UNITED STATES	
SECURITIES AND EXCHANGE COMMISSION	
Washington, D.C. 20549	
 	 	 	
FORM 8-K	
 	 	
Current Report Pursuant	
to Section 13 or 15(d) of the	
Securities Exchange Act of 1934	
 	 	 	
Date of report (date of earliest event reported): July 27, 2017	
 	
TAUBMAN CENTERS, INC .	
(Exact Name of Registrant as Specified in its Charter)	
 	 	
Michigan	
(State of Other Jurisdiction of Incorporation)	
 	 	
 	1-11530	38-2033632	
 	(Commission File Number)	(I.R.S. Employer Identification No.)	
 	 	 	
 	200 East Long Lake Road, Suite 300,
Bloomfield Hills, Michigan	
48304-2324	
 	(Address of Principal Executive Office)	(Zip Code)	
 	 	
 	Registrant’s Telephone Number, Including Area Code: (248) 258-6800	
 	 	
 	None	
 	(Former Name or Former Address, if Changed Since Last Report)	
 	 	
     Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (See General Instruction A.2. below):	
 	 	
o	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)	
 	 	
o	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)	
 	 	
o	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))	
 	 	
o	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))	

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging Growth Company      o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.                                                  o

Item 2.02.      RESULTS OF OPERATIONS AND FINANCIAL CONDITION.

The information under this caption is furnished by Taubman Centers, Inc. (the "Company") in accordance with Securities and Exchange Commission Release No. 33-8216. This information shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

On July 27, 2017, the Company issued a press release announcing its results of operations for the quarter ended June 30, 2017. A copy of the press release is attached as Exhibit 99 to this report.

Item 9.01.    FINANCIAL STATEMENTS AND EXHIBITS.

(d)    Exhibits

	
		
Exhibit	Description	
 	 	
99	Press Release, dated July 27, 2017, entitled “Taubman Centers, Inc. Issues Second Quarter Results.”	

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	
			
Date : July 27, 2017	TAUBMAN CENTERS, INC.	
 	 	 	
 	By:	/s/ Simon J. Leopold	
 	 	Simon J. Leopold	
 	 	Executive Vice President, Chief Financial Officer, and Treasurer	

EXHIBIT INDEX

	
		
Exhibit	Description	
 	 	
99	Press Release, dated July 27, 2017, entitled “Taubman Centers, Inc. Issues Second Quarter Results.”	

Exhibit 99

					
Taubman Centers, Inc.	T 248.258.6800	 	 		
200 East Long Lake Road	www.taubman.com	 	 		
Suite 300	 	 	 		
Bloomfield Hills, Michigan	 	 	 		
48304-2324	 	 	 		

Taubman Centers, Inc. Issues Second Quarter Results

–	Net Income and Earnings Per Common Share Lower Due to a Substantial Lump Sum Termination Payment Received in the Second Quarter Last Year	
		
–	Comparable Center Net Operating Income (NOI), Including Lease Cancellation Income, Up 6.5 Percent; Up 2.8 Percent Excluding Lease Cancellation Income	
		
–	Adjusted Funds from Operations Per Share Up 16.5 Percent	
		
–	Fourth Consecutive Quarter of Positive Sales Growth	
		
–	2017 Guidance Revised	

BLOOMFIELD HILLS, Mich., July 27, 2017 - - Taubman Centers, Inc. (NYSE: TCO) today reported financial results for the second quarter of 2017.

	
					
 	June 30, 2017
Three Months Ended (1)	June 30, 2016
Three Months Ended (2)	June 30, 2017
Six Months Ended (1)	June 30, 2016
Six Months Ended (2)	
Net income attributable to common shareowners, diluted (in thousands)
Growth rate	
$13,505
(61.2)%	$34,779	
$30,720
(48.3)%	$59,460	
Net income attributable to common shareowners (EPS) per diluted common share
Growth rate	
$0.22
(61.4)%	$0.57	
$0.50
(49.0)%	$0.98	
Funds from Operations (FFO) per diluted common share
Growth rate	
$0.86
(17.3)%	$1.04	
$1.71
(9.0)%	$1.88	
Adjusted Funds from Operations (Adjusted FFO) per diluted common share
Growth rate	
$0.92
16.5%	$0.79	
$1.85
13.5%	$1.63	
(1) Adjusted FFO for the three and six month periods ended June 30, 2017 exclude a restructuring charge and costs associated with shareowner activism. In addition, Adjusted FFO for the six months ended June 30, 2017 excludes a charge recognized in connection with the partial write-off of deferred financing costs related to an amendment of the company’s primary line of credit in February 2017.

(2) Adjusted FFO for the three and six month periods ended June 30, 2016 exclude a $21.7 million ($0.25 per share) lump sum termination payment the company received in the second quarter for the termination of the company’s leasing services agreement at The Shops at Crystals (Las Vegas, Nev.) .	

“We are pleased with our financial results this quarter, which were in line with our expectations, as we delivered strong earnings growth with Adjusted FFO per share up more than 16 percent,” said Robert S. Taubman, chairman, president and chief executive officer of Taubman Centers. “Significant lease cancellation income and higher rents, combined with lower operating and general and administrative expenses, drove our results.”

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Taubman Centers/2

Operating Statistics

For the quarter, comparable center NOI, including lease cancellation income, was up 6.5 percent, bringing year-to-date growth to 5.2 percent. Excluding lease cancellation income, comparable center NOI growth was 2.8 percent for both the quarter and year-to-date.

Comparable center mall tenant sales per square foot increased 2.9 percent from the second quarter of 2016. This brings the company's 12-month trailing mall tenant sales per square foot to $782, an increase of 2.2 percent from the 12-months ended June 30, 2016. Year-to-date, mall tenant sales per square foot were up 2.1 percent.

“We were very pleased to see positive sales per square foot growth for the fourth consecutive quarter,” said Mr. Taubman. “Our Florida assets were strongest in the quarter, and have performed particularly well this year.”

Average rent per square foot was $62.08, up 1.6 percent from $61.13 in the comparable period last year. Year-to-date, average rent per square foot was up 1.3 percent, consistent with the company’s expectation of rent per square foot growth of about 1 percent for the year.

Trailing 12-month releasing spreads per square foot for the period ended June 30, 2017 were 9.1 percent.

Ending occupancy in comparable centers was 92.2 percent on June 30, 2017, down 1 percent from June 30, 2016. Leased space in comparable centers was 94.6 percent on June 30, 2017, down 1.1 percent from June 30, 2016, but up 0.7 percent from March 31, 2017, consistent with the company’s expectation of around 95 percent occupancy in comparable centers at December 31, 2017.

2017 Guidance

Taubman Executive Vice President and Chief Financial Officer, Simon J. Leopold said, “While our year-to-date results have been strong, challenges within the retail environment increased throughout the quarter. Where appropriate, we are making the decision to preserve occupancy and some income as we retenant space. In the interim there will be impacts to our FFO and NOI growth. As a result, we believe it is prudent to adjust our outlook for the year.”

The company is updating its guidance. 2017 EPS is now expected to be in the range of $1.03 to $1.23 per diluted common share, revised from the previous range of $1.16 to $1.41.

2017 FFO, which includes $0.14 per diluted common share of year-to-date adjustments, is now expected to be in the range of $3.53 to $3.63 per diluted common share, revised from the previous range of $3.60 to $3.75.

2017 Adjusted FFO, which excludes $0.14 per diluted common share of year-to-date adjustments, is expected to be in the range of $3.67 to $3.77 per diluted common share, revised from the previous range of $3.67 to $3.82.

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Taubman Centers/3

The revision to the company’s Adjusted FFO guidance is primarily attributable to reduced comparable center NOI growth expectations. The company now assumes comparable center NOI growth, including lease cancellation income, will be in the range of 1 to 3 percent for the year. The company’s previous comparable center NOI growth guidance, including lease cancellation income, was about 3 ½ percent. Excluding lease cancellation income, comparable center NOI growth is expected to be in the range of flat to 2 percent. The revised NOI outlook is primarily a result of lower average occupancy for the year, lower net recoveries, and increased bad debt expense.

