MACERICH CO (MAC) Business, 2017

The Company is involved in the acquisition, ownership, development, redevelopment, management and leasing of regional and community/power shopping centers located throughout the United States. The Company is the sole general partner of, and owns a majority of the ownership interests in, The Macerich Partnership, L.P., a Delaware limited partnership (the "Operating Partnership"). As of December 31, 2017, the Operating Partnership owned or had an ownership interest in 48 regional shopping centers and seven community/power shopping centers. These 55 regional and community/power shopping centers (which include any related office space) consist of approximately 53 million square feet of gross leasable area (“GLA”) and are referred to herein as the “Centers”. The Centers consist of consolidated Centers (“Consolidated Centers”) and unconsolidated joint venture Centers (“Unconsolidated Joint Venture Centers”) as set forth in “Item 2. Properties,” unless the context otherwise requires.

The Company is a self-administered and self-managed real estate investment trust ("REIT") and conducts all of its operations through the Operating Partnership and the Company's management companies, Macerich Property Management Company, LLC, a single member Delaware limited liability company, Macerich Management Company, a California corporation, Macerich Arizona Partners LLC, a single member Arizona limited liability company, Macerich Arizona Management LLC, a single member Delaware limited liability company, Macerich Partners of Colorado LLC, a single member Colorado limited liability company, MACW Mall Management, Inc., a New York corporation, and MACW Property Management, LLC, a single member New York limited liability company. All seven of the management companies are owned by the Company and are collectively referred to herein as the "Management Companies."

The Company was organized as a Maryland corporation in September 1993. All references to the Company in this Annual Report on Form 10-K include the Company, those entities owned or controlled by the Company and predecessors of the Company, unless the context indicates otherwise.

Financial information regarding the Company for each of the last three fiscal years is contained in the Company's Consolidated Financial Statements included in "Item 15. Exhibits and Financial Statement Schedule."

Acquisitions and Dispositions:

On January 18, 2017, the Company sold Cascade Mall, a 589,000 square foot regional shopping center in Burlington, Washington; and Northgate Mall, a 750,000 square foot regional shopping center in San Rafael, California, in a combined transaction for $170.0 million, resulting in a gain on the sale of assets of $59.6 million. The proceeds were used to pay off the mortgage note payable on Northgate Mall and to repurchase shares of the Company's common stock under the 2017 Stock Buyback Program (See "Other Transactions and Events").

On March 17, 2017, the Company's joint venture in Country Club Plaza sold an office building for $78.0 million, resulting in a gain on sale of assets of $4.6 million. The Company's pro rata share of the gain on sale of assets of $2.3 million was included in equity in income of unconsolidated joint ventures. The Company used its share of the proceeds to fund repurchases under the 2017 Stock Buyback Program (See "Other Transactions and Events").

On September 18, 2017, the Company's joint venture in Fashion District Philadelphia sold an office building for $61.5 million, resulting in a gain on sale of assets of $13.1 million. The Company's pro rata share of the gain on sale of assets of $6.5 million was included in equity in income of unconsolidated joint ventures. The Company used its share of the proceeds to fund repurchases under the 2017 Stock Buyback Program (See "Other Transactions and Events").

On November 16, 2017, the Company sold 500 North Michigan Avenue, a 326,000 square foot office building in Chicago, Illinois for $86.4 million, resulting in a gain on sale of assets of $14.6 million. The Company used the proceeds from the sale to pay down its line of credit and for other general corporate purposes.

On December 14, 2017, the Company’s joint venture in Westcor/Queens Creek LLC sold land for $30.5 million, resulting in a gain on sale of assets of $14.9 million. The Company’s share of the gain on sale was $5.4 million. The Company used its portion of the proceeds to pay down its line of credit and for general corporate purposes.

Financing Activity:

On February 1, 2017, the Company's joint venture in West Acres replaced the existing loan on the property with a new $80.0 million loan that bears interest at an effective rate of 4.61% and matures on March 1, 2032. The Company used its share of the excess proceeds to pay down its line of credit and for general corporate purposes.

On March 16, 2017, the Company's joint venture in Kierland Commons replaced the existing loan on the property with a new $225.0 million loan that bears interest at an effective rate of 3.98% and matures on April 1, 2027. The Company used its share of the excess proceeds to pay down its line of credit and for general corporate purposes.

On September 29, 2017, the Company placed a new $110.0 million loan on Green Acres Commons that bears interest at LIBOR plus 2.15% and matures on March 29, 2021, including extension options. The loan can be expanded, depending on certain conditions, up to $130.0 million. The Company used the proceeds to pay down its line of credit and for general corporate purposes.

On October 19, 2017, the Company's joint venture in Chandler Fashion Center and Freehold Raceway Mall replaced the existing loan on Freehold Raceway Mall with a new $400.0 million loan that bears interest at an effective rate of 3.94% and matures on November 1, 2029. The Company used its share of the net proceeds to pay down its line of credit and for general corporate purposes.

