10-K: Annual report [Section 13 and 15(d), not S-K Item 405]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K

(Mark One)
__X__ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the fiscal year ended December 31, 2000

OR

____ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from ____________ to ____________

Commission file number 1-10899

Kimco Realty Corporation
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)

Maryland 13-2744380
- ------------------------ ------------------------------------
(State of incorporation) (I.R.S. Employer Identification No.)

3333 New Hyde Park Road, New Hyde Park, NY 11042-0020
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(Address of principal executive offices) Zip Code

Registrant's telephone number, including area code (516)869-9000
Securities registered pursuant to Section 12(b) of the Act:


Name of each exchange on
Title of each class which registered
------------------- ------------------------
Common Stock, par value $.01 per share. New York Stock Exchange

Depositary Shares, each representing one-
tenth of a share of 7-3/4% Class A
Cumulative Redeemable Preferred Stock,
par value $1.00 per share. New York Stock Exchange

Depositary Shares, each representing one-
tenth of a share of 8-1/2% Class B
Cumulative Redeemable Preferred Stock,
par value $1.00 per share. New York Stock Exchange

Depositary Shares, each representing one-
tenth of a share of 8-3/8% Class C
Cumulative Redeemable Preferred Stock,
par value $1.00 per share. New York Stock Exchange

Depositary Shares, each representing one-
tenth of a share of 7-1/2% Class D
Cumulative Convertible Preferred
Stock, par value $1.00 per share. New York Stock Exchange

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


Indicate by check mark whether the registrant (i) 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 (ii) has been subject to such
filing requirements for the past 90 days. Yes X No Indicate by check mark if
disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not
contained herein, and will not be contained, to the best of registrant's
knowledge, in definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this Form 10-K. _X_

The aggregate market value of the voting stock held by
nonaffiliates of the registrant was approximately $2.4 billion based upon the
closing price on the New York Stock Exchange for such stock on February 1, 2001.

(APPLICABLE ONLY TO CORPORATE REGISTRANTS)
Indicate the number of shares outstanding of each of the
registrant's classes of common stock, as of the latest practicable date.

63,249,835 shares as of February 1, 2001.



Page 1 of 85






DOCUMENTS INCORPORATED BY REFERENCE


Part III incorporates certain information by reference to the Registrant's
definitive proxy statement to be filed with respect to the Annual Meeting of
Stockholders expected to be held on May 15, 2001.

Index to Exhibits begins on page 37.











2









TABLE OF CONTENTS

Form
10-K
Report
Item No. Page
- -------- ------
PART I

1. Business . . . . . . . . . . . . . . . . . . . . . . . . . . 4

2. Properties . . . . . . . . . . . . . . . . . . . . . . . . . 13

3. Legal Proceedings. . . . . . . . . . . . . . . . . . . . . . 15

4. Submission of Matters to a Vote of Security Holders . . . . 15

Executive Officers and other Significant Employees
of the Registrant . . . . . . . . . . . . . . . . . . . . 25


PART II

5. Market for the Registrant's Common Equity
and Related Shareholder Matters . . . . . . . . . . . . . 27

6. Selected Financial Data . . . . . . . . . . . . . . . . . . 28

7. Management's Discussion and Analysis of Financial
Condition and Results of Operations . . . . . . . . . . . 30

7A. Quantitative and Qualitative Disclosures About Market Risk. . 33

8. Financial Statements and Supplementary Data . . . . . . . . 34

9. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure . . . . . . . . . . . 34



PART III

10. Directors and Executive Officers of the Registrant . . . . . 35

11. Executive Compensation . . . . . . . . . . . . . . . . . . . 35

12. Security Ownership of Certain Beneficial Owners and
Management . . . . . . . . . . . . . . . . . . . . . . . . 35

13. Certain Relationships and Related Transactions . . . . . . . 35



PART IV

14. Exhibits, Financial Statements, Schedules and Reports on
Form 8-K . . . . . . . . . . . . . . . . . . . . . . . . . 36



3





PART I


FORWARD-LOOKING STATEMENTS

This annual report on Form 10-K, together with other statements and information
publicly disseminated by Kimco Realty Corporation (the "Company" or "Kimco")
contains certain 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. The Company intends such forward-looking
statements to be covered by the safe harbor provisions for forward-looking
statements contained in the Private Securities Litigation Reform Act of 1995 and
include this statement for purposes of complying with these safe harbor
provisions. Forward-looking statements, which are based on certain assumptions
and describe the Company's future plans, strategies and expectations, are
generally identifiable by use of the words "believe," "expect," "intend,"
"anticipate," "estimate," "project" or similar expressions. You should not rely
on forward-looking statements since they involve known and unknown risks,
uncertainties and other factors which are, in some cases, beyond the Company's
control and which could materially affect actual results, performances or
achievements. Factors which may cause actual results to differ materially from
current expectations include, but are not limited to, (i) general economic and
local real estate conditions, (ii) financing risks, such as the inability to
obtain equity or debt financing on favorable terms, (iii) changes in
governmental laws and regulations, (iv) the level and volatility of interest
rates (v) the availability of suitable acquisition opportunities and (vi)
increases in operating costs. Accordingly, there is no assurance that the
Company's expectations will be realized.

Item 1. Business

General Kimco Realty Corporation is one of the nation's largest owners and
operators of neighborhood and community shopping centers. As of February 1,
2001, the Company's portfolio was comprised of 494 property interests including
429 neighborhood and community shopping center properties, two regional malls,
50 retail store leases, nine ground-up development projects, three parcels of
undeveloped land and one distribution center totaling approximately 66.0 million
square feet of leasable space located in 41 states. The Company's portfolio
includes 53 shopping center properties comprising approximately 9.2 million
square feet (the "KIR Portfolio") relating to the Kimco Income REIT ("KIR"), a
joint venture arrangement with institutional investors established for the
purpose of investing in high quality retail properties financed primarily with
individual non-recourse mortgage debt (See Recent Developments - Investment in
Kimco Income REIT ("KIR") and Note 4 of the Notes to Consolidated Financial
Statements included in this annual report on Form 10-K). The Company believes
its portfolio of neighborhood and community shopping center properties is the
largest (measured by gross leasable area ("GLA")) currently held by any
publicly-traded real estate investment trust ("REIT"). The Company is a
self-administered REIT and manages its properties through present management,
which has owned and operated neighborhood and community shopping centers for 35
years. The Company has not engaged, nor does it expect to retain, any REIT
advisors in connection with the operation of its properties.

