Edgar Filing: SIZELER PROPERTY INVESTORS INC

As filed with the Securities and Exchange Commission on December 3, 2001

Registration No. 333-72210
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

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Amendment No. 2

to
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

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SIZELER PROPERTY INVESTORS, INC.
(Exact name of registrant as specified in its charter)

Maryland 72-1082589
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)

2542 Williams Boulevard
Kenner, Louisiana 70062
(504) 471-6200
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)

SIDNEY W. LASSEN, Chairman
2542 Williams Boulevard
Kenner, Louisiana 70062
(504) 471-6200
(Name, address, including zip code, and telephone number,
including area code, of agent for service)

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Copies to:

WILLIAM I. SCHAPIRO, Esq.
Jaeckle Fleischmann & Mugel, LLP J. WARREN GORRELL, JR., Esq.

800 Fleet Bank Building, Twelve HENRY D. KAHN, Esq.

Fountain Plaza
Hogan & Hartson L.L.P.

Buffalo, New York 14202 555 Thirteenth Street, N.W.

(716) 856-0600 Washington, D.C. 20004

(202) 637-5600

Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of this registration statement as determined
by market conditions.

If the only securities being registered on this form are being offered
pursuant to a dividend or interest reinvestment plan, please check the
following box. [_]

If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933 (the "Securities Act"), other than securities offered only in connection
with dividend or interest reinvestment plans, check the following box. [X]

If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_]

If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]

If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]

CALCULATION OF REGISTRATION FEE

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Proposed Maximum Amount of
Title of Each Class Aggregate Registration
of Securities to be Registered Offering Price (1)(2) Fee
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Debt Securities..............................
Preferred Stock (3).......................... $100,000,000 $25,000(7)
Common Stock (4)(5)..........................
Warrants (6).................................

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(1) The aggregate maximum offering price of all securities issued pursuant to
this Registration Statement will not exceed $100 million. Any securities
registered hereunder may be sold separately or as units with other
securities registered hereunder.

(2) The proposed maximum offering price per unit (a) has been omitted pursuant
to Instruction II.D of Form S-3 and (b) will be determined, from time to
time, by the registrant in connection with the issuance by the registrant
of the securities registered hereunder.

(3) Subject to footnote (1), includes such indeterminate number of shares of
preferred stock as may be issued upon conversion of or in exchange for any
debt securities that provide for conversion or exchange into shares of
preferred stock. No separate consideration will be received for the shares
of preferred stock issued upon conversion of or in exchange for debt
securities.

(4) Subject to footnote (1), includes such indeterminate number of shares of
common stock as may be issued upon conversion of or in exchange for any
debt securities or shares of preferred stock that provide for conversion
or exchange into shares of common stock. No separate consideration will be
received for the shares of common stock issued upon conversion of or in
exchange for debt securities or shares of preferred stock.

(5) Common stock being registered hereunder includes associated rights to
purchase Series A Preferred Stock.

(6) Warrants may be sold separately or with debt securities, shares of
preferred stock or shares of common stock.

(7) The registration fee was paid in connection with the initial filing of
this Form S-3 on October 25, 2001.

The registrant hereby amends this registration statement on such date or
dates as may be necessary to delay its effective date until the registrant
shall file a further amendment which specifically states that this
registration statement shall thereafter become effective in accordance with
section 8(a) of the Securities Act of 1933, as amended, or until this
registration statement shall become effective on such date as the Commission,
acting pursuant to said Section 8(a), may determine.

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++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+ +

+ +
+The information in this prospectus supplement and the accompanying prospectus +
+is not complete and may be changed. We may not sell these securities until +
+the registration statement filed with the Securities and Exchange Commission +
+is effective. This prospectus is not an offer to sell these securities and it +
+is not soliciting an offer to buy these securities in any state where the +
+offer or sale is not permitted. +

++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
Subject to Completion

Preliminary Prospectus Supplement dated December 3, 2001

PROSPECTUS SUPPLEMENT

(To Prospectus dated December , 2001)

[SIZELER LOGO]

SIZELER PROPERTY INVESTORS, INC.

3,000,000 Shares

Common Stock

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We are selling 3,000,000 shares of our common stock. We will receive all of
the net proceeds from this sale.

Our common stock is listed on the New York Stock Exchange under the symbol
"SIZ". Our most recent quarterly dividend on our common stock was paid at an
annual rate of $0.92 per share, representing an annual yield of approximately
9.5%, based upon the last reported sale price of our common stock on the New
York Stock Exchange on November 29, 2001, of $9.72 per share.

--------------

Investing in our common stock involves various risks. See "Risk Factors"
beginning on page 2 in the accompanying prospectus.

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Per
Share Total
-------- --------

Public offering price........................................ $ $
Underwriting discount........................................ $ $
Proceeds to us (before expenses)............................. $ $

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NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF
THIS PROSPECTUS SUPPLEMENT OR THE ACCOMPANYING PROSPECTUS IS TRUTHFUL OR
COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

We have granted the underwriters an option to purchase an additional 450,000
shares of our common stock at the public offering price, less the underwriting
discount, solely to cover over-allotments, if any.

We expect that the shares of common stock will be ready for delivery on or
about December , 2001.

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Ferris, Baker Watts
Incorporated

J.J.B. Hilliard, W.L. Lyons, Inc.

Advest, Inc.

Sterne, Agee & Leach, Inc.

The date of this prospectus supplement is December , 2001

The inside from cover contains four photographs, one each of: Governors Gate in
Pensacola, Florida; Southland Mall in Houme, Louisiana; Westward Plaza in West
Palm Beach, Florida; and The Georgian in New Orleans, Louisiana, as well as a
color map entitled Portfolio Composition with symbols indicating the location of
Enclosed Malls, Power Shopping Center, Shopping Centers, and Apartment
Complexes.

You should rely only on the information contained in this prospectus
supplement, the accompanying prospectus and the information incorporated by
reference therein. We have not, and the underwriters have not, authorized
anyone to provide you with different information. If anyone provides you with
additional or inconsistent information, you should not rely on it. We are not,
and the underwriters are not, making an offer of these securities in any state
where the offer or sale is not permitted. You should assume that the
information contained in this prospectus supplement and the accompanying
prospectus, as well as information previously filed by us with the Securities
and Exchange Commission and incorporated by reference in the accompanying
prospectus, is accurate only as of the date of the applicable document. Our
business, financial condition, results of operations and prospects may have
changed since such dates.

