UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934

For the quarter ended September 30, 2004

Commission File Number 0-20449

PRICE LEGACY CORPORATION

(Exact name of registrant as specified in its charter)

Maryland	33-0628740
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)

17140 Bernardo Center Drive, Suite 300, San Diego, California 92128

(Address of principal executive offices) (Zip Code)

(858) 675-9400

(Registrant’s telephone number, including area code)

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 period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES ý NO o

Indicate by check mark whether the registrant is an accelerated filer (as defined in Exchange Act Rule 12b-2). Yes ý No o

The registrant had 36,921,206 shares of common stock, par value $.0004 per share, outstanding at November 5, 2004.

PART I - FINANCIAL INFORMATION

ITEM 1 - FINANCIAL STATEMENTS

PRICE LEGACY CORPORATION

CONSOLIDATED BALANCE SHEETS

(unaudited – amounts in thousands, except share data)

ASSETS

	September 30			December 31
	2004			2003

Real estate assets
Land and land improvements	$	366,305		$	410,207
Building and improvements	663,557			670,050
Construction in progress	655			582
	1,030,517			1,080,839
Property held for sale	45,191			70,988
Less accumulated depreciation	(67,352		)	(54,836		)
	1,008,356			1,096,991

Investment in unconsolidated real estate joint ventures	—			4,113
Cash and cash equivalents	54,760			7,631
Restricted cash	11,410			11,288
Accounts receivable, net of allowance of $1,219 and $1,415	5,352			7,440
Notes receivable	811			10,311
Deferred rents	12,039			11,161
Other assets	41,107			21,953
Total assets	$	1,133,835		$	1,170,888

See accompanying notes.

LIABILITIES AND STOCKHOLDERS’ EQUITY

	September 30			December 31
	2004			2003

Liabilities
Mortgages and notes payable	$	540,714		$	483,675
Capital lease payable on property held for sale	—			11,706
Revolving line of credit	—			69,100
	540,714			564,481
Accounts payable and other liabilities	51,489			29,945
Total liabilities	592,203			594,426

Commitments and contingencies

Minority interests	595			1,608

Stockholders’ equity
Series A Preferred Stock, cumulative, redeemable, $0.0001 par value, 27,849,771 shares authorized, 3,986,994 and 27,434,166 shares issued and outstanding	58,116			399,615
Series 1 Preferred Stock, cumulative, redeemable, $0.0001 par value, 15,218,506 shares authorized, 2,942,463 shares issued and outstanding at September 30, 2004	47,227			—
Series B Preferred Stock, junior, convertible, redeemable, $0.0001 par value, 27,458,855 shares authorized, 24,125,208 shares issued and outstanding at December 31, 2003	—			131,023

Common stock, $0.0004 par value, 106,931,723 shares authorized, 36,921,206 issued and outstanding at September 30, 2004; $0.0001 par value, 94,691,374 shares authorized, 8,690,414 issued and outstanding at December 31, 2003	15			3
Additional paid-in capital	649,032			176,431
Accumulated comprehensive loss	(2,776		)	(1,479		)
Retained deficit	(210,577		)	(130,739		)
Total stockholders’ equity	541,037			574,854
Total liabilities and stockholders’ equity	$	1,133,835		$	1,170,888

See accompanying notes.

PRICE LEGACY CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited - amounts in thousands, except per share data)

Third Quarter
Three Months Ended
September 30

Year-to-Date
Nine Months Ended
September 30

2004

2003

2004

2003

Rental revenues

32,149

29,286

94,483

89,174

Expenses

Operating and maintenance

3,994

4,744

13,279

15,381

Property taxes

4,193

3,786

12,315

11,280

Depreciation and amortization

5,525

5,051

16,436

14,379

General and administrative

PART I - FINANCIAL INFORMATION			3
	ITEM 1 - FINANCIAL STATEMENTS		3
		CONSOLIDATED BALANCE SHEETS	3
		CONSOLIDATED STATEMENTS OF OPERATIONS	5
		CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY	6
		CONSOLIDATED STATEMENTS OF CASH FLOWS	7
		NOTES TO CONSOLIDATED FINANCIAL STATEMENTS	8
	ITEM 2 - MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS		29
	ITEM 3 - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK		43
	ITEM 4 – CONTROLS AND PROCEDURES		44
PART II - OTHER INFORMATION			45
	ITEM 1 – LEGAL PROCEEDINGS		45
	ITEM 6 - EXHIBITS		46