The Company's executive offices are located at 3333 New Hyde Park Road, New Hyde
Park, New York 11042-0020 and its telephone number is (516) 869-9000. Unless the
context indicates otherwise, the term the "Company" as used herein is intended
to include subsidiaries of the Company.

History The Company began operations through its predecessor, The Kimco
Corporation, which was organized in 1966 upon the contribution of several
shopping center properties owned by its principal stockholders. In 1973, these
principals formed the Company as a Delaware corporation, and in 1985, the
operations of The Kimco Corporation were merged into the Company. The Company
completed its initial public stock offering (the "IPO") in November 1991, and
commencing with its taxable year which began January 1, 1992, elected to
qualify as a REIT in accordance with Sections 856 through 860 of the Internal
Revenue Code of 1986, as amended (the "Code"). In 1994 the Company reorganized
as a Maryland corporation.

The Company's growth through its first fifteen years resulted primarily from the
ground-up development and construction of its shopping centers. By 1981, the
Company had assembled a portfolio of 77 properties that provided an established
source of income and positioned the Company for an expansion of its asset base.
At that time, the Company revised its growth strategy to focus on the
acquisition of existing shopping centers and creating value through the
redevelopment and re-tenanting of those properties. As a result of this
strategy, substantially all of the shopping centers added to the Company's
portfolio since 1981 have been through the acquisition of existing shopping
centers.


4




During 1998, the Company, through a merger transaction, completed the
acquisition of The Price REIT, Inc., a Maryland corporation (the "Price
REIT")(See Note 3 of the Notes to Consolidated Financial Statements included in
this annual report on Form 10-K). Prior to the merger, Price REIT was a
self-administered and self-managed equity REIT that was primarily focused on the
acquisition, development, management and redevelopment of large retail community
shopping center properties concentrated in the western part of the United
States. In connection with the Merger, the Company acquired interests in 43
properties, located in 17 states, consisting of 39 retail community centers, one
stand-alone retail warehouse, one project under development and two undeveloped
land parcels, containing approximately 8.0 million square feet of GLA. The
overall occupancy rate of the retail community centers was approximately 98%.
With the completion of the Price REIT merger, the Company expanded its presence
in certain western states including California, Arizona and Washington. In
addition, Price REIT had strong ground-up development capabilities. These
development capabilities, coupled with the Company's own construction management
expertise, provides the Company, on a selective basis, the ability to pursue
ground-up development opportunities.

Also during 1998, the Company formed KIR, an entity in which the Company held a
99.99% limited partnership interest. KIR was established for the purpose of
investing in high quality properties financed primarily with individual
non-recourse mortgages. The Company believes that these properties are
appropriate for financing with greater leverage than the Company traditionally
uses. At the time of formation, the Company contributed 19 properties to KIR,
each encumbered by an individual non-recourse mortgage. During 1999, KIR sold a
significant interest in the partnership to institutional investors. As of
December 31, 2000, the Company holds a 43.3% non-controlling limited partnership
interest in KIR and accounts for its investment in KIR under the equity method
of accounting (See Recent Developments - Investment in Kimco Income REIT ("KIR")
and Note 4 of the Notes to Consolidated Financial Statements included in this
annual report on form 10-K).

In connection with the Tax Relief Extension Act of 1999 (the "RMA") which became
effective January 1, 2001, the Company is now permitted to participate in
activities which it was precluded from previously in order to maintain its
qualification as a REIT, so long as these activities are conducted in entities
which elect to be treated as taxable subsidiaries under the code, subject to
certain limitations. As such, the Company has established Kimco Developers, Inc.
("KDI"), a wholly-owned taxable REIT subsidiary which will be primarily engaged
in the ground-up development of neighborhood and community shopping centers and
sales thereof upon completion. KDI currently has nine ground-up development
projects in progress located in San Antonio, TX, Houston, TX, Tallahasee, FL,
Miamisburg, OH, Columbus, OH, Raleigh, NC, Henderson, NV, Burleson, TX and
Peoria, AZ (see Recent Developments - Ground-Up Developments).

Investment and Operating Strategy The Company's investment objective has been to
increase cash flow, current income and, consequently, the value of its existing
portfolio of properties, and to seek continued growth through (i) the strategic
re-tenanting, renovation and expansion of its existing centers and (ii) the
selective acquisition of established income-producing real estate properties and
properties requiring significant re-tenanting and redevelopment, primarily in
neighborhood and community shopping centers in geographic regions in which the
Company presently operates. The Company, through its KDI subsidiary, will also
make selective acquisitions of land parcels for the ground-up development of
neighborhood and community shopping centers and subsequent sale thereof upon
completion. The Company will consider investments in other real estate sectors
and in geographic markets where it does not presently operate should suitable
opportunities arise.

The Company's neighborhood and community shopping center properties are designed
to attract local area customers and typically are anchored by a discount
department store, a supermarket or drugstore tenant offering day-to-day
necessities rather than high-priced luxury items. The Company may either
purchase or lease income-producing properties in the future, and may also
participate with other entities in property ownership through partnerships,
joint ventures or similar types of co-ownership. Equity investments may be
subject to existing mortgage financing and other indebtedness or such financing
or indebtedness may be incurred in connection with acquiring such investments.
Any such financing or indebtedness will have priority over the Company's equity
interest in such property. The Company may make loans to joint ventures in which
it may or may not participate in the future.