TABLE OF CONTENTS

Page
----
Prospectus Supplement

Disclosure Regarding Forward-Looking Statements.......................... S-1
Summary.................................................................. S-2
Our Company.............................................................. S-6
Capitalization........................................................... S-10
Price Range of Common Stock and Dividends................................ S-11
Selected Financial Data.................................................. S-12
Summary Discussion and Analysis of Financial Condition and Results of
Operations.............................................................. S-14
Management............................................................... S-18
Underwriting............................................................. S-20
Experts.................................................................. S-21
Legal Matters............................................................ S-21

Prospectus
About This Prospectus.................................................... 1
Where You Can Find More Information...................................... 1
Incorporation of Certain Documents by Reference.......................... 1
About Sizeler Property Investors, Inc.................................... 2
Risk Factors............................................................. 2
Disclosure Regarding Forward-Looking Statements.......................... 7
Use of Proceeds.......................................................... 7
Ratio of Earnings to Fixed Charges....................................... 8
Description of Debt Securities........................................... 8
Description of Capital Stock............................................. 15
Description of Warrants.................................................. 19
Certain Provisions of Maryland Law and Our Charter and By-Laws........... 21
Material United States Federal Income Tax Consequences................... 25
Plan of Distribution..................................................... 39
Legal Matters............................................................ 40
Experts.................................................................. 40

DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

This prospectus supplement, the accompanying prospectus and the information
incorporated by reference into the accompanying prospectus include forward-
looking statements. When used, the words "anticipates," "expects," "intends,"
"plans," "believes," "seeks," "estimates" and similar expressions, as they
relate to us or our management, are intended to identify forward-looking
statements. These statements indicate that we have used assumptions that are
subject to a number of risks and uncertainties which could cause our actual
results or performance to differ materially from those projected, including:

. the effect of regional economic conditions, particularly with regard to
retail shopping center and multifamily apartment property occupancy and
rental growth in Alabama, Florida and Louisiana;

. our ability to identify and secure additional properties and sites that
meet our criteria for acquisition or development;

. the acceptance of our financing plans by the capital markets and the
effect of prevailing market interest rates and the pricing of our stock;
and

. other factors discussed under the heading "Risk Factors" in the
accompanying prospectus and as described from time to time in our
filings with the SEC.

We undertake no obligation to release publicly any updates or revisions to
any forward-looking statements contained in this prospectus supplement, the
accompanying prospectus and the information incorporated by reference into the
accompanying prospectus to reflect any change in our expectations or any change
in events, conditions or circumstances on which the statement is based.

S-1

SUMMARY

This summary highlights selected information about us. It does not contain
all of the information that is important to you in deciding whether to invest
in our common stock. To understand this offering fully, you should read the
entire prospectus supplement and the accompanying prospectus carefully,
including the risk factors and financial statements, as well as the other
documents to which those documents refer you. The information presented in this
prospectus supplement assumes a public offering price of $9.72 per share, based
on the last reported sale price of our common stock on the New York Stock
Exchange on November 29, 2001.

Our Company

We are a self-administered and self-managed real estate investment trust
that invests in income producing shopping centers and apartment communities in
the Gulf Coast region of the southeastern United States. We currently own 29
properties, consisting of 15 retail shopping centers with approximately 2.6
million square feet of gross leasable area and 14 apartment properties
containing approximately 3,400 units. Our properties are located in Louisiana
(15), Florida (10) and Alabama (4). As of September 30, 2001, our retail
shopping centers and apartment properties were approximately 92% and 97%
leased, respectively.

We have made uninterrupted quarterly cash distributions to our stockholders
since we commenced operations as a public company in 1987, with a cumulative
total of approximately $98 million paid to our stockholders over this time
period. We were organized as a Delaware corporation in 1986 and reincorporated
as a Maryland corporation in June 2001.

Our Investment Objective and Strategic Plan

Our primary objective is to increase stockholder value through

. an effective value-added asset management program which emphasizes
increasing funds from operations and the appreciation of property values;
and

. selective development of new properties.

We own approximately 93 acres of land in proximity or adjacent to our
existing properties which is available for development. In 2002, we intend to
commence development of the second phase of our Governors Gate apartment
community in Pensacola, Florida and a new apartment community in proximity to
our North Shore Square Mall in Slidell, Louisiana, totalling approximately 350
units. The expected cost of these new developments is approximately $25
million. We also may make selective property acquisitions and participate with
other entities in property ownership, through joint ventures or other types of
co-ownership.

Our strategy for growth is to:

. control and develop sites in proximity or adjacent to our existing
properties in our targeted geographic markets;

. improve the operating performance of our properties through our effective
and efficient leasing and management programs;

. implement programs of redevelopment or expansion of certain properties;
and

. acquire shopping center and apartment properties in the strongest
submarkets within our targeted geographic markets.

S-2

We have a general goal of balancing our portfolio between retail shopping
centers and apartment properties. We believe our investment in both retail
shopping centers and apartment properties, which provide basic necessary
services for everyday living, generates a stable revenue stream that reduces
our exposure to economic downturns. At September 30, 2001, approximately 60% of
our portfolio consisted of investments in retail properties (which accounted
for approximately 54% of our total revenues) and 40% consisted of investments
in apartment communities (which accounted for approximately 46% of our total
revenues).

We believe that our regional concentration and substantial knowledge of the
markets in which we operate afford us a competitive advantage in the
identification of real estate trends and investment opportunities within these
markets. This advantage should enhance our overall strategy to increase cash
flow and portfolio value through:

. maximizing rental income by achieving an optimum level of rental rates
and occupancy levels;

. operating properties in a cost-effective manner;

. renovating properties in order to maintain and improve our competitive
position and performance in the marketplace; and

. assessing the most cost-effective sources of capital to finance
properties.

Management

Our four executive officers have an average of approximately 25 years of
experience in real estate investment and related fields. Sidney W. Lassen and
Thomas A. Masilla have held the positions of Chief Executive Officer and
President since 1986 and 1995, respectively. Robert A. Whelan has held the
position of Chief Financial Officer since May 1999. James W. Brodie has held
the position of Vice President and Secretary since 1991 and 1999, respectively.
Our independent directors also have many years of experience in the real estate
industry, as well as business, finance and investment management. Our directors
and executive officers beneficially own approximately 8% of our common stock
and hold options to acquire an additional 7% of our common stock.

Recent Developments

Acquisition of Management Company. On October 5, 2001, we completed the
acquisition of Sizeler Real Estate Management Co., Inc. from Sizeler Realty
Co., Inc. The purchase price for this acquisition was $3.05 million. For the
year ended December 31, 2000, we paid Sizeler Real Estate Management Co., Inc.
approximately $3.0 million in management fees and leasing commissions and
reimbursement of legal and administrative costs. This management company has
been our property manager since 1986. Mr. Lassen, our Chairman of the Board of
Directors, owned a minority beneficial interest in this management company,
with the balance owned by members of his wife's family and her parents'
estates. This transaction was approved unanimously by our Board of Directors,
after receiving the advice of a committee of independent directors and a
fairness opinion from an independent financial advisor. As a result of this
transaction, we are now fully self-managed. See "Summary Discussion and
Analysis of Financial Condition and Results of Operations--Overview" for a
discussion of the treatment of this transaction in our financial statements.

S-3

The Offering

Common stock offered.................................. 3,000,000 shares (1)

Common stock to be outstanding after the offering .... 11,420,000 shares (2)(3)

New York Stock Exchange symbol for our common stock... "SIZ"

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(1) 3,450,000 shares of common stock if the underwriters exercise their over-
allotment option in full.

(2) Based on 8,420,000 shares of common stock outstanding on November 23, 2001.

(3) 11,870,000 shares of common stock if the underwriters exercise their over-
allotment option in full. Does not include: 225,000 shares of common stock
reserved for issuance under our employee stock option plans; (ii) 1,500,000
shares of common stock reserved for issuance under our dividend
reinvestment and share purchase plan; and (iii) 4,760,000 shares of common
stock reserved for issuance upon the conversion of our existing 8%
convertible subordinated debentures.

