estates and beneficiaries of peer executives of the Company under such plans, programs, practices and policies relating to death benefits, if any, as in effect with respect to other peer executives and their beneficiaries at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive’s estate and/or the Executive’s beneficiaries, as in effect on the date of the Executive’s death with respect to other peer executives of the Company and their beneficiaries.

(c)        Disability. If the Executive’s employment is terminated by Taubman by reason of the Executive’s Disability during the Employment Period, Taubman shall provide, or shall cause one of the Affiliated Companies to provide, the Executive with the Accrued Obligations and the timely payment or delivery of the Other Benefits, and shall have no other severance obligations under this Agreement. The Accrued Obligations shall be paid to the Executive in a lump sum in cash within 30 days of the Date of Termination. With respect to the provision of the Other Benefits, the term “Other Benefits” as utilized in this Section 6(c) shall include, and the Executive shall be entitled after the Disability Effective Date to receive, disability and other benefits at least equal to the most favorable of those generally provided by the Company to disabled executives and/or their families in accordance with such plans, programs, practices and policies relating to disability, if any, as in effect generally with respect to other peer executives and their families at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive and/or the Executive’s family, as in effect at any time thereafter generally with respect to other peer executives of the Company and their families.

(d)        Cause; Other Than for Good Reason. If the Executive’s employment is terminated by Taubman for Cause during the Employment Period, Taubman shall provide to the Executive, or shall cause one of the Affiliated Companies to provide to Executive, (1) the Executive’s Annual Base Salary through the Date of Termination, (2) the amount of any compensation previously deferred by the Executive, and (3) the Other Benefits, in each case, to the extent theretofore unpaid, and shall have no other severance obligations under this Agreement. If the Executive voluntarily terminates employment during the Employment Period, excluding

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a termination for Good Reason, Taubman shall provide to the Executive, or shall cause one of the Affiliated Companies to provide to the Executive, the Accrued Obligations and the timely payment or delivery of the Other Benefits, and shall have no other severance obligations under this Agreement. In such case, all the Accrued Obligations shall be paid to the Executive in a lump sum in cash within 30 days of the Date of Termination.

Section 6.Non-exclusivity of Rights. Nothing in this Agreement shall prevent or limit the Executive’s continuing or future participation in any plan, program, policy or practice provided by the Company and for which the Executive may qualify, nor, subject to Section 11(f), shall anything herein limit or otherwise affect such rights as the Executive may have under any other contract or agreement with the Company. Amounts that are vested benefits or that the Executive is otherwise entitled to receive under any plan, policy, practice or program of or any other contract or agreement with Taubman or any of the Affiliated Companies at or subsequent to the Date of Termination (“Other Benefits”) shall be payable in accordance with such plan, policy, practice or program or contract or agreement, except as explicitly modified by this Agreement. Notwithstanding the foregoing, if the Executive receives payments and benefits pursuant to Section 5(a) of this Agreement, the Executive shall not be entitled to any severance pay or benefits under any severance plan, program or policy of the Company, unless otherwise specifically provided therein in a specific reference to this Agreement.

Section 7.Full Settlement. Taubman’s obligation to make or cause one of the Affiliated Companies to make the payments provided for in this Agreement and otherwise to perform its obligations hereunder shall not be affected by any set-off, counterclaim, recoupment, defense, or other claim, right or action that the Company may have against the Executive or others. In no event shall the Executive be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to the Executive under any of the provisions of this Agreement, and such amounts shall not be reduced whether or not the Executive obtains other employment. Taubman shall pay, or cause one of the Affiliated Companies to pay, as incurred (within 15 days following Taubman’s receipt of an invoice from the Executive), to the full extent permitted by law, all legal fees and expenses that the Executive may reasonably incur as a result of any contest (regardless of the outcome thereof) by Taubman, any of the Affiliated Companies, the Executive or others of the validity or enforceability of, or liability under, any provision of this Agreement or any guarantee of performance thereof (including as a result of any contest by the Executive about the amount of any payment pursuant to this Agreement), plus, in each case, interest on any delayed payment at the applicable federal rate provided for in Section 7872(f)(2)(A) of the Internal Revenue Code of 1986, as amended (the “Code”).

Section 8. Reduction of Payments.

(a)        For purposes of this Section 8: (i) a “Payment” shall mean any payment or distribution in the nature of compensation to or for the benefit of the Executive, whether paid or payable pursuant to this Agreement or otherwise; (ii) “Separation Payment” shall mean a Payment paid or payable pursuant to this Agreement (disregarding this Section); (iii) “Present Value” shall mean such value determined in accordance with Sections 280G(b)(2)(A)(ii) and 280G(d)(4) of the Code; and (iv) “Reduced Amount” shall mean an amount expressed in Present Value that maximizes the aggregate Present Value of Separation Payments without causing any Payment to be nondeductible because of Section 280G of the Code.

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(b)        Taubman shall select, in its discretion, a nationally recognized accounting firm (the “Accounting Firm”) to make the determinations contemplated by this Section 4(g). Anything in the Plan to the contrary notwithstanding, in the event that the Accounting Firm determines that receipt of all Payments would subject the Participant to tax under Section 4999 of the Code, the aggregate Separation Payments shall be reduced (but not below zero) to meet the definition of Reduced Amount.

(c)        If the Accounting Firm determines that aggregate Separation Payments should be reduced to the Reduced Amount, Taubman shall promptly give the Executive notice to that effect and a copy of the detailed calculation thereof, and the Executive may then elect, in his or her sole discretion, which and how much of the Separation Payments shall be eliminated or reduced (as long as after such election the Present Value of the aggregate Separation Payments equals the Reduced Amount), and shall advise Taubman in writing of his or her election within ten days of his or her receipt of notice. If no such election is made by the Executive within such ten-day period, Taubman may elect which of such Separation Payments shall be eliminated or reduced (as long as after such election the Present Value of the aggregate Separation Payments equals the Reduced Amount) and shall notify the Executive promptly of such election. All determinations made by the Accounting Firm under this Section shall be binding upon Taubman and the Affiliated Companies and the Executive and shall be made within 60 days of a termination of employment of the Executive. As promptly as practicable following such determination, Taubman shall pay or distribute, or shall cause one of the Affiliated Companies to pay or distribute, to or for the benefit of the Executive such Separation Payments as are then due to the Executive under this Agreement, and shall promptly pay or distribute, or cause to be paid or distributed, to or for the benefit of the Executive in the future such Separation Payments as become due to the Executive under this Agreement.

(d)        As a result of the uncertainty in the application of Section 4999 of the Code at the time of the initial determination by the Accounting Firm hereunder, it is possible that amounts will have been paid or distributed to or for the benefit of the Executive pursuant to this Agreement which should not have been so paid or distributed (“Overpayment”) or that additional amounts which will have not been paid or distributed to or for the benefit of the Executive pursuant to this Agreement could have been so paid or distributed (“Underpayment”), in each case, consistent with the calculation of the Reduced Amount hereunder. In the event that the Accounting Firm, based upon the assertion of a deficiency by the Internal Revenue Service against Taubman or any of the Affiliated Companies or the Executive which the Accounting Firm believes has a high probability of success determines that an Overpayment has been made, any such Overpayment paid or distributed to or for the benefit of the Executive shall be repaid by the Executive; provided, however, that no such payment shall be made by the Executive if and to the extent such payment would neither reduce the amount on which the Executive is subject to tax under Section 1 and Section 4999 of the Code or generate a refund of such taxes. In the event that the Accounting Firm, based upon controlling precedent or substantial authority, determines that an Underpayment has occurred, any such Underpayment shall be promptly paid to or for the benefit of the Executive together with interest at the applicable federal rate provided for in Section 7872(f)(2) of the Code.

