2009 ANNUAL REPORT 2009 ANNUAL REPORT CBL & ASSOCIATES PROPERTIES, INC. CORPORATE OFFICE CBL CENTER SUITE 500 2030 HAMILTON PLACE BLVD CHATTANOOGA, TN 37421-6000 (423) 855-0001 CBL & ASSOCIATES PROPERTIES, INC. PROPERTIES, CBL & ASSOCIATES 2009 BOSTON REGIONAL OFFICE WATERMILL CENTER SUITE 395 UNIFIED 800 SOUTH STREET 1978 COMMITMENT WALTHAM, MA 02453-1457 (781) 398-7100 DALLAS REGIONAL OFFICE CBL & ASSOCIATES PROPERTIES, INC. ATRIUM AT OFFICE CENTER 2009 ANNUAL REPORT SUITE 750 1320 GREENWAY DRIVE IRVING, TX 75038-2503 (214) 596-1195 ST. LOUIS REGIONAL OFFICE 1200 CHESTERFIELD MALL CHESTERFIELD, MO 63017-4841 (636) 536-0581 CBLPROPERTIES.COM CBL PROPERTIES ON THE COVER: Left to right, top to bottom: WEST COUNTY CENTER, ST. LOUIS, MO BROOKFIELD SQUARE, BROOKFIELD, WI PEARLAND TOWN CENTER, PEARLAND, TX GULF COAST TOWN CENTER, FT. MYERS, FL ARBOR PLACE, DOUGLASVILLE, GA FRIENDLY CENTER RETAIL COMPLEX, GREENSBORO, NC The 2009 CBL & Associates Properties, Inc. Annual Report saved the following resources by printing on paper containing 10% postconsumer recycled content. trees waste water energy solid waste greenhouse gases waterborne waste 4 1,664 2,773,890 184 362 11 fully grown gallons BTUs pounds pounds pounds SHAREHOLDER INFORMATION CORPORATE OFFICE FORM 10-K CBL & Associates Properties, Inc. Copies of the CBL & Associates Properties, Inc. Annual 2009 CBL Center, Suite 500 Report on Form 10-K are available, without charge, upon 2030 Hamilton Place Boulevard written request to: Chattanooga, TN 37421-6000 Katie Reinsmidt, Vice President – Corporate UNIFIED (423) 855-0001 Communications and Investor Relations COMMITMENT CBL & Associates Properties, Inc. 1978 TRANSFER AGENT AND REGISTRAR Computershare CBL Center, Suite 500 P.O. Box 43078 2030 Hamilton Place Boulevard Providence, RI 02940-3078 Chattanooga, TN 37421-6000 (800) 568-3476 ANNUAL MEETING OF SHAREHOLDERS The annual meeting of shareholders will be held on May 3, You learn a lot more in challenging times than when success comes easy. In 2009, at CBL & DIVIDEND REINVESTMENT PLAN Shareholders of record may automatically reinvest their 2010, at 4:00 P.M. (EDT) at The Chattanoogan, 1201 South Associates Properties, Inc., we learned how deep the commitment to success is that we share dividends in additional shares of our Common Stock through Broad Street, Chattanooga, TN. with our business partners. The relationships we have built over more than three decades our Dividend Reinvestment Plan, which also provides for QUARTERLY STOCK PRICE AND DIVIDEND purchase by voluntary cash contributions. For additional with lenders, retailers and shareholders will now grow even stronger as the economy recovers. INFORMATION information, please contact Computershare. The following table presents the dividends declared and the high and low sale price of the common stock as listed on the INDEPENDENT AUDITORS Our strategy of owning malls in markets where we are the dominant presence has proven to New York Stock Exchange for each quarter of 2009 and 2008. Deloitte & Touche LLP be especially sound during this national recession. CBL is one of the largest mall REITs in the Atlanta, GA Market Quotations United States and owns, holds interests in or manages more than 160 properties including COUNSEL 2009 Quarter Ended High Low Dividends Husch Blackwell Sanders LLP 88 market-dominant enclosed malls and open-air centers. We are positioned to thrive because March 31 $ 8.70 $ 2.06 $ 0.370 Chattanooga, TN June 30 $ 7.99 $ 2.41 $ 0.110 our strategies are sound and our employees accept no less. We are proud of the vote of Morrison & Foerster LLP September 30 $ 10.69 $ 4.40 $ 0.050 New York, NY confidence our shareholders gave us in 2009 and we will strive to reward that trust. December 31 $ 10.50 $ 7.96 $ 0.050 STOCK EXCHANGE LISTING New York Stock Exchange Market Quotations Symbols: CBL, CBLPrC, CBLPrD 2008 Quarter Ended High Low Dividends March 31 $ 27.46 $ 21.12 $ 0.545 June 30 $ 27.55 $ 22.38 $ 0.545 September 30 $ 23.28 $ 18.64 $ 0.545 December 31 $ 20.02 $ 2.53 $ 0.370 TOTAL RETURN PERFORMANCE $160 The adjacent graph compares the cumulative stockholder return on the Common Stock of the $120 Company with the cumulative total return of the $80 Russell 2000 index of small companies (“Russell 2000”) and the NAREIT All Equity REIT Total $40 Return Index for the period commencing $0 / Atlanta December 31, 2004, through December 31, 2004 2005 2006 2007 2008 2009 2009. The adjacent graph assumes that the Period Ending value of the investments in the Company and in Index 12/31/04 12/31/05 12/31/06 12/31/07 12/31/08 12/31/09 each of the indices was $100 at the beginning of see eye the period and that dividends were reinvested. CBL & Associates Properties, Inc. $100.00 108.20 124.19 72.81 22.29 36.64 The stock price performance presented is not Russell 2000 $100.00 104.55 123.76 121.82 80.66 102.58 necessarily indicative of future results. NAREIT All Equity REIT Index $100.00 112.16 151.49 127.72 79.53 101.79 designed and produced by designed and produced CHARLES B. LEBOVITZ STEPHEN D. LEBOVITZ JOHN N. FOY CHAIRMAN OF THE BOARD PRESIDENT AND VICE CHAIRMAN, CHIEF EXECUTIVE OFFICER CHIEF FINANCIAL OFFICER, TREASURER AND SECRETARY DEAR SHAREHOLDERS, In the most challenging economy in generations, CBL not only survived 2009, but prepared itself to thrive as the economy improves. This would not have been possible without the commitment of all of CBL’s stake- holders – especially shareholders, employees, lenders and retailers – who shared a vision for what CBL needed to do to successfully emerge from these challenges and position itself for the future. 