While tenants had sales of $833 million in the second quarter and $1.6 billion for the first six months of the year, Taubman says funds from operations also rose, citing the opening of its Stony Point Fashion Park in Richmond, VA, and higher rents in its core portfolio of properties. Bloomfield Hills-based Taubman reported second-quarter FFO of $0.44 per share, up $0.41 a share from the previous year's second quarter.

Leased space at the end of the second quarter was 88.2%, up 0.2% from June 30, 2003. Total occupancy for the portfolio was 85.2%, up 0.4% sequentially from the first quarter and on track to show increasing occupancy for the second half of the year, says chief executive officer Robert S. Taubman.

Including temporary tenants, occupancy was 87.6% on June 30, up from 87.0% a year ago. Average rent per sf was $40.92 for the quarter in the consolidated portfolio, up 4.1% from the second quarter of 2003.

"With 15 consecutive months of increasing sales in our centers, retailers are optimistic about their future prospects," Taubman says. "We are converting this positive sales momentum into occupancy and rental increases at our centers."

The company is raising its FFO outlook for 2004. The company expects 2004 FFO per diluted share to be in the range of $1.90 to $1.93.