On December 4, 2017, the Company replaced the existing loan on Santa Monica Place with a new $300.0 million loan that bears interest at LIBOR plus 1.35% and matures on December 9, 2022, including three one-year extension options. The loan is covered by an interest rate cap agreement that effectively prevents LIBOR from exceeding 4.00%. The Company used the net proceeds to pay down its line of credit and for general corporate purposes.

On January 22, 2018, the Company's joint venture in Fashion District Philadelphia obtained a $250.0 million term loan that bears interest at LIBOR plus 2.0% and matures on January 22, 2023. Concurrent with the loan closing, the joint venture borrowed $150.0 million on the term loan and expects to borrow the remaining $100.0 million in the first quarter of 2018. The Company used its share of the proceeds to pay down its line of credit and for general corporate purposes.

On February 5, 2018, the Company's joint venture in Broadway Plaza received a loan commitment for $450.0 million on the property at a fixed rate of 4.18% for twelve years. The loan is expected to close in the first quarter of 2018. The Company plans to use its share of the loan proceeds to pay down its line of credit.

Redevelopment and Development Activity:

The Company's joint venture is proceeding with the development of Fashion District Philadelphia, a redevelopment of an 850,000 square foot shopping center in Philadelphia, Pennsylvania. The project is expected to be completed in the fourth quarter of 2018. The total cost of the project is estimated to be between $305.0 million and $365.0 million, with $152.5 million to $182.5 million estimated to be the Company's pro rata share. The Company has funded $127.2 million of the total $254.4 million incurred by the joint venture as of December 31, 2017.

The Company is currently in the process of redeveloping a 250,000 square foot former Sears store at Kings Plaza Shopping Center. The Company expects to complete the project in the second quarter of 2018. As of December 31, 2017, the Company has incurred $63.6 million in costs and anticipates the total cost of the project to be between $95.0 million and $100.0 million.

Other Transactions and Events:

On February 12, 2017, the Company's Board of Directors authorized the repurchase of up to $500.0 million of its outstanding common shares as market conditions and the Company’s liquidity warrant. Repurchases may be made through open market purchases, privately negotiated transactions, structured or derivative transactions, including accelerated share repurchase transactions, or other methods of acquiring shares and pursuant to Rule 10b5-1 of the Securities Act of 1934, from time to time as permitted by securities laws and other legal requirements. During the period from February 12, 2017 to December 31, 2017, the Company repurchased a total of 3,627,390 of its common shares for $221.4 million, representing an average price of $61.01 per share. The Company funded the repurchases from the net proceeds of the sale of Cascade Mall and Northgate Mall (See "Acquisitions and Dispositions"), its share of the proceeds from the sale of office buildings at Fashion District Philadelphia and Country Club Plaza (See "Acquisitions and Dispositions") and from borrowings under its line of credit.

General:

There are several types of retail shopping centers, which are differentiated primarily based on size and marketing strategy. Regional shopping centers generally contain in excess of 400,000 square feet of GLA and are typically anchored by two or more department or large retail stores ("Anchors") and are referred to as "Regional Shopping Centers" or "Malls." Regional Shopping Centers also typically contain numerous diversified retail stores ("Mall Stores"), most of which are national or regional retailers typically located along corridors connecting the Anchors. "Strip centers", "urban villages" or "specialty centers" ("Community/Power Shopping Centers") are retail shopping centers that are designed to attract local or neighborhood customers and are typically anchored by one or more supermarkets, discount department stores and/or drug stores. Community/Power Shopping Centers typically contain 100,000 to 400,000 square feet of GLA. Outlet Centers generally contain a wide variety of designer and manufacturer stores, often located in an open-air center, and typically range in size from 200,000 to 850,000 square feet of GLA ("Outlet Centers"). In addition, freestanding retail stores are located along the perimeter of the shopping centers ("Freestanding Stores"). Mall Stores and Freestanding Stores over 10,000 square feet of GLA are also referred to as "Big Box." Anchors, Mall Stores, Freestanding Stores and other tenants typically contribute funds for the maintenance of the common areas, property taxes, insurance, advertising and other expenditures related to the operation of the shopping center.

Regional Shopping Centers:

A Regional Shopping Center draws from its trade area by offering a variety of fashion merchandise, hard goods and services and entertainment, often in an enclosed, climate controlled environment with convenient parking. Regional Shopping Centers provide an array of retail shops and entertainment facilities and often serve as the town center and a gathering place for community, charity and promotional events.

Regional Shopping Centers have generally provided owners with relatively stable income despite the cyclical nature of the retail business. This stability is due both to the diversity of tenants and to the typical dominance of Regional Shopping Centers in their trade areas.

