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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-K

OR

TAUBMAN CENTERS, INC.
(Exact Name of Registrant as Specified in Its Charter)

Securities registered pursuant to Section 12(b) of the Act:

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter periods that the registrant was required to file such report(s)) and (2) has been subject to such filing requirements for the past 90 days.

     Yes X    No

As of March 5, 2004, the aggregate market value of the 49,724,783 shares of Common Stock held by non-affiliates of the registrant was $1.2 billion, based upon the closing price $24.68 on the New York Stock Exchange composite tape on such date. (For this computation, the registrant has excluded the market value of all shares of its Common Stock reported as beneficially owned by executive officers and directors of the registrant and certain other shareholders; such exclusion shall not be deemed to constitute an admission that any such person is an "affiliate" of the registrant.) As of March 5, 2003, there were outstanding 50,456,343 shares of Common Stock.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the proxy statement for the annual shareholders meeting to be held in 2003 are incorporated by reference into Parts II and III.

PART I

Item 1. BUSINESS.

The Company

        Taubman Centers, Inc. (“we”, “us”, “our”, or “TCO”) was incorporated in Michigan in 1973 and had our initial public offering (“IPO”) in 1992. We own a 61% managing general partner’s interest in The Taubman Realty Group Limited Partnership (the “Operating Partnership” or “TRG”), through which we conduct all of our operations.

        We are engaged in the ownership, development, acquisition, and operation of regional shopping centers and interests therein. Our portfolio, as of December 31, 2003, included 21 urban and suburban centers located in nine states. One new center is under construction in North Carolina and is scheduled to open September 15, 2005. The Operating Partnership also owns certain regional retail shopping center development projects and more than 99% of The Taubman Company LLC (the “Manager”), which manages the shopping centers and provides other services to the Operating Partnership and to us. See the table on page 10 of this report for information regarding the centers.

        We are a real estate investment trust, or REIT, under the Internal Revenue Code of 1986, as amended (the “Code”). In order to satisfy the provisions of the Code applicable to REITs, we must distribute to our shareholders at least 90% of our REIT taxable income and meet certain other requirements. The Operating Partnership’s partnership agreement provides that the Operating Partnership will distribute, at a minimum, sufficient amounts to its partners such that our pro rata share will enable us to pay shareholder dividends (including capital gains dividends that may be required upon the Operating Partnership’s sale of an asset) that will satisfy the REIT provisions of the Code.

Recent Developments

        For a discussion of business developments that occurred in 2003, see Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” (MD&A).

The Shopping Center Business

        There are several types of retail shopping centers, varying primarily by size and marketing strategy. Retail shopping centers range from neighborhood centers of less than 100,000 square feet of GLA to regional and super-regional shopping centers. Retail shopping centers in excess of 400,000 square feet of GLA are generally referred to as “regional” shopping centers, while those centers having in excess of 800,000 square feet of GLA are generally referred to as “super-regional” shopping centers. Nineteen of our centers are “super-regional” centers. In this annual report on Form 10-K, the term “regional shopping centers” refers to both regional and super-regional shopping centers. The term “GLA” refers to gross retail space, including anchors and mall tenant areas, and the term “Mall GLA” refers to gross retail space, excluding anchors. The term “anchor” refers to a department store or other large retail store. The term “mall tenants” refers to stores (other than anchors) that are typically specialty retailers and lease space in shopping centers.

Business of the Company

        We, as managing general partner of the Operating Partnership, are engaged in the ownership, management, leasing, acquisition, development, and expansion of regional shopping centers.

      The centers:

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        The most important factor affecting the revenues generated by the centers is leasing to mall tenants (primarily specialty retailers), which represents approximately 90% of revenues. Anchors account for less than 10% of revenues because many own their stores and, in general, those that lease their stores do so at rates substantially lower than those in effect for mall tenants.

        Our portfolio is concentrated in highly productive super-regional shopping centers. Of the 21 centers, 20 had annual rent rolls at December 31, 2003 of over $10 million. We believe that this level of productivity is indicative of the centers’ strong competitive position and is, in significant part, attributable to our business strategy and philosophy. We believe that large shopping centers (including regional and especially super-regional shopping centers) are the least susceptible to direct competition because (among other reasons) anchors and large specialty retail stores do not find it economically attractive to open additional stores in the immediate vicinity of an existing location for fear of competing with themselves. In addition to the advantage of size, we believe that the centers’ success can be attributed in part to their other physical characteristics, such as design, layout, and amenities.