While the Company has historically held its properties for long-term investment,
and accordingly has placed strong emphasis on its ongoing program of regular
maintenance, periodic renovation and capital improvement, it is possible that
properties in the portfolio may be sold, in whole or in part, as circumstances
warrant, subject to REIT qualification rules.

5




The Company emphasizes equity real estate investments, but may, at its
discretion, invest in mortgages, other real estate interests and other
investments. The mortgages in which the Company may invest may be either first
mortgages, junior mortgages or other mortgage-related securities.

The Company may legally invest in the securities of other issuers, for the
purpose, among others, of exercising control over such entities, subject to the
gross income and asset tests necessary for REIT qualification. The Company may,
on a selective basis, acquire all or substantially all securities or assets of
other REITs or similar entities where such investments would be consistent with
the Company's investment policies. In any event, the Company does not intend
that its investments in securities will require it to register as an "investment
company" under the Investment Company Act of 1940.

The Company seeks to reduce its operating and leasing risks through
diversification achieved by the geographic distribution of its properties and a
large tenant base. At December 31, 2000, the Company's single largest
neighborhood and community shopping center, excluding the KIR Portfolio,
accounted for only 1.4% of the Company's annualized base rental revenues and
only 1.0% of the Company's total shopping center GLA. At December 31, 2000, the
Company's five largest tenants, excluding the KIR Portfolio, include Kmart
Corporation, Kohl's, The Home Depot, Ames, and TJX Companies, which represent
approximately 13.3%, 2.9%, 2.6%, 2.6% and 1.9%, respectively, of the Company's
annualized base rental revenues.

The Company intends to maintain a conservative debt capitalization with a ratio
of debt to total market capitalization of approximately 50% or less. As of
December 31, 2000, the Company had a debt to total market capitalization ratio
of approximately 30%.

The Company has authority to offer shares of capital stock or other senior
securities in exchange for property and to repurchase or otherwise reacquire its
common stock or any other securities and may engage in such activities in the
future. At all times, the Company intends to make investments in such a manner
as to be consistent with the requirements of the Code, to qualify as a REIT
unless, because of circumstances or changes in the Code (or in Treasury
Regulations), the Board of Directors determines that it is no longer in the best
interests of the Company to qualify as a REIT.

The Company's policies with respect to the aforementioned activities may be
reviewed and modified from time to time by the Company's Board of Directors
without the vote of the Company's stockholders.

Competition As one of the original participants in the growth of the shopping
center industry and one of the nation's largest owners and operators of
neighborhood and community shopping centers, the Company has established close
relationships with a large number of major national and regional retailers and
maintains a broad network of industry contacts. Management is associated with
and/or actively participates in many shopping center and REIT industry
organizations. Notwithstanding these relationships, there are numerous
commercial developers, real estate companies, financial institutions and other
investors that compete with the Company in seeking properties for acquisition
and tenants who will lease space in these properties.

Capital Resources Since the completion of the Company's IPO in 1991, the Company
has utilized the public debt and equity markets as its principal source of
capital. Since the IPO, the Company has completed additional offerings of its
public unsecured debt and equity, raising in the aggregate over $2.2 billion for
the purposes of repaying indebtedness, acquiring interests in neighborhood and
community shopping centers and for expanding and improving properties in the
portfolio.

During August 2000, the Company established a $250.0 million, unsecured
revolving credit facility, which is scheduled to expire in August 2003. This
credit facility, which replaced the Company's $215.0 million unsecured revolving
credit facility, has made available funds to both finance the purchase of
properties and meet any short-term working capital requirements. As of December
31, 2000 there was $45.0 million outstanding under this unsecured revolving
credit facility.

The Company has also implemented a medium-term notes program (the "MTN program")
pursuant to which it may from time to time offer for sale its senior unsecured
debt for any general corporate purposes, including (i) funding specific
liquidity requirements in its business, including property acquisitions,
development and redevelopment costs, and (ii) managing the Company's debt
maturities. (See Note 8 of the Notes to Consolidated Financial Statements
included in this annual report on Form 10-K.)

6






In addition to the public debt and equity markets as capital sources, the
Company may, from time to time, obtain mortgage financing on selected
properties. As of December 31, 2000, the Company had over 350 unencumbered
property interests in its portfolio.

During August 1998, the Company filed a shelf registration on Form S-3 for up to
$750.0 million of debt securities, preferred stock, depositary shares, common
stock and common stock warrants. As of February 1, 2001, the Company had
approximately $106.7 million available for issuance under this shelf
registration statement.

It is management's intention that the Company continually have access to the
capital resources necessary to expand and develop its business. Accordingly, the
Company may seek to obtain funds through additional equity offerings, unsecured
debt financings and/or mortgage financings in a manner consistent with its
intention to operate with a conservative debt capitalization policy.

The Company anticipates that cash flows from operations will continue to provide
adequate capital to fund its operating and administrative expenses, regular debt
service obligations and the payment of dividends in accordance with REIT
requirements in both the short-term and long-term. In addition, the Company
anticipates that cash on hand, availability under its revolving credit facility,
issuance of equity and public debt, as well as other debt and equity
alternatives, will provide the necessary capital required by the Company. Cash
flow from operations increased to $250.5 million for the year ended December 31,
2000, as compared to $237.2 million for the year ended December 31, 1999.

Inflation and Other Business Issues Many of the Company's leases contain
provisions designed to mitigate the adverse impact of inflation. Such provisions
include clauses enabling the Company to receive payment of additional rent
calculated as a percentage of tenants' gross sales above predetermined
thresholds ("Percentage Rents"), which generally increase as prices rise, and/or
escalation clauses, which generally increase rental rates during the terms of
the leases. Such escalation clauses include increases in the consumer price
index or similar inflation indices. In addition, many of the Company's leases
are for terms of less than 10 years, which permits the Company to seek to
increase rents upon renewal to market rates. Most of the Company's leases
require the tenant to pay an allocable share of operating expenses, including
common area maintenance costs, real estate taxes and insurance, thereby reducing
the Company's exposure to increases in costs and operating expenses resulting
from inflation. The Company periodically evaluates its exposure to short-term
interest rates and will, from time to time, enter into interest rate protection
agreements which mitigate, but do not eliminate, the effect of changes in
interest rates on its floating-rate debt.