Regional Shopping Centers have different strategies with regard to price, merchandise offered and tenant mix, and are generally tailored to meet the needs of their trade areas. Anchors are located along common areas in a configuration designed to maximize consumer traffic for the benefit of the Mall Stores. Mall GLA, which generally refers to GLA contiguous to the Anchors for tenants other than Anchors, is leased to a wide variety of smaller retailers. Mall Stores typically account for the majority of the revenues of a Regional Shopping Center.

Strategy:

The Company has a long-term four-pronged business strategy that focuses on the acquisition, leasing and management, redevelopment and development of Regional Shopping Centers.

Acquisitions. The Company principally focuses on well-located, quality Regional Shopping Centers that can be dominant in their trade area and have strong revenue enhancement potential. In addition, the Company pursues other opportunistic acquisitions of property that include retail and will complement the Company's portfolio such as Outlet Centers. The Company subsequently seeks to improve operating performance and returns from these properties through leasing, management and redevelopment. Since its initial public offering, the Company has acquired interests in shopping centers nationwide. The Company believes that it is geographically well positioned to cultivate and maintain ongoing relationships with potential sellers and financial institutions and to act quickly when acquisition opportunities arise (See "Acquisitions and Dispositions" in Recent Developments).

Leasing and Management. The Company believes that the shopping center business requires specialized skills across a broad array of disciplines for effective and profitable operations. For this reason, the Company has developed a fully integrated real estate organization with in-house acquisition, accounting, development, finance, information technology, leasing, legal, marketing, property management and redevelopment expertise. In addition, the Company emphasizes a philosophy of decentralized property management, leasing and marketing performed by on-site professionals. The Company believes that this strategy results in the optimal operation, tenant mix and drawing power of each Center, as well as the ability to quickly respond to changing competitive conditions of the Center's trade area.

The Company believes that on-site property managers can most effectively operate the Centers. Each Center's property manager is responsible for overseeing the operations, marketing, maintenance and security functions at the Center. Property managers focus special attention on controlling operating costs, a key element in the profitability of the Centers, and seek to develop strong relationships with and be responsive to the needs of retailers.

The Company generally utilizes regionally located leasing managers to better understand the market and the community in which a Center is located. The Company continually assesses and fine tunes each Center's tenant mix, identifies and replaces underperforming tenants and seeks to optimize existing tenant sizes and configurations.

On a selective basis, the Company provides property management and leasing services for third parties. The Company currently manages two regional shopping centers and three community centers for third party owners on a fee basis.

Redevelopment. One of the major components of the Company's growth strategy is its ability to redevelop acquired properties. For this reason, the Company has built a staff of redevelopment professionals who have primary responsibility for identifying redevelopment opportunities that they believe will result in enhanced long-term financial returns and market position for the Centers. The redevelopment professionals oversee the design and construction of the projects in addition to obtaining required governmental approvals (See "Redevelopment and Development Activity" in Recent Developments).

Development. The Company pursues ground-up development projects on a selective basis. The Company has supplemented its strong acquisition, operations and redevelopment skills with its ground-up development expertise to further increase growth opportunities (See "Redevelopment and Development Activity" in Recent Developments).

The Centers:

As of December 31, 2017, the Centers primarily included 48 Regional Shopping Centers and seven Community/Power Shopping Centers totaling approximately 53 million square feet of GLA. These 55 Centers average approximately 929,000 square feet of GLA and range in size from 3.5 million square feet of GLA at Tysons Corner Center to 185,000 square feet of GLA at Boulevard Shops. As of December 31, 2017, the Centers primarily included 195 Anchors totaling approximately 26.4 million square feet of GLA and approximately 5,200 Mall Stores and Freestanding Stores totaling approximately 25.1 million square feet of GLA.

Competition:

Numerous owners, developers and managers of malls, shopping centers and other retail-oriented real estate compete with the Company for the acquisition of properties and in attracting tenants or Anchors to occupy space. There are seven other publicly traded mall companies and several large private mall companies in the United States, any of which under certain circumstances could compete against the Company for an Anchor or a tenant. In addition, these companies, as well as other REITs, private real estate companies or investors compete with the Company in terms of property acquisitions. This results in competition both for the acquisition of properties or centers and for tenants or Anchors to occupy space. Competition for property acquisitions may result in increased purchase prices and may adversely affect the Company's ability to make suitable property acquisitions on favorable terms. The existence of competing shopping centers could have a material adverse impact on the Company's ability to lease space and on the level of rents that can be achieved. There is also increasing competition from other retail formats and technologies, such as lifestyle centers, power centers, outlet centers, Internet shopping, home shopping networks, catalogs, telemarketing and discount shopping clubs that could adversely affect the Company's revenues.

In making leasing decisions, the Company believes that retailers consider the following material factors relating to a center: quality, design and location, including consumer demographics; rental rates; type and quality of Anchors and retailers at the center; and management and operational experience and strategy of the center. The Company believes it is able to compete effectively for retail tenants in its local markets based on these criteria in light of the overall size, quality and diversity of its Centers.