Business Strategy And Philosophy

        We believe that the regional shopping center business is not simply a real estate development business, but rather an operating business in which a retailing approach to the on-going management and leasing of the centers is essential. Thus we:

        The centers compete for retail consumer spending through diverse, in-depth presentations of predominantly fashion merchandise in an environment intended to facilitate customer shopping. While some centers include stores that target high-end, upscale customers, each center is individually merchandised in light of the demographics of its potential customers within convenient driving distance.

        Our leasing strategy involves assembling a diverse mix of mall tenants in each of the centers in order to attract customers, thereby generating higher sales by mall tenants. High sales by mall tenants make the centers attractive to prospective tenants, thereby increasing the rental rates that prospective tenants are willing to pay. We implement an active leasing strategy to increase the centers’ productivity and to set minimum rents at higher levels. Elements of this strategy include terminating leases of under-performing tenants, renegotiating existing leases, and not leasing space to prospective tenants that (though viable or attractive in certain ways) would not enhance a center’s retail mix.

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Potential For Growth

        Our principal objective is to enhance shareholder value. We seek to maximize the financial results of our core assets, while also pursuing a growth strategy that primarily includes an active new center development program.

Internal Growth

        We expect that 90% of our future growth will come from our existing core portfolio and business. Although we’ve always had a culture of intensively managing our assets and maximizing the rents from tenants, we’re committed to improving the processes that significantly impact the core portfolio in order to drive even better performance.

        Our core business strategy is to maintain a portfolio of properties that deliver above-market profitable growth by providing targeted retailers with the best opportunity to do business in each market and targeted shoppers with the best local shopping experience for their needs.

        We are working on three endeavors that we believe will lead to achievement of our key mission to “deliver above market profitable growth”. Our first endeavor is to become an even more customer centric company than we are today, which will enable us to make better decisions driven by a fact-based understanding of what retailers and shoppers want. Our second endeavor is to become more operationally excellent, which will enable us to achieve competitive cost efficiencies, greater discipline, and more timely processes and decision making. This is especially important as our competitors search for economies of scale in increasingly larger operations. Our third endeavor is to achieve profitable growth, which we’ve defined as maintaining the highest tenant sales and sales growth in the industry, and accelerating core operations growth over time. We believe further integrating these basic strategic themes throughout the organization will serve to coordinate and prioritize all of our efforts to achieve our strategy.

        We’ve identified the key drivers to achieve our core business strategy. These drivers fall into four categories: people drivers, organizational drivers, customer drivers and financial drivers. These drivers served as a basis for the companywide initiatives we worked on in 2003 and that we believe will establish a strong foundation for improved core performance. We made progress on our initiatives, including the implementation of a new lease process software package in 2003, which will help reduce the time between a tenant leaving a space and a new tenant paying rent in that space. In addition, in a year which we’ve experienced significant early tenant terminations, we’ve worked to maximize income by increasing the number of temporary tenants. Also, we’ve made improvements to our tenant grading system to ensure that the system is a strong predictor of a new tenant’s ability to pay contract rent for its entire term and to establish risk parameters for each asset to guide our leasing team. We’re continuing to work on these and other initiatives to improve core performance.

        We strongly believe that focusing management attention on these initiatives will improve our performance on these drivers and by establishing specific benchmarks and goals for these drivers, which we can measure year after year, we will have set the stage for future strong core operations growth.

Development of New Centers

        We are pursuing an active program of regional shopping center development. We believe that we have the expertise to develop economically attractive regional shopping centers through intensive analysis of local retail opportunities. We believe that the development of new centers is an important use of our capital and an area in which we excel. At any time, we have numerous potential development projects in various stages.

        The Mall at Millenia, a 1.1 million square foot center in which the Operating Partnership has a 50% interest, opened in October 2002 in Orlando, Florida.

        Stony Point Fashion Park, a 665,000 square foot wholly-owned center, opened September 18, 2003 in Richmond, Virginia.

        Northlake Mall, a 1.1 million square foot wholly-owned center in Charlotte, North Carolina is currently under construction and is scheduled to open September 15, 2005.

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        Our approximately $34.2 million balance of development pre-construction costs as of December 31, 2003 consists of costs relating to our Oyster Bay project in Syosset, New York. Refer to Management’s Discussion and Analysis of Financial Condition and Results of Operations-Planned Capital Spending regarding the status of this project.

