Simon Malls | More Choices®

INDIANAPOLIS, Dec. 23 /PRNewswire-FirstCall/ -- Simon Property Group, Inc. (NYSE: SPG) and SMP Interests, Inc. announced today that they have entered into a definitive agreement to jointly own and operate the Gateway Shopping Centers in Austin, Texas. This transaction, which is subject to customary closing conditions, is expected to be completed in the first quarter of 2004.

The Gateway Shopping Centers are a 484,000 square-foot complex consisting of Gateway Square, Gateway Market, Gateway Courtyard, and Gateway Cinema. Gateway is located at the confluence of Mo-Pac Expressway (Loop 1), Research Boulevard (Highway 183), and Capital of Texas Highway (Loop 360) -- three of the major arterial roads in Austin. It is located across from The Arboretum, a 200,000 square foot high-end specialty retail center owned by Simon, and near the planned Shops at Arbor Walk, to be developed by Simon on land owned by the University of Texas. These three centers will give Simon a powerful presence in this important consumer area of Austin.

Gateway is anchored by Whole Foods, REI, Regal Cinema, Best Buy, Linens N Things, The Container Store, Comp USA, Star Furniture and Old Navy. The legendary homeware retailer Crate & Barrel is scheduled to open a 35,000 square foot, two-story store at Gateway. Crate & Barrel projects a late 2004 opening.

"We are very excited to add Gateway Shopping Center to our Austin holdings," said Myles Minton, senior vice president of SPG. "Simon Property Group has a significant interest in the Austin market and Gateway is another prime property for us in Central Texas." Simon will assume leasing, management and development responsibility for Gateway upon closing.

Mark Palmer, president and founder of SMP Interests, Inc. developed Gateway Shopping Centers in phases from 1993 to 1996. Mr. Palmer has continued to improve and upgrade the property since then. It is currently 99% leased and has enjoyed an average historical occupancy over the past five years of 95%.

"By partnering with someone as strong as Simon Property Group," Palmer said, "we believe Gateway Shopping Centers can improve and expand to its fullest potential over time."

Simon Property Group, Inc. (NYSE: SPG), headquartered in Indianapolis, Indiana, is a real estate investment trust engaged in the ownership and management of income-producing properties, primarily regional malls and community shopping centers. Through its subsidiary partnerships, it currently owns or has an interest in 245 properties containing an aggregate of 190 million square feet of gross leasable area in 37 states. The Company also holds interests in nine assets in Europe and Canada and ownership interests in other real estate assets. In Austin, SPG owns the Lakeline Mall, Barton Creek Square, The Arboretum, as well as an interest in Highland Mall. Additional Simon Property Group information is available at www.simon.com .

SOURCE Simon Property Group, Inc.

CONTACT: Les Morris of Simon Property Group, +1-317-263-7711; or Mark Palmer of SMP Interests, Inc., +1-512-418-1144/