The company’s guidance does not reflect any future costs that may be incurred related to shareowner activism.

“Despite the significant headwinds our industry continues to face, there is good demand for space in our centers. We believe our high quality portfolio is well-positioned to weather this storm and will gain market share over time,” added Mr. Taubman.

Supplemental Investor Information Available

The company provides supplemental investor information along with its earnings announcements, available online at www.taubman.com under “Investors.” This includes the following:

•	Company Information	
		
•	Income Statements	
		
•	Earnings Reconciliations	
		
•	Changes in Funds from Operations and Earnings Per Common Share	
		
•	Components of Other Income, Other Operating Expense, and Nonoperating Income, Net	
		
•	Balance Sheets	
		
•	Debt Summary	
		
•	Other Debt, Equity and Certain Balance Sheet Information	
		
•	Redevelopments and Disposition	
		
•	Capital Spending	
		
•	Operational Statistics	
		
•	Summary of Key Guidance Measures	
		
•	Owned Centers	
		
•	Major Tenants in Owned Portfolio	
		
•	Anchors in Owned Portfolio	
		
•	Operating Statistics Glossary	

Investor Conference Call

The company will host a conference call at 11:00 a.m. EDT on Friday, July 28 to discuss these results, business conditions and the company’s outlook for the remainder of 2017. The conference call will be simulcast at www.taubman.com . An online replay will follow shortly after the call and continue for approximately 90 days.

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Taubman Centers/4

About Taubman
Taubman Centers is an S&P MidCap 400 Real Estate Investment Trust engaged in the ownership, management and/or leasing of 27 regional, super-regional and outlet shopping centers in the U.S. and Asia. Taubman’s U.S.-owned properties are the most productive in the publicly held U.S. regional mall industry. Founded in 1950, Taubman is headquartered in Bloomfield Hills, Mich. Taubman Asia, founded in 2005, is headquartered in Hong Kong. www.taubman.com.

For ease of use, references in this press release to “Taubman Centers,” “company,” “Taubman” or an operating platform mean Taubman Centers, Inc. and/or one or more of a number of separate, affiliated entities. Business is actually conducted by an affiliated entity rather than Taubman Centers, Inc. itself or the named operating platform.

This press release may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements reflect management's current views with respect to future events and financial performance. Forward-looking statements can be identified by words such as “will”, “may”, “could”, “expect”, “anticipate”, “believes”, “intends”, “should”, “plans”, “estimates”, “approximate”, “guidance” and similar expressions in this press release that predict or indicate future events and trends and that do not report historical matters. The forward-looking statements included in this release are made as of the date hereof. Except as required by law, the company assumes no obligation to update these forward-looking statements, even if new information becomes available in the future. Actual results may differ materially from those expected because of various risks, uncertainties and other factors. Such factors include, but are not limited to: changes in market rental rates; unscheduled closings or bankruptcies of tenants; relationships with anchor tenants; trends in the retail industry; the liquidity of real estate investments; the company’s ability to comply with debt covenants; the availability and terms of financings; changes in market rates of interest and foreign exchange rates for foreign currencies; changes in value of investments in foreign entities; the ability to hedge interest rate and currency risk; risks related to acquiring, developing, expanding, leasing and managing properties; changes in value of investments in foreign entities; risks related to joint venture properties; insurance costs and coverage; security breaches that could impact the company’s information technology, infrastructure or personal data; the loss of key management personnel; shareholder activism costs and related diversion of management time; terrorist activities; maintaining the company’s status as a real estate investment trust; changes in the laws of states, localities, and foreign jurisdictions that may increase taxes on the company’s operations; and changes in global, national, regional and/or local economic and geopolitical climates. You should review the company's filings with the Securities and Exchange Commission, including “Risk Factors” in its most recent Annual Report on Form 10-K and subsequent quarterly reports, for a discussion of such risks and uncertainties.

CONTACTS:     
Ryan Hurren, Taubman, Director, Investor Relations, 248-258-7232
rhurren@taubman.com

Maria Mainville, Taubman, Director, Strategic Communications, 248-258-7469
mmainville@taubman.com

# # #

Taubman Centers/ 5

	
												
TAUBMAN CENTERS, INC.	 	 	 	 	 	 	 	
Table 1 - Summary of Results	 	 	 	 	 	 	 	
For the Periods Ended June 30, 2017 and 2016	 	 	 	 	 	 	 	
(in thousands of dollars, except as indicated)	 	 	 	 	 	 	
 	Three Months Ended	 	Year to Date	
 	2017	 	2016	 	2017	 	2016	
Net income	27,663		 	57,744		 	60,422		 	102,073		
Noncontrolling share of income of consolidated joint ventures	(1,605	)	 	(1,630	)	 	(3,049	)	 	(4,151	)	
Noncontrolling share of income of TRG	(6,214	)	 	(15,087	)	 	(14,004	)	 	(25,986	)	
Distributions to participating securities of TRG	(576	)	 	(524	)	 	(1,147	)	 	(1,036	)	
Preferred stock dividends	(5,785	)	 	(5,785	)	 	(11,569	)	 	(11,569	)	
Net income attributable to Taubman Centers, Inc. common shareowners	13,483		 	34,718		 	30,653		 	59,331		
Net income per common share - basic	0.22		 	0.58		 	0.51		 	0.98		
Net income per common share - diluted	0.22		 	0.57		 	0.50		 	0.98		
Beneficial interest in EBITDA - Combined (1)	123,396		 	127,895		 	247,171		 	236,371		
Adjusted Beneficial interest in EBITDA - Combined (1)	128,812		 	106,193		 	255,169		 	214,669		
Funds from Operations attributable to partnership unitholders and participating securities of TRG (1)	74,682		 	89,816		 	149,108		 	162,840		
Funds from Operations attributable to TCO's common shareowners (1)	52,911		 	63,464		 	105,503		 	115,061		
Funds from Operations per common share - basic (1)	0.87		 	1.05		 	1.74		 	1.91		
Funds from Operations per common share - diluted (1)	0.86		 	1.04		 	1.71		 	1.88		
Adjusted Funds from Operations attributable to partnership unitholders and participating securities of TRG (1)	80,098		 	68,114		 	160,333		 	141,138		
Adjusted Funds from Operations attributable to TCO's common shareowners (1)	56,750		 	48,129		 	113,555		 	99,726		
Adjusted Funds from Operations per common share - basic (1)	0.94		 	0.80		 	1.87		 	1.65		
Adjusted Funds from Operations per common share - diluted (1)	0.92		 	0.79		 	1.85		 	1.63		
Weighted average number of common shares outstanding - basic	60,694,727		 	60,353,080		 	60,625,481		 	60,314,042		
Weighted average number of common shares outstanding - diluted	61,001,588		 	60,701,702		 	61,028,241		 	60,746,351		
Common shares outstanding at end of period	60,706,101		 	60,390,149		 	 	 	 	
Weighted average units - Operating Partnership - basic	85,665,078		 	85,413,911		 	85,599,609		 	85,375,537		
Weighted average units - Operating Partnership - diluted	86,843,201		 	86,633,794		 	86,873,631		 	86,679,108		
Units outstanding at end of period - Operating Partnership	85,665,976		 	85,449,499		 	 	 	 	
Ownership percentage of the Operating Partnership at end of period	70.9	%	 	70.7	%	 	 	 	 	
Number of owned shopping centers at end of period	24		 	21		 	 	 	 	
 	 	 	 	 	 	 	 	