Major Tenants:

The Centers derived approximately 74% of their total rents for the year ended December 31, 2017 from Mall Stores and Freestanding Stores under 10,000 square feet, and Big Box and Anchor tenants accounted for 26% of total rents for the year ended December 31, 2017. Total rents as set forth in "Item 1. Business" include minimum rents and percentage rents.

The following retailers (including their subsidiaries) represent the 10 largest tenants in the Centers based upon total rents in place as of December 31, 2017:

Tenant Primary DBAs Number ofLocationsin thePortfolio % of TotalRents L Brands, Inc. Victoria's Secret, Bath and Body Works, PINK 95 2.8 % Forever 21, Inc. Forever 21, XXI Forever 33 2.3 % Foot Locker, Inc. Champs Sports, Foot Locker, Kids Foot Locker, Lady Foot Locker, Foot Action, House of Hoops SIX:02 and others 94 2.1 % H & M Hennes & Mauritz AB H & M 23 1.9 % Gap, Inc., The Athleta, Banana Republic, Gap, Gap Kids, Old Navy and others 54 1.7 % Signet Jewelers Jared Jewelry, Kay Jewelers, Piercing Pagoda, Shaw's Jewelers, Weisfield Jewelers, Zales 104 1.6 % Dick's Sporting Goods, Inc. Dick's Sporting Goods 15 1.5 % American Eagle Outfitters, Inc. American Eagle Outfitters, aerie 37 1.2 % Sears Holdings Corporation Sears 21 1.0 % Golden Gate Capital Payless ShoeSource, Eddie Bauer, California Pizza Kitchen, PacSun 71 1.0 %

Mall Stores and Freestanding Stores:

Mall Store and Freestanding Store leases generally provide for tenants to pay rent comprised of a base (or "minimum") rent and a percentage rent based on sales. In some cases, tenants pay only minimum rent, and in other cases, tenants pay only percentage rent. The Company generally enters into leases for Mall Stores and Freestanding Stores that also require tenants to pay a stated amount for operating expenses, generally excluding property taxes, regardless of the expenses the Company actually incurs at any Center. However, certain leases for Mall Stores and Freestanding Stores contain provisions that only require tenants to pay their pro rata share of maintenance of the common areas, property taxes, insurance, advertising and other expenditures related to the operations of the Center.

Tenant space of 10,000 square feet and under in the Company's portfolio at December 31, 2017 comprises approximately 65% of all Mall Store and Freestanding Store space. The Company uses tenant spaces of 10,000 square feet and under for comparing rental rate activity because this space is more consistent in terms of shape and configuration and, as such, the Company is able to provide a meaningful comparison of rental rate activity for this space. Mall Store and Freestanding Store space greater than 10,000 square feet is inconsistent in size and configuration throughout the Company's portfolio and as a result does not lend itself to a meaningful comparison of rental rate activity with the Company's other space. Much of the non-Anchor space over 10,000 square feet is not physically connected to the mall, does not share the same common area amenities and does not benefit from the foot traffic in the mall. As a result, space greater than 10,000 square feet has a unique rent structure that is inconsistent with mall space under 10,000 square feet.

The following tables set forth the average base rent per square foot for the Centers, as of December 31 for each of the past five years:

For the Years Ended December 31, Avg. BaseRent PerSq. Ft.(1)(2) Avg. Base RentPer Sq. Ft. onLeases ExecutedDuring the Year(2)(3) Avg. Base RentPer Sq. Ft.on Leases ExpiringDuring the Year(2)(4) Consolidated Centers: 2017 $ 55.08 $ 57.36 $ 49.61 2016 $ 53.51 $ 53.48 $ 44.77 2015 $ 52.64 $ 53.99 $ 49.02 2014 $ 49.68 $ 49.55 $ 41.20 2013 $ 44.51 $ 45.06 $ 40.00 Unconsolidated Joint Venture Centers (at the Company's pro rata share): 2017 $ 60.99 $ 63.50 $ 55.50 2016 $ 57.90 $ 64.78 $ 57.29 2015 $ 60.74 $ 80.18 $ 60.85 2014 $ 63.78 $ 82.47 $ 64.59 2013 $ 62.47 $ 63.44 $ 48.43

