The Mills Corporation Announces Pricing of $275 Million Convertible Preferred Stock

Business Wire, August 18, 2004

ARLINGTON, Va. -- The Mills Corporation (NYSE:MLS), a leading developer of retail and entertainment destinations, today announced that it has priced an offering of 275,000 shares of Series F Cumulative Redeemable Convertible Preferred Stock, each with a liquidation preference of $1,000. The offering is being made under Rule 144A of the Securities Act to qualified institutional buyers. The Company also granted the initial purchasers an option to purchase up to an additional 41,250 shares of preferred stock.

The preferred stock will have a dividend of 6.75%. The preferred stock will be convertible into The Mills Corporation's common stock at an initial conversion price of $60.05 per share (subject to formulaic adjustments) if the closing price of the Company's common stock exceeds 125% of the conversion price over specified periods, as well as in certain other circumstances. The conversion price represents a 33% premium to the closing price of $45.15 for the Company's common stock on August 17, 2004. The Mills Corporation will have the right to redeem the preferred stock, in part or in whole, on or after August 5, 2009 if the closing price of the Company's common stock exceeds 130% of the conversion price over specified periods.

The Company expects to use net proceeds from this offering to finance a portion of the purchase price of its pending acquisition of interests in a portfolio of nine regional malls from General Motors Assets Management. Pending this application of net proceeds, the Company will use the net proceeds to repay a portion of borrowings under its existing credit facility. This acquisition is subject to customary closing conditions and is expected to close on or about October 15, 2004.

Neither the Series F Cumulative Redeemable Convertible Preferred Stock nor the shares of the Company's common stock into which they will be convertible have been registered under the Securities Act of 1933, as amended, or any state securities laws, and they may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.

This announcement does not constitute an offer to sell, or the solicitation of an offer to buy, any securities and shall not constitute an offer, solicitation or sale in any jurisdiction in which such offer, solicitation or sale would be unlawful.

About The Mills Corporation

The Mills Corporation is a self-managed real estate investment trust (REIT) based in Arlington, Va. that owns, develops, leases, manages and markets a portfolio of 27 retail and entertainment destinations totaling approximately 34 million square feet. Currently, the Company has eight projects under construction or development around the world.

Statements in this press release that are not historical may be deemed forward-looking statements within the meaning of the federal securities laws. Although The Mills Corporation believes the expectations reflected in any forward-looking statements are based on reasonable assumptions, the Company can give no assurance that their expectations will be attained and it is possible that actual results may differ materially from those indicated by these forward-looking statements due to a variety of risks and uncertainties. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. The reader is directed to the Company's various filings with the Securities and Exchange Commission, including quarterly reports on Form 10-Q, reports on Form 8-K and annual reports on Form 10-K for a discussion of such risks and uncertainties.