Operating Statistics:	 	 	 	 	 	 	 	
Net Operating Income excluding lease cancellation income - growth % (1)(2)	2.8	%	 	6.2	%	 	2.8	%	 	6.0	%	
Net Operating Income including lease cancellation income - growth % (1)(2)	6.5	%	 	6.2	%	 	5.2	%	 	5.2	%	
Average rent per square foot - Consolidated Businesses (3)	64.26		 	63.00		 	63.44		 	62.38		
Average rent per square foot - Unconsolidated Joint Ventures (3)	59.57		 	58.95		 	58.90		 	58.36		
Average rent per square foot - Combined (3)	62.08		 	61.13		 	61.33		 	60.52		
Average rent per square foot growth (3)	1.6	%	 	 	 	1.3	%	 	 	
Ending occupancy - all centers	92.7	%	 	92.5	%	 	92.7	%	 	92.5	%	
Ending occupancy - comparable (3)	92.2	%	 	93.2	%	 	92.2	%	 	93.2	%	
Leased space - all centers	94.9	%	 	95.6	%	 	94.9	%	 	95.6	%	
Leased space - comparable (3)	94.6	%	 	95.7	%	 	94.6	%	 	95.7	%	
Mall tenant sales - all centers (4)	1,485,116		 	1,293,120		 	2,873,793		 	2,495,388		
Mall tenant sales - comparable (3)(4)	1,174,724		 	1,147,011		 	2,306,969		 	2,263,340		

 	 	 	 	 	 	 	 	
 	12-Months Trailing	 	 	 	
 	2017	 	2016	 	 	 	 	
Operating Statistics:	 	 	 	 	 	 	 	
Mall tenant sales - all centers (4)	6,152,019		 	5,294,103		 	 	 	 	
Mall tenant sales - comparable (3)(4)	5,065,121		 	4,903,327		 	 	 	 	
Sales per square foot (3)(4)	782		 	765		 	 	 	 	
All centers (4) :	 	 	 	 	 	 	 	
    Mall tenant occupancy costs as a percentage of tenant sales - Consolidated Businesses	14.8	%	 	14.6	%	 	 	 	 	
    Mall tenant occupancy costs as a percentage of tenant sales - Unconsolidated Joint Ventures	14.5	%	 	14.1	%	 	 	 	 	
    Mall tenant occupancy costs as a percentage of tenant sales - Combined	14.6	%	 	14.4	%	 	 	 	 	
Comparable centers (3)(4) :	 	 	 	 	 	 	 	
    Mall tenant occupancy costs as a percentage of tenant sales - Consolidated Businesses	14.2	%	 	14.1	%	 	 	 	 	
    Mall tenant occupancy costs as a percentage of tenant sales - Unconsolidated Joint Ventures	13.9	%	 	14.2	%	 	 	 	 	
    Mall tenant occupancy costs as a percentage of tenant sales - Combined	14.1	%	 	14.2	%	 	 	 	 	

Taubman Centers/ 6

	
				
(1)	EBITDA represents earnings before interest, income taxes, and depreciation and amortization of the Operating Partnership's consolidated and unconsolidated businesses. Beneficial interest in EBITDA represents the Operating Partnership’s share of the earnings before interest, income taxes, and depreciation and amortization of its consolidated and unconsolidated businesses. The Company believes EBITDA and beneficial interest in EBITDA provide useful indicators of operating performance, as it is customary in the real estate and shopping center business to evaluate the performance of properties on a basis unaffected by capital structure.	
 	The Company uses Net Operating Income (NOI) as an alternative measure to evaluate the operating performance of centers, both on individual and stabilized portfolio bases. The Company defines NOI as property-level operating revenues (includes rental income excluding straight-line adjustments of minimum rent) less maintenance, taxes, utilities, promotion, ground rent (including straight-line adjustments), and other property operating expenses. Since NOI excludes general and administrative expenses, pre-development charges, interest income and expense, depreciation and amortization, impairment charges, restructuring charges, and gains from peripheral land and property dispositions, it provides a performance measure that, when compared period over period, reflects the revenues and expenses most directly associated with owning and operating rental properties, as well as the impact on their operations from trends in tenant sales, occupancy and rental rates, and operating costs. The Company also uses NOI excluding lease cancellation income as an alternative measure because this income may vary significantly from period to period, which can affect comparability and trend analysis. The Company generally provides separate projections for expected comparable center NOI growth and lease cancellation income. Comparable centers are generally defined as centers that were owned and open for the entire current and preceding period presented, excluding centers impacted by significant redevelopment activity.	
 	The National Association of Real Estate Investment Trusts (NAREIT) defines Funds from Operations (FFO) as net income (computed in accordance with Generally Accepted Accounting Principles (GAAP)), excluding gains (or losses) from extraordinary items and sales of properties and impairment write-downs of depreciable real estate, plus real estate related depreciation and after adjustments for unconsolidated partnerships and joint ventures. The Company believes that FFO is a useful supplemental measure of operating performance for REITs. Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values instead have historically risen or fallen with market conditions, the Company and most industry investors and analysts have considered presentations of operating results that exclude historical cost depreciation to be useful in evaluating the operating performance of REITs. The Company primarily uses FFO in measuring performance and in formulating corporate goals and compensation.	
 	The Company may also present adjusted versions of NOI, beneficial interest in EBITDA, and FFO when used by management to evaluate operating performance when certain significant items have impacted results that affect comparability with prior or future periods due to the nature or amounts of these items. The Company believes the disclosure of the adjusted items is similarly useful to investors and others to understand management's view on comparability of such measures between periods. For the three and six month periods ended June 30, 2017, FFO and EBITDA were adjusted to exclude a restructuring charge and costs incurred associated with shareowner activism. For the six months ended June 30, 2017, FFO was also adjusted for a charge recognized in connection with the partial write-off of deferred financing costs related to an amendment of the Company's primary unsecured revolving line of credit in February 2017. For the six months ended June 30, 2017, EBITDA was also adjusted to exclude a gain recognized in connection with the sale of the Valencia Place office tower at Country Club Plaza. For the three and six month periods ended June 30, 2016, FFO and EBITDA were adjusted to exclude the lump sum payment received in May 2016 for the termination of the Company's third party leasing agreement at The Shops at Crystals (Crystals) due to a change in ownership of the center.	
 	These non-GAAP measures as presented by the Company are not necessarily comparable to similarly titled measures used by other REITs due to the fact that not all REITs use the same definitions. These measures should not be considered alternatives to net income or as an indicator of the Company's operating performance. Additionally, these measures do not represent cash flows from operating, investing, or financing activities as defined by GAAP.	
 	The Company provides its beneficial interest in certain financial information of its Unconsolidated Joint Ventures. This beneficial information is derived as the Company’s ownership interest in the investee multiplied by the specific financial statement item being presented. Investors are cautioned that deriving the Company’s beneficial interest in this manner may not accurately depict the legal and economic implications of holding a non-controlling interest in the investee.	
 	 	 	 	
(2)	Statistics exclude non-comparable centers as defined in the respective periods and have not been subsequently restated for changes in the pools of comparable centers.	
(3)	Statistics exclude non-comparable centers for all periods presented. The June 30, 2016 statistics have been restated to include comparable centers to 2017.	
 	 	 	 	
(4)	Based on reports of sales furnished by mall tenants. Sales per square foot exclude spaces greater than or equal to 10,000 square feet.	

Taubman Centers/ 7

	
													
TAUBMAN CENTERS, INC.	 	 	 	 	 	 	 	
Table 2 - Income Statement	 	 	 	 	 	 	 	
For the Three Months Ended June 30, 2017 and 2016	 	 	 	 	 	 	 	
(in thousands of dollars)	 	 	 	 	 	 	 	
 	 	2017	 	2016	
 	 	CONSOLIDATED	 	UNCONSOLIDATED	 	CONSOLIDATED	 	UNCONSOLIDATED	
 	 	BUSINESSES	 	JOINT VENTURES (1)	 	BUSINESSES	 	JOINT VENTURES (1)	
REVENUES:	 	 	 	 	 	 	 	
 	Minimum rents	86,787		 	84,957		 	82,694		 	66,452		
 	Percentage rents	1,179		 	5,215		 	924		 	1,188		
 	Expense recoveries	49,413		 	43,692		 	47,380		 	38,340		
 	Management, leasing, and development services (2)	1,375		 	 	 	23,196		 	 	
 	Other	15,922		 	8,349		 	4,696		 	2,668		
 	Total revenues	154,676		 	142,213		 	158,890		 	108,648		
 	 	 	 	 	 	 	 	 	