For the Years Ended December 31, Avg. BaseRent PerSq. Ft.(1)(2) Avg. Base RentPer Sq. Ft. onLeases ExecutedDuring the Year(2)(3) Number ofLeasesExecutedDuringthe Year Avg. Base RentPer Sq. Ft.on Leases ExpiringDuring the Year(2)(4) Number ofLeasesExpiringDuringthe Year Consolidated Centers: 2017 $ 14.13 $ 18.19 24 $ 14.85 21 2016 $ 13.34 $ 22.23 20 $ 19.12 8 2015 $ 12.72 $ 19.87 19 $ 8.96 14 2014 $ 11.26 $ 18.28 22 $ 15.16 14 2013 $ 10.94 $ 14.61 29 $ 14.08 21 Unconsolidated Joint Venture Centers (at the Company's pro rata share): 2017 $ 16.87 $ 26.33 15 $ 33.25 8 2016 $ 15.76 $ 29.41 13 $ 28.00 1 2015 $ 14.48 $ 33.00 14 $ 9.30 8 2014 $ 18.51 $ 33.62 11 $ 27.27 6 2013 $ 13.36 $ 37.45 22 $ 24.58 10

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(1) Average base rent per square foot is based on spaces occupied as of December 31 for each of the Centers and gives effect to the terms of each lease in effect, as of such date, including any concessions, abatements and other adjustments or allowances that have been granted to the tenants.

(2) Centers under development and redevelopment are excluded from average base rents. As a result, the leases for Fashion District Philadelphia, Paradise Valley Mall and Westside Pavilion are excluded for the years ended December 31, 2017, 2016, 2015 and 2014. The leases for Broadway Plaza are excluded for the years ended December 31, 2016, 2015, and 2014. The leases for Fashion Outlets of Niagara Falls USA and SouthPark Mall are excluded for the years ended December 31, 2015 and 2014. The leases for Paradise Valley Mall are excluded for the year ended December 31, 2013.

The leases for Cascade Mall and Northgate Mall, which were sold on January 18, 2017, are excluded for the year ended December 31, 2016. Flagstaff Mall was conveyed to the mortgage lender by a deed-in-lieu of foreclosure on July 15, 2016 and is excluded for the year ended December 31, 2015. On June 30, 2015, Great Northern Mall was conveyed to the mortgage lender by a deed-in-lieu of foreclosure and is excluded for the year ended December 31, 2014. The leases for Rotterdam Square, which was sold on January 15, 2014, are excluded for the year ended December 31, 2013.

(3) The average base rent per square foot on leases executed during the year represents the actual rent paid on a per square foot basis during the first twelve months of the lease.

(4) The average base rent per square foot on leases expiring during the year represents the actual rent to be paid on a per square foot basis during the final twelve months of the lease.

Cost of Occupancy:

A major factor contributing to tenant profitability is cost of occupancy, which consists of tenant occupancy costs charged by the Company. Tenant expenses included in this calculation are minimum rents, percentage rents and recoverable expenditures, which consist primarily of property operating expenses, real estate taxes and repair and maintenance expenditures. These tenant charges are collectively referred to as tenant occupancy costs. These tenant occupancy costs are compared to tenant sales. A low cost of occupancy percentage shows more potential capacity for the Company to increase rents at the time of lease renewal than a high cost of occupancy percentage. The following table summarizes occupancy costs for Mall Store and Freestanding Store tenants in the Centers as a percentage of total Mall Store sales for the last five years:

For the Years Ended December 31, 2017 2016 (1) 2015 (2) 2014 (3) 2013 (4) Consolidated Centers: Minimum rents 9.5 % 9.4 % 9.0 % 8.7 % 8.4 % Percentage rents 0.3 % 0.4 % 0.4 % 0.4 % 0.4 % Expense recoveries(5) 4.2 % 4.3 % 4.5 % 4.3 % 4.5 % 14.0 % 14.1 % 13.9 % 13.4 % 13.3 % Unconsolidated Joint Venture Centers: Minimum rents 8.6 % 8.6 % 8.1 % 8.7 % 8.8 % Percentage rents 0.3 % 0.3 % 0.4 % 0.4 % 0.4 % Expense recoveries(5) 3.8 % 3.9 % 4.0 % 4.5 % 4.0 % 12.7 % 12.8 % 12.5 % 13.6 % 13.2 %

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(1) Cascade Mall and Northgate Mall were sold on January 18, 2017 and are excluded for the year ended December 31, 2016.

(2) Flagstaff Mall was conveyed to the mortgage lender by a deed-in-lieu of foreclosure on July 15, 2016 and is excluded for the year ended December 31, 2015.

(3) Great Northern Mall was conveyed to the mortgage lender by a deed-in-lieu of foreclosure on June 30, 2015 and is excluded for the year ended December 31, 2014.

(4) Rotterdam Square was sold on January 15, 2014 and is excluded for the year ended December 31, 2013.

(5) Represents real estate tax and common area maintenance charges.