As an owner of real estate, the Company is subject to risks arising in
connection with the underlying real estate, including, among other factors,
defaults or nonrenewal of tenant leases, the financial condition and stability
of tenants, retailing trends, environmental matters and changes in real estate
and zoning laws. The success of the Company also depends upon trends in the
economy, including, but not limited to, interest rates, the availability of
capital, either in the form of debt or equity on satisfactory terms, income tax
laws, governmental regulations and legislation and population trends.

Operating Practices Nearly all operating functions, including leasing, legal,
construction, data processing, maintenance, finance and accounting, are
administered by the Company from its executive offices in New Hyde Park, New
York. The Company believes it is critical to have a management presence in its
principal areas of operation; accordingly, the Company also maintains regional
offices in Margate, Orlando and Tampa, Florida; Philadelphia, Pennsylvania;
Dallas, Texas; Dayton and Cleveland, Ohio; Lisle and Chicago, Illinois;
Charlotte, North Carolina; Phoenix and Tucson, Arizona and Los Angeles,
California. A total of 260 persons are employed at the Company's executive and
regional offices.

The Company's regional offices are generally staffed by a manager and the
support personnel necessary to both function as local representatives for
leasing and promotional purposes and to complement the corporate office efforts
to ensure that property inspection and maintenance objectives are achieved. The
regional offices are important in reducing the time necessary to respond to the
needs of the Company's tenants. Leasing and maintenance personnel from the
corporate office also conduct regular inspections of each shopping center.

The Company also employs a total of 58 persons at several of its larger
properties in order to more effectively administer its maintenance and security
responsibilities.

7





Management Information Systems Virtually all operating activities are supported
by a sophisticated computer software system designed to provide management with
operating data necessary to make informed business decisions on a timely basis.
These systems are continually expanded and enhanced by the Company and reflect a
commitment to quality management and tenant relations. The Company has
integrated an advanced mid-range computer with personal computer technology,
creating a management information system that facilitates the development of
property cash flow budgets, forecasts and related management information.

Qualification as a REIT The Company has elected, commencing with its taxable
year which began January 1, 1992, to qualify as a REIT under the Code. If, as
the Company believes, it is organized and operates in such a manner so as to
qualify and remain qualified as a REIT under the Code, the Company generally
will not be subject to Federal income tax, provided that distributions to its
stockholders equal at least the amount of its REIT taxable income as defined
under the Code. However, in connection with the RMA, which became effective
January 1, 2001, the Company is now permitted to participate in activities which
the Company was precluded from previously in order to maintain its qualification
as a REIT, so long as these activities are conducted in entities which elect to
be treated as taxable subsidiaries under the Code, subject to certain
limitations. These activities include, but are not limited to, the ground-up
development of real estate and subsequent sale thereof. As such, the Company
will be subject to Federal income tax on the income from these activities.

Recent Developments

Investment in Kimco Income REIT ("KIR") -

During 1998, the Company formed KIR, an entity in which the Company held a
99.99% limited partnership interest. KIR was established for the purpose of
investing in high quality real estate properties financed primarily with
individual non-recourse mortgages. These properties include, but are not limited
to, fully developed properties with strong, stable cash flows from credit-worthy
retailers with long-term leases. The Company believes these type of properties
are more appropriately financed with greater leverage than the Company
traditionally uses. During April 1999, the Company entered into an agreement
whereby an institutional investor purchased a significant limited partnership
interest in KIR. Under the terms of the agreement, the agreed equity value for
the properties previously contributed by the Company to KIR was approximately
$107.0 million and the Company agreed to contribute an additional $10.0 million
for a total investment of $117.0 million. During August 1999, KIR admitted three
additional limited partners. The limited partners other than the Company
subscribed for a total of $152.0 million in KIR. As a result of these
transactions, the Company had a 43.3% non-controlling limited partnership
interest in KIR as of December 31, 1999, and accounts for its investment in KIR
under the equity method of accounting.

During 2000, all subscriptions related to the initial commitments were
contributed. During August 2000, KIR obtained additional subscriptions
aggregating $300.0 million from the existing limited partners, of which the
Company subscribed for an additional $130.0 million. As of December 31, 2000,
the Company had contributed $19.5 million of such subscriptions and maintained
its 43.3% interest in KIR. As of December 31, 2000, KIR had unfunded capital
commitments of $255.0 million.

During 2000, KIR purchased 24 shopping center properties, in separate
transactions, aggregating 3.8 million square feet of GLA for approximately
$421.0 million, including the assumption of approximately $152.0 million of
mortgage debt. As of December 31, 2000, the KIR portfolio was comprised of 53
shopping center properties aggregating approximately 9.2 million square feet of
GLA located in 17 states.

During 2000, KIR obtained individual non-recourse, non-cross collateralized
ten-year fixed-rate first mortgages aggregating $137.3 million on 12 of its
properties, with interest rates ranging from 7.97% to 8.36% per annum. The net
proceeds were used to finance the acquisition of various shopping center
properties.

During November 2000, KIR established a two year $100.0 million secured
revolving credit facility with a group of banks which is scheduled to expire in
November 2002. This facility is collateralized by the unfunded subscriptions of
certain partners, including those of the Company. Under the terms of the
facility, funds may be borrowed for general corporate purposes including funding
the acquisition of institutional quality properties. Borrowings under the
facility accrue interest at LIBOR plus .80%. A fee of 0.15% per annum is payable
quarterly in arrears on the unused portion of the facility. As of December 31,
2000, there was $58.0 million outstanding under this facility.