EXPENSES:	 	 	 	 	 	 	 	
 	Maintenance, taxes, utilities, and promotion	39,519		 	36,890		 	35,917		 	31,429		
 	Other operating	22,098		 	11,496		 	20,482		 	5,424		
 	Management, leasing, and development services	595		 	 	 	894		 	 	
 	General and administrative	9,416		 	 	 	11,693		 	 	
 	Restructuring charge	416		 	 	 	 	 	 	
 	Costs associated with shareowner activism	5,000		 	 	 	 	 	 	
 	Interest expense	26,746		 	34,721		 	20,588		 	24,965		
 	Depreciation and amortization	39,442		 	34,146		 	29,716		 	20,612		
 	Total expenses	143,232		 	117,253		 	119,290		 	82,430		
 	 	 	 	 	 	 	 	 	
Nonoperating income, net	3,074		 	360		 	2,676		 	860		
 	 	14,518		 	25,320		 	42,276		 	27,078		
Income tax expense	(113	)	 	(1,220	)	 	(442	)	 	 	
 	 	 	24,100		 	 	 	27,078		
Equity in income of Unconsolidated Joint Ventures	13,258		 	 	 	15,910		 	 	
 	 	 	 	 	 	 	 	 	
Net income	27,663		 	 	 	57,744		 	 	
Net income attributable to noncontrolling interests:	 	 	 	 	 	 	 	
Noncontrolling share of income of consolidated joint ventures	(1,605	)	 	 	 	(1,630	)	 	 	
Noncontrolling share of income of TRG	(6,214	)	 	 	 	(15,087	)	 	 	
Distributions to participating securities of TRG	(576	)	 	 	 	(524	)	 	 	
Preferred stock dividends	(5,785	)	 	 	 	(5,785	)	 	 	
Net income attributable to Taubman Centers, Inc. common shareowners	13,483		 	 	 	34,718		 	 	
 	 	 	 	 	 	 	 	 	
SUPPLEMENTAL INFORMATION:	 	 	 	 	 	 	 	
 	EBITDA - 100%	80,706		 	94,187		 	92,580		 	72,655		
 	EBITDA - outside partners' share	(6,456	)	 	(45,041	)	 	(5,471	)	 	(31,869	)	
 	Beneficial interest in EBITDA	74,250		 	49,146		 	87,109		 	40,786		
 	Beneficial interest expense	(23,749	)	 	(17,849	)	 	(18,022	)	 	(13,207	)	
 	Beneficial income tax expense - TRG and TCO	(70	)	 	(518	)	 	(434	)	 	 	
 	Beneficial income tax expense - TCO	2		 	 	 	 	 	 	
 	Non-real estate depreciation	(745	)	 	 	 	(631	)	 	 	
 	Preferred dividends and distributions	(5,785	)	 	 	 	(5,785	)	 	 	
 	Funds from Operations attributable to partnership unitholders and participating securities of TRG	43,903		 	30,779		 	62,237		 	27,579		
 	 	 	 	 	 	 	 	 	
STRAIGHTLINE AND PURCHASE ACCOUNTING ADJUSTMENTS:	 	 	 	 	 	 	 	
 	Net straight-line adjustments to rental revenue, recoveries, and ground rent expense at TRG%	483		 	248		 	440		 	707		
 	Country Club Plaza purchase accounting adjustments - minimum rents increase at TRG%	 	 	2		 	 	 	 	
 	The Mall at Green Hills purchase accounting adjustments - minimum rents increase	33		 	 	 	56		 	 	
 	 	 	 	 	 	 	 	 	
(1)	With the exception of the Supplemental Information, amounts include 100% of the Unconsolidated Joint Ventures. Amounts are net of intercompany transactions. The Unconsolidated Joint Ventures are presented at 100% in order to allow for measurement of their performance as a whole, without regard to the Company's ownership interest.	
(2)	The 2016 amount includes the $21.7 million lump sum payment received in May 2016 for the termination of the Company's third party leasing agreement at Crystals due to a change in ownership in the center.	

Taubman Centers/ 8

	
															
TAUBMAN CENTERS, INC.	 	 	 	 	 	 	
Table 3 - Income Statement	 	 	 	 	 	 	
For the Six Months Ended June 30, 2017 and 2016	 	 	 	 	 	 	
 (in thousands of dollars)	 	 	 	 	 	 	
 	 	 	2017	 	2016	
 	 	 	CONSOLIDATED BUSINESSES	 	 UNCONSOLIDATED JOINT VENTURES (1)	 	CONSOLIDATED BUSINESSES	 	 UNCONSOLIDATED JOINT VENTURES (1)	
REVENUES:	 	 	 	 	 	 	 	
 	Minimum rents	171,090		 	168,482		 	164,671		 	124,015		
 	Percentage rents	3,754		 	10,277		 	3,696		 	3,220		
 	Expense recoveries	102,425		 	89,440		 	95,140		 	72,712		
 	Management, leasing, and development services (2)	2,292		 		 	24,924		 		
 	Other	24,198		 	14,614		 	9,914		 	5,464		
 	 	Total revenues	303,759		 	282,813		 	298,345		 	205,411		
 	 	 	 	 	 	 	 	 	 	
EXPENSES:	 	 	 	 	 	 	 	
 	Maintenance, taxes, utilities, and promotion	79,230		 	70,604		 	70,855		 	54,785		
 	Other operating	41,417		 	22,899		 	39,190		 	8,828		
 	Management, leasing, and development services	1,174		 		 	1,766		 		
 	General and administrative	20,167		 		 	23,073		 		
 	Restructuring charge	2,312		 	 	 	 	 	 	
 	Costs associated with shareowner activism	8,500		 		 		 		
 	Interest expense	52,292		 	65,090		 	39,716		 	46,298		
 	Depreciation and amortization	77,153		 	64,654		 	59,462		 	36,618		
 	 	Total expenses	282,245		 	223,247		 	234,062		 	146,529		
 	 	 	 	 	 	 	 	 	 	
Nonoperating income, net	5,853		 	2,211		 	4,146		 	1,106		
 	 	 	27,367		 	61,777		 	68,429		 	59,988		
Income tax expense	(321	)	 	(4,163	)	 	(744	)	 	 	
 	 	 	57,614		 	 	 	 	
Gain on disposition, net of tax (3)	 	 	3,713		 	 	 	 	
 	 	 	61,327		 	 	 	59,988		
Equity in income of Unconsolidated Joint Ventures	33,376		 	 	 	34,388		 	 	
 	 	 	 	 	 	 	 	
Net income	60,422		 	 	 	102,073		 	 	
Net income attributable to noncontrolling interests:	 	 	 	 	 	 	 	
 	Noncontrolling share of income of consolidated joint ventures	(3,049	)	 	 	 	(4,151	)	 	 	
 	Noncontrolling share of income of TRG	(14,004	)	 	 	 	(25,986	)	 	 	
Distributions to participating securities of TRG	(1,147	)	 	 	 	(1,036	)	 	 	
Preferred stock dividends	(11,569	)	 	 	 	(11,569	)	 	 	
Net income attributable to Taubman Centers, Inc. common shareowners	30,653		 	 	 	59,331		 	 	
 	 	 	 	 	 	 	 	 	 	
SUPPLEMENTAL INFORMATION:	 	 	 	 	 	 	 	
 	EBITDA - 100%	156,812		 	195,965		 	167,607		 	142,904		
 	EBITDA - outside partners' share	(12,702	)	 	(92,904	)	 	(11,363	)	 	(62,777	)	
 	Beneficial interest in EBITDA	144,110		 	103,061		 	156,244		 	80,127		
 	Beneficial share of gain on disposition (3)	 	 	(2,814	)	 	 	 	 	
 	Beneficial interest expense	(46,320	)	 	(33,630	)	 	(35,198	)	 	(24,735	)	
 	Beneficial income tax expense - TRG and TCO	(247	)	 	(2,151	)	 	(736	)	 		
 	Beneficial income tax expense (benefit) - TCO	102		 		 	(19	)	 		
 	Non-real estate depreciation	(1,434	)	 		 	(1,274	)	 		
 	Preferred dividends and distributions	(11,569	)	 		 	(11,569	)	 		
 	Funds from Operations attributable to partnership unitholders and participating securities of TRG	84,642		 	64,466		 	107,448		 	55,392		
 	 	 	 	 	 	 	 	 	 	