        Our policies with respect to development activities are designed to reduce the risks associated with development. We generally do not intend to acquire land early in the development process. Instead, we generally acquire options on land or form partnerships with landholders holding potentially attractive development sites. We typically exercise the options only once we are prepared to begin construction. The pre-construction phase for a regional center typically extends over several years and the time to obtain anchor commitments, zoning and regulatory approvals, and public financing arrangements can vary significantly from project to project. In addition, we do not intend to begin construction until a sufficient number of anchor stores have agreed to operate in the shopping center, such that we are confident that the projected sales and rents from Mall GLA are sufficient to earn a return on invested capital in excess of our cost of capital. Having historically followed these principles, our experience indicates that, on average, less than 10% of the costs of the development of a regional shopping center will be incurred prior to the construction period. However, no assurance can be given that we will continue to be able to so limit pre-construction costs. Unexpected costs due to extended zoning and regulatory processes may cause our investment in a project to exceed this historic experience.

        While we will continue to evaluate development projects using criteria, including financial criteria for rates of return, similar to those employed in the past, no assurances can be given that the adherence to these policies will produce comparable results in the future. In addition, the costs of shopping center development opportunities that are explored but ultimately abandoned will, to some extent, diminish the overall return on development projects (see Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources — Capital Spending for further discussion of our development activities).

Strategic Acquisitions

        Our objective is to acquire existing centers only when they are compatible with the quality of our portfolio (or can be redeveloped to that level) and that satisfy our strategic plans and pricing requirements. During 2003 we acquired:

Expansions of the Centers

        Another potential element of growth is the strategic expansion of existing properties to update and enhance their market positions, by replacing or adding new anchor stores or increasing mall tenant space. Most of the centers have been designed to accommodate expansions. Expansion projects can be as significant as new shopping center construction in terms of scope and cost, requiring governmental and existing anchor store approvals, design and engineering activities, including rerouting utilities, providing additional parking areas or decking, acquiring additional land, and relocating anchors and mall tenants (all of which must take place with a minimum of disruption to existing tenants and customers).

4

        The following table includes information regarding recent development, acquisition, and expansion activities:

Rental Rates

        As leases have expired in the centers, we have generally been able to rent the available space, either to the existing tenant or a new tenant, at rental rates that are higher than those of the expired leases. In a period of increasing sales, rents on new leases will tend to rise as tenants’ expectations of future growth become more optimistic. In periods of slower growth or declining sales, rents on new leases will grow more slowly or will decline for the opposite reason. However, center revenues nevertheless increase as older leases roll over or are terminated early and replaced with new leases negotiated at current rental rates that are usually higher than the average rates for existing leases.

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        The following tables contain certain information regarding per square foot minimum rent at the comparable centers, which exclude the discontinued operations at Biltmore Fashion Park, La Cumbre Plaza, and Paseo Nuevo, as well as centers opened or acquired during 2001 through 2003:

Lease Expirations

        The following table shows lease expirations based on information available as of December 31, 2003 for the next ten years for the centers in operation at that date:

        We believe that the information in the table is not necessarily indicative of what will occur in the future because of several factors, but principally because of early lease terminations at the centers. For example, the average remaining term of the leases that were terminated during the period 1997 to 2003 was approximately two years. The average term of leases signed during 2003 and 2002 was approximately seven years.

        In addition, mall tenants at the centers may seek the protection of the bankruptcy laws, which could result in the termination of such tenants’ leases and thus cause a reduction in cash flow. In 2003, approximately 2.3% of leases were so affected compared to 1.7% in 2002. This statistic has ranged from 1.2% to 4.5% since we went public in 1992. Since 1991, the annual provision for losses on accounts receivable has been less than 2% of annual revenues.

Occupancy

        For comparable centers, leased space, ending occupancy, and average occupancy were 90.0%, 88.1%, and 87.8%, respectively, in 2003, and 93.3%, 90.3%, and 88.2%, respectively, in 2002. Mall tenant average occupancy, ending occupancy, and leased space rates of all centers are as follows:

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Major Tenants

        No single retail company represents 10% or more of our revenues. The combined operations of The Limited, Inc. accounted for approximately 5.2% of Mall GLA as of December 31, 2003 and 5.3% of 2003 minimum rent. No other single retail company accounted for more than 3% of Mall GLA or 4% of 2003 minimum rent. The following table shows the ten largest tenants and their square footage as of December 31, 2003:

General Risks of the Company

Economic Performance and Value of Shopping Centers Dependent on Many Factors

        The economic performance and value of our shopping centers are dependent on various factors. Additionally, these same factors will influence our decision whether to go forward on the development of new centers and may affect the ultimate economic performance and value of projects under construction (see other risks associated with the development of new centers under “Business of the Company — Development of New Centers”). Such factors include:

In addition, the value of shopping centers may be adversely affected by:

        Adverse changes in the economic performance and value of shopping centers would adversely affect our income and cash available to pay dividends.