8





Shopping Center Acquisitions -

During the year ended December 31, 2000, the Company and its affiliates acquired
interests in 12 shopping center properties located in 11 states, comprising
approximately 1.4 million square feet of GLA for an aggregate purchase price of
approximately $62.5 million, including the assumption of approximately $19.4
million of mortgage debt encumbering the properties as follows:

In January 2000, the Company acquired Chippewa Plaza located in Chippewa, PA for
a purchase price of approximately $14.5 million, including the assumption of
approximately $13.3 million of mortgage debt encumbering the property. This
shopping center is anchored by Kmart Corporation and Home Depot and contains
approximately 215,000 square feet of GLA.

In February 2000, the Company acquired Fort Collins Shopping Center located in
Fort Collins, CO for a purchase price of approximately $8.8 million including
the assumption of approximately $3.2 million of mortgage debt encumbering the
property. This shopping center is anchored by Kohl's and contains approximately
106,000 square feet of GLA. Also during February 2000, the Company purchased
Hammond Aire Plaza, a shopping center anchored by Burlington Coat Factory, for a
purchase price of approximately $3.4 million. This center is located in Baton
Rouge, LA and contains approximately 80,000 square feet of GLA.

In June 2000, the Company, through its Kimco Select Investments affiliate,
acquired five shopping center properties comprising approximately 462,000 square
feet of GLA located in five states for an aggregate price of approximately $18.9
million. These properties were formerly anchored by a retailer which filed for
protection under Chapter 11 of the Bankruptcy Code and subsequently rejected
these leases in January 2000. The Company acquired these properties with an
occupancy level of approximately 43% (currently 74%) and is actively negotiating
with other retailers to lease the vacant space (see Recent Developments - Kimco
Select Investments).

Also in June 2000, the Company exercised its option to acquire two shopping
center properties comprising 396,000 square feet of GLA from KC Holdings, Inc.
("KC Holdings"), an entity formed in connection with the Company's IPO in
November 1991. The properties were acquired for an aggregate option price of
approximately $12.2 million, paid $11.6 million in shares of the Company's
common stock (285,148 common shares issued at $40.7625 per share) and $0.6
million through the assumption of mortgage debt encumbering one of the
properties. Such mortgage debt was repaid during September 2000. The members of
the Company's Board of Directors who are not also shareholders of KC Holdings,
unanimously approved the Company's purchase of these two shopping center
properties (See Note 15 of the Notes to Consolidated Financial Statements
included in this annual report on Form 10-K).

In August 2000, the Company acquired a shopping center located in North
Charleston, SC for a purchase price of approximately $3.7 million including the
assumption of approximately $2.3 million in mortgage debt encumbering the
property. This shopping center has approximately 62,000 square feet of GLA and
is anchored by Sports Authority.

In December 2000, the Company acquired a leasehold interest in a vacant shopping
center property located in Glen Burnie, MD for approximately $1.0 million. This
property contains approximately 60,000 square feet of GLA and was formerly
occupied by Hechinger Stores Inc. The Company has completed the lease-up of this
location.

The Company, as a regular part of its business operations, will continue to
actively seek properties for acquisition, which have below market-rate leases or
other cash flow growth potential.

Property Redevelopment -

The Company has an ongoing program to reformat and re-tenant its properties to
maintain or enhance its competitive position in the marketplace. During 2000,
the Company substantially completed the redevelopment and re-tenanting of
various shopping center properties. The Company expended approximately $39.0
million in connection with these major redevelopments and re-tenanting projects
during 2000. The Company is currently involved in redeveloping several other
shopping centers in the existing portfolio. The Company anticipates its capital
commitment toward these and other redevelopment projects will be approximately
$40 million during 2001.


9




Ground-Up Developments -

During 2000, the Company was in progress on ground-up development projects
located in San Antonio, TX, Houston, TX, Cedar Hill, TX, Tallahasee, FL,
Miamisburg, OH, Henderson, NV, Burleson, TX, Peoria, AZ and Chandler, AZ. These
projects had substantial pre-leasing prior to the commencement of construction.
During 2000, the Company expended approximately $74.0 million in connection with
the purchase of land and construction costs related to these projects. The
Company anticipates its capital commitment toward these and other development
projects will be approximately $150.0 million to $200.0 million during 2001.

Effective January 1, 2001, the Company has elected taxable REIT subsidiary
status for its wholly-owned subsidiary KDI. KDI will be primarily engaged in the
ground-up development of neighborhood and community shopping centers and the
subsequent sale thereof upon completion. As such, as of January 1, 2001, the
ground-up development projects described above are included in KDI. During
January 2001, KDI sold its recently completed project in Chandler, AZ for
approximately $32.5 million.

Property Dispositions -

During the year ended December 31, 2000, the Company, in separate transactions,
disposed of ten shopping center properties. Sale prices from two of these
dispositions aggregated approximately $4.5 million which approximated their
aggregate net book value. Sale prices from six of these dispositions aggregated
approximately $25.5 million which resulted in net gains of approximately $2.2
million.

During June 2000, the Company disposed of a shopping center property in Forest
Park, GA. Cash proceeds from the disposition totaling approximately $1.5
million, together with an additional $2.2 million cash investment, were used to
acquire an exchange shopping center property located in North Charleston, SC
during August 2000. The sale of this property resulted in a gain of
approximately $1.1 million.

During December 2000, the Company disposed of a shopping center property in
Grand Haven, MI. Proceeds from the disposition totaling approximately $2.7
million will be used to acquire an exchange shopping center property. The sale
of this property resulted in a gain of approximately $0.7 million.

In addition, during 2000, the Company disposed of various land parcels, in
separate transactions, for aggregate proceeds of approximately $5.6 million.

Kimco Select Investments -

Kimco Select Investments, a New York general partnership ("Kimco Select"), was
formed in 1997 to provide the Company, through its 90% ownership interest, the
opportunity to make investments outside of its core neighborhood and community
shopping center business.