Use of Proceeds

We estimate that the net proceeds to us from the sale of 3,000,000 shares of
our common stock in this offering will be approximately $27,232,000 after
deducting underwriting discounts and commissions and the estimated expenses of
this offering. If the underwriters exercise their over-allotment option in
full, we estimate that our net proceeds will be approximately $31,052,000.

We intend to use the net proceeds to develop additional apartment properties
consistent with our current business strategy. Currently we have plans to spend
approximately $25 million over the next 18 months to develop a second phase of
our Governors Gate apartment community in Pensacola, Florida and to develop a
new apartment community in proximity to our North Shore Square Mall in Slidell,
Louisiana, totalling approximately 350 units.

Pending the use of the net proceeds for these purposes, we intend to use the
net proceeds to reduce amounts outstanding under our bank lines of credit.

S-4

Market Price of and Distributions on Our Common Stock

Our common stock trades on the New York Stock Exchange under the symbol
"SIZ". The high and low sale prices of our common stock as reported on the New
York Stock Exchange, and dividend payments on our common stock on a quarterly
basis for each of the quarters indicated are shown in a table under the heading
"Price Range of Common Stock and Dividends". On November 29, 2001, the closing
sale price of our common stock was $9.72 per share as reported on the New York
Stock Exchange. As of November 23, 2001, there were 8,420,000 shares of common
stock outstanding held by approximately 511 persons of record.

We have made uninterrupted quarterly distributions to our stockholders since
we commenced operations as a public company in 1987, with a cumulative total of
approximately $98 million paid to stockholders over this time period. Future
dividends will be at the discretion of our board of directors and will depend
on a number of factors, including our operating results and financial
condition. We cannot assure you that the historical level of dividends will be
maintained.

On November 8, 2001, our Board of Directors declared a $0.23 per share
quarterly dividend on our common stock, payable on December 6, 2001, to
stockholders of record on November 27, 2001.

We have made, and we intend to continue to make, timely dividend
distributions to our stockholders sufficient to satisfy the annual distribution
requirements applicable to REITs under federal income tax law that are
discussed under "Material United States Federal Income Tax Consequences" in the
accompanying prospectus and to avoid the imposition of federal income and
excise taxes on us. However, we cannot assure you that we will be able to make
sufficient distributions in any given year to maintain our REIT status and to
avoid the imposition of federal income and excise taxes on us.

S-5

OUR COMPANY

Our Business

Our principal executive offices are located at 2542 Williams Boulevard,
Kenner, Louisiana 70062. Our telephone number is (504) 471-6200. We were
organized as a Delaware corporation in 1986 and reincorporated as a Maryland
corporation in June 2001.

Investment Objective and Strategic Plan

Our primary objective is to increase stockholder value through

. an effective value-added asset management program which emphasizes
increasing funds from operations through the appreciation of property
values; and

. selective development of new properties.

Our strategy for growth is to:

. control and develop sites in proximity or adjacent to existing
properties in our targeted geographic markets;

. improve the operating performance of our properties through our
effective and efficient leasing and management programs;

. implement programs of redevelopment or expansion of certain properties;
and

. acquire shopping center and apartment properties in the strongest
submarkets within our targeted geographic markets.

S-6

these markets. This advantage should enhance our overall strategy to increase
cash flow and portfolio value through:

. maximizing rental income by achieving an optimum level of rental rates
and occupancy levels;

. operating properties in a cost-effective manner;

. renovating properties in order to maintain and improve our competitive
position and performance in the marketplace; and

. assessing the most cost-effective sources of capital to finance
properties.

We consider numerous factors in the evaluation of potential real estate
investments including, but not limited to, the following:

. acquisition and/or development cost and initial cash flow in relation
to yield objective;

. the presence of or proximity to potential environmental issues;

. current and historical occupancy levels;

. current and historical sales levels of retail tenants;

. other characteristics of existing tenants, including credit-worthiness;

. the potential to increase cash flow through effective property
management;

. geographic area and demographic profile;

. property size and composition of tenants;

. availability of financing, including the possibility of assuming
existing financing or the potential for refinancing;

. condition, quality of design, construction, and other physical
attributes;

. level of real property taxes and property insurance and the ability to
pass through these costs to tenants;

. current and expected economic environment of local and regional real
estate markets;

. anticipated future treatment under applicable federal, state, and local
tax laws and regulations; and

. potential for appreciation in value.

We expect to hold our properties as long-term investments and have no
maximum holding period for our properties.

S-7

Our Properties

As of September 30, 2001, our real estate portfolio included interests in 15
retail shopping centers and 14 apartment communities. Of our properties, 15 are
unencumbered and 14 are subject to mortgages. Of the encumbered properties, 12
are apartment properties and two are retail shopping centers.

The following table sets forth information concerning our real estate
investments as of September 30, 2001:

Percent
Gross Leasable Leased (c)
Area in Square September 30, Number of
Year Year Last Feet or ------------- Tenants/
Description Completed Renovated Rentable Units 2000 2001 Occupants(e)
----------- ---------- ---------- -------------- ------ ------ ------------

Regional Enclosed Malls (3)
Hammond Square (Hammond,
Louisiana)................. 1978 1992, 1995 361,000 88% 88% 57
431,000(a) 90% 90%

Significant Tenants/
Description Occupants(e)
----------- --------------------

Regional Enclosed Malls (3)
Hammond Square (Hammond,
Louisiana)................. JC Penney, Sears, Dillard's,
Rite Aid, Lerner Shops

North Shore Square (Slidell, 1986 1995, 2001 355,000 98% 98% 77
Louisiana).................
623,000(a) 99% 99%
North Shore Square (Slidell, JC Penney, Sears, Dillard's,
Louisiana).................
Mervyn's Camelot Music

Southland Mall (Houma, 1970, 1981 1994 431,000(d) 94% 93% 85
Louisiana)...............
585,000(a) 96% 95%
Southland Mall (Houma, JC Penney, Sears, Dillard's,
Louisiana)...............
Rite Aid, Lerner Shops,
American Eagle

PowerPShoppingoCentersw(3)er Shopping Centers (3)
LantanaLPlazaa(PalmnBeachtana KPMart,lHomeaDepot,zFooda (Palm Beach 1992 1999 274,000 97% 99% 20
County,CFlorida).........ountyLion,,BurgerFKinglorida).........
Town & Country (Palatka, 1989 2000 199,000 82% 82% 11
Florida).................
Town & Country (Palatka, K Mart, Publix
Florida).................

Westward (W. Palm Beach, Circuit City, Office Depot,
WFlorida).................estwaPetsMart,rSportsd (W. Palm Beach, 1961, 1990 1995, 2000 221,000 97% 97% 22
Florida)................. Authority, Old Navy
Community Shopping Centers
(9)
Airline Park (Metairie, 1973 1986, 2001 54,000 61% 92% 8
CommunityLShoppingoCentersuisiana)...............
(9)
Airline Park (Metairie, Rite Aid, Harbor Freight,
Louisiana)............... Sears, McDonalds

Azalea Gardens (Jefferson, 1950 1986 45,000 100% 100% 3
Louisiana)...............
Azalea Gardens (Jefferson, Winn Dixie, Family Dollar
Louisiana)...............