Lease Expirations:

The following tables show scheduled lease expirations for Centers owned as of December 31, 2017 for the next ten years, assuming that none of the tenants exercise renewal options:

Year Ending December 31, Number ofLeasesExpiring ApproximateGLA of LeasesExpiring(1) % of Total LeasedGLA Representedby ExpiringLeases(1) Ending Base Rentper Square Foot ofExpiring Leases(1) % of Base RentRepresentedby ExpiringLeases(1) Consolidated Centers: 2018 345 712,258 13.94 % $ 52.29 12.32 % 2019 333 768,299 15.04 % $ 48.73 12.38 % 2020 302 621,413 12.16 % $ 53.90 11.08 % 2021 236 519,116 10.16 % $ 57.62 9.89 % 2022 197 366,228 7.17 % $ 62.52 7.57 % 2023 169 353,073 6.91 % $ 59.81 6.99 % 2024 165 430,007 8.42 % $ 64.43 9.16 % 2025 161 415,255 8.13 % $ 67.60 9.28 % 2026 140 436,015 8.53 % $ 67.06 9.67 % 2027 105 251,538 4.92 % $ 79.34 6.60 % Unconsolidated Joint Venture Centers (at the Company's pro rata share): 2018 224 269,343 11.20 % $ 60.09 10.10 % 2019 208 230,305 9.57 % $ 66.18 9.51 % 2020 199 258,621 10.75 % $ 58.50 9.44 % 2021 209 261,733 10.88 % $ 65.50 10.69 % 2022 157 221,959 9.23 % $ 62.22 8.62 % 2023 142 231,859 9.64 % $ 57.00 8.24 % 2024 108 180,137 7.49 % $ 62.62 7.04 % 2025 121 203,784 8.47 % $ 66.24 8.42 % 2026 153 224,682 9.34 % $ 86.27 12.09 % 2027 111 164,641 6.84 % $ 86.26 8.86 %

Year Ending December 31, Number ofLeasesExpiring ApproximateGLA of LeasesExpiring(1) % of Total LeasedGLA Representedby ExpiringLeases(1) Ending Base Rentper Square Foot ofExpiring Leases(1) % of Base RentRepresentedby ExpiringLeases(1) Consolidated Centers: 2018 13 251,179 2.41 % $ 16.83 2.54 % 2019 21 678,113 6.50 % $ 10.19 4.15 % 2020 21 894,784 8.57 % $ 10.30 5.53 % 2021 30 1,484,891 14.22 % $ 8.74 7.79 % 2022 29 1,103,013 10.57 % $ 20.39 13.49 % 2023 27 888,518 8.51 % $ 12.48 6.65 % 2024 23 809,431 7.75 % $ 20.59 10.00 % 2025 22 769,713 7.37 % $ 23.43 10.82 % 2026 16 735,337 7.04 % $ 15.07 6.65 % 2027 19 578,200 5.54 % $ 30.23 10.48 % Unconsolidated Joint Venture Centers (at the Company's pro rata share): 2018 7 55,761 1.09 % $ 38.20 2.47 % 2019 9 129,574 2.54 % $ 31.29 4.70 % 2020 26 812,934 15.94 % $ 14.12 13.32 % 2021 18 228,750 4.49 % $ 21.54 5.72 % 2022 18 606,825 11.90 % $ 8.03 5.66 % 2023 20 298,452 5.85 % $ 21.16 7.33 % 2024 20 291,001 5.71 % $ 33.68 11.37 % 2025 21 1,049,746 20.59 % $ 12.65 15.41 % 2026 19 364,157 7.14 % $ 25.13 10.62 % 2027 11 157,891 3.10 % $ 30.84 5.65 %

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(1) The ending base rent per square foot on leases expiring during the period represents the final year minimum rent, on a cash basis, for tenant leases expiring during the year. Currently, 48% of leases have provisions for future consumer price index increases that are not reflected in ending base rent. The leases for Centers currently under development and redevelopment are excluded from this table.

Anchors:

Anchors have traditionally been a major factor in the public's identification with Regional Shopping Centers. Anchors are generally department stores whose merchandise appeals to a broad range of shoppers. Although the Centers receive a smaller percentage of their operating income from Anchors than from Mall Stores and Freestanding Stores, strong Anchors play an important part in maintaining customer traffic and making the Centers desirable locations for Mall Store and Freestanding Store tenants.

Anchors either own their stores, the land under them and in some cases adjacent parking areas, or enter into long-term leases with an owner at rates that are lower than the rents charged to tenants of Mall Stores and Freestanding Stores. Each Anchor that owns its own store and certain Anchors that lease their stores enter into reciprocal easement agreements with the owner of the Center covering, among other things, operational matters, initial construction and future expansion.

Anchors accounted for approximately 7.9% of the Company's total rents for the year ended December 31, 2017.

The following table identifies each Anchor, each parent company that owns multiple Anchors and the number of square feet owned or leased by each such Anchor or parent company in the Company's portfolio at December 31, 2017.