(e)                    All fees and expenses of the Accounting Firm in implementing the provisions of this Section 8 shall be borne by the Company.

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Section 9.Confidential Information. The Executive shall hold in a fiduciary capacity for the benefit of the Company all secret or confidential information, knowledge or data relating to Taubman or any of the Affiliated Companies, and their respective businesses, which information, knowledge or data shall have been obtained by the Executive during the Executive’s employment by the Company and which information, knowledge or data shall not be or become public knowledge (other than by acts by the Executive or representatives of the Executive in violation of this Agreement). After termination of the Executive’s employment with the Company, the Executive shall not, without the prior written consent of Taubman or as may otherwise be required by law or legal process, communicate or divulge any such information, knowledge or data to anyone other than the Company and those persons designated by the Company. In no event shall an asserted violation of the provisions of this Section 9 constitute a basis for deferring or withholding any amounts otherwise payable to the Executive under this Agreement.

Section 10.Successors. (a) This Agreement is personal to the Executive, and, without the prior written consent of Taubman, shall not be assignable by the Executive other than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive’s legal representatives.

(b)        This Agreement shall inure to the benefit of and be binding upon Taubman and its successors and assigns. Except as provided in Section 10(c), without the prior written consent of the Executive this Agreement shall not be assignable by Taubman.

(c)        Each of Taubman and TRG will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of its business and/or assets to assume expressly and agree to perform this Agreement in the same manner and to the same extent that it would be required to perform it if no such succession had taken place. “Taubman” means Taubman as hereinbefore defined and any successor to its business and/or assets as aforesaid that assumes and agrees to perform this Agreement by operation of law or otherwise. “TRG” means TRG as hereinbefore defined and any successor to its business and/or assets as aforesaid that assumes and agrees to perform this Agreement by operation of law or otherwise.

Section 11.Miscellaneous. (a) This Agreement shall be governed by and construed in accordance with the laws of the State of Michigan, without reference to principles of conflict of laws. The captions of this Agreement are not part of the provisions hereof and shall have no force or effect. This Agreement may not be amended or modified other than by a written agreement executed by the parties hereto or their respective successors and legal representatives.

(b)        All notices and other communications hereunder shall be in writing and shall be given by hand delivery to the other party or by registered or certified mail, return receipt requested, postage prepaid, addressed as follows:

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if to the Executive:

At the most recent address on file at the Company.

if to Taubman:

Taubman Centers, Inc.

200 East Long Lake Road

Suite 300

Bloomfield Hills, Michigan 48304

Attention: General Counsel

if to TRG:

Taubman Realty Group Limited Partnership

200 East Long Lake Road

Suite 300

Bloomfield Hills, Michigan 48304

Attention: General Counsel

or to such other address as either party shall have furnished to the other in writing in accordance herewith. Notice and communications shall be effective when actually received by the addressee.

(c)        The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement.

(d)        Taubman may withhold or cause to be withheld from any amounts payable under this Agreement such United States federal, state or local or foreign taxes as shall be required to be withheld pursuant to any applicable law or regulation.

(e)        The Executive’s or Taubman’s failure to insist upon strict compliance with any provision of this Agreement or the failure to assert any right the Executive or Taubman may have hereunder, including, without limitation, the right of the Executive to terminate employment for Good Reason pursuant to Sections 4(c)(1) through 4(c)(5), shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.

(f)         The Executive, Taubman and TRG acknowledge that, except as may otherwise be provided under any other written agreement between the Executive and Taubman or any of the Affiliated Companies, the employment of the Executive by the Company is “at will” and, subject to Section 1(a), prior to the Effective Date, the Executive’s employment may be terminated by either the Executive or the Company at any time prior to the Effective Date, in which case the Executive shall have no further rights under this Agreement. From and after the Effective Date, except as specifically provided herein, this Agreement shall supersede any other agreement between the parties with respect to the subject matter hereof including without limitation the Employment Agreement between The Taubman Company Limited Partnership, a Michigan Limited Partnership, and the Executive dated as of January 3, 1997.

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Section 12.Guarantee. TRG hereby irrevocably, absolutely and unconditionally guarantees the payment of all compensation and benefits (the “Benefits”) that Taubman is obligated to provide or cause to be provided to the Executive under this Agreement. This is a guarantee of payment and not a collection, and is the primary obligation of TRG, and the Executive may enforce this guarantee against TRG without any prior enforcement of the obligation to make the Benefits against Taubman.

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IN WITNESS WHEREOF, the Executive has hereunto set the Executive’s hand and, pursuant to the authorization from the Board, Taubman and TRG have each caused these presents to be executed in its name on its behalf, all as of the day and year first above written.

/s/ Lisa A. Payne

LISA PAYNE

/s/ Robert S. Taubman

TAUBMAN CENTERS INC.

As guarantor of Taubman Centers Inc.:

/s/ Robert S. Taubman

TAUBMAN REALTY GROUP LIMITED

PARTNERSHIP

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EX-10

CHANGE OF CONTROL EMPLOYMENT AGREEMENT

AGREEMENT, dated as of the [____] day of ______,_______(this “Agreement”), by and between Taubman Centers Inc., a Michigancorporation (together with its successors, “Taubman”), Taubman Realty Group Limited Partnership, a Delaware limited partnership (“TRG”) and [_________] (the “Executive”).

WHEREAS, the Board of Directors of Taubman (the “Board”), has determined that it is in the best interests of Taubman and its stockholdersto assure that the Company (as defined below) will have the continued dedication of the Executive, notwithstanding the possibility, threat or occurrence of a Change of Control (as defined herein). The Board believes it is imperative to diminish the inevitable distraction of the Executive by virtue of the personal uncertainties and risks created by a pending or threatened Change of Control and to encourage the Executive’s full attention and dedication to the current Company and in the event of any threatened or pending Change of Control, and to provide the Executive with compensation and benefits arrangements upon a Change of Control that ensure that the compensation and benefits expectations of the Executive will be satisfied and that are competitive with those of other corporations. Therefore, in order to accomplish these objectives, the Board has caused Taubman to enter into this Agreement.

NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

Section 1.Certain Definitions. (a) “Effective Date” means the first date during the Coverage Period (as defined herein) on which a Change of Control occurs. Notwithstanding anything in this Agreement to the contrary, if a Change of Control occurs and if the Executive’s employment with the Company is terminated prior to the date on which the Change of Control occurs, and if it is reasonably demonstrated by the Executive that such termination of employment (1) was at the request of a third party that has taken steps reasonably calculated to effect a Change of Control or (2) otherwise arose in connection with or anticipation of a Change of Control, then “Effective Date” means the date immediately prior to the date of such termination of employment.