Colonial (Harahan, 1981 1987, 1999 45,000 100% 100% 3
Louisiana)...............
Colonial (Harahan, State Farm, Discount Auto
Louisiana)............... Parts

Gonzales Plaza (Gonzales, 1989 -- 73,000 29% 29% 7
Louisiana)...............
290,000(a) 73% 82%
Rainbow Square (Dunnellon, 1986 -- 75,000 99% 99% 12
Florida).................
117,000(a) 99% 99%
Gonzales Plaza (Gonzales, Blockbuster
Louisiana)...............
Rainbow Square (Dunnellon, Kash-N-Karry, Walgreens,
Florida).................
Beall's Outlet Store

Southwood (b) (Gretna, 1986 2001 40,000 100% 100% 9
Louisiana)...............
Southwood (b) (Gretna, T J Maxx
Louisiana)...............

Weeki Wachee Village 1987 2000 82,000 85% 89% 17
(Weeki Wachee, Florida)..
Weeki Wachee Village Eckerds, Winn Dixie
(Weeki Wachee, Florida)..

Westgate (Alexandria, 1964 1987, 2001 208,000 98% 98% 14
WestgateL(Alexandria,ouisiana)Sutherland.Building.Materials,.............
Louisiana)............... Big Lots, Autozone

Westland (Kenner, 1966 1990, 1999 109,000 99% 99% 13
Louisiana)...............
----------- ---
2,572,000 91%(f) 92%(f) 358
=========== ===
Apartments (14)
Bel Air (Mobile, 1968, 1974 -- 202 units 96% 94%
Alabama).................
Bryn Mawr (Naples, 1991 1999 240 units 99% 98%
Florida).................
Colonial Manor (Harahan, 1967 1994 48 units 100% 100%
Louisiana)...............
Garden Lane (Gretna, 1966, 1971 1999 262 units 100% 97%
Louisiana)...............
Georgian (New Orleans, 1951, 1980 1993 135 units 99% 97%
Louisiana)...............
Governors Gate (Pensacola, 1999 -- 240 units 97% 99%
Florida).................
Hampton Park (Mobile, 1977 1995 300 units 96% 97%
Alabama).................
Jamestown Estates 1971-1972 -- 177 units 99% 95%
(Pensacola, Florida).....
Lafayette Square (Mobile, 1969-1972 1995, 1999 675 units 98% 94%
Alabama).................
Lakeview Club (Ft. 1992 -- 443 units 100% 100%
Lauderdale, Florida).....
Magnolia Place (New 1984 -- 148 units 95% 100%
Iberia, Louisiana).......
Pine Bend (Mobile, 1979 -- 152 units 95% 98%
Alabama).................
Steeplechase (Lafayette, 1982 -- 192 units 95% 100%
Louisiana)...............
Woodcliff (Pensacola, 1977 1999 184 units 100% 96%
Florida).................
-----------
3,398 units 98%(f) 97%(f)
===========
Westland (Kenner, Universal Furniture, Eckerds
Louisiana)...............
Apartments (14)
Bel Air (Mobile,
Alabama).................
Bryn Mawr (Naples,
Florida).................
Colonial Manor (Harahan,
Louisiana)...............
Garden Lane (Gretna,
Louisiana)...............
Georgian (New Orleans,
Louisiana)...............
Governors Gate (Pensacola,
Florida).................
Hampton Park (Mobile,
Alabama).................
Jamestown Estates
(Pensacola, Florida).....
Lafayette Square (Mobile,
Alabama).................
Lakeview Club (Ft.
Lauderdale, Florida).....
Magnolia Place (New
Iberia, Louisiana).......
Pine Bend (Mobile,
Alabama).................
Steeplechase (Lafayette,
Louisiana)...............
Woodcliff (Pensacola,
Florida).................

--------

(a) The larger number is the total area of the indicated center, including
owner-occupied stores in which we have no ownership interest. Hammond
Square and Southland Mall have stores owned by Dillard Department Stores,
Inc., comprising 70,000 s.f. and 154,000 s.f. of space, respectively; North
Shore Square Mall has stores owned by Dillard Department Stores, Inc.
comprising 116,000 s.f. and 77,000 s.f. of space, and Mervyn's comprising
75,000 s.f. of space; Gonzales Plaza and Rainbow Square Shopping Centers
have stores owned by Wal-Mart Stores, Inc., comprising 217,000 s.f. and
42,000 s.f., respectively.

(b) We have a 50% partnership interest in Southwood Shopping Center.

(c) Except as otherwise noted in (a), we define "leased" as an executed
conveyance whereby the tenant possesses the premises, including those in
which the tenant may not have commenced occupancy or rental payments.
Percent leased for retail is computed as the ratio of total space leased,
including anchor stores, to total leasable space, expressed as a
percentage.

(d) During 2000 we removed 36,000 s.f. from retail use.

(e) None of the owner-occupants set forth in note (a) above are our tenants.

(f) Represents weighted average occupancy for the respective period.

S-8

Tenants

Our tenants consist of national, regional and local retailers for our retail
properties, and individual leases for our apartment properties. Our retail
properties generally attract tenants who provide basic necessary services for
everyday living to local customers. We believe sales of these items are less
sensitive to fluctuations in the business cycle than higher priced retail
items. No single tenant currently represents more than 3.0% of the total annual
base rent of our retail properties or more than 2.0% of our total annual
revenue. The list below shows our ten largest tenants as of September 30, 2001:

Percent of Total Percent of
Annual Base Rent Total
No. of Minimum of Retail Annual
Tenant Stores Rent Properties(1) Revenue(1)
------ ------ ---------- ---------------- ----------

K-Mart............................ 2 $ 832,000 2.9% 1.6%
Home Depot........................ 1 824,000 2.9% 1.6%
J.C. Penney....................... 3 809,000 2.9% 1.6%
Sports Authority.................. 1 454,000 1.6% 0.9%
Sears............................. 3 397,000 1.4% 0.8%
Publix............................ 1 365,000 1.3% 0.7%
Circuit City...................... 1 333,000 1.2% 0.6%
Office Depot...................... 1 281,000 1.0% 0.5%
Old Navy.......................... 1 281,000 1.0% 0.5%
Food Lion......................... 1 254,000 0.9% 0.5%
--- ---------- ---- ---
Total........................... 15 $4,830,000 17.0% 9.4%
=== ========== ==== ===

--------

(1) Based on rent revenues for the year ended December 31, 2000. Our year 2000
total revenue was $51,441,000 and our year 2000 total base rent of retail
properties was $28,353,000.

S-9

CAPITALIZATION

The following table sets forth our capitalization as of September 30, 2001
on a historical basis and as adjusted to reflect this offering and the
application of the net proceeds thereof. You should read this information in
conjunction with our consolidated financial information and accompanying notes,
which are incorporated by reference into the accompanying prospectus.

As of September 30, 2001
--------------------------
(unaudited)
As
Actual Adjusted (1)
-------- ------------
(in thousands)

Indebtedness (2)
Notes payable..................................... $ 31,512 $ 4,280
Mortgage indebtedness (3)......................... 111,776 111,776
Convertible subordinated debentures............... 61,878 61,878
Shareholders' equity (2)
Series A preferred stock, 40,000 shares
authorized, none issued.......................... -- --
Common stock, par value $0.0001 per share,
53,960,000 shares authorized, 8,368,000 shares
issued and outstanding, 11,368,000 shares issued
and outstanding, as adjusted (4)(5).............. 1 1
Additional paid-in capital........................ 121,917 149,149
Cumulative net income............................. 42,336 42,336
Cumulative distributions paid..................... (97,572) (97,572)
-------- --------
Total shareholders' equity...................... 66,682 93,914
-------- --------
Total capitalization............................ $271,848 $271,848
======== ========

--------

(1) After deducting underwriting discounts and commissions and expenses of this
offering payable by us, estimated to be an aggregate of approximately
$1,928,000 assuming that the underwriters' over-allotment option is not
exercised.