1 During 2009, our shareholders actively supported we showed our lenders a plan to reduce our our mid-year equity offering. Our employees debt by approximately $800 million within five dedicated themselves to doing “whatever it years through raising new equity and natural takes” to accomplish our goals. Lenders demon- debt amortization. The lenders recognized the strated their confidence by helping us complete value of extending our lines of credit. They knew three major credit facility extensions and multiple that CBL has a long track record of consistent secured mortgage refinancings. And retailers operating performance, and they were comfortable recognized the stability of our market-dominant that their investment would continue to pay off. properties. Thanks to this unified commitment, In June 2009, CBL completed an equity offering at 31 years old, CBL is still going strong. to the public that allowed us to deleverage Many industry experts predicted companies the Company, but more than that it revealed a would find it impossible to maintain credit continuing commitment to CBL by both existing facilities in 2009. But CBL overcame the obstacles and new shareholders. We raised nearly $400 mil- presented and successfully extended 100% of its lion in a very tough economic environment. At a credit facilities. Our employees demonstrated time when business news was filled with questions the soundness of our business plan to our about commercial real estate, CBL brought in lending partners, and we were able to accom- major new shareholders and strengthened its plish the extensions through both existing and relationship with a number of existing shareholders. new relationships with financial institutions. The success of this offering was a clear endorse- ment of our strategic plan and a confirmation What did lenders like about CBL’s plans? We are that investors believe CBL is on the right track. committed to deleveraging the Company, and CBL & ASSOCIATES PROPERTIES, INC. 2009 ANNUAL REPORT While it has been satisfying to experience the commitment from our lenders and shareholders, no group has shown more dedication and belief in CBL’s long-term strategy than our employees. While CBL will continue with many of its time- Beginning in 2008 we asked the CBL team to tested strategies, we are adjusting to the current examine every expense, from travel to postage, financial environment by converting our unsecured to determine if cost reductions could be made line of credit into a secured facility. And we are without hurting the quality of our properties. staggering maturities so we don’t have a dispro- The team responded with many creative ideas, portionate number of loans that come due in including exploring ways to market our properties any single year. utilizing new technologies, new ideas of how to We also are committed to exploring new ways maximize productivity and efficiency and a new 2 to strengthen our balance sheet. We are in emphasis on energy conservation and sustain- discussions with potential new joint venture ability at our properties. Thanks to the exceptional partners and will continue with the strategic commitment from CBL’s staff, these efforts had a disposition of office and non-core properties, major positive impact on the bottom line. assuming prices are attractive to us. And, as While our strategy of owning market-dominant lenders become owners of commercial real shopping centers has been reaffirmed during estate through foreclosure, we will explore this cycle, we have made some adjustments to property management and other third-party address the slumping economy. For example, we fee opportunities, where lenders can tap into have increased efforts to bring regional and local CBL’s expertise in property management, retailers and non-retail uses into our properties, leasing services, redevelopment and marketing while still maintaining relationships with our shopping center outparcels. national retail partners. This has resulted in a broadened tenant mix and some great success Left to right: stories at new developments we opened in 2009 AUGUSTUS N. STEPHAS in Florida, Mississippi and Pennsylvania. EXECUTIVE VICE PRESIDENT AND CHIEF OPERATING OFFICER Our market-dominant strategy led us to develop MICHAEL I.