(b)      “Coverage Period” means the period commencing on the date hereof and ending on the third anniversary of the date hereof; provided, however, that, commencing on the date one year after the date hereof, and on each annual anniversary of such date (such date and each annual anniversary thereof, the “Renewal Date”), unless previously terminated, the Coverage Period shall be automatically extended so as to terminate three years from such Renewal Date, unless, at least 60 days prior to the Renewal Date, Taubman shall give notice to the Executive that the Coverage Period shall not be so extended.

(c)       “Affiliated Company” means any company controlled by, controlling or under common control with Taubman.

(d)       “Change of Control” means the first to occur of any of the following events:

(1)       The acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) other than an Existing Shareholder (a “Person”) of beneficial ownership (within

the meaning of Rule 13d-3 promulgated under the Exchange Act) of 33% or more of either (A) the then-outstanding shares of common stock of Taubman (the “Outstanding Taubman Common Stock”) or (B) the combined voting power of the then-outstanding voting securities of Taubman entitled to vote generally in the election of directors (the “Outstanding Taubman Voting Securities”); provided, however, that, for purposes of this Section 1(d), the following acquisitions shall not constitute a Change of Control: (i) any acquisition directly from Taubman, (ii) any acquisition by Taubman, (iii) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by Taubman or any Affiliated Company or (iv) any acquisition by any corporation pursuant to a transaction that complies with Sections 1(d)(3)(A), 1(d)(3)(B) and 1(d)(3)(C);

(2)       Any time at which individuals who, as of the date hereof, constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the date hereof whose election, or nomination for election by Taubman’s stockholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board;

(3)       Consummation of a reorganization, merger, statutory share exchange or consolidation or similar corporate transaction involving Taubman or any of its subsidiaries, a sale or other disposition of all or substantially all of the assets of Taubman, or the acquisition of assets or stock of another entity by Taubman or any of its subsidiaries (each, a “Business Combination”), in each case unless, following such Business Combination, (A) all or substantially all of the individuals and entities that were the beneficial owners of the Outstanding Taubman Common Stock and the Outstanding Taubman Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than 50% of the then-outstanding shares of common stock and the combined voting power of the then-outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such Business Combination (including, without limitation, a corporation that, as a result of such transaction, owns Taubman or all or substantially all of Taubman’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership immediately prior to such Business Combination of the Outstanding Taubman Common Stock and the Outstanding Taubman Voting Securities, as the case may be, (B) no Person (excluding any corporation resulting from such Business Combination or any employee benefit plan (or related trust) of Taubman or such corporation resulting from such Business Combination) beneficially owns, directly or indirectly, 33% or more of, respectively, the then-outstanding shares of common stock of the corporation resulting from such Business Combination or the combined voting power of the then-outstanding voting securities of such corporation, except to the extent that such ownership existed prior to the Business Combination, and (C) at least a majority of the members of the board of directors of the corporation resulting from such Business Combination were members of the Incumbent Board at the time of the execution of the initial agreement or of the action of the Board providing for such Business Combination;

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(4)       Approval by the stockholdersof Taubman of a complete liquidation or dissolution of Taubman; or

(5)       Termination, non-renewal, material amendment or material modification of the Master Services Agreement between TRG and The Taubman Company LLC dated as of November 30, 1992, as amended through the date hereof or the Corporate Services Agreement between the Taubman and the Taubman Company LLC dated as of November 30, 1992, as amended through the date hereof, other than any such termination, non-renewal, amendment or modification which has been previously approved by a majority of the Independent Directors (as defined in Taubman’s Restated Articles of Incorporation) serving on the Incumbent Board.

(e) “Company” means Taubman and the Affiliated Companies.

(f)        “Existing Shareholder” means A. Alfred Taubman or any of his issue or any of his or their respective descendants, heirs, beneficiaries or donees or any trust, corporation, partnership, limited liability company or other entity if substantially all of the economic interests in such entity are held by or for the benefit of such persons.

Section 2.Employment Period.Taubman hereby agrees to continue, or to cause one of the Affiliated Companies to continue, the Executive in its employ, subject to the terms and conditions of this Agreement, for the period commencing on the Effective Date and ending on the third anniversary of the Effective Date (the “Employment Period”). The Employment Period shall terminate upon the Executive’s termination of employment for any reason.

Section 3.Terms of Employment. (a) Position and Duties. (1) During the Employment Period, (A) the Executive’s position (including status, offices, titles and reporting requirements), authority, duties and responsibilities shall be at least commensurate in all material respects with the most significant of those held, exercised and assigned at any time during the 120-day period immediately preceding the Effective Date and (B) the Executive’s services shall be performed at the office where the Executive was employed immediately preceding the Effective Date or at any other location less than 35 miles from such office.

(2)      During the Employment Period, and excluding any periods of vacation and sick leave to which the Executive is entitled, the Executive agrees to devote reasonable attention and time during normal business hours to the business and affairs of the Company and, to the extent necessary to discharge the responsibilities assigned to the Executive hereunder, to use the Executive’s reasonable best efforts to perform faithfully and efficiently such responsibilities. During the Employment Period, it shall not be a violation of this Agreement for the Executive to (A) serve on corporate, civic or charitable boards or committees, (B) deliver lectures, fulfill speaking engagements or teach at educational institutions and (C) manage personal investments, so long as such activities do not significantly interfere with the performance of the Executive’s responsibilities as an employee of the Company in accordance with this Agreement. It is expressly understood and agreed that, to the extent that any such activities have been conducted by the Executive prior to the Effective Date, the continued conduct of such activities (or the conduct of activities similar in nature and scope thereto) subsequent to the Effective Date shall not thereafter be deemed to interfere with the performance of the Executive’s responsibilities to the Company.

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(b)       Compensation. (1) Base Salary. During the Employment Period, the Executive shall receive an annual base salary (the “Annual Base Salary”) at an annual rate at least equal to 12 times the highest monthly base salary paid or payable, including any base salary that has been earned but deferred, to the Executive by the Company in respect of the 12-month period immediately preceding the month in which the Effective Date occurs. The Annual Base Salary shall be paid at such intervals as the Company pays executive salaries generally. During the Employment Period, the Annual Base Salary shall be reviewed for increase, but not decrease, at least annually, beginning no more than 12 months after the last salary increase awarded to the Executive prior to the Effective Date. Any increase in the Annual Base Salary shall not serve to limit or reduce any other obligation to the Executive under this Agreement. The Annual Base Salary shall not be reduced after any such increase and the term “Annual Base Salary” shall refer to the Annual Base Salary as so increased.

(2)      Annual Bonus. In addition to the Annual Base Salary, the Executive shall be awarded, for each fiscal year ending during the Employment Period, an annual bonus (the “Annual Bonus”) in cash at least equal to the Executive’s highest bonus earned under the Company’s Annual Incentive Plans, or any comparable bonus under any predecessor or successor plan, for the last three full fiscal years prior to the Effective Date (or for such lesser number of full fiscal years prior to the Effective Date for which the Executive was eligible to earn such a bonus, and annualized in the case of any bonus earned for a partial fiscal year) (the “Recent Annual Bonus”). (If the Executive has not been eligible to earn such a bonus for any period prior to the Effective Date, the “Recent Annual Bonus” shall mean the Executive’s target annual bonus for the year in which the Effective Date occurs.) Each such Annual Bonus shall be paid no later than the end of the third month of the fiscal year next following the fiscal year for which the Annual Bonus is awarded, unless the Executive shall elect to defer the receipt of such Annual Bonus.