Name Number ofAnchorStores GLA Ownedby Anchor GLA Leasedby Anchor Total GLAOccupied byAnchor Macy's Inc. Macy's(1) 37 4,918,000 1,931,000 6,849,000 Bloomingdale's 2 — 355,000 355,000 39 4,918,000 2,286,000 7,204,000 JCPenney(2) 28 1,744,000 2,299,000 4,043,000 Sears 21 811,000 2,237,000 3,048,000 Dillard's 14 2,205,000 257,000 2,462,000 Nordstrom(3) 12 739,000 1,339,000 2,078,000 Dick's Sporting Goods 15 — 952,000 952,000 Forever 21 8 155,000 629,000 784,000 Target 4 304,000 273,000 577,000 The Bon-Ton Stores, Inc. Younkers 3 — 317,000 317,000 Bon-Ton, The 1 — 71,000 71,000 Herberger's 1 188,000 — 188,000 5 188,000 388,000 576,000 Hudson Bay Company Lord & Taylor 3 121,000 199,000 320,000 Saks Fifth Avenue 1 — 92,000 92,000 4 121,000 291,000 412,000 Home Depot 3 — 395,000 395,000 Burlington(2) 4 187,000 182,000 369,000 Costco 2 — 321,000 321,000 Kohl's 3 89,000 200,000 289,000 Primark(2) 3 — 240,000 240,000 Neiman Marcus 2 — 188,000 188,000 Von Maur 2 187,000 — 187,000 Walmart 1 — 173,000 173,000 Century 21 2 — 171,000 171,000 La Curacao 1 — 165,000 165,000 Boscov's 1 — 161,000 161,000 Belk 2 — 139,000 139,000 BJ's Wholesale Club 1 — 123,000 123,000 Lowe's 1 — 114,000 114,000 Mercado de los Cielos 1 — 78,000 78,000 L.L. Bean 1 — 75,000 75,000 Best Buy 1 66,000 — 66,000 Des Moines Area Community College 1 64,000 — 64,000 Bealls 1 — 40,000 40,000 Vacant Anchors(4) 8 — 636,000 636,000 191 11,778,000 14,352,000 26,130,000 Anchors at Centers not owned by the Company(5): Forever 21 1 — 79,000 79,000 Kohl's 1 — 83,000 83,000 Vacant Anchors(4) 2 — 116,000 116,000 Total 195 11,778,000 14,630,000 26,408,000

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(1) The Anchor has announced its intention of closing their location at Westside Pavilion in March 2018.

(2) The Company anticipates that Burlington, JCPenney and Primark will open stores at Kings Plaza Shopping Center in Spring 2018.

(3) Nordstrom has announced plans to open a store at Country Club Plaza in 2021.

(4) The Company is seeking replacement tenants and/or contemplating redevelopment opportunities for these vacant sites. The Company continues to collect rent under the terms of an agreement regarding one of these vacant Anchor locations.

(5) The Company owns an office building and seven stores located at shopping centers not owned by the Company. Of these seven stores, one has been leased to Forever 21, one has been leased to Kohl's, two are vacant and three have been leased for non-Anchor usage.

Each of the Centers has been subjected to an Environmental Site Assessment—Phase I (which involves review of publicly available information and general property inspections, but does not involve soil sampling or ground water analysis) completed by an environmental consultant.

Based on these assessments, and on other information, the Company is aware of the following environmental issues, which may result in potential environmental liability and cause the Company to incur costs in responding to these liabilities or in other costs associated with future investigation or remediation:

• Asbestos. The Company has conducted asbestos-containing materials ("ACM") surveys at various locations within the Centers. The surveys indicate that ACMs are present or suspected in certain areas, primarily vinyl floor tiles, mastics, roofing materials, drywall tape and joint compounds. The identified ACMs are generally non-friable, in good condition, and possess low probabilities for disturbance. At certain Centers where ACMs are present or suspected, however, some ACMs have been or may be classified as "friable," and ultimately may require removal under certain conditions. The Company has developed and implemented an operations and maintenance ("O&M") plan to manage ACMs in place.

• Underground Storage Tanks. Underground storage tanks ("USTs") are or were present at certain Centers, often in connection with tenant operations at gasoline stations or automotive tire, battery and accessory service centers located at such Centers. USTs also may be or have been present at properties neighboring certain Centers. Some of these tanks have either leaked or are suspected to have leaked. Where leakage has occurred, investigation, remediation, and monitoring costs may be incurred by the Company if responsible current or former tenants, or other responsible parties, are unavailable to pay such costs.

• Chlorinated Hydrocarbons. The presence of chlorinated hydrocarbons such as perchloroethylene ("PCE") and its degradation byproducts have been detected at certain Centers, often in connection with tenant dry cleaning operations. Where PCE has been detected, the Company may incur investigation, remediation and monitoring costs if responsible current or former tenants, or other responsible parties, are unavailable to pay such costs.

See "Item 1A. Risk Factors—Possible environmental liabilities could adversely affect us."

