1 of 6

Investment Overview:

We purchased Westgate Mall in San Jose, California in May 1995. The 645,000 sq. ft. enclosed mall was originally developed in 1960 with a classic dumbbell design anchored by two department stores. The mall began to struggle in the 1980's as two malls in the trade area greatly expanded and pulled tenants away. An $80 million renovation in 1988 failed to address its high vacancy which was primarily focused on the small shop tenants located in the mall's interior. As the economy soured in the early 1990's, the mall suffered further and the owners were unable to meet their debt obligations. The lender foreclosed two months prior to our purchase and we acquired the property at a 30% discount to the amount of the original note, well below intrinsic value.

Value Addition:

We focused on repositioning the mall as a power center and bringing in under-represented retail categories, such as books, electronics and sporting goods. We consolidated the interior shop space and raised the ceilings to create junior anchor spaces, adding Any Mountain Sporting Goods, Party City and Barnes & Noble. The center was further improved by replacing Home Express with Nordstrom Rack and Montgomery Ward with Target. Occupancy increased from 88% to 97%. We sold the shopping center in March 2004.