Investments in Unconsolidated Joint Ventures:

6 Months Ended

Jun. 30, 2013

Investments in Unconsolidated Joint Ventures:

Investments in Unconsolidated Joint Ventures:

4. Investments in Unconsolidated Joint Ventures:

        During 2012 and 2013, the Company made the following investments and dispositions relating to its unconsolidated joint ventures:

        On March 30, 2012, the Company sold its 50% ownership interest in Chandler Village Center, a 273,000 square foot community center in Chandler, Arizona, for a total sales price of $14,795, resulting in a gain on sale of assets of $8,184 that was included in gain on remeasurement, sale or write down of assets, net during the six months ended June 30, 2012. The sales price was funded by a cash payment of $6,045 and the assumption of the Company's share of the mortgage note payable on the property of $8,750. The Company used the cash proceeds from the sale to pay down its line of credit and for general corporate purposes.

        On March 30, 2012, the Company sold its 50% ownership interest in Chandler Festival, a 500,000 square foot community center in Chandler, Arizona, for a total sales price of $30,975, resulting in a gain on sale of assets of $12,347 that was included in gain on remeasurement, sale or write down of assets, net during the six months ended June 30, 2012. The sales price was funded by a cash payment of $16,183 and the assumption of the Company's share of the mortgage note payable on the property of $14,792. The Company used the cash proceeds from the sale to pay down its line of credit and for general corporate purposes.

        On March 30, 2012, the Company's joint venture in SanTan Village Power Center, a 491,000 square foot community center in Gilbert, Arizona, sold the property for $54,780, resulting in a gain on sale of assets to the joint venture of $23,294. The cash proceeds from the sale were used to pay off the $45,000 mortgage loan on the property and the remaining $9,780 was distributed to the partners. The Company's share of the gain recognized was $11,502, which was included in equity in income of unconsolidated joint ventures during the six months ended June 30, 2012, offset in part by $3,565, which was included in net income attributable to noncontrolling interests during the six months ended June 30, 2012. The Company used its share of the proceeds to pay down its line of credit and for general corporate purposes.

        On May 31, 2012, the Company sold its 50% ownership interest in Chandler Gateway, a 260,000 square foot community center in Chandler, Arizona, for a total sales price of $14,315, resulting in a gain on sale of assets of $3,363 that was included in gain on remeasurement, sale or write down of assets, net during the six months ended June 30, 2012. The sales price was funded by a cash payment of $4,921 and the assumption of the Company's share of the mortgage note payable on the property of $9,394. The Company used the cash proceeds from the sale to pay down its line of credit and for general corporate purposes.

        On August 10, 2012, the Company was bought out of its ownership interest in NorthPark Center, a 1,946,000 square foot regional shopping center in Dallas, Texas, for $118,810, resulting in a gain of $24,590. The Company used the cash proceeds to pay down its line of credit.

        On October 3, 2012, the Company acquired the remaining 75% ownership interest in FlatIron Crossing, a 1,425,000 square foot regional shopping center in Broomfield, Colorado, that it did not own for $310,397. The purchase price was funded by a cash payment of $195,900 and the assumption of the third party's share of the mortgage note payable on the property of $114,497. Prior to the acquisition, the Company had accounted for its investment in FlatIron Crossing under the equity method. Since the date of acquisition, the Company has included FlatIron Crossing in its consolidated financial statements (See Note 14—Acquisitions).

        On October 26, 2012, the Company acquired the remaining 33.3% ownership interest in Arrowhead Towne Center, a 1,196,000 square foot regional shopping center in Glendale, Arizona, that it did not own for $144,400. The purchase price was funded by a cash payment of $69,025 and the assumption of the third party's pro rata share of the mortgage note payable on the property of $75,375. Prior to the acquisition, the Company had accounted for its investment in Arrowhead Towne Center under the equity method. Since the date of acquisition, the Company has included Arrowhead Towne Center in its consolidated financial statements (See Note 14—Acquisitions).

        On May 29, 2013, the Company's joint venture in Pacific Premier Retail LP sold Redmond Town Center Office, a 582,000 square foot office building in Redmond, Washington, for $185,000, resulting in a gain on the sale of assets of $89,183 to the joint venture. The Company's share of the gain was $44,438, which was included in equity in income of unconsolidated joint ventures during the three and six months ended June 30, 2013. The Company used its share of the proceeds to pay down its line of credit and for general corporate purposes.

        On June 12, 2013, the Company's joint venture in Pacific Premier Retail LP sold Kitsap Mall, a 846,000 square foot regional shopping center in Silverdale, Washington, for $127,000, resulting in a gain on the sale of assets of $55,166 to the joint venture. The Company's share of the gain was $28,135, which was included in equity in income of unconsolidated joint ventures during the three and six months ended June 30, 2013. The Company used its share of the proceeds to pay down its line of credit and for general corporate purposes.

        Combined condensed balance sheets and statements of operations are presented below for all unconsolidated joint ventures.