Although potential investments may be largely retail-focused, Kimco Select may
invest in other asset categories. Kimco Select will focus on investments where
the intrinsic value in the underlying assets may provide potentially superior
returns relative to the inherent risk. These investments may be in the form of
direct ownership of real estate, mortgage loans, public and private debt and
equity securities that Kimco Select believes are undervalued, unoccupied
properties, properties leased to troubled or bankrupt tenants and other assets.

During 2000, Kimco Select (i) acquired fee title to five shopping center
properties formerly anchored by a retailer who filed for protection under
Chapter 11 of the Bankruptcy Code and rejected the leases prior to the
acquisition by Kimco Select for an aggregate purchase price of $18.9 million,
(ii) acquired certain public bonds for an aggregate purchase price of
approximately $27.0 million and (iii) sold two property interests, in separate
transactions, for aggregate proceeds of approximately $16.2 million which
resulted in net gains of $1.9 million (see Recent Developments - Property
Dispositions).

Kimco Select also has investments in (i) other public bonds, (ii) a joint
venture which owns an office building in Miami, FL, (iii) two joint ventures
which acquired participating interests in first and second mortgages, (iv) three
retail properties in the Chicago, IL market and one property in Massapequa, NY,
and (v) three properties which are anchored by ambulatory care facilities with
complementary retail space. As of December 31, 2000, Kimco Select had total
investments of approximately $110.0 million.

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Other Transactions -

In January 2000, the Company acquired fee title to a shopping center property in
which the Company held a leasehold interest for an aggregate purchase price of
approximately $2.5 million.

During 1998, in connection with the Company's merger with The Price REIT, Inc.,
the Company acquired a 50% interest in a joint venture in Houston, TX. During
March 2000, the Company acquired the remaining 50% interest in such partnership
for $5.0 million and now accounts for its investment under the consolidation
method of accounting.

Financings -

Unsecured Debt During August 2000, the Company issued $110.0 million of floating
rate MTNs under its MTN program. These floating rate MTNs were priced at
99.7661% of par, mature in August 2002, and bear interest at LIBOR plus .25%.
Interest on the MTNs is payable quarterly in arrears. As of November 2000, the
Company entered into an interest rate swap agreement for the term of these MTNs,
which effectively fixed the interest rate at 6.865% per annum. The proceeds from
this MTN issuance were used to (i) repay a $60.0 million MTN that matured in
August 2000 and (ii) to prepay a $52.0 million term loan that matured in
November 2000.

During October 2000, the Company issued an aggregate $100.0 million of senior
fixed rate MTNs under its MTN program. These issuances consisted of (i) a $50.0
million MTN which matures in November 2005 and bears interest at 7.68% per
annum, and (ii) a $50.0 million MTN which matures in November 2007 and bears
interest at 7.86% per annum. Interest on these notes is payable semi-annually in
arrears. The proceeds from these MTN issuances were used to repay a $100.0
million senior note that matured in November 2000.

Mortgage Debt During 2000, the Company obtained individual non-recourse,
non-cross collateralized fixed-rate first mortgage financing aggregating
approximately $44.2 million on five Kmart anchored shopping centers. These
mortgages mature in 2010 and have effective interest rates ranging from 7.91% to
8.15% per annum.

Credit Facility In August 2000, the Company established a $250.0 million
unsecured revolving credit facility (the "Credit Facility") with a group of
banks. The Credit Facility is scheduled to expire in August 2003. Under the
terms of the Credit Facility, funds may be borrowed for general corporate
purposes, including (i) funding property acquisitions and (ii) development and
redevelopment costs. Interest on borrowings under the Credit Facility accrues at
a spread (currently .55%) to LIBOR, which fluctuates in accordance with changes
in the Company's senior debt ratings. As part of the Credit Facility, the
Company has a competitive bid option where the Company may auction up to $100.0
million of its requested borrowings to the bank group. This competitive bid
option provides the Company the opportunity to obtain pricing below the
currently stated spread to LIBOR of .55%. This Credit Facility replaced the
Company's $215.0 million unsecured revolving credit facility. As of December 31,
2000, there was $45.0 million outstanding under the Credit Facility.

Equity During May 2000, the Company repurchased from an officer and director of
the Company 100,217 depositary shares of its Class D Preferred Stock at a price
of $25.00 per depositary share, totaling approximately $2.5 million. The Company
does not have a share repurchase program but acquired the shares when it
received an unsolicited offer to buy the shares (See Note 13 of the Notes to
Consolidated Financial Statements included in this annual report on Form 10-K).

During June 2000, the Company issued 285,148 shares of common stock at $40.7625
per share in connection with the exercise of its option to acquire two shopping
center properties from KC Holdings (See Note 15 of the Notes to Consolidated
Financial Statements included in this annual report on Form 10-K).

During August 2000, the Company completed a primary public stock offering of
1,800,000 shares of common stock priced at $42.50 per share. The net proceeds
from this sale of common stock, totaling approximately $72.4 million (after
related transaction costs of $4.1 million) were used for general corporate
purposes, including (i) the investment of additional equity capital in KIR (See
Note 4 of the Notes to Consolidated Financial Statements included in this annual
report on Form 10-K), and (ii) the development, redevelopment and expansion of
properties in the Company's portfolio.


11





KC Holdings, Inc.

To facilitate the Company's November 1991 IPO, 46 shopping center properties and
certain other assets, together with indebtedness related thereto, were
transferred to subsidiaries of KC Holdings. The Company, although having no
ownership interest in KC Holdings or its subsidiary companies, was granted
ten-year, fixed-price acquisition options which expire in November 2001 to
reacquire the real estate assets owned by KC Holdings' subsidiaries, subject to
any liabilities outstanding with respect to such assets at the time of an option
exercise. As of December 31, 2000, KC Holdings' subsidiaries had conveyed 29
shopping center properties back to the Company and had disposed of ten
additional centers in transactions with third parties. The members of the
Company's Board of Directors who are not also shareholders of KC Holdings
unanimously approved the purchase of each of the 29 shopping centers that have
been reacquired by the Company from KC Holdings. (See Notes 11 and 15 of the
Notes to Consolidated Financial Statements included in this annual report on
Form 10-K.) The Company manages three of KC Holdings' remaining seven shopping
center properties pursuant to a management agreement. KC Holdings' other four
shopping center properties are managed by unaffiliated joint venture partners.