STRAIGHTLINE AND PURCHASE ACCOUNTING ADJUSTMENTS:	 	 	 	 	 	 	 	
 	Net straight-line adjustments to rental revenue, recoveries, and ground rent expense at TRG%	435		 	701		 	453		 	1,164		
 	Country Club Plaza purchase accounting adjustments - minimum rents increase at TRG %	 	 	54		 	 	 	 	
 	The Mall at Green Hills purchase accounting adjustments - minimum rents increase	82		 	 	 	116		 	 	
 	 	 	 	 	 	 	 	 	 	
(1	)	With the exception of the Supplemental Information, amounts include 100% of the Unconsolidated Joint Ventures. Amounts are net of intercompany transactions. The Unconsolidated Joint Ventures are presented at 100% in order to allow for measurement of their performance as a whole, without regard to the Company's ownership interest.	
(2	)	The 2016 amount includes the $21.7 million lump sum payment received in May 2016 for the termination of the Company's third party leasing agreement at Crystals due to a change in ownership in the center.	
(3	)	During the six months ended June 30, 2017, the joint venture that owns the Valencia Place office tower at Country Club Plaza recognized a $4.4 million gain ($2.8 million at TRG's share) and $0.7 million of income tax expense ($0.7 million at TRG's share) in connection with the sale of the office tower.	

Taubman Centers/ 9

	
																				
TAUBMAN CENTERS, INC.	 	 	 	 	 	 	 	 	 	 	 	
Table 4 - Reconciliation of Net Income Attributable to Taubman Centers, Inc. Common Shareowners to Funds From Operations and Adjusted Funds From Operations	
For the Three Months Ended June 30, 2017 and 2016	
(in thousands of dollars except as noted; may not add or recalculate due to rounding)	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	2017	 	2016	
 	 	 	 	Shares	 	Per Share	 	 	 	Shares	 	Per Share	
 	 	Dollars	 	/Units	 	/Unit	 	Dollars	 	/Units	 	/Unit	
Net income attributable to TCO common shareowners - basic	13,483		 	60,694,727		 	0.22		 	34,718		 	60,353,080		 	0.58		
 	 	 	 	 	 	 	 	 	 	 	 	
Add impact of share-based compensation	22		 	306,861		 		 	61		 	348,622		 		
 	 	 	 	 	 	 	 	 	 	 	 	
Net income attributable to TCO common shareowners - diluted	13,505		 	61,001,588		 	0.22		 	34,779		 	60,701,702		 	0.57		
 	 	 	 	 	 	 	 	 	 	 	 	 	
Add depreciation of TCO's additional basis	1,617		 		 	0.03		 	1,617		 		 	0.03		
Add TCO's additional income tax expense	2		 		 	0.00		 			 		 			
 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income attributable to TCO common shareowners,	 	 	 	 	 	 	 	 	 	 	 	
 	excluding step-up depreciation and additional income tax expense	15,124		 	61,001,588		 	0.25		 	36,396		 	60,701,702		 	0.60		
 	 	 	 	 	 	 	 	 	 	 	 	 	
Add noncontrolling share of income of TRG	6,214		 	24,970,351		 		 	15,087		 	25,060,830		 		
Add distributions to participating securities of TRG	576		 	871,262		 		 	524		 	871,262		 		
 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income attributable to partnership unitholders	 	 	 	 	 	 	 	 	 	 	 	
 	and participating securities of TRG	21,914		 	86,843,201		 	0.25		 	52,007		 	86,633,794		 	0.60		
 	 	 	 	 	 	 	 	 	 	 	 	 	
Add (less) depreciation and amortization:	 	 	 	 	 	 	 	 	 	 	 	
 	Consolidated businesses at 100%	39,442		 		 	0.45		 	29,716		 		 	0.34		
 	Depreciation of TCO's additional basis	(1,617	)	 		 	(0.02	)	 	(1,617	)	 		 	(0.02	)	
 	Noncontrolling partners in consolidated joint ventures	(1,811	)	 		 	(0.02	)	 	(1,267	)	 		 	(0.01	)	
 	Share of Unconsolidated Joint Ventures	17,521		 		 	0.20		 	11,669		 		 	0.13		
 	Non-real estate depreciation	(745	)	 		 	(0.01	)	 	(631	)	 		 	(0.01	)	
 	 	 	 	 	 	 	 	 	 	 	 	 	
Less impact of share-based compensation	(22	)	 			 	(0.00	)	 	(61	)	 			 	(0.00	)	
 	 	 	 	 	 	 	 	 	 	 	 	 	
Funds from Operations attributable to partnership unitholders	 	 	 	 	 	 	 	 	 	 	 	
 	and participating securities of TRG	74,682		 	86,843,201		 	0.86		 	89,816		 	86,633,794		 	1.04		
 	 	 	 	 	 	 	 	 	 	 	 	 	
TCO's average ownership percentage of TRG - basic (1)	70.9	%	 	 	 	 	 	70.7	%	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	
Funds from Operations attributable to TCO's common shareowners,	 	 	 	 	 	 	 	 	 	 	 	
 	excluding additional income tax expense (1)	52,913		 	 	 	0.86		 	63,464		 	 	 	1.04		
 	 	 	 	 	 	 	 	 	 	 	 	 	
Less TCO's additional income tax expense	(2	)	 	 	 	(0.00	)	 		 	 	 			
 	 	 	 	 	 	 	 	 	 	 	 	 	
Funds from Operations attributable to TCO's common shareowners (1)	52,911		 	 	 	0.86		 	63,464		 	 	 	1.04		
 	 	 	 	 	 	 	 	 	 	 	 	 	
Funds from Operations attributable to partnership unitholders	 	 	 	 	 	 	 	 	 	 	 	
 	and participating securities of TRG	74,682		 	86,843,201		 	0.86		 	89,816		 	86,633,794		 	1.04		
 	 	 	 	 	 	 	 	 	 	 	 	 	
Restructuring charge	416		 	 	 	0.00		 	 	 	 	 	 	
Costs associated with shareowner activism	5,000		 	 	 	0.06		 	 	 	 	 	 	
Crystals lump sum payment received for termination of leasing agreement	 	 			 	 	 	(21,702	)	 		 	(0.25	)	
 	 	 	 	 	 	 	 	 	 	 	 	
Adjusted Funds from Operations attributable to partnership unitholders	 	 	 	 	 	 	 	 	 	 	 	
 	and participating securities of TRG	80,098		 	86,843,201		 	0.92		 	68,114		 	86,633,794		 	0.79		
 	 	 	 	 	 	 	 	 	 	 	 	 	
TCO's average ownership percentage of TRG - basic (2)	70.9	%	 	 	 	 	 	70.7	%	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	
Adjusted Funds from Operations attributable to TCO's common shareowners (2)	56,750		 	 	 	0.92		 	48,129		 	 	 	0.79		
 	 	 	 	 	 	 	 	 	 	 	 	 	
(1	)	For the three months ended June 30, 2017, Funds from Operations attributable to TCO's common shareowners was $52,193 using TCO's diluted average ownership percentage of TRG of 69.9%. For the three months ended June 30, 2016, Funds from Operations attributable to TCO's common shareowners was $62,570 using TCO's diluted average ownership percentage of TRG of 69.7%.	
 		
(2	)	For the three months ended June 30, 2017, Adjusted Funds from Operations attributable to TCO's common shareowners was $55,981 using TCO's diluted average ownership percentage of TRG of 69.9%. For the three months ended June 30, 2016, Adjusted Funds from Operations attributable to TCO's common shareowners was $47,451 using TCO's diluted average ownership percentage of TRG of 69.7%.	