(3)       Incentive, Savings and Retirement Plans. During the Employment Period, the Executive shall be entitled to participate in all cash incentive, equity incentive, savings and retirement plans, practices, policies, and programs applicable generally to other peer executives of the Company, but in no event shall such plans, practices, policies and programs provide the Executive with incentive opportunities (measured with respect to both regular and special incentive opportunities, to the extent, if any, that such distinction is applicable), savings opportunities and retirement benefit opportunities, in each case, less favorable, in the aggregate, than the most favorable of those provided by the Company for the Executive under such plans, practices, policies and programs as in effect at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, those provided generally at any time after the Effective Date to other peer executives of the Company. Notwithstanding any provision in any plan or award agreement to the contrary, effective as of the Effective Date, each and every stock option, restricted stock award, restricted stock unit award and other equity-based award held by the Executive that is outstanding as of the Change of Control shall immediately vest and become exercisable, and each compensation award (as defined in the Long-Term Performance Compensation Plan (the “LTPC Plan”)) granted under the LTPC Plan outstanding as of the Change of Control shall vest and become immediately payable in full (along with any Premium (as defined in the LTPC Plan) thereon, if the FFO Per Share Growth Rate (as defined in the LTPC Plan) for the three full calendar years preceding the date of the Change of Control equals or exceeds 10%).

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(4)       Welfare Benefit Plans. During the Employment Period, the Executive and/or the Executive’s family, as the case may be, shall be eligible for participation in and shall receive all benefits under welfare benefit plans, practices, policies and programs provided by the Company (including, without limitation, medical, prescription, dental, disability, employee life, group life, accidental death and travel accident insurance plans and programs) to the extent applicable generally to other peer executives of the Company, but in no event shall such plans, practices, policies and programs provide the Executive with benefits that are less favorable, in the aggregate, than the most favorable of such plans, practices, policies and programs in effect for the Executive at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, those provided generally at any time after the Effective Date to other peer executives of the Company.

(5)       Expenses. During the Employment Period, the Executive shall be entitled to receive prompt reimbursement for all reasonable expenses incurred by the Executive in accordance with the most favorable policies, practices and procedures of the Company in effect for the Executive at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, as in effect generally at any time thereafter with respect to other peer executives of the Company.

(6)       Fringe Benefits. During the Employment Period, the Executive shall be entitled to fringe benefits, including, without limitation, tax and financial planning services, payment of club dues, and, if applicable, use of an automobile and payment of related expenses, in accordance with the most favorable plans, practices, programs and policies of the Company in effect for the Executive at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, as in effect generally at any time thereafter with respect to other peer executives of the Company.

(7)       Office and Support Staff. During the Employment Period, the Executive shall be entitled to an office or offices of a size and with furnishings and other appointments, and to exclusive personal secretarial and other assistance, at least equal to the most favorable of the foregoing provided to the Executive by the Company at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, as provided generally at any time thereafter with respect to other peer executives of the Company.

(8)       Vacation. During the Employment Period, the Executive shall be entitled to paid vacation in accordance with the most favorable plans, policies, programs and practices of the Company as in effect for the Executive at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, as in effect generally at any time thereafter with respect to other peer executives of the Company.

Section 4.Termination of Employment. (a) Death or Disability. The Executive’s employment shall terminate automatically if the Executive dies during the Employment Period. If Taubman determines in good faith that the Disability (as defined herein) of the Executive has occurred during the Employment Period (pursuant to the definition of “Disability”), it may give to the Executive written notice in accordance with Section 11(b) of its intention to terminate the Executive’s employment. In such event, the Executive’s employment with the Company shall terminate effective on the 30th day after receipt of such notice by the Executive (the “Disability Effective Date”), provided that, within the 30 days after such receipt, the Executive shall not have returned to full-time performance of the Executive’s du

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ties. “Disability” means the absence of the Executive from the Executive’s duties with the Company on a full-time basis for 180 consecutive business days as a result of incapacity due to mental or physical illness that is determined to be total and permanent by a physician selected by the Company or its insurers and acceptable to the Executive or the Executive’s legal representative.

(b)      Cause. Taubman may terminate the Executive’s employment during the Employment Period with or without Cause. “Cause” means:

(1)       the willful and continued failure of the Executive to perform substantially the Executive’s duties (as contemplated by Section 3(a)(1)(A)) with the Company (other than any such failure resulting from incapacity due to physical or mental illness or following the Executive’s delivery of a Notice of Termination for Good Reason), after a written demand for substantial performance is delivered to the Executive by the Board or the Chief Executive Officer of Taubman that specifically identifies the manner in which the Board or the Chief Executive Officer of Taubman believes that the Executive has not substantially performed the Executive’s duties, or

(2)       the willful engaging by the Executive in illegal conduct or gross misconduct that is materially and demonstrably injurious to the Company.

For purposes of this Section 4(b), no act, or failure to act, on the part of the Executive shall be considered “willful” unless it is done, or omitted to be done, by the Executive in bad faith or without reasonable belief that the Executive’s action or omission was in the best interests of the Company. Any act, or failure to act, based upon authority given pursuant to a resolution duly adopted by the Board or upon the instructions of the Chief Executive Officer of Taubman or a senior officer of Taubman or based upon the advice of counsel for the Company shall be conclusively presumed to be done, or omitted to be done, by the Executive in good faith and in the best interests of the Company. The cessation of employment of the Executive shall not be deemed to be for Cause unless and until there shall have been delivered to the Executive a copy of a resolution duly adopted by the affirmative vote of not less than three-quarters of the entire membership of the Board (excluding the Executive, if the Executive is a member of the Board) at a meeting of the Board called and held for such purpose (after reasonable notice is provided to the Executive and the Executive is given an opportunity, together with counsel for the Executive, to be heard before the Board), finding that, in the good faith opinion of the Board, the Executive is guilty of the conduct described in Section 4(b)(1) or 4(b)(2), and specifying the particulars thereof in detail.

(c)       Good Reason. The Executive’s employment may be terminated by the Executive for Good Reason or by the Executive voluntarily without Good Reason. “Good Reason” means:

(1)       the assignment to the Executive of any duties inconsistent in any respect with the Executive’s position (including status, offices, titles and reporting requirements), authority, duties or responsibilities as contemplated by Section 3(a), or any other diminution in such position, authority, duties or responsibilities (whether or not occurring solely as a result of Taubman’s ceasing to be a publicly traded entity), excluding for this purpose an isolated, insubstantial and inadvertent action not taken in bad faith and that is remedied by the Company promptly after receipt of notice thereof given by the Executive;

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(2)       any failure by the Company to comply with any of the provisions of Section 3(b), other than an isolated, insubstantial and inadvertent failure not occurring in bad faith and that is remedied by the Company promptly after receipt of notice thereof given by the Executive;

(3)       the Company’s requiring the Executive (i) to be based at any office or location other than as provided in Section 3(a)(1)(B), (ii) to be based at a location other than the principal executive offices of the Company if the Executive was employed at such location immediately preceding the Effective Date, or (iii) to travel on Company business to a substantially greater extent than required immediately prior to the Effective Date;

(4)       any purported termination by the Company of the Executive’s employment otherwise than as expressly permitted by this Agreement; or

(5) any failure by Taubman to comply with and satisfy Section 10(c).