At December 31, 2000, the Company holds 10-year acquisition options which expire
in November 2001 to reacquire interests in the remaining seven shopping center
properties owned by KC Holdings' subsidiaries. The option exercise prices are
fixed and payable in shares of the Company's common stock or, in the event
payment in the form of common stock could jeopardize the Company's status as a
REIT, an equivalent value in cash. If the Company exercises its options to
acquire all the remaining shopping center properties, the maximum aggregate
amount payable to KC Holdings would be approximately $3.3 million, or
approximately 75,600 shares of the Company's common stock (assuming shares
valued at the closing price on the NYSE of $44.1875 per share as of December 31,
2000). The Company would acquire the properties subject to any existing mortgage
indebtedness and other liabilities on the properties. The acquisition options
enable the Company to obtain any appreciation in the value of these properties
over the option exercise prices, while eliminating the Company's interim
exposure to leverage and operating risks.

The option exercise prices for the shopping center properties are generally
equal to 10% of KC Holdings' share of the mortgage debt which was outstanding on
the properties at the date of the IPO. If, however, the market value of the
Company's common stock at the time an option is exercised is less than $13.33
per share (the IPO price), then the option exercise price will decline
proportionately (subject to maximum reduction of 50%).

The seven shopping center properties subject to the acquisition options are held
in five subsidiaries of KC Holdings. Four of the properties, which are owned in
two separate joint ventures and managed by unaffiliated joint venture partners,
are held by two subsidiaries, and the remaining three shopping center properties
are each held by separate subsidiaries. The Company may exercise its acquisition
options separately with respect to each subsidiary.

The acquisition options may be exercised by either (i) a majority of the
Company's directors who are not also stockholders of KC Holdings, provided that
the pro forma annualized net cash flows of the properties to be acquired exceeds
the dividend yield on the shares issued to exercise each option, or (ii) a
majority of the Company's stockholders who are not also stockholders of KC
Holdings.

KC Holdings' subsidiaries may sell any of the properties subject to the
acquisition options to any third party unaffiliated with KC Holdings or its
stockholders, provided that KC Holdings provides the Company with a 30-day right
of first refusal notice with regard to such sale. KC Holdings may cause such a
selling subsidiary to distribute any sale proceeds to KC Holdings or its
stockholders, provided that the option exercise price with respect to such
subsidiary is reduced by the amount that is distributed, and further provided
that no amount may be distributed so as to cause the option exercise price for
any subsidiary to be reduced to less than $1.00.

Each of KC Holdings' subsidiaries may pay dividends to KC Holdings to the extent
of net operating cash flow. In addition, any KC Holdings subsidiary may make
distributions to KC Holdings in excess of net operating cash flow, provided that
the option exercise price with respect to such subsidiary is reduced by the
amount of such distribution, and further provided that no amount may be
distributed so as to cause the option exercise price for any subsidiary to be
reduced to less than $1.00. KC Holdings may increase the indebtedness in its
subsidiaries for the purpose of improving, maintaining, refinancing or operating
the related shopping center properties. Such indebtedness may include borrowings
from the stockholders of KC Holdings.

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In the event of a complete casualty or a condemnation of a property held by any
of KC Holdings' subsidiaries, the acquisition option will terminate with respect
to such property and the option shall continue to be effective with respect to
any other properties held by such subsidiary.

Each of KC Holdings' subsidiaries has agreed with the Company that it will
engage in no activities other than in connection with the ownership, maintenance
and improvement of the properties that it owns and only to the extent that the
Company could engage in such activities without receiving or earning
non-qualifying income (in excess of certain limits) under the REIT provisions of
the Code or without otherwise impairing the Company's status as a REIT. In
addition, KC Holdings has covenanted not to engage in any other real estate
activity. The Company has agreed not to make loans to KC Holdings or its
subsidiaries.

Subsequent Events

During March 2001, the Company through a joint venture (the "Ward Venture") in
which the Company has a 50% interest, acquired asset designation rights for all
of the real estate property interests of the bankrupt estate of Montgomery Ward
LLC and its affiliates. These asset designation rights will enable the Ward
Venture to direct the ultimate disposition of the 315 fee and leasehold
interests held by the bankrupt estate. The Ward Venture acquired the asset
designation rights for an initial purchase price of $60.5 million, however, the
price may ultimately exceed $435.5 million under the terms of the designation
rights agreement.

The asset designation rights expire in February 2002 for the leasehold positions
and December 2004 for the fee owned locations. During the marketing period, the
Ward Venture will be responsible for all carrying costs associated with the
properties until the site is designated for a user.

Exchange Listings

The Company's common stock, Class A Depositary Shares, Class B Depositary
Shares, Class C Depositary Shares and Class D Depositary Shares are traded on
the NYSE under the trading symbols "KIM", "KIMprA", "KIMprB", "KIMprC" and
"KIMprD", respectively.

Item 2. Properties

Real Estate Portfolio As of January 1, 2001 the Company's real estate portfolio
was comprised of approximately 66.5 million square feet of GLA in 431
neighborhood and community shopping center properties, two regional malls, 55
retail store leases, three parcels of undeveloped land, one distribution center
and seven projects under development, located in 41 states. The Company's
portfolio includes 53 shopping center properties comprising approximately 9.2
million square feet of GLA relating to the KIR Portfolio. Neighborhood and
community shopping centers comprise the primary focus of the Company's current
portfolio, representing approximately 98% of the Company's total shopping center
GLA. As of January 1, 2001, approximately 92.8% of the Company's neighborhood
and community shopping center space (excluding the KIR Portfolio) was leased,
and the average annualized base rent per leased square foot of the neighborhood
and community shopping center portfolio (excluding the KIR Portfolio) was $7.99.
As of January 1, 2001, the KIR Portfolio was 98.3% leased with an average
annualized base rent per leased square foot of $11.16.