Taubman Centers/ 10

	
																				
TAUBMAN CENTERS, INC.	 	 	 	 	 	 	 	 	 	 	 	
Table 5 - Reconciliation of Net Income Attributable to Taubman Centers, Inc. Common Shareowners to Funds from Operations and Adjusted Funds from Operations	
For the Six Months Ended June 30, 2017 and 2016	
(in thousands of dollars except as noted; may not add or recalculate due to rounding)	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	2017	 	2016	
 	 	 	 	Shares	 	Per Share	 	 	 	Shares	 	Per Share	
 	 	Dollars	 	/Units	 	/Unit	 	Dollars	 	/Units	 	/Unit	
Net income attributable to TCO common shareowners - basic	30,653		 	60,625,481		 	0.51		 	59,331		 	60,314,042		 	0.98		
 	 	 	 	 	 	 	 	 	 	 	 	
Add impact of share-based compensation	67		 	402,760		 		 	129		 	432,309		 		
 	 	 	 	 	 	 	 	 	 	 	 	
Net income attributable to TCO common shareowners - diluted	30,720		 	61,028,241		 	0.50		 	59,460		 	60,746,351		 	0.98		
 	 	 	 	 	 	 	 	 	 	 	 	 	
Add depreciation of TCO's additional basis	3,234		 		 	0.05		 	3,234		 		 	0.05		
Add (less) TCO's additional income tax expense (benefit)	102		 		 	0.00		 	(19	)	 		 	(0.00	)	
 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income attributable to TCO common shareowners,	 	 	 	 	 	 	 	 	 	 	 	
 	excluding step-up depreciation and additional income tax expense (benefit)	34,056		 	61,028,241		 	0.56		 	62,675		 	60,746,351		 	1.03		
 	 	 	 	 	 	 	 	 	 	 	 	 	
Add noncontrolling share of income of TRG	14,004		 	24,974,128		 			 	25,986		 	25,061,495		 			
Add distributions to participating securities of TRG	1,147		 	871,262		 		 	1,036		 	871,262		 		
 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income attributable to partnership unitholders	 	 	 	 	 	 	 	 	 	 	 	
 	and participating securities of TRG	49,207		 	86,873,631		 	0.57		 	89,697		 	86,679,108		 	1.03		
 	 	 	 	 	 	 	 	 	 	 	 	 	
Add (less) depreciation and amortization:	 	 	 	 	 	 	 	 	 	 	 	
 	Consolidated businesses at 100%	77,153		 		 	0.89		 	59,462		 		 	0.69		
 	Depreciation of TCO's additional basis	(3,234	)	 		 	(0.04	)	 	(3,234	)	 		 	(0.04	)	
 	Noncontrolling partners in consolidated joint ventures	(3,607	)	 		 	(0.04	)	 	(2,686	)	 		 	(0.03	)	
 	Share of Unconsolidated Joint Ventures	33,173		 		 	0.38		 	21,004		 		 	0.24		
 	Non-real estate depreciation	(1,434	)	 		 	(0.02	)	 	(1,274	)	 		 	(0.01	)	
 	 			 			 			 			 			 			
Less beneficial gain on disposition, net of tax	(2,083	)	 		 	(0.00	)	 		 		 			
Less impact of share-based compensation	(67	)	 		 	(0.00	)	 	(129	)	 		 	(0.00	)	
 	 	 	 	 	 	 	 	 	 	 	 	 	
Funds from Operations attributable to partnership unitholders	 	 	 	 	 	 	 	 	 	 	 	
 	and participating securities of TRG	149,108		 	86,873,631		 	1.72		 	162,840		 	86,679,108		 	1.88		
 	 	 	 	 	 	 	 	 	 	 	 	 	
TCO's average ownership percentage of TRG - basic (1)	70.8	%	 	 	 	 	 	70.6	%	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	
Funds from Operations attributable to TCO's common shareowners,	 	 	 	 	 	 	 	 	 	 	 	
 	excluding additional income tax benefit (expense) (1)	105,605		 	 	 	1.72		 	115,042		 		 	1.88		
 	 	 	 	 	 	 	 	 	 	 	 	 	
Add (less) TCO's additional income tax benefit (expense)	(102	)	 	 	 	(0.00	)	 	19		 		 	0.00		
 	 	 	 	 	 	 	 	 	 	 	 	 	
Funds from Operations attributable to TCO's common shareowners (1)	105,503		 	 	 	1.71		 	115,061		 	 	 	1.88		
 	 	 	 	 	 	 	 	 	 	 	 	 	
Funds from Operations attributable to partnership unitholders	 	 	 	 	 	 	 	 	 	 	 	
 	and participating securities of TRG	149,108		 	86,873,631		 	1.72		 	162,840		 	86,679,108		 	1.88		
 	 	 	 	 	 	 	 	 	 	 	 	 	
Restructuring charge	2,312		 	 	 	0.03		 	 	 	 	 	 	
Costs associated with shareowner activism	8,500		 	 	 	0.10		 	 	 	 	 	 	
Partial write-off of deferred financing costs	413		 	 	 	0.00		 	 	 	 	 	 	
Crystals lump sum payment for termination of leasing agreement	 	 	 	 	 	 	(21,702	)	 	 	 	(0.25	)	
 	 	 	 	 	 	 	 	 	 	 	 	
Adjusted Funds from Operations attributable to partnership unitholders	 	 	 	 	 	 	 	 	 	 	 	
 	and participating securities of TRG	160,333		 	86,873,631		 	1.85		 	141,138		 	86,679,108		 	1.63		
 	 	 	 	 	 	 	 	 	 	 	 	 	
TCO's average ownership percentage of TRG - basic (2)	70.8	%	 	 	 	 	 	70.6	%	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	
Adjusted Funds from Operations attributable to TCO's common shareowners,	 	 	 	 	 	 	 	 	 	 	 	
 	excluding additional income tax benefit (2)	113,555		 		 	1.85		 	99,707		 		 	1.63		
 	 	 	 	 	 	 	 	 	 	 	 	 	
Add TCO's additional income tax benefit			 		 	 	 	19		 		 	0.00		
 	 	 	 	 	 	 	 	 	 	 	 	 	
Adjusted Funds from Operations attributable to TCO's common shareowners  (2)	113,555		 		 	1.85		 	99,726		 		 	1.63		
 	 	 	 	 	 	 	 	 	 	 	 	 	
(1	)	For the six months ended June 30, 2017, Funds from Operations attributable to TCO's common shareowners was $103,954 using TCO's diluted average ownership percentage of TRG of 69.8%. For the six months ended June 30, 2016, Funds from Operations attributable to TCO's common shareowners was $113,342 using TCO's diluted average ownership percentage of TRG of 69.6%.	
 		
(2	)	For the six months ended June 30, 2017, Adjusted Funds from Operations attributable to TCO's common shareowners was $111,890 using TCO's diluted average ownership percentage of TRG of 69.8%. For the six months ended June 30, 2016, Adjusted Funds from Operations attributable to TCO's common shareowners was $98,223 using TCO's diluted average ownership percentage of TRG of 69.6%.	