For purposes of this Section 4(c), any good faith determination of Good Reason made by the Executive shall be conclusive. The Executive’s mental or physical incapacity following the occurrence of an event described above in clauses (1) through (5) shall not affect the Executive’s ability to terminate employment for Good Reason.

(d)       Notice of Termination. Any termination by Taubman for Cause, or by the Executive for Good Reason, shall be communicated by Notice of Termination to the other party hereto given in accordance with Section 11(b). “Notice of Termination” means a written notice that (1) indicates the specific termination provision in this Agreement relied upon, (2) to the extent applicable, sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under the provision so indicated, and (3) if the Date of Termination (as defined herein) is other than the date of receipt of such notice, specifies the Date of Termination (which Date of Termination shall be not more than 30 days after the giving of such notice). The failure by the Executive or Taubman to set forth in the Notice of Termination any fact or circumstance that contributes to a showing of Good Reason or Cause shall not waive any right of the Executive or Taubman , respectively, hereunder or preclude the Executive or Taubman , respectively, from asserting such fact or circumstance in enforcing the Executive’s or Taubman’s respective rights hereunder.

(e)       Date of Termination. “Date of Termination” means (1) if the Executive’s employment is terminated by Taubman for Cause, or by the Executive for Good Reason, the date of receipt of the Notice of Termination or any later date specified in the Notice of Termination, (which date shall not be more than 30 days after the giving of such notice), as the case may be, (2) if the Executive’s employment is terminated by Taubman other than for Cause or Disability, the date on which the Company notifies the Executive of such termination, and (3) if the Executive resigns without Good Reason, the date on which the Executive notifies the Company of such termination, and (4) if the Executive’s employment is terminated by reason of death or Disability, the date of death of the Executive or the Disability Effective Date, as the case may be.

Section 5.Obligations of the Company upon Termination. (a) Good Reason; Other Than for Cause, Death or Disability. If, during the Employment Period,

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Taubman terminates the Executive’s employment other than for Cause or Disability or the Executive terminates employment for Good Reason:

(1)       Taubman shall pay, or shall cause one of the Affiliated Company to pay, to the Executive, in a lump sum in cash within 30 days after the Date of Termination, the aggregate of the following amounts:

(A)      the sum of (i) the Executive’s Annual Base Salary through the Date of Termination to the extent not theretofore paid; (ii) the Executive’s business expenses that are reimbursable pursuant to Section 3(b)(5) but have not been reimbursed by the Company as of the Date of Termination; (iii) the Executive’s Annual Bonus for the fiscal year immediately preceding the fiscal year in which the Date of Termination occurs if such bonus has been determined but not paid as of the Date of Termination; (iv) the product of (x) the higher of (I) the Recent Annual Bonus and (II) the Annual Bonus paid or payable, including any bonus or portion thereof that has been earned but deferred (and annualized for any fiscal year consisting of less than 12 full months or during which the Executive was employed for less than 12 full months), for the most recently completed fiscal year during the Employment Period, if any (such higher amount, the “Highest Annual Bonus”) and (y) a fraction, the numerator of which is the number of days in the current fiscal year through the Date of Termination and the denominator of which is 365; and (v) any compensation previously deferred by the Executive (together with any accrued interest or earnings thereon) and any accrued vacation pay, in each case, to the extent not theretofore paid (the sum of the amounts described in subclauses (i), (ii), (iii), (iv) and (v), the “Accrued Obligations”);

(B)      the amount equal to the product of (i) two and a half (2.5)and (ii) the sum of (x) the Executive’s Annual Base Salary and (y) the Highest Annual Bonus;and

(2)       for 30 months after the Executive’s Date of Termination, or such longer period as may be provided by the terms of the appropriate plan, program, practice or policy, the Company shall continue benefits to the Executive and/or the Executive’s family at least equal to those that would have been provided to them in accordance with the plans, programs, practices and policies described in Section 3(b)(4) and Section 3(b)(6) if the Executive’s employment had not been terminated or, if more favorable to the Executive, as in effect generally at any time thereafter with respect to other peer executives of the Company and their families; provided, however, that, if the Executive becomes reemployed with another employer and is eligible to receive such benefits under another employer provided plan, the medical and other welfare benefits described herein shall terminate. For purposes of determining eligibility (but not the time of commencement of benefits) of the Executive for retiree benefits pursuant to such plans, practices, programs and policies, the Executive shall be considered to have remained employed until three years after the Date of Termination and to have retired on the last day of such period;

(3)       Taubman shall provide, or shall cause one of the Affiliated Companies to provide, the Executive with outplacement benefits through the services of an independ

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ent outplacement consulting firm selected by Taubman during the 12-month period following the Date of Termination; and

(4)       to the extent not theretofore paid or provided, Taubman shall timely pay or provide, or shall cause one of the Affiliated Companies to timely pay or provide, to the Executive any Other Benefits (as defined in Section 6).

(b)       Death. If the Executive’s employment is terminated by reason of the Executive’s death during the Employment Period, Taubman shall provide, or shall cause one of the Affiliated Companies to provide, the Executive’s estate or beneficiaries with the Accrued Obligations and the timely payment or delivery of the Other Benefits, and shall have no other severance obligations under this Agreement. The Accrued Obligations shall be paid to the Executive’s estate or beneficiary, as applicable, in a lump sum in cash within 30 days of the Date of Termination. With respect to the provision of the Other Benefits, the term “Other Benefits” as utilized in this Section 5(b) shall include, without limitation, and the Executive’s estate and/or beneficiaries shall be entitled to receive, benefits at least equal to the most favorable benefits provided by the Company to the estates and beneficiaries of peer executives of the Company under such plans, programs, practices and policies relating to death benefits, if any, as in effect with respect to other peer executives and their beneficiaries at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive’s estate and/or the Executive’s beneficiaries, as in effect on the date of the Executive’s death with respect to other peer executives of the Company and their beneficiaries.

(c)       Disability. If the Executive’s employment is terminated by Taubman by reason of the Executive’s Disability during the Employment Period, Taubman shall provide, or shall cause one of the Affiliated Companies to provide, the Executive with the Accrued Obligations and the timely payment or delivery of the Other Benefits, and shall have no other severance obligations under this Agreement. The Accrued Obligations shall be paid to the Executive in a lump sum in cash within 30 days of the Date of Termination. With respect to the provision of the Other Benefits, the term “Other Benefits” as utilized in this Section 6(c) shall include, and the Executive shall be entitled after the Disability Effective Date to receive, disability and other benefits at least equal to the most favorable of those generally provided by the Company to disabled executives and/or their families in accordance with such plans, programs, practices and policies relating to disability, if any, as in effect generally with respect to other peer executives and their families at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive and/or the Executive’s family, as in effect at any time thereafter generally with respect to other peer executives of the Company and their families.

