Businessweek

company transferred 50% of its 60% interest in a development property located in Tijuana, Baja California, Mexico. In August 2006, the company sold 50% of its 100% interest in a development property located in Monterrey, Mexico. The company accounts for its remaining 50% non-controlling interest under the equity method of accounting. In November 2006, the company acquired an operating property in Mexicali, Baja California, Mexico, comprising approximately 0.1 million square feet of GLA. During 2006, the company acquired, in separate transactions, ten operating properties, through a joint venture in which the Company has a 50% non-controlling interest. During 2006, the company acquired, in separate transactions, nine parcels of land in various cities throughout Mexico. The properties were at various stages of construction at acquisition and would be developed into retail centers aggregating approximately 3.4 million square feet. Other Real Estate Investments Kimsouth As of January 1, 2006, Kimsouth consisted of five properties. Properties Real Estate Portfolio As of January 1, 2007, the company’s real estate portfolio comprises interests in approximately 138.0 million square feet of GLA (not including 36 properties under development comprising 3.5 million square feet of GLA related to the Preferred Equity program, 38 property interests comprising 0.7 million square feet of GLA related to FNC Realty, 61 property interests comprising 6.4 million square feet of GLA related to the American Industries portfolio, 51 property interests comprising 2.5 million square feet of GLA related to the NewKirk Portfolio and 22.4 million square feet of planned GLA for the 77 ground-up development projects and undeveloped land parcels) in 1,061 operating properties primarily consisting of neighborhood and community shopping centers, and 20 retail store leases located in 45 states, Canada, Mexico and Puerto Rico. The company’s neighborhood and community shopping center properties, generally owned and operated through subsidiaries or joint ventures, had an average size of approximately 131,000 square feet as of January 1, 2007. The company’s neighborhood and community shopping centers are usually anchored by a national or regional discount department store, supermarket or drugstore. The company's major tenants include The Home Depot, TJX Companies, Sears Holdings, Kohl’s, Wal-Mart, Value City, Linens N Things, Burlington Coat, Royal Ahold and Costco. Retail Store Leases In addition to neighborhood and community shopping centers, as of January 1, 2007, the company had interests in retail store leases totaling approximately 1.8 million square feet of anchor stores in 20 neighborhood and community shopping centers located in 14 states. As of January 1, 2007, approximately 99.8% of the space in these anchor stores had been sublet to retailers that lease the stores under net lease agreements. Ground-Leased Properties The company has interests in 83 shopping center properties that are subject to long-term ground leases where a third party owns and has leased the underlying land to the company (or an affiliated joint venture) to construct and/or operate a shopping center. The company or the joint venture pays rent for the use of the land and generally is responsible for all costs and expenses associated with the building and improvements. Ground-Up Development Properties The company engages in ground-up development projects which consists of merchant building through the company’s wholly-owned taxable REIT subsidiary KDI, which develops neighborhood and community shopping centers and the subsequent sale thereof upon completion, U.S. ground-up development projects which would be held as long-term investments by the company and various ground-up development projects located in Mexico and Canada. As of December 31, 2006, the company had in progress a total of 45 ground-up development projects including 23 merchant building projects, six domestic ground-up development projects, and 16 ground-up development projects located throughout Mexico. Undeveloped Land The company owns certain unimproved la