Horizon Stockholders OK Ending REIT Status

The stockholders of Horizon Group Properties Inc., Rosemont, Ill., have approved a board proposal to terminate the company's status as a real estate investment trust.Voting at their recent annual meeting, the stockholders also approved amendments to HGP's charter that retain share ownership limitations designed to preserve the company's ability to use net operating losses for federal income tax purposes, and that will "facilitate the future re-election of REIT status," which cannot occur before 2009, HGP reported. The company said it will continue to operate, manage, and develop its portfolio of factory outlet centers. "The termination of REIT status allows us to pursue future opportunities unencumbered by the restrictions on the sources of income we may earn or types of assets in which we may invest that are imposed by the REIT rules," said Gary J. Skolen, HGP's chairman, president, and chief executive officer. "The primary benefit of being a REIT is the ability to eliminate federal income taxes at the corporate level. Given our accumulated net operating and capital losses, we do not anticipate incurring income taxes in the near future." HGP can be found online at http://www.horizongroup.com.