Net operating income (“NOI”) increased in 2003 by $17.5 million to $95.9 million. Same property NOI (includes properties where the Company’s ownership and investment are substantially the same in the two calendar years) grew by 1.9% or $1.0 million during the year.  NOI from acquisitions increased by $13.7 million in 2003 to $26.0 million as a result of 2003 acquisitions which contributed NOI of $7.3 million and from the incremental effect of 2002 acquisitions held for the entire year of $6.4 million. The development and redevelopment projects completed during the year also provided $4.2 million of the increase in NOI.  In the normal course of operations the Company receives payments from tenants as compensation for the cancellation of leases. Typically, annual lease termination income ranges normally from $300,000 to $500,000. In 2003, the Company received lease cancellation payments of $0.5 million as compared to $1.9 million in 2002. Lease termination income was lower in 2003 due to a one- time lease termination payment of $1.6 million received from a single tenant in 2002. The Company’s share of Equity One’s net earnings, adjusted to Canadian GAAP, net of a provision for future tax on the undistributed earnings of Equity One, is recorded as equity income. The $2.5 million decrease in the equity income is primarily due to a change in the average U.S. exchange rate from $1.57 in 2002 to $1.40 in 2003, and is also impacted by a decrease in the weighted average ownership from 33% to 20% offset by an increase in Equity One income. Interest and other income is comprised of the following: The Company earns interest income from funds invested in three types of investments: advances made to the Company’s development partners; short-term cash deposits; and an investment in a portfolio of short-term mortgages and other receivables. The growth in interest and other income in 2003 is primarily from increased interest income due to a higher amount of advances made to development partners for development activities during the year. The loss on disposition of land and shopping centres for the year ended December 31, 2003 is from the disposition of a non-core asset. The gains on disposition of land and shopping centres for the year ended December 31, 2002 are from the sale to large format retailers of land parcels adjacent to the Company’s properties. 24 First Capital Realty Annual Report 2003 (thousands of dollars) 2003 2002 Interest and other income $ 2,839 $ 1,998 Gain (loss) on disposition of marketable securities 74 (138) Dividend income 77 156 2,990 2,016 Gain (loss) on disposition of land and shopping centres (275) 591 Total $ 2,715 $ 2,607 Interest, Other Income and Gains on Sale  Equity Income from Equity One, Inc. Same property  NOI grew 1.9% over 2002. Management’s Discussion and Analysis  continued