(2) Does not reflect the possible exchange of new convertible subordinated
debentures and/or Series B preferred stock for our existing convertible
subordinated debentures as described under "Summary Discussion and Analysis
of Financial Condition and Results of Operations--Introduction."

(3) This mortgage debt is long-term, non-recourse and bears fixed rates of
interest for fixed terms.

(4) 11,818,000 shares of common stock issued and outstanding, as adjusted, if
the underwriters exercise their over-allotment option in full. Does not
include: 225,000 shares of common stock reserved for issuance under our
employee stock option plans; (ii) 1,500,000 shares of common stock reserved
for issuance under our dividend reinvestment and share purchase plan; and
(iii) 4,760,000 shares of common stock reserved for issuance upon the
conversion of our existing 8% convertible debentures.

(5) Does not include 16,000,000 shares of excess stock, into which our common
stock is automatically convertible in certain circumstances. See
"Description of Capital Stock."

S-10

PRICE RANGE OF COMMON STOCK AND DIVIDENDS

The following table sets forth the high and low sales price of the shares
for the periods indicated, as reported by the New York Stock Exchange, and the
dividends paid per share in such periods:

Dividends
High Low Paid
------ ----- ---------

2001
1st Quarter............................................. $ 8.82 $6.94 $0.23
2nd Quarter............................................. 9.76 8.31 0.23
3rd Quarter............................................. 10.33 8.60 0.23
4th Quarter (through November 29, 2001)................. 10.00 8.61 --(a)
2000
1st Quarter............................................. $ 8.56 $6.38 $0.22
2nd Quarter............................................. 7.81 6.44 0.23
3rd Quarter............................................. 8.50 7.38 0.23
4th Quarter............................................. 7.88 6.88 0.23
1999
1st Quarter............................................. $ 8.94 $7.94 $0.22
2nd Quarter............................................. 9.44 7.75 0.22
3rd Quarter............................................. 9.13 8.25 0.22
4th Quarter............................................. 8.69 8.00 0.22

--------

(a) On November 8, 2001, our Board of Directors declared a $0.23 per share
quarterly dividend on our common stock, payable on December 6, 2001, to
stockholders of record on November 27, 2001.

The federal income tax status of dividends per share paid for each of the
five years ended December 31, 2000 was as follows:

2000 1999 1998 1997 1996
----- ----- ----- ----- -----

Ordinary Income................................ $0.54 $0.54 $0.62 $0.54 $0.37
Return of Capital.............................. 0.37 0.34 0.27(a) 0.34 0.51
Capital Gain................................... -- -- -- -- --
----- ----- ----- ----- -----
Total...................................... $0.91 $0.88 $0.89 $0.88 $0.88
===== ===== ===== ===== =====

--------

(a) Includes a $0.01 per share distribution for the redemption of stock
purchase rights in connection with the Company's adoption of a replacement
shareholder rights plan.

S-11

SELECTED FINANCIAL DATA

The following table sets forth our selected historical consolidated
financial and operating data as of and for each of the periods indicated. The
consolidated financial data as of and for each of the five years ended December
31, 2000 were derived from our audited financial statements. The consolidated
financial data as of and for the nine months ended September 30, 2001 and 2000
were derived from our unaudited financial statements. The selected financial
data should be read in conjunction with our consolidated financial statements
and related notes incorporated by reference in the accompanying prospectus.

Nine Months Ended
September 30, Years Ended December 31,
------------------ --------------------------------------------
2001 2000 2000 1999 1998 1997 1996
-------- -------- -------- -------- -------- -------- --------
In thousands except per share data and percentages

Operating Data:
Total revenue.......... $ 39,302 $ 38,282 $ 51,441 $ 49,969 $ 47,791 $ 46,443 $ 44,456
Property operating
expenses (1).......... 15,215 14,291 19,442 18,971 17,905 17,139 16,317
-------- -------- -------- -------- -------- -------- --------
Net operating income
(NOI) (2)............. 24,087 23,991 31,999 30,998 29,886 29,304 28,139
Depreciation and
amortization.......... 8,481 8,333 11,173 10,845 10,145 9,621 9,119
Interest expense....... 11,581 11,838 15,850 15,018 14,554 14,608 14,542
Administrative
expense............... 1,912 2,183 2,648 2,788 2,431 2,520 2,194
Other items (3)........ 506 -- -- -- -- -- (449)
-------- -------- -------- -------- -------- -------- --------
Net income............. $ 2,619 $ 1,637 $ 2,328 $ 2,347 $ 2,756 $ 2,555 $ 1,835
======== ======== ======== ======== ======== ======== ========
Common stock cash
distributions paid.... $ 5,665 $ 5,389 $ 7,234 $ 6,938 $ 7,330 $ 7,413 $ 7,425

Per Share Data (4):
Basic and diluted
earnings per share
(4)................... $ 0.32 $ 0.21 $ 0.29 $ 0.30 $ 0.33 $ 0.30 $ 0.22
Cash dividends to
shareholders.......... $ 0.69 $ 0.68 $ 0.91 $ 0.88 $ 0.88 $ 0.88 $ 0.88
Weighted average common
shares outstanding--
basic and diluted..... 8,204 7,925 7,950 7,888 8,331 8,423 8,433

Balance Sheet Data:
Real estate
investments, at cost.. $347,576 $346,789 $348,759 $338,389 $328,477 $310,312 $303,476
Investment in real
estate partnership.... 907 915 916 917 913 904 948
Total assets........... 276,610 284,911 285,417 284,943 284,935 275,485 277,604
Mortgage notes
payable............... 111,776 109,683 113,163 84,712 89,869 90,615 68,080
Notes payable.......... 31,512 39,109 35,716 59,988 49,178 32,342 52,639
Convertible
subordinated
debentures............ 61,878 61,878 61,878 61,878 62,878 62,878 62,878
Total liabilities...... 209,928 217,056 218,298 213,990 208,718 190,958 188,237
Shareholders' equity... $ 66,682 $ 67,855 $ 67,119 $ 70,953 $ 76,217 $ 84,527 $ 89,367
Number of shares of
common stock
outstanding........... 8,368 8,004 8,063 7,909 7,990 8,425 8,422
Other Data:
Computation of Funds
from Operations (5):
Net income............. $ 2,619 $ 1,637 $ 2,328 $ 2,347 $ 2,756 $ 2,555 $ 1,835
Adjustments:
Depreciation on real
estate investments.... 7,996 7,891 10,579 10,256 9,528 8,954 8,487
Other items (3)........ (506) -- -- -- -- -- 449
-------- -------- -------- -------- -------- -------- --------
Funds from operations
attributable to shares
of common stock--
basic................. 10,109 9,528 12,907 12,603 12,284 11,509 10,771
Interest on convertible
subordinated
debentures............ 3,713 3,713 4,950 5,017 5,030 5,030 5,030
Amortization of
debenture issuance
cost.................. 183 183 244 248 248 248 248
-------- -------- -------- -------- -------- -------- --------
Funds from operations
attributable to shares
of common stock--
diluted............... $ 14,005 $ 13,424 $ 18,101 $ 17,868 $ 17,562 $ 16,787 $ 16,049
======== ======== ======== ======== ======== ======== ========
Weighted average common
shares outstanding--
diluted............... 13,040 12,742 12,787 12,725 13,168 13,260 13,269
Dividend payout ratio--
basic (8)............. 56% 57% 56% 55% 60% 64% 69%
Dividend payout ratio--
diluted (8)........... 40% 40% 40% 39% 42% 44% 46%

