DISCLOSURES Cautionary Statement Regarding Forward-Looking Statements BUSINESS OVERVIEW AND STRATEGY First Capital Realty’s primary objective is the creation of value through long-term maximization of cash flow and capital appreciation from its growing shopping  centre portfolio. Management’s Discussion and Analysis This Management’s Discussion and Analysis (“MD&A”) of results of operations and financial condition should be read in conjunction with First Capital Realty Inc.’s (“First Capital Realty” or the “Company”) audited consolidated financial statements for the years ended December 31, 2003 and 2002 and the accompanying notes. Additional information on the Company, including the Annual Information Form is on SEDAR at www.sedar.com. Certain statements included in this MD&A constitute forward-looking statements, including those identified by the expressions “anticipate”, “believe”, “plan”, “estimate”, “expect”, “intend” and similar expressions to the extent they relate to the Company or its management. The forward- looking statements are not historical facts but reflect the Company’s current expectations regarding future results or events and are based on information currently available to management.  Management believes that the expectations reflected in forward-looking statements are based upon reasonable assumptions; however, management can give no assurance that actual results will be consistent with these forward-looking statements. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations, including the matters discussed under “Risk Management” and in other sections of this management’s discussion and analysis. Factors that could cause actual results or events to differ materially from those expressed or implied by forward-looking statements, include, but are not limited to, general economic conditions, the availability of new competitive supply of retail properties which may become available either through construction or sublease, First Capital Realty’s ability to maintain occupancy and to lease or re-lease space at current or anticipated rents, tenant bankruptcies, financial difficulties and defaults, changes in interest rates, changes in operating costs, First Capital Realty’s ability to obtain insurance coverage at a reasonable cost and the availability of financing. These forward-looking statements are made as of March 12, 2004 and First Capital Realty assumes no obligation to update or revise them to reflect new events or circumstances. First Capital Realty Inc. was established in November 1993. The Company, directly and through subsidiaries, invests in neighbourhood and community shopping centres in Canada. The Company also invests in the United States through its holdings in Equity One, Inc. (NYSE:EQY) (“Equity One”), a neighbourhood and community shopping centre REIT operating primarily in the southern United States. First Capital Realty’s primary objective is the creation of value through long-term maximization of cash flow and capital appreciation from its growing shopping centre portfolio. This objective is achieved by proactive management of the existing shopping centre portfolio, by a focused and disciplined acquisition strategy and by undertaking selective development and redevelopment activities. 15 First Capital Realty Annual Report 2003