(d)       Cause; Other Than for Good Reason. If the Executive’s employment is terminated by Taubman for Cause during the Employment Period, Taubman shall provide to the Executive, or shall cause one of the Affiliated Companies to provide to Executive, (1) the Executive’s Annual Base Salary through the Date of Termination, (2) the amount of any compensation previously deferred by the Executive, and (3) the Other Benefits, in each case, to the extent theretofore unpaid, and shall have no other severance obligations under this Agreement. If the Executive voluntarily terminates employment during the Employment Period, excluding a termination for Good Reason, Taubman shall provide to the Executive, or shall cause one of the Affiliated Companies to provide to the Executive, the Accrued Obligations and the timely payment or delivery of the Other Benefits, and shall have no other severance obligations under

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this Agreement. In such case, all the Accrued Obligations shall be paid to the Executive in a lump sum in cash within 30 days of the Date of Termination.

Section 6.Non-exclusivity of Rights. Nothing in this Agreement shall prevent or limit the Executive’s continuing or future participation in any plan, program, policy or practice provided by the Company and for which the Executive may qualify, nor, subject to Section 11(f), shall anything herein limit or otherwise affect such rights as the Executive may have under any other contract or agreement with the Company. Amounts that are vested benefits or that the Executive is otherwise entitled to receive under any plan, policy, practice or program of or any other contract or agreement with Taubman or any of the Affiliated Companies at or subsequent to the Date of Termination (“Other Benefits”) shall be payable in accordance with such plan, policy, practice or program or contract or agreement, except as explicitly modified by this Agreement. Notwithstanding the foregoing, if the Executive receives payments and benefits pursuant to Section 5(a) of this Agreement, the Executive shall not be entitled to any severance pay or benefits under any severance plan, program or policy of the Company, unless otherwise specifically provided therein in a specific reference to this Agreement.

Section 7.Full Settlement. Taubman’s obligation to make or cause one of the Affiliated Companies to make the payments provided for in this Agreement and otherwise to perform its obligations hereunder shall not be affected by any set-off, counterclaim, recoupment, defense, or other claim, right or action that the Company may have against the Executive or others. In no event shall the Executive be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to the Executive under any of the provisions of this Agreement, and such amounts shall not be reduced whether or not the Executive obtains other employment. Taubman shall pay, or cause one of the Affiliated Companies to pay, as incurred (within 15 days following Taubman’s receipt of an invoice from the Executive), to the full extent permitted by law, all legal fees and expenses that the Executive may reasonably incur as a result of any contest (regardless of the outcome thereof) by Taubman, any of the Affiliated Companies, the Executive or others of the validity or enforceability of, or liability under, any provision of this Agreement or any guarantee of performance thereof (including as a result of any contest by the Executive about the amount of any payment pursuant to this Agreement), plus, in each case, interest on any delayed payment at the applicable federal rate provided for in Section 7872(f)(2)(A) of the Internal Revenue Code of 1986, as amended (the “Code”).

Section 8. Reduction of Payments.

(a)       For purposes of this Section 8: (i) a “Payment” shall mean any payment or distribution in the nature of compensation to or for the benefit of the Executive, whether paid or payable pursuant to this Agreement or otherwise; (ii) “Separation Payment” shall mean a Payment paid or payable pursuant to this Agreement (disregarding this Section); (iii) “Present Value” shall mean such value determined in accordance with Sections 280G(b)(2)(A)(ii) and 280G(d)(4) of the Code; and (iv) “Reduced Amount” shall mean an amount expressed in Present Value that maximizes the aggregate Present Value of Separation Payments without causing any Payment to be nondeductible because of Section 280G of the Code.

(b)       Taubman shall select, in its discretion, a nationally recognized accounting firm (the “Accounting Firm”) to make the determinations contemplated by this Section

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4(g). Anything in the Plan to the contrary notwithstanding, in the event that the Accounting Firm determines that receipt of all Payments would subject the Participant to tax under Section 4999 of the Code, the aggregate Separation Payments shall be reduced (but not below zero) to meet the definition of Reduced Amount.

(c)       If the Accounting Firm determines that aggregate Separation Payments should be reduced to the Reduced Amount, Taubman shall promptly give the Executive notice to that effect and a copy of the detailed calculation thereof, and the Executive may then elect, in his or her sole discretion, which and how much of the Separation Payments shall be eliminated or reduced (as long as after such election the Present Value of the aggregate Separation Payments equals the Reduced Amount), and shall advise Taubman in writing of his or her election within ten days of his or her receipt of notice. If no such election is made by the Executive within such ten-day period, Taubman may elect which of such Separation Payments shall be eliminated or reduced (as long as after such election the Present Value of the aggregate Separation Payments equals the Reduced Amount) and shall notify the Executive promptly of such election. All determinations made by the Accounting Firm under this Section shall be binding upon Taubman and the Affiliated Companies and the Executive and shall be made within 60 days of a termination of employment of the Executive. As promptly as practicable following such determination, Taubman shall pay or distribute, or shall cause one of the Affiliated Companies to pay or distribute, to or for the benefit of the Executive such Separation Payments as are then due to the Executive under this Agreement, and shall promptly pay or distribute, or cause to be paid or distributed, to or for the benefit of the Executive in the future such Separation Payments as become due to the Executive under this Agreement.

(d)       As a result of the uncertainty in the application of Section 4999 of the Code at the time of the initial determination by the Accounting Firm hereunder, it is possible that amounts will have been paid or distributed to or for the benefit of the Executive pursuant to this Agreement which should not have been so paid or distributed (“Overpayment”) or that additional amounts which will have not been paid or distributed to or for the benefit of the Executive pursuant to this Agreement could have been so paid or distributed (“Underpayment”), in each case, consistent with the calculation of the Reduced Amount hereunder. In the event that the Accounting Firm, based upon the assertion of a deficiency by the Internal Revenue Service against Taubman or any of the Affiliated Companies or the Executive which the Accounting Firm believes has a high probability of success determines that an Overpayment has been made, any such Overpayment paid or distributed to or for the benefit of the Executive shall be repaid by the Executive; provided, however, that no such payment shall be made by the Executive if and to the extent such payment would neither reduce the amount on which the Executive is subject to tax under Section 1 and Section 4999 of the Code or generate a refund of such taxes. In the event that the Accounting Firm, based upon controlling precedent or substantial authority, determines that an Underpayment has occurred, any such Underpayment shall be promptly paid to or for the benefit of the Executive together with interest at the applicable federal rate provided for in Section 7872(f)(2) of the Code.

(e)                 All fees and expenses of the Accounting Firm in implementing the provisions of this Section 8 shall be borne by the Company.

Section 9.Confidential Information. The Executive shall hold in a fiduciary capacity for the benefit of the Company all secret or confidential information, knowledge or data relating to Taubman or any of the Affiliated Companies, and their respective busi

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nesses, which information, knowledge or data shall have been obtained by the Executive during the Executive’s employment by the Company and which information, knowledge or data shall not be or become public knowledge (other than by acts by the Executive or representatives of the Executive in violation of this Agreement). After termination of the Executive’s employment with the Company, the Executive shall not, without the prior written consent of Taubman or as may otherwise be required by law or legal process, communicate or divulge any such information, knowledge or data to anyone other than the Company and those persons designated by the Company. In no event shall an asserted violation of the provisions of this Section 9 constitute a basis for deferring or withholding any amounts otherwise payable to the Executive under this Agreement.