S-12

Nine Months Ended
September 30, Years Ended December 31,
------------------ ------------------------------------------------
2001 2000 2000 1999 1998 1997 1996
-------- -------- -------- -------- -------- -------- --------
In thousands except per share data and percentages

Cash Flows:
Net cash provided by
operating activities.. $ 6,867 $ 8,971 $ 14,010 $ 13,193 $ 12,456 $ 12,945 $ 13,504
Net cash provided by
(used in) investing
activities............ 1,248 (8,521) (10,496) (9,925) (16,966) (6,757) (7,476)
Net cash (used in)
provided by financing
activities............ $ (8,316) $ (1,130) $ (2,955) $ (3,081) $ 4,532 $ (5,528) $ (6,834)

Apartments segment:
Gross investment....... $138,476 $136,148 $136,870 $134,092 $129,510 $113,446 $109,236
Total units............ 3,398 3,398 3,398 3,397 3,341 3,157 3,157
Percent leased (6)..... 97% 96% 97% 96% 96% 97% 98%
Operating revenue...... $ 17,946 $ 17,267 $ 22,954 $ 21,947 $ 20,353 $ 19,883 $ 19,052
Operating expenses
(9)................... $ 7,280 $ 7,045 $ 9,432 $ 9,026 $ 8,190 $ 7,874 $ 7,539
Net operating income
(2)................... $ 10,666 $ 10,222 $ 13,522 $ 12,921 $ 12,163 $ 12,009 $ 11,513
Percent of total NOI... 44% 43% 42% 42% 41% 41% 41%

Retail Properties
Segment:
Gross investment (7)... $210,006 $211,556 $212,805 $205,214 $199,880 $197,770 $195,188
Total square footage... 2,571 2,693 2,680 2,720 2,668 2,668 2,667
Percent leased (6)..... 92% 91% 92% 95% 95% 95% 92%
Operating revenue...... $ 21,356 $ 21,015 $ 28,487 $ 28,022 $ 27,438 $ 26,560 $ 25,404
Operating expenses
(9)................... $ 7,935 $ 7,246 $ 10,010 $ 9,945 $ 9,715 $ 9,265 $ 8,778
Net operating income
(2)................... $ 13,421 $ 13,769 $ 18,477 $ 18,077 $ 17,723 $ 17,295 $ 16,626
Percent of total NOI... 56% 57% 58% 58% 59% 59% 59%

--------

(1) Property operating expenses consist of management and leasing fees,
utilities, real estate taxes, operations and maintenance and other
operating expenses.

(2) Net operating income (NOI) is another measurement of financial performance
utilized by us, and is based on the operating revenues and operating
expenses directly associated with the operations of the real estate
properties (excluding administrative expenses, depreciation and
amortization and interest expense). NOI is calculated as operating revenues
less operating expenses directly related to the operations of the real
estate properties, before administrative expenses, depreciation and
amortization and interest.

(3) In 1996, we recorded an extraordinary charge related to the early
extinguishment of debt. In 2001, we recorded a gain related to the sale of
one of our real estate properties.

(4) Basic EPS is computed by dividing net income by the weighted average number
of shares of common stock outstanding for the period. Diluted EPS reflects
the potential dilution that could occur if securities or other contracts to
issue common stock were exercised or converted into common stock or
resulted in the issuance of common stock that then shared in our earnings.
For the nine month period ended September 30, 2001 there were options to
purchase shares of common stock with exercise prices less than the average
market price, however, the effect of the inclusion in the calculation of
EPS is immaterial. For all other periods presented, the options to purchase
shares of common stock were excluded in the computation of diluted EPS
because the options' exercise prices were greater than the average market
prices of common stock. Our outstanding debentures are also excluded from
the computation for all periods presented due to their anti-dilutive
effect. Accordingly, there is no effect on net income in the calculation of
diluted EPS for the periods presented.

(5) Funds from operations has been an industry-wide standard used to measure
operating performance of a REIT since its adoption by the National
Association of Real Estate Investment Trusts in 1991. In October 1999
NAREIT revised the definition of funds from operations. The revision had no
effect on our calculation of funds from operations. We calculate funds from
operations as net income, excluding gains or losses from sales of property
and those items defined as extraordinary under accounting principles
generally accepted in the United States of America (GAAP), plus
depreciation on real estate assets, and after adjustments for
unconsolidated partnerships to reflect funds from operations on the same
basis. Funds from operations should not be considered as an alternative to
net earnings or any other GAAP measurement of performance or as an
alternative to cash flow from operating, investing or financing activities
as a measure of liquidity. The funds from operations measure presented by
us, while consistent with NAREIT's definition, will not be comparable to
similarly titled measure of other REITs that do not compute funds from
operations in a manner consistent with ours.

(6) Represents the average percent leased for the respective period.

(7) Includes our investment in an unconsolidated real estate entity.

(8) Dividend payout ratio is calculated based on cash dividends paid to
shareholders as a percentage of funds from operations attributable to
shares of common stock.

(9) Operating expenses do not include an allocation of administrative expenses.

S-13

SUMMARY DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Introduction

The following is a discussion and comparison of our financial condition and
results of operations as of and for the three years ended December 31, 2000,
1999 and 1998 and the nine months ended September 30, 2001 and 2000. You should
read this discussion in conjunction with our consolidated financial statements
and notes and the other financial and operating data included in or
incorporated by reference in this prospectus supplement and the accompanying
prospectus.

On October 5, 2001, we completed the acquisition of Sizeler Real Estate
Management Co., Inc. from Sizeler Realty Co., Inc. The purchase price for this
acquisition was $3.05 million. For the year ended December 31, 2000, we paid
Sizeler Real Estate Management Co. approximately $3.0 million in management
fees and leasing commissions and reimbursement of legal and administrative
costs. Financial reporting requires that any difference between the net asset
valuation of the assets we acquired in the purchase of Sizeler Real Estate
Management Co., Inc. and the total of the purchase price plus acquisition costs
will be recognized as a nonrecurring charge to operations during the fourth
quarter of 2001. Based on the information presently available, which is subject
to change and to final review by our independent auditors, we currently
estimate that we will recognize a nonrecurring charge to operations of
approximately $1.2 million in the quarter ended December 31, 2001. This amount
would be a non-cash nonrecurring charge and would not affect reported funds
from operations.