Combined Condensed Balance Sheets of Unconsolidated Joint Ventures:

	June 30, 2013			December 31, 2012
Assets(1):
Properties, net	$	3,534,985		$	3,653,631
Other assets		338,541			411,862
Total assets	$	3,873,526		$	4,065,493
Liabilities and partners' capital(1):
Mortgage notes payable(2)	$	3,151,636		$	3,240,723
Other liabilities		181,254			148,711
Company's capital		236,045			304,477
Outside partners' capital		304,591			371,582
Total liabilities and partners' capital	$	3,873,526		$	4,065,493
Investments in unconsolidated joint ventures:
Company's capital	$	236,045		$	304,477
Basis adjustment(3)		511,147			516,833
	$	747,192		$	821,310
Assets—Investments in unconsolidated joint ventures	$	949,726		$	974,258
Liabilities—Distributions in excess of investments in unconsolidated joint ventures		(202,534	)		(152,948	)
	$	747,192		$	821,310

(1)

These amounts include the assets and liabilities of the following joint ventures as of June 30, 2013 and December 31, 2012:

	Pacific Premier Retail LP		Tysons Corner LLC
As of June 30, 2013:
Total Assets	$	882,490	$	467,632
Total Liabilities	$	815,322	$	337,804
As of December 31, 2012:
Total Assets	$	1,039,742	$	409,622
Total Liabilities	$	942,370	$	329,145

(2)

Certain mortgage notes payable could become recourse debt to the Company should the joint venture be unable to discharge the obligations of the related debt. As of June 30, 2013 and December 31, 2012, a total of $51,130 and $51,171, respectively, could become recourse debt to the Company. As of June 30, 2013 and December 31, 2012, the Company has indemnity agreements from joint venture partners for $21,270 of the guaranteed amount.

Included in mortgage notes payable are amounts due to affiliates of Northwestern Mutual Life ("NML") of $433,641 and $436,857 as of June 30, 2013 and December 31, 2012, respectively. NML is considered a related party because it is a joint venture partner with the Company in Macerich Northwestern Associates—Broadway Plaza. Interest expense incurred on these borrowings amounted to $6,854 and $10,939 for the three months ended June 30, 2013 and 2012, respectively, and $13,797 and $21,994 for the six months ended June 30, 2013 and 2012, respectively.

(3)

The Company amortizes the difference between the cost of its investments in unconsolidated joint ventures and the book value of the underlying equity into income on a straight-line basis consistent with the lives of the underlying assets. The amortization of this difference was $3,331 and $3,132 for the three months ended June 30, 2013 and 2012, respectively, and $5,893 and $3,075 for the six months ended June 30, 2013 and 2012, respectively.

Combined Condensed Statements of Operations of Unconsolidated Joint Ventures:

	Pacific Premier Retail LP			Tysons Corner LLC		Other Joint Ventures			Total
Three Months Ended June 30, 2013
Revenues:
Minimum rents	$	31,221		$	15,685	$	59,969		$	106,875
Percentage rents		594			180		2,936			3,710
Tenant recoveries		14,486			11,697		26,688			52,871
Other		1,643			652		11,367			13,662
Total revenues		47,944			28,214		100,960			177,118
Expenses:
Shopping center and operating expenses		14,269			8,519		34,790			57,578
Interest expense		11,293			1,784		20,929			34,006
Depreciation and amortization		10,720			4,501		23,299			38,520
Total operating expenses		36,282			14,804		79,018			130,104
Gain on remeasurement, sale or write down of assets, net		144,349			—		891			145,240
Net income	$	156,011		$	13,410	$	22,833		$	192,254
Company's equity in net income	$	78,426		$	5,161	$	8,614		$	92,201
Three Months Ended June 30, 2012
Revenues:
Minimum rents	$	32,459		$	15,962	$	85,685		$	134,106
Percentage rents		771			233		3,027			4,031
Tenant recoveries		14,402			10,814		41,750			66,966
Other		1,261			669		9,780			11,710
Total revenues		48,893			27,678		140,242			216,813
Expenses:
Shopping center and operating expenses		14,148			8,560		52,938			75,646
Interest expense		13,213			3,043		37,323			53,579
Depreciation and amortization		10,559			5,109		31,377			47,045
Total operating expenses		37,920			16,712		121,638			176,270
Loss on remeasurement, sale or write down of assets, net		(10	)		—		(14	)		(24	)
Net income	$	10,963		$	10,966	$	18,590		$	40,519
Company's equity in net income	$	5,577		$	4,302	$	8,812		$	18,691
Six Months Ended June 30, 2013
Revenues:
Minimum rents	$	64,353		$	31,182	$	120,930		$	216,465
Percentage rents		1,583			746		4,238			6,567
Tenant recoveries		28,440			22,721		53,900			105,061
Other		2,894			1,570		18,780			23,244
Total revenues		97,270			56,219		197,848			351,337
Expenses:
Shopping center and operating expenses		28,717			17,001		70,961			116,679
Interest expense		22,867			4,024		45,046			71,937
Depreciation and amortization		21,630			8,931		45,120			75,681
Total operating expenses		73,214			29,956		161,127			264,297
Gain on remeasurement, sale or write down of assets, net		144,349			—		701			145,050
Net income	$	168,405		$	26,263	$	37,422		$	232,090
Company's equity in net income	$	84,117		$	10,038	$	16,161		$	110,316
Six Months Ended June 30, 2012
Revenues:
Minimum rents	$	66,094		$	31,302	$	175,790		$	273,186
Percentage rents		1,734			633		6,317			8,684
Tenant recoveries		27,876			21,629		84,162			133,667
Other		2,527			1,346		18,360			22,233
Total revenues		98,231			54,910		284,629			437,770
Expenses:
Shopping center and operating expenses		28,310			17,074		108,861			154,245
Interest expense		26,501			6,064		76,446			109,011
Depreciation and amortization		21,021			10,185		62,430			93,636
Total operating expenses		75,832			33,323		247,737			356,892
(Loss) gain on remeasurement, sale or write down of assets, net		(10	)		—		22,976			22,966
Net income	$	22,389		$	21,587	$	59,868		$	103,844
Company's equity in net income	$	11,387		$	8,349	$	29,573		$	49,309

        Significant accounting policies used by the unconsolidated joint ventures are similar to those used by the Company.