Section 10.Successors. (a) This Agreement is personal to the Executive, and, without the prior written consent of Taubman, shall not be assignable by the Executive other than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive’s legal representatives.

(b)      This Agreement shall inure to the benefit of and be binding upon Taubman and its successors and assigns. Except as provided in Section 10(c), without the prior written consent of the Executive this Agreement shall not be assignable by Taubman.

(c)       Each of Taubman and TRG will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of its business and/or assets to assume expressly and agree to perform this Agreement in the same manner and to the same extent that it would be required to perform it if no such succession had taken place. “Taubman” means Taubman as hereinbefore defined and any successor to its business and/or assets as aforesaid that assumes and agrees to perform this Agreement by operation of law or otherwise. “TRG” means TRG as hereinbefore defined and any successor to its business and/or assets as aforesaid that assumes and agrees to perform this Agreement by operation of law or otherwise.

Section 11.Miscellaneous. (a) This Agreement shall be governed by and construed in accordance with the laws of the State of Michigan, without reference to principles of conflict of laws. The captions of this Agreement are not part of the provisions hereof and shall have no force or effect. This Agreement may not be amended or modified other than by a written agreement executed by the parties hereto or their respective successors and legal representatives.

(b)      All notices and other communications hereunder shall be in writing and shall be given by hand delivery to the other party or by registered or certified mail, return receipt requested, postage prepaid, addressed as follows:

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if to the Executive:

At the most recent address on file at the Company.

if to Taubman:

Taubman Centers, Inc.

200 East Long Lake Road

Suite 300

Bloomfield Hills, Michigan 48304

Attention: General Counsel

if to TRG:

Taubman Realty Group Limited Partnership

200 East Long Lake Road

Suite 300

Bloomfield Hills, Michigan 48304

Attention: General Counsel

or to such other address as either party shall have furnished to the other in writing in accordance herewith. Notice and communications shall be effective when actually received by the addressee.

(c)       The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement.

(d)       Taubman may withhold or cause to be withheld from any amounts payable under this Agreement such United States federal, state or local or foreign taxes as shall be required to be withheld pursuant to any applicable law or regulation.

(e)       The Executive’s or Taubman’s failure to insist upon strict compliance with any provision of this Agreement or the failure to assert any right the Executive or Taubman may have hereunder, including, without limitation, the right of the Executive to terminate employment for Good Reason pursuant to Sections 4(c)(1) through 4(c)(5), shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.

(f)        The Executive, Taubman and TRG acknowledge that, except as may otherwise be provided under any other written agreement between the Executive and Taubman or any of the Affiliated Companies, the employment of the Executive by the Company is “at will” and, subject to Section 1(a), prior to the Effective Date, the Executive’s employment may be terminated by either the Executive or the Company at any time prior to the Effective Date, in which case the Executive shall have no further rights under this Agreement. From and after the Effective Date, except as specifically provided herein, this Agreement shall supersede any other agreement between the parties with respect to the subject matter hereof.

Section 12.Guarantee. TRG hereby irrevocably, absolutely and unconditionally guarantees the payment of all compensation and benefits (the “Benefits”) that Taubman is obligated to provide or cause to be provided to the Executive under this Agreement. This is

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a guarantee of payment and not a collection, and is the primary obligation of TRG, and the Executive may enforce this guarantee against TRG without any prior enforcement of the obligation to make the Benefits against Taubman.

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IN WITNESS WHEREOF, the Executive has hereunto set the Executive’s hand and, pursuant to the authorization from the Board, Taubman and TRG have each caused these presents to be executed in its name on its behalf, all as of the day and year first above written.

[Executive]

____________________________________

TAUBMAN CENTERS INC.

As guarantor of Taubman Centers Inc.:

____________________________________

TAUBMAN REALTY GROUP LIMITED

PARTNERSHIP

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EX-12

Exhibit 12

TAUBMAN CENTERS, INC.

Computation of Ratios of Earnings to Combined Fixed Charges and Preferred Dividends
(in thousands, except ratios)

	Three Months Ended March 31
	2005			2004
Earnings before income from equity investees	$	9,146		$	9,609
Add back:
Fixed charges	$	29,213		$	26,439
Amortization of previously capitalized interest		911			861
Distributed income of Unconsolidated Joint Ventures		9,070			9,593
Deduct:
Capitalized interest		(2,377	)		(1,100	)
Preferred distributions		(615	)		(2,250	)
Earnings available for fixed charges and preferred dividends	$	45,348		$	43,152
Fixed Charges:
Interest expense	$	25,540		$	22,572
Capitalized interest		2,377			1,100
Interest portion of rent expense		681			517
Preferred distributions		615			2,250
Total fixed charges	$	29,213		$	26,439
Preferred dividends		6,150			4,150
Total fixed charges and preferred dividends	$	35,363		$	30,589
Ratio of earnings to fixed charges and preferred dividends		1.3			1.4

EX-31

Exhibit 31 (a)

Certification of Chief Executive Officer

Pursuant to 15 U.S.C. Section 10A, as Adopted Pursuant to

Section 302 of the Sarbanes-Oxley Act of 2002

I, Robert S. Taubman, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Taubman Centers, Inc.;

2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e))and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting, which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:May 4, 2005

/s/ Robert S. Taubman
Robert S. Taubman

Chairman of the Board of Directors, President, and Chief Executive Officer

EX-31

Exhibit 31 (b)

Certification of Chief Financial Officer

Pursuant to 15 U.S.C. Section 10A, as Adopted Pursuant to

Section 302 of the Sarbanes-Oxley Act of 2002

I, Lisa A. Payne, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Taubman Centers, Inc.;

2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting, which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: May 4, 2005	/s/ Lisa A. Payne
	Lisa A. Payne
	Executive Vice President, Chief Financial and Administrative Officer

EX-32

Exhibit 32 (a)

Certification of Chief Executive Officer
Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002

        I, Robert S. Taubman, Chief Executive Officer of Taubman Centers, Inc. (the “Registrant”), certify that based upon a review of the Quarterly Report on Form 10-Q for the period ended March 31, 2005 (the “Report”):

(i) The Report fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934, as amended; and

(ii) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

/s/ Robert S. Taubman	Date:	May 4, 2005
Robert S. Taubman
Chairman of the Board of Directors,
President, and Chief Executive Officer

EX-32

Exhibit 32 (b)

Certification of Chief Financial Officer
Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002

        I, Lisa A. Payne, Chief Financial Officer of Taubman Centers, Inc. (the "Registrant"), certify that based upon a review of the Quarterly Report on Form 10-Q for the period ended March 31, 2005 (the "Report"):

(i) The Report fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934, as amended; and

(ii) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

/s/ Lisa A. Payne	Date:	May 4, 2005
Lisa A. Payne
Executive Vice President, Chief Financial Officer
and Administrative Officer