Each of the Centers has comprehensive liability, fire, extended coverage and rental loss insurance with insured limits customarily carried for similar properties. The Company does not insure certain types of losses (such as losses from wars), because they are either uninsurable or not economically insurable. In addition, while the Company or the relevant joint venture, as applicable, carry specific earthquake insurance on the Centers located in California, the policies are subject to a deductible equal to 5% of the total insured value of each Center, a $100,000 per occurrence minimum and a combined annual aggregate loss limit of $150 million on these Centers. The Company or the relevant joint venture, as applicable, carry specific earthquake insurance on the Centers located in the Pacific Northwest and in the New Madrid Seismic Zone. However, the policies are subject to a deductible equal to 2% of the total insured value of each Center, a $50,000 per occurrence minimum and a combined annual aggregate loss limit of $200 million on these Centers. While the Company or the relevant joint venture also carries standalone terrorism insurance on the Centers, the policies are subject to a $50,000 deductible and a combined annual aggregate loss limit of $1.2 billion. Each Center has environmental insurance covering eligible third‑party losses, remediation and non-owned disposal sites, subject to a $100,000 retention and a $50 million three-year aggregate loss limit, with the exception of one Center, which has a $5 million ten-year aggregate loss limit and another Center, which has a $20 million ten-

year aggregate loss limit. Some environmental losses are not covered by this insurance because they are uninsurable or not economically insurable. Furthermore, the Company carries title insurance on substantially all of the Centers for generally less than their full value.

The Company elected to be taxed as a REIT under the Internal Revenue Code of 1986, as amended (the "Code"), commencing with its first taxable year ended December 31, 1994, and intends to conduct its operations so as to continue to qualify as a REIT under the Code. As a REIT, the Company generally will not be subject to federal and state income taxes on its net taxable income that it currently distributes to stockholders. Qualification and taxation as a REIT depends on the Company's ability to meet certain dividend distribution tests, share ownership requirements and various qualification tests prescribed in the Code.

On December 22, 2017, President Trump signed into law H.R. 1, known as the “Tax Cuts and Jobs Act” (the “TCJA”). The provisions of the TCJA generally apply to taxable years beginning after December 31, 2017. Significant provisions of the TCJA that investors should be aware of include provisions that: (i) lower the corporate income tax rate to 21% and lower Foreign Investment in Real Property Tax Act withholding on certain capital gain dividends to 21%, (ii) provide noncorporate taxpayers with a deduction of up to 20% of certain income earned through partnerships and REITs for taxable years beginning before January 1, 2026, (iii) limits the net operating loss deduction to 80% of taxable income, where taxable income is determined without regard to the net operating loss deduction itself, generally eliminates net operating loss carrybacks and allows unused net operating losses to be carried forward indefinitely, (iv) expand the ability of businesses to deduct the cost of certain property investments in the year in which the property is purchased, and (v) generally lower tax rates for individuals and other noncorporate taxpayers for taxable years beginning before January 1, 2026, while limiting deductions such as miscellaneous itemized deductions and state and local tax deductions.

In addition, the TCJA limits the deduction for net interest expense incurred by a business to 30% of the “adjusted taxable income” of the taxpayer. However, the limitation on the interest expense deduction does not apply to electing real property trades or businesses, such as any real property development, redevelopment, construction, reconstruction, acquisition, conversion, rental, operation, management, leasing, or brokerage trade or business. Making the election to be treated as a real property trade or business requires the electing real property trade or business to depreciate non-residential real property, residential rental property, and qualified improvement property over a longer period using the alternative depreciation system. The Company generally will decide whether to make any available election to treat as a real property trade or business any direct or indirect investment made through an entity that it controls.

Stockholders are urged to consult with their own tax advisors with respect to the impact that the TCJA and other legislation may have on their investment and the status of legislative, regulatory or administrative developments and proposals and their potential effect on their investment in the Company's stock.

As of December 31, 2017, the Company had approximately 855 employees, of which approximately 850 were full-time. The Company believes that relations with its employees are good.

For a discussion of the extent to which the Company's business may be seasonal, see "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations—Management's Overview and Summary—Seasonality."

The Company's corporate website address is www.macerich.com. The Company makes available free-of-charge through this website its reports on Forms 10-K, 10-Q and 8-K and all amendments thereto, as soon as reasonably practicable after the reports have been filed with, or furnished to, the SEC. These reports are available under the heading "Investors—Financial Information—SEC Filings", through a free hyperlink to a third-party service. Information provided on our website is not incorporated by reference into this Form 10-K.

The following documents relating to Corporate Governance are available on the Company's website at www.macerich.com under "Investors—Corporate Governance":

Guidelines on Corporate Governance

Code of Business Conduct and Ethics

Code of Ethics for CEO and Senior Financial Officers

Audit Committee Charter

Compensation Committee Charter

Executive Committee Charter

Nominating and Corporate Governance Committee Charter

You may also request copies of any of these documents by writing to:

Attention: Corporate Secretary

The Macerich Company

401 Wilshire Blvd., Suite 700

Santa Monica, CA 90401