The Company's neighborhood and community shopping center properties, generally
owned and operated through subsidiaries or joint ventures, had an average size
of approximately 139,000 square feet as of January 1, 2001. The Company
generally retains its shopping centers for long-term investment and consequently
pursues a program of regular physical maintenance together with major
renovations and refurbishing to preserve and increase the value of its
properties. These projects usually include renovating existing facades,
installing uniform signage, resurfacing parking lots and enhancing parking lot
lighting. During 2000, the Company capitalized approximately $6.2 million in
connection with these property improvements.

The Company's neighborhood and community shopping centers (including the KIR
Portfolio) are usually "anchored" by a national or regional discount department
store, supermarket or drugstore. As one of the original participants in the
growth of the shopping center industry and one of the nation's largest owners
and operators of shopping centers, the Company has established close
relationships with a large number of major national and regional retailers.
National and regional companies that are tenants in the Company's shopping
center properties include Kmart Corporation, The Home Depot, Kohl's, WalMart,
Ames, TJX Companies, Toys/Kids R' Us, Costco and Best Buy.

13




A substantial portion of the Company's income consists of rent received under
long-term leases. Most of the leases provide for the payment of fixed base
rentals monthly in advance and for the payment by tenants of an allocable share
of the real estate taxes, insurance, utilities and common area maintenance
expenses incurred in operating the shopping centers. Although a majority of the
leases require the Company to make roof and structural repairs as needed, a
number of tenant leases place that responsibility on the tenant, and the
Company's standard small store lease provides for roof repairs to be reimbursed
by the tenant as part of common area maintenance. The Company's management
places a strong emphasis on sound construction and safety at its properties.

Approximately 1,900 of the Company's 5,020 leases also contain provisions
requiring the payment of additional rent calculated as a percentage of tenants'
gross sales above predetermined thresholds. Percentage Rents accounted for
approximately 1% of the Company's revenues from rental property for the year
ended December 31, 2000.

Minimum base rental revenues and operating expense reimbursements accounted for
approximately 99% of the Company's total revenues from rental property for the
year ended December 31, 2000. The Company's management believes that the base
rent per leased square foot for many of the Company's existing leases is
generally lower than the prevailing market-rate base rents in the geographic
regions where the Company operates, reflecting the potential for future growth.

The Company has been able to capitalize on the below market-rate leases in its
existing shopping center portfolio to obtain increases in rental revenues
through the renewal of leases or strategic re-tenanting of space. For the period
January 1, 2000 to December 31, 2000 excluding the effects of 2000 acquisitions
and dispositions, the Company increased the average base rent per leased square
foot in its portfolio of neighborhood and community shopping centers (excluding
the KIR Portfolio) from $7.87 to $7.96, an increase of $0.09 per square foot,
which was primarily attributed to general leasing activity within the existing
portfolio. The combined effect of the 2000 acquisitions/dispositions decreased
the overall rent per leased square foot by $0.01, thus bringing the average rent
per leased square foot to $7.95 as of December 31, 2000. The average annual base
rent per leased square foot for new leases (excluding the KIR Portfolio)
executed in 2000 was $8.23.

The Company seeks to reduce its operating and leasing risks through geographic
and tenant diversity. No single neighborhood and community shopping center
(excluding the KIR Portfolio) accounted for more than 1.0% of the Company's
total shopping center GLA or more than 1.4% of total annualized base rental
revenues as of December 31, 2000. The Company's five largest tenants (excluding
the KIR Portfolio) include Kmart Corporation, Kohl's, The Home Depot, Ames, and
TJX Companies, which represent approximately 13.3%, 2.9%, 2.6%, 2.6% and 1.9%,
respectively, of annualized base rental revenues at December 31, 2000. The
Company maintains an active leasing and capital improvement program that,
combined with the high quality of the locations, has made, in management's
opinion, the Company's properties attractive to tenants.

The Company's management believes its experience in the real estate industry and
its relationships with numerous national and regional tenants gives it an
advantage in an industry where ownership is fragmented among a large number of
property owners.

Retail Store Leases In addition to neighborhood and community shopping centers,
as of January 1, 2001, the Company had interests in retail store leases totaling
approximately 4.9 million square feet of anchor stores in 55 neighborhood and
community shopping centers located in 24 states. As of January 1, 2001,
approximately 93.0% of the space in these anchor stores had been sublet to
retailers that lease the stores under net lease agreements providing for average
annualized base rental payments of $4.18 per square foot. The average annualized
base rental payments under the Company's retail store leases to the land owners
of such subleased stores is approximately $2.82 per square foot. The average
remaining primary term of the retail store leases (and, similarly, the remaining
primary terms of the sublease agreements with the tenants currently leasing such
space) is approximately 4 years, excluding options to renew the leases for terms
which generally range from 5 to 25 years.

Ground-Leased Properties The Company has 54 shopping center properties that are
subject to long-term ground leases where a third party owns and has leased the
underlying land to the Company (or an affiliated joint venture) to construct
and/or operate a shopping center. The Company or the joint venture pays rent for
the use of the land and generally is responsible for all costs and expenses
associated with the building and improvements. At the end of these long-term
leases, unless extended, the land together with all improvements revert to the
land owner.

14




Undeveloped Land The Company owns certain unimproved land tracts and parcels of
land adjacent to certain of its existing shopping centers that are held for
possible expansion. At times, should circumstances warrant, the Company may
develop or dispose of these parcels.

The table on pages 16 to 24 sets forth more specific information with respect to
each of the Company's property interests.

Item 3. Legal Proceedings

The Company is not presently involved in any litigation nor to its knowledge is
any litigation threatened against the Company or its subsidiaries that, in
management's opinion, would result in any material adverse effect on the
Company's ownership, management or operation of its properties, or which is not
covered by the Company's liability insurance.

Item 4. Submission of Matters to a Vote of Security Holders

None.

15