EX-99

Exhibit 99

MORTGAGE AND OTHER NOTES PAYABLE
INCLUDING WEIGHTED INTEREST RATES AT MARCH 31, 2005

		100%	Beneficial Interest	Effective Rate	(a)	LIBOR Rate
		3/31/05	3/31/05	3/31/05		Spread	2005	2006	2007	2008	2009	2010	2011	2012	2013	2014	Total
Consolidated Fixed Rate Debt:
Beverly Center Great Lakes Crossing International Plaza MacArthur Center Regency Square Stony Point Fashion Park The Mall at Short Hills	50.10% 95.00%	347.5 146.9 184.5 142.7  79.6 114.2 261.0	347.5 146.9  92.2 135.8  79.6 114.2 261.0	5.28%  5.25%  4.39%  6.84%  6.75%  6.24%  6.70%	(b) (c)		1.6 1.2 1.8 0.7 0.9 2.6	3.9 2.3 1.6 2.6 1.1 1.4 3.7	4.8 2.5 1.7 2.7 1.1 1.5 4.0	5.0 2.6 87.7 2.8 1.2 1.5 4.2	5.4   2.7       3.0   1.3   1.6 246.4	5.7   2.9     122.9   1.4   1.8	6.0  3.0          72.8  1.9	6.3 3.2 2.0	6.6 126.0 2.1	303.8     99.5	347.5 146.9  92.2 135.8  79.6 114.2 261.0
Total Consolidated Fixed Weighted Rate Consolidated Floating Rate Debt: Dolphin Mall Northlake Oyster Bay The Mall at Wellington Green The Shops at Willow Bend The Shops at Willow Bend TRG Revolving Credit TRG Revolving Credit	90.00%	1,276.4 5.79% 142.9  54.8  46.1 140.0  97.6  48.8  10.6 135.0	1,177.2 5.89% 142.9  54.8  46.1 126.0  97.6  48.8   10.6 135.0	4.96% 4.47% 4.69% 6.22% 4.31% 6.56% 3.63% 3.49%	(d) (e) (e) (f) (g) (h) (i) (e)	2.15% 1.75% 2.00% 1.50% 1.50% 3.75%        0.80%	8.9 6.11%   1.6  46.1        1.2   0.6	16.5 5.92% 141.3 (j)                   96.4  48.2	18.3 5.90%  (k)              54.8   126.0  (l)               (l)	105.1 4.67%        (l)                                                   10.6     135.0	260.5 6.65%                                           (m)	134.6 6.73%	83.7 6.58%	11.4 5.44%	134.8 5.27%	403.3 5.52%	1,177.2 142.9  54.8  46.1 126.0  97.6  48.8   10.6 135.0
Total Consolidated Floating Weighted Rate Total Consolidated Weighted Rate		675.9   4.52% 1,952.3   5.35%	661.8   4.84% 1,839.0   5.52%				49.5 4.71% 58.4 4.93%	285.9 5.01% 302.5 5.06%	180.8 5.69% 199.1 5.71%	145.6 3.50% 250.8 3.99%	260.5 6.65%	134.6 6.73%	83.7 6.58%	11.4 5.44%	134.8 5.27%	403.3 5.52%	661.8 1,839.0
Joint Ventures Fixed Rate Debt:
Arizona Mills Cherry Creek Fair Oaks Mall at Millenia Sunvalley Westfarms Mall	50.00% 50.00% 50.00% 50.00% 50.00% 78.94%	140.6 175.7 140.0 210.0 131.3 203.4	70.3  87.8  70.0 105.0  65.6 160.6	7.90% 7.68% 6.60% 5.46% 5.67% 6.10%			0.6 0.8         0.8 1.6	0.8 87.0            1.0  2.3	0.9             1.0 2.4	0.9      70.0  0.9  1.1  2.6	1.0         1.4 1.2 2.7	66.0            1.5  1.2  2.9	1.6 1.3 3.1	1.6  58.1 142.9	98.1		70.3  87.8  70.0 105.0  65.6 160.6
Total Joint Venture Fixed Weighted Rate Joint Ventures Floating Rate Debt: Other		1,001.0   6.51%     5.0	559.3 6.47%   2.7	5.32%			3.8 6.65%   0.7	91.1 7.62%   0.8	4.3 6.36%   0.6	75.5 6.57%   0.3	6.3 6.17%   0.3	71.6 7.73%	6.0 5.84%	202.7 5.97%	98.1 5.46%		559.3   2.7
Total Joint Venture Floating Weighted Rate Total Joint Venture Weighted Rate		5.0 5.32% 1,006.0   6.50%	2.7 5.32% 562.0 6.46%				0.7 5.32%   4.4 6.46%	0.8 5.32%  91.9 7.60%	0.6 5.32%   5.0 6.23%	0.3 5.32%  75.7 6.57%	0.3 5.32%   6.6 6.14%	71.6 7.73%	6.0 5.84%	202.7 5.97%	98.1 5.46%		2.7  562.0
TRG Beneficial Interest Totals Fixed Rate Debt                                 Floating Rate Debt                                 Total		2,277.4    6.11%    680.9    4.52%  2,958.3    5.74%	1,736.5    6.08%    664.5    4.84%  2,401.0    5.74% Average Maturity		5.75 =====		12.7 6.27%  50.1 4.72% 62.8 5.03%	107.6 7.36% 286.8 5.01% 394.4 5.65%	22.6 5.99% 181.4 5.69% 204.0 5.72%	180.6 5.46% 145.9 3.50% 326.5 4.59%	266.8 6.64% 0.3 5.32% 267.1 6.64%	206.2 7.08%    206.2 7.08%	89.7 6.53%     89.7 6.53%	214.1 5.94%    214.1 5.94%	232.9 5.35%    232.9 5.35%	403.3 5.52%    403.3 5.52%	1,736.5  664.5 2,401.0

(a) Includes the impact of interest rate swaps but does not include effect of amortization of debt issuance costs, losses on settlement of derivatives used to hedge the refinancing of certain fixed rate debt, or interest rate cap premiums.

(b) Debt is reduced by $.4 million of purchase accounting discount from acquisition which increases the stated rate on the debt of 4.21% to an effective rate of 4.39%.

(c) Debt includes $4.1 million of purchase accounting premium from acquisition which reduces the stated rate on the debt of 7.59% to an effective rate of 6.84%.

(d) The debt is floating month to month at LIBOR plus spread and the entire debt balance is capped at 7% plus spread.

(e) LIBOR rate floats month to month.

(f) $100 million of this debt is swapped to 5.25% plus spread to May 2005. The remainder is floating month to month at LIBOR plus spread.

(g) LIBOR rate is floating month to month. $96.4 million of this debt is capped at 4.6% plus spread to July 2006.

(h) LIBOR rate is floating month to month. $48.2 million of this debt is capped at 5.75% plus spread to July 2006.

(i) Rate floats daily.

(j) If construction commences prior to 12/31/05, the maturity date is automatically extended from 12/31/05 to three years from the commencement of construction.

(k) Maturity date may be extended for a total of 3 years.

(l) Maturity date may be extended for a total of 2 years.

(m) Maturity date may be extended for 1 year.

(n) Amounts in this table may not add due to rounding.