We recently filed a registration statement for a possible exchange offer of
a new series of convertible subordinated debentures and/or preferred stock for
our currently outstanding 8% convertible subordinated debentures due 2003. The
purpose of this exchange offer is to refinance existing indebtedness. We intend
to proceed with the exchange offer, subject to market conditions, after this
offering is completed. In our filing, we estimated that the new debentures
would be 9% convertible subordinated debentures due 2009 with a conversion
price of $11.00 per share. If we proceed with the exchange offer, we will
establish the interest rate, conversion price, maturity and other basic terms
based on market conditions at the time and with the assistance of our financial
advisors.

Results of Operations

Comparison of nine months ended September 30, 2001 to the nine months ended
September 30, 2000

For the nine months ended September 30, 2001, our total operating revenues
increased approximately $1.0 million or 3% to $39.3 million, compared to $38.3
in the same period of 2000. Operating revenues increased due to strong
occupancy levels for both the retail shopping centers and apartment properties,
rent increases and new retail leases. Among others, we leased the newly
developed 44,300 s.f. Publix Supermarket at the Town and Country Power Shopping
Center in Palatka, Florida. Operating revenue for retail shopping centers and
apartment properties was $21.4 million and $17.9 million, respectively,
compared to operating revenue for retail shopping centers and apartment
properties of $21.0 million and $17.3 million, respectively, in the nine months
ended September 30, 2000. Revenue growth over the first nine months of 2001 was
partially offset by increased operating costs, in particular utilities, real
estate taxes and insurance costs. Net operating income for the nine months
ended September 30, 2001 totaled $24.1 million, compared to $24.0 million for
the nine months ended September 30, 2000. We use the concept of net operating
income (operating revenues and expenses directly associated with the operation
of our properties, excluding administrative expenses, depreciation and
amortization and interest expense) as a measure of the financial and operating
performance of our real estate portfolio.

Interest expense for the nine months ended September 30, 2001 decreased
$257,000 from the nine months ended September 30, 2000. The reduction in
interest expense was the result of the combination of lower interest rates paid
on our borrowed funds and our reduction in the amount of floating rate bank
debt outstanding discussed below.

S-14

Comparison of the year ended December 31, 2000 to the year ended December 31,
1999

For the year ended December 31, 2000, operating revenue increased
approximately 3% to $51.4 million, compared with $50.0 million in the prior
year. Operating revenue for retail centers and apartments was $28.5 million and
$22.9 million, respectively, compared to operating revenue for retail centers
and apartments of $28.0 million and $22.0 million, respectively, for the year
ended December 31, 1999. The increase in operating revenue was due primarily
to: new retail leases, in particular the leasing of 40,000 s.f. of space
previously reported vacated by a tenant at the end of 1999, and the opening of
the 44,300 s.f. Publix Supermarket in Palatka, Florida at the end of August
2000; increased apartment rental rates, as reflected in a 5% increase in
apartment revenues over the prior year, and sustained occupancy levels. Net
operating income increased 3% to $32.0 million in 2000, as compared to $31.0
million in 1999. Operating expenses, excluding administrative expenses,
depreciation and amortization and interest expense totaled $19.4 million in
2000, compared to $19.0 million in 1999. The increase in operating expenses was
primarily attributable to increased costs of utilities, insurance and real
estate taxes.

Interest expense reflected a net increase of $832,000 resulting from the
rising interest rate environment during the year. In 2000, we completed
approximately $30 million of additional long-term, fixed-rate, non-recourse
financing and used these proceeds to reduce floating rate bank debt. The
average bank borrowings in 2000 were approximately $47.3 million, with an
average interest rate of 7.9%, as compared to $54.0 million, with an average
interest rate of 6.8% in 1999.

Comparison of year ended December 31, 1999 to the year ended December 31, 1998

For the year ended December 31, 1999, operating revenue increased
approximately 5% to $50 million, compared with $47.8 million in the prior year.
Operating revenue from shopping centers and apartments increased approximately
$584,000 and $1,594,000 to $28.0 million and $22.0 million, respectively,
compared to operating revenue from shopping centers and apartments of $27.4
million and $20.4 million, respectively, for the year ended December 31, 1998.
The increase in operating revenue is primarily attributable to the Governors
Gate Apartments complex, which was completed in the first quarter of 1999. In
addition, there were increases in rental rates coupled with market sustained
occupancy levels at the retail properties. Operating expenses, excluding
administrative expenses, depreciation and amortization and interest expense
increased approximately $1.1 million in 1999 compared to 1998. The increase in
operating expenses associated with the retail properties is $229,000 and with
the apartment properties is $836,000. The increase in operating expenses was
due to costs related to Governors Gate apartments as well as increases in
management and leasing fees, and other non-controllable costs.

Interest expense reflects a net increase of $464,000 resulting from
financing activities occurring in 1998, particularly the refinancing of
mortgage debt on ten apartment properties and the repayment of bank debt with a
portion of these proceeds resulting in the availability of the bank line for
certain development projects, repayment of other debt and stock repurchases.

Liquidity and Capital Resources

The primary source of our working capital is net cash provided by operating
activities, from which we fund normal operating requirements, debt service
obligations and distributions to shareholders. In addition, we maintain
unsecured credit lines with commercial banks, which we utilize to supplement
cash provided by operating activities and to initially finance the cost of
property development and redevelopment activities, portfolio acquisitions and
other expenditures. At September 30, 2001, we had $1,695,000 in cash and cash
equivalents and $50 million in committed bank lines of credit facilities, of
which approximately $31.5 was outstanding and $18.5 million was available.
Utilization of the bank lines is subject to certain restrictive covenants that
impose maximum borrowing levels by us through the maintenance of certain
prescribed financial ratios.

Net cash provided by operating activities decreased $2.1 million in the nine
months ended September 30, 2001 compared to the same period in 2000. The
decrease was principally attributable to a decrease in short-term payables and
an increase in prepaid insurance costs in 2001. Net cash flows provided by
operating

S-15

activities increased $817,000 in the year ended December 31, 2000 from the year
ended December 31, 1999, and $737,000 in the year ended December 31, 1999 from
the year ended December 31, 1998. The increase between 2000 and 1999 is
primarily attributable to a net increase in income from operations before
depreciation, as well as a net decrease in accounts receivable and prepaid
expenses. The increase between 1999 and 1998 is primarily attributable to a net
increase in income from operations before depreciation, as well as a net
increase in operating liabilities.

Net cash provided by investing activities increased approximately $9.8
million in the nine months ended September 30, 2001 from the nine months ended
September 30, 2000, primarily attributable to the sale of one of our shopping
centers. Total net cash provided by investing activities totaled $1.2 million
during the nine months ended September 30, 2001. Comparatively, cash flows used
in acquisition of and improvement to real estate investments in the nine months
ended September 30, 2000, totaled $8.5 million, due in part to the development
of the Publix Supermarket in Palatka, Florida. Net cash flows used in investing
activities increased $571,000 in the year ended December 31, 2000 from the year
ended December 31, 1999, primarily attributable to these increased development
activities.

Net cash used in investing activities decreased $7.0 million in the year
ended December 31,1999 from the year ended December 31, 1998, primarily due to
the construction of our Governors Gate apartments during 1998, which we
completed in March 1999. This luxury 240-unit garden-style apartment community,
located in Florida, contributed positively to our increase in revenue in the
year ended December 31, 1999. The decrease was partially offset by the
development of a freestanding Walgreen's store at the Camelot Plaza Shopping
Center in San Antonio, Texas and the start of construction on a new Publix
Super market at the Town and Country Shopping Center in Palatka, Florida. We
also acquired two parcels of land, one in Florida, and the other in Texas,
which can be used for future development.