7

Third Party Interests in the Centers

        Some of the shopping centers are partially owned by non-affiliated partners through joint venture arrangements. As a result, we do not control all decisions regarding those shopping centers and may be required to take actions that are in the interest of the joint venture partners but not our best interests.

Bankruptcy of Mall Tenants or Joint Venture Partners

        We could be adversely affected by the bankruptcy of third parties. The bankruptcy of a mall tenant could result in the termination of its lease which would lower the amount of cash generated by that mall. In addition, if a department store operating an anchor at one of our shopping centers were to go into bankruptcy and cease operating, its closing may lead to reduced customer traffic and lower mall tenant sales which would, in turn, affect the amount of rent our tenants pay us. The profitability of shopping centers held in a joint venture could also be adversely affected by the bankruptcy of one of the joint venture partners if, because of certain provisions of the bankruptcy laws, we were unable to make important decisions in a timely fashion or became subject to additional liabilities.

Investments in and Loans to Third Parties

        We occasionally extend credit to third parties in connection with the sale of land or other transactions. We have occasionally made investments in marketable and other equity securities. We are exposed to risk in the event the values of our investments and/or our loans decrease due to overall market conditions, business failure, and/or other nonperformance by the investees or counterparties.

Third Party Contracts

        We provide property management, leasing, development, and other administrative services to centers owned by General Motors pension trusts, other third parties and to certain Taubman affiliates. The contracts under which these services are provided may be canceled or not renewed or may be renegotiated on terms less favorable to us. Certain overhead costs allocated to these contracts would not be eliminated if the contracts were to be canceled or not renewed.

Inability to Maintain Status as a REIT

8

Environmental Matters

        All of the centers presently owned by us (not including option interests in certain pre- development projects or any of the real estate managed but not included in our portfolio) have been subject to environmental assessments. We are not aware of any environmental liability relating to the centers or any other property, in which we have or had an interest (whether as an owner or operator) that we believe, would have a material adverse effect on our business, assets, or results of operations. No assurances can be given, however, that all environmental liabilities have been identified or that no prior owner, operator, or current occupant has created an environmental condition not known to us. Moreover, no assurances can be given that (1) future laws, ordinances, or regulations will not impose any material environmental liability or that (2) the current environmental condition of the centers will not be affected by tenants and occupants of the centers, by the condition of properties in the vicinity of the centers (such as the presence of underground storage tanks), or by third parties unrelated to us.

Personnel

        We have engaged the Manager to provide real estate management, acquisition, development, and administrative services required by us and our properties.

        As of December 31, 2003, the Manager had 718 full-time employees. The following table provides a breakdown of employees by operational areas as of December 31, 2003:

Available Information

        We make available free of charge through our website at www.taubman.com all reports we electronically file with, or furnish to, the Securities Exchange Commission (the “SEC”), including our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K, as well as any amendments to those reports, as soon as reasonably practicable after those documents are filed with, or furnished to, the SEC. These filings are also accessible on the SEC’s website at www.sec.gov.

Item 2. PROPERTIES.

Ownership

        The following table sets forth certain information about each of the centers. The table includes only centers in operation at December 31, 2003. Excluded from this table is Northlake Mall which will open in 2005. Centers are owned in fee other than Beverly Center, Cherry Creek, International Plaza, MacArthur Center, and Sunvalley, which are held under ground leases expiring between 2049 and 2083.

        Certain of the centers are partially owned through joint ventures. Generally, the Operating Partnership’s joint venture partners have ongoing rights with regard to the disposition of the Operating Partnership’s interest in the joint ventures, as well as the approval of certain major matters.

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Anchors

        The following table summarizes certain information regarding the anchors at the operating centers (excluding the value centers) as of December 31, 2003:

Mortgage Debt

        The following table sets forth certain information regarding the mortgages encumbering the centers as of December 31, 2003. All mortgage debt in the table below is nonrecourse to the Operating Partnership, except for debt encumbering Dolphin Mall, Stony Point Fashion Park, The Mall at Wellington Green, and The Shops at Willow Bend. The Operating Partnership has guaranteed the payment of all or a portion of the principal and interest on the mortgage debt of these centers. The Stony Point Fashion Park and Wellington Green loan ag