Taubman Centers/ 11

	
															
TAUBMAN CENTERS, INC.	 	 	 	 	 	 	 	 	
Table 6 - Reconciliation of Net Income to Beneficial Interest in EBITDA and Adjusted Beneficial Interest in EBITDA	 	 	 	 	
For the Periods Ended June 30, 2017 and 2016	 	 	 	 	
(in thousands of dollars; amounts attributable to TCO may not recalculate due to rounding)	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	Three Months Ended	 	Year to Date	
 	 	 	 	2017	 	2016	 	2017	 	2016	
Net income	 	27,663		 	57,744		 	60,422		 	102,073		
 	 	 	 	 	 	 	 	 	 	 	
Add (less) depreciation and amortization:	 	 	 	 	 	 	 	 	
 	Consolidated businesses at 100%	 	39,442		 	29,716		 	77,153		 	59,462		
 	Noncontrolling partners in consolidated joint ventures	 	(1,811	)	 	(1,267	)	 	(3,607	)	 	(2,686	)	
 	Share of Unconsolidated Joint Ventures	 	17,521		 	11,669		 	33,173		 	21,004		
 	 	 	 	 	 	 	 	 	 	 	
Add (less) interest expense and income tax expense:	 	 	 	 	 	 	 	 	
 	Interest expense:	 	 	 	 	 	 	 	 	
 	 	Consolidated businesses at 100%	 	26,746		 	20,588		 	52,292		 	39,716		
 	 	Noncontrolling partners in consolidated joint ventures	 	(2,997	)	 	(2,566	)	 	(5,972	)	 	(4,518	)	
 	 	Share of Unconsolidated Joint Ventures	 	17,849		 	13,207		 	33,630		 	24,735		
 	Income tax expense:	 	 	 	 	 	 	 	 	
 	 	Consolidated businesses at 100%	 	113		 	434		 	321		 	736		
 	 	Noncontrolling partners in consolidated joint ventures	 	(43	)	 	 	 	(74	)	 	 	
 	 	Share of Unconsolidated Joint Ventures	 	518		 	 	 	2,151		 	 	
 	 	Share of income tax expense on disposition	 		 	 	 	731		 	 	
 	 	 	 	 	 	 	 	 	 	 	
Less noncontrolling share of income of consolidated joint ventures	 	(1,605	)	 	(1,630	)	 	(3,049	)	 	(4,151	)	
 	 	 	 	 	 	 	 	 	 	 	
Beneficial interest in EBITDA	 	123,396		 	127,895		 	247,171		 	236,371		
 	 	 	 	 	 	 	 	 	 	 	
TCO's average ownership percentage of TRG - basic	 	70.9	%	 	70.7	%	 	70.8	%	 	70.6	%	
 	 	 	 	 	 	 	 	 	 	 	
Beneficial interest in EBITDA attributable to TCO	 	87,428		 	90,368		 	175,058		 	166,986		
 	 	 	 	 	 	 	 	 	 	 	
Beneficial interest in EBITDA	 	123,396		 	127,895		 	247,171		 	236,371		
 	 	 	 	 	 	 	 	 	 	 	
Add (less):	 	 	 	 	 	 	 	 	
 	Restructuring charge	 	416		 	 	 	2,312		 	 	
 	Costs associated with shareowner activism	 	5,000		 	 	 	8,500		 	 	
 	Beneficial share of gain on disposition	 	 	 	 	 	(2,814	)	 	 	
 	Crystals lump sum payment for termination of leasing agreement	 	 	 	(21,702	)	 	 	 	(21,702	)	
 	 	 	 	 	 	 	 	 	 	 	
Adjusted Beneficial interest in EBITDA	 	128,812		 	106,193		 	255,169		 	214,669		
 	 	 	 	 	 	 	 	 	 	 	
TCO's average ownership percentage of TRG - basic	 	70.9	%	 	70.7	%	 	70.8	%	 	70.6	%	
 	 	 	 	 	 	 	 	 	 	 	
Adjusted Beneficial interest in EBITDA attributable to TCO	 	91,265		 	75,035		 	180,723		 	151,653		

Taubman Centers/ 12

	
																											
TAUBMAN CENTERS, INC.	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Table 7 - Reconciliation of Net Income to Net Operating Income (NOI)	 	 	 	 	 	 	 	 	 	 	 	 	 	
For the Periods Ended June 30, 2017, 2016, and 2015	 	 	 	 	 	 	 	 	 	 	 	 	 	
(in thousands of dollars)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	 	Three Months Ended	 	Three Months Ended	 	Year to Date	 	Year to Date	 	
 	 	 	2017	 	2016	 	2016	 	2015	 	2017	 	2016	 	2016	 	2015	 	
Net income	27,663		 	57,744		 	57,744		 	42,333		 	60,422		 	102,073		 	102,073		 	93,333		 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Add (less) depreciation and amortization:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	Consolidated businesses at 100%	39,442		 	29,716		 	29,716		 	26,378		 	77,153		 	59,462		 	59,462		 	50,419		 	
 	Noncontrolling partners in consolidated joint ventures	(1,811	)	 	(1,267	)	 	(1,267	)	 	(547	)	 	(3,607	)	 	(2,686	)	 	(2,686	)	 	(1,631	)	 	
 	Share of Unconsolidated Joint Ventures	17,521		 	11,669		 	11,669		 	8,502		 	33,173		 	21,004		 	21,004		 	16,570		 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Add (less) interest expense and income tax expense:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	Interest expense:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	Consolidated businesses at 100%	26,746		 	20,588		 	20,588		 	14,781		 	52,292		 	39,716		 	39,716		 	28,306		 	
 	 	Noncontrolling partners in consolidated joint ventures	(2,997	)	 	(2,566	)	 	(2,566	)	 	(1,734	)	 	(5,972	)	 	(4,518	)	 	(4,518	)	 	(3,388	)	 	
 	 	Share of Unconsolidated Joint Ventures	17,849		 	13,207		 	13,207		 	11,405		 	33,630		 	24,735		 	24,735		 	22,768		 	
 	Share of income tax expense:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	Consolidated businesses at 100%	113		 	434		 	434		 	688		 	321		 	736		 	736		 	1,526		 	
 	 	Noncontrolling partners in consolidated joint ventures	(43	)	 	 	 	 	 	 	 	(74	)	 	 	 	 	 	 	 	
 	 	Share of Unconsolidated Joint Ventures	518		 	 	 	 	 	 	 	2,151		 	 	 	 	 	 	 	
 	 	Share of income tax expense on disposition	 	 	 	 	 	 	 	 	731		 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 			 	 	 	 	 	
Less noncontrolling share of income of consolidated joint ventures	(1,605	)	 	(1,630	)	 	(1,630	)	 	(2,672	)	 	(3,049	)	 	(4,151	)	 	(4,151	)	 	(5,263	)	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Add EBITDA attributable to outside partners:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	EBITDA attributable to noncontrolling partners in consolidated joint ventures	6,456		 	5,471		 	5,471		 	4,953		 	12,702		 	11,363		 	11,363		 	10,282		 	
 	EBITDA attributable to outside partners in Unconsolidated Joint Ventures	45,041		 	31,869		 	31,869		 	26,541		 	92,904		 	62,777		 	62,777		 	55,028		 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
EBITDA at 100%	174,893		 	165,235		 	165,235		 	130,628		 	352,777		 	310,511		 	310,511		 	267,950		 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Add (less) items excluded from shopping center NOI:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	General and administrative expenses	9,416		 	11,693		 	11,693		 	12,055		 	20,167		 	23,073		 	23,073		 	23,980		 	
 	Management, leasing, and development services, net	(780	)	 	(22,302	)	(1)	(22,302	)	(1)	(1,930	)	 	(1,118	)	 	(23,158	)	(1)	(23,158	)	(1)	(3,757	)	 	
 	Restructuring charge	416		 	 	 	 	 	 	 	2,312		 	 	 	 	 	 	 	
 	Costs associated with shareowner activism	5,000		 	 	 	 	 	 	 	8,500		 	 	 	 	 	 	 	
 	Straight-line of rents	(1,698	)	 	(2,024	)	 	(2,024	)	 	(1,378	)	 	(3,168	)	 	(3,138	)	 	(3,138	)	 	(2,098	)	 	
 	Gain on disposition	 	 	 	 	 	 	 	 	(4,445	)	 	 	 	 	 	 	 	
 	Gains on sales of peripheral land			 			 			 			 	(1,668	)	 	(403	)	 	(403	)	 			 	
 	Dividend income	(1,033	)	 	(944	)	 	(944	)	 	(885	)	 	(2,066	)	 	(1,888	)	 	(1,888	)	 	(1,711	)	 	
 	Interest income	(2,245	)	 	(1,760	)	 	(1,760	)	 	(553	)	 	(4,277	)	 	(2,272	)	 	(2,272	)	 	(1,219	)	 	
 	Other nonoperating expense (income)	(156	)	 	(832	)	 	(832	)	 	(15	)	 	(53	)	 	(689	)	 	(689	)	 	223		 	
 	Unallocated operating expenses and other	9,054		 	12,148		 	12,148		 	8,505		 	16,376		 	22,176		 	22,176		 	17,063		 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
NOI - all centers at 100%	192,867		 	161,214		 	161,214		 	146,427		 	383,337		 	324,212		 	324,212		 	300,431		 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Less NOI of non-comparable centers	(38,014	)	(2)	(15,841	)	(3)	(16,371	)	(4)	(10,026	)	(5)	(72,324	)	(2)	(28,491	)	(3)	(30,252	)	(4)	(20,955	)	(5)	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
NOI at 100% - comparable centers	154,853		 	145,373		 	144,843		 	136,401		 	311,013		 	295,721		 	293,960		 	279,476		 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
NOI - growth %	6.5	%	 	 	 	6.2	%	 	 	 	5.2	%	 	 	 	5.2	%	 			 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
NOI at 100% - comparable centers	154,853		 	145,373		 	144,843		 	136,401		 	311,013		 	295,721		 	293,960		 	279,476		 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Lease cancellation income	(5,671	)	 	(251	)	 	(251	)	 	(310	)	 	(9,279	)	 	(2,226	)	 	(2,226	)	 	(4,255	)	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
NOI at 100% - comparable centers excluding lease cancellation income	149,182		 	145,122		 	144,592		 	136,091		 	301,734		 	293,495		 	291,734		 	275,221		 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
NOI at 100% excluding lease cancellation income - growth %	2.8	%	 	 	 	6.2	%	 	 	 	2.8	%	 	 	 	6.0	%	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
(1)	Amount includes the lump sum payment of $21.7 million received in May 2016 in connection with the termination of the Company's third party leasing agreement for Crystals due to a change in ownership of the center.	
(2)	Includes Beverly Center, CityOn.Xi'an, CityOn.Zhengzhou, Country Club Plaza, International Market Place, and Starfield Hanam.	
(3)	Includes Beverly Center, CityOn.Xi'an, and Country Club Plaza.	
(4)	Includes Beverly Center, CityOn.Xi'an, Country Club Plaza, and The Mall of San Juan.	
(5)	Includes Beverly Center and The Mall of San Juan.	