Net cash used in financing activities increased $7.2 million in the nine
months ended September 30, 2001 from September 30, 2000 due to (i) no new
mortgage financings being completed in the nine months ended September 30, 2001
as compared to the prior year's issuance of mortgage notes payable totaling
$26.4 million and the subsequent paydown of notes payable to banks, mortgage
notes payable and related debt issuance costs; (ii) increased cash dividends to
shareholders of $276,000; (iii) increase in cash proceeds of approximately $1.2
million from the issuance of common stock pursuant to the direct stock purchase
and dividend reinvestment plan; and (iv) pursuant to our stock repurchase
program initiated in 1995, our repurchase of 90,000 fewer shares than in the
nine months ended September 30, 2000, at an approximate cost of $723,000.

Net cash used in financing activities decreased $126,000 in the year ended
December 30, 2000 from the year ended December 30, 1999 due to (i) net decrease
in cash proceeds of approximately $1.3 million from the issuance of mortgage
notes payable, related debt issuance costs, and the subsequent paydown of notes
payable to banks; (ii) increase in cash dividends to shareholders of
approximately $296,000; (iii) increase in cash proceeds of approximately
$940,000 from the issuance of common stock pursuant to the direct stock
purchase and dividend reinvestment plan; and (iv) pursuant to our stock
repurchase program initiated in 1995, we reduced cash usage by approximately
$805,000 in the year ended December 31, 2000, repurchasing 95,900 fewer shares
than in the year ended December 31, 1999.

As of September 30, 2001, fourteen of the our properties, comprising
approximately 50% of our gross investment in real estate, were subject to a
total of $111.8 million in mortgage obligations, all of which are long-term,
non-recourse and bear fixed rates of interest for fixed terms. The remaining
fifteen properties and vacant parcels of land in the portfolio are currently
unencumbered by debt. We anticipate our current cash balance, operating cash
flows, and borrowing capacity (including borrowings under our lines of credit)
will be adequate to fund our future (i) operating and administrative expenses,
(ii) debt service obligations, (iii) distributions to shareholders, (iv)
development activities, (v) capital improvements on existing properties, and
(vi) typical repair and maintenance expenses at our properties.

The weighted average maturity of our mortgage notes payable is approximately
8 years, our 8% convertible subordinated debentures mature on July 15, 2003,
and our bank lines of credit range in maturity from one month to six months.

S-16

Our current dividend policy is to pay quarterly dividends to shareholders,
based upon funds from operations, as well as other factors. As funds from
operations excludes the deduction of certain non-cash charges, principally
depreciation on real estate assets, quarterly dividends will typically be
greater than net income and may include a tax-deferred return of capital
component. Additionally, in 2001, a portion of the dividend will include
capital gain from the sale of a property completed during the third quarter of
the year. Our board of directors, on November 8, 2001, declared a cash dividend
of $0.23 per share for the period July 1, 2001 through September 30, 2001,
payable on December 6, 2001 to shareholders of record as of November 27, 2001.

Funds from Operations

Real estate industry analysts and our management use the concept of funds
from operations as an important analytical measure of a real estate investment
trust's financial performance. Our board of directors and management consider
funds from operations in evaluating our operating results and our dividend
policy, as previously mentioned, is also based, in part, on the concept of
funds from operations.

Funds from operations (FFO) is defined by the National Association of Real
Estate Investment Trusts (NAREIT) and by us as net income, excluding gains or
losses from sales of property and those items defined as extraordinary under
accounting principles generally accepted in the United States of America, plus
depreciation on real estate assets and after adjustments for unconsolidated
partnerships to reflect funds from operations on the same basis. Funds from
operations do not represent cash flows from operations as defined by GAAP, nor
is it indicative that cash flows are adequate to fund all cash needs, including
distributions to shareholders. Funds from operations should not be considered
as an alternative to net income as defined by GAAP or to cash flows as a
measure of liquidity. A reconciliation of net income to basic funds from
operations is presented below (in thousands):

Nine Months Ended September 30
--------------------------------
2001 2000
---------------- ---------------
Weighted Weighted
Average Average
Shares Shares
-------- --------
(in thousands)

Net income..................................... $ 2,619 8,204 $1,637 7,925
Additions:
Depreciation................................. 8,481 8,333
Partnership depreciation..................... 26 26
Deductions:
Minority depreciation........................ 38 37
Gain on sale of real estate.................. 506 --
Amortization costs........................... 473 431
------- ----- ------ -----
Funds from operations--basic................... $10,109 8,204 $9,528 7,925
======= ===== ====== =====

Year Ended December 31
--------------------------------------------------
2000 1999 1998
---------------- ---------------- ----------------
Weighted Weighted Weighted
Average Average Average
Shares Shares Shares
-------- -------- --------
(in thousands)

Net income................. $ 2,328 7,950 $ 2,347 7,888 $ 2,756 8,331
Additions:
Depreciation............. 11,173 10,845 10,145
Partnership
depreciation............ 35 37 38
Deductions:
Minority depreciation.... 50 48 47
Amortization costs....... 579 578 608
------- ----- ------- ----- ------- -----
Funds from operations--
basic..................... $12,907 7,950 $12,603 7,888 $12,284 8,331
======= ===== ======= ===== ======= =====

S-17

For the year ended December 31, 2000, funds from operations increased
approximately $300,000 to $12.9 million, compared to $12.6 million in 1999.
This increase in funds from operations is primarily attributable to growth in
operating revenues as a result of new retail leases at its malls, power
centers, and community shopping centers, combined with higher apartment
property occupancies and market sustained rents. The growth of operating
revenues and improved operating margins were partially offset by the combined
effects of increased uncontrollable expenses such as higher interest costs,
real estate taxes, and property insurance costs.

For the year ended December 31, 1999, funds from operations totalled $12.6
million, compared to $12.3 million in 1998, an increase of approximately
$300,000. This increase in funds from operations is primarily attributable to
internal growth and improved operating performance by our retail and apartment
properties, which experienced overall revenue growth, primarily from higher
rental rates coupled with market sustained occupancy.

For the year ended December 31, 1998, funds from operations totalled $12.3
million, compared to $11.5 million in 1997, an increase of approximately
$800,000. This increase in funds from operations results from internal growth
and improved operating performance by our real estate properties, which
experienced overall income growth, primarily from higher rental rates coupled
with market sustained occupancy.

MANAGEMENT

Our four executive officers have an average of approximately 25 years of
experience in real estate investment and related fields. Our independent
directors also have many years of experience in the real estate industry, as
well as business, finance and investment management.

Our directors and executive officers beneficially own approximately 8% of
our common stock and hold options to acquire an additional 7% of our common
stock.

Board of Directors

The following persons currently serve as members of our Board of Directors:

Name Age Position
---- --- --------------------------

Sidney W. Lassen............................. 66 Chairman and Director
Thomas A. Masilla, Jr........................ 54 Vice Chairman and Director
J. Terrell Brown............................. 61 Director
Francis L. Fraenkel.......................... 68 Director
Harold B. Judell............................. 86 Director
James W. McFarland........................... 55 Director
Richard L. Pearlstone........................ 53 Director
Theodore H. Strauss.......................... 