Taubman Centers/ 13

	
										
TAUBMAN CENTERS, INC.	 	 	
Table 8 - Balance Sheets	 	
As of June 30, 2017 and December 31, 2016	
(in thousands of dollars)	 	 	
 	 	 	 	 	As of	
 	 	 	 	 	June 30, 2017	 	December 31, 2016	
Consolidated Balance Sheet of Taubman Centers, Inc.:	 	 	 	 	
 	 	 	 	 	 	 	 	
Assets:	 	 	 	 	
 	Properties	 	4,304,273		 	4,173,954		
 	Accumulated depreciation and amortization	 	(1,211,672	)	 	(1,147,390	)	
 	 	 	 	 	3,092,601		 	3,026,564		
 	Investment in Unconsolidated Joint Ventures	 	564,496		 	604,808		
 	Cash and cash equivalents	 	42,260		 	40,603		
 	Restricted cash	 	7,968		 	932		
 	Accounts and notes receivable, net	 	61,088		 	60,174		
 	Accounts receivable from related parties	 	2,504		 	2,103		
 	Deferred charges and other assets	 	290,821		 	275,728		
 	 	 	 	 	4,061,738		 	4,010,912		
Liabilities:	 	 	 	 	
 	Notes payable, net	 	3,351,212		 	3,255,512		
 	Accounts payable and accrued liabilities	 	316,086		 	336,536		
 	Distributions in excess of investments in and net income of	 			 			
 	Unconsolidated Joint Ventures	 	506,165		 	480,863		
 	 	 	4,173,463		 	4,072,911		
 	 	 	
Redeemable noncontrolling interest	 	9,150		 	8,704		
 	 	 	
Equity (Deficit):	 	 	 	 	
 	Taubman Centers, Inc. Shareowners' Equity:	 	 	 	 	
 	 	Series B Non-Participating Convertible Preferred Stock	 	25		 	25		
 	 	Series J Cumulative Redeemable Preferred Stock	 			 			
 	 	Series K Cumulative Redeemable Preferred Stock	 		 		
 	 	Common Stock	 	607		 	604		
 	 	Additional paid-in capital	 	664,182		 	657,281		
 	 	Accumulated other comprehensive income (loss)	 	(30,998	)	 	(35,916	)	
 	 	Dividends in excess of net income	 	(595,264	)	 	(549,914	)	
 	 	 	38,552		 	72,080		
 	Noncontrolling interests:	 	 	 	 	
 	 	Noncontrolling interests in consolidated joint ventures	 	(157,052	)	 	(155,919	)	
 	 	Noncontrolling interests in partnership equity of TRG	 	(2,375	)	 	13,136		
 	 	 	 	(159,427	)	 	(142,783	)	
 	 	 	 	(120,875	)	 	(70,703	)	
 	 	 	 	4,061,738		 	4,010,912		

 	 	 	 	 	 	 	 	
Combined Balance Sheet of Unconsolidated Joint Ventures (1) :	 	 	 	 	
Assets:	 	 	 	 	
 	Properties	 	3,660,407		 	3,371,216		
 	Accumulated depreciation and amortization	 	(706,521	)	 	(661,611	)	
 	 	 	 	 	2,953,886		 	2,709,605		
 	Cash and cash equivalents	 	112,965		 	83,882		
 	Accounts and notes receivable, net	 	107,962		 	87,612		
 	Deferred charges and other assets	 	122,982		 	67,167		
 	 	 	 	 	3,297,795		 	2,948,266		
Liabilities:	 	 	 	 	
 	Notes payable, net (2)	 	2,832,586		 	2,706,628		
 	Accounts payable and other liabilities	 	516,230		 	359,814		
 	 	 	 	 	3,348,816		 	3,066,442		
Accumulated deficiency in assets:	 	 	 	 	
 	Accumulated deficiency in assets - TRG	 	(83,293	)	 	(145,679	)	
 	Accumulated deficiency in assets - Joint Venture Partners	 	74,150		 	81,217		
 	Accumulated other comprehensive loss - TRG	 	(16,597	)	 	(20,547	)	
 	Accumulated other comprehensive loss - Joint Venture Partners	 	(25,281	)	 	(33,167	)	
 	 	 	 	 	(51,021	)	 	(118,176	)	
 	 	 	 	 	3,297,795		 	2,948,266		
 	 	 	 	 	 	 	 	
(1)	As of December 31, 2016, Unconsolidated Joint Venture amounts exclude the balances of CityOn.Zhengzhou, which opened in March 2017.	
(2)	The December 31, 2016 balance excludes the construction financing outstanding for CityOn.Zhengzhou of $70.5 million ($34.5 million at TRG's share).	

Taubman Centers/ 14

	
								
TAUBMAN CENTERS, INC.	
Table 9 - Annual Guidance	
(all dollar amounts per common share on a diluted basis; amounts may not add due to rounding)	

 	 	Range for the Year Ended	
 	 	December 31, 2017  	
 	 	 	 	 	
Adjusted Funds from Operations per common share	3.67		 	3.77		
 	 	 	 	
Restructuring charge	(0.03	)	 	(0.03	)	
 	 	 	 	
Costs associated with shareowner activism (1)	(0.10	)	 	(0.10	)	
 	 	 	 	
Partial write-off of deferred financing costs	(0.00	)	 	(0.00	)	
 	 	 	 	 	
Funds from Operations per common share	3.53		 	3.63		
 	 	 	 	 	
Gain on disposition, net of tax	0.02		 	0.02		
 	 	 	 	 	
Real estate depreciation - TRG	(2.40	)	 	(2.28	)	
 	 	 	 	 	
Distributions to participating securities of TRG	(0.03	)	 	(0.03	)	
 	 	 	 	 	
Depreciation of TCO's additional basis in TRG	(0.11	)	 	(0.11	)	
 	 	 	 	 	
Net income attributable to common shareowners, per common share (EPS)	1.03		 	1.23		
 	 	 	 	 	
(1	)	Amount represents actual expense recognized through the second quarter of 2017. Amount does not include future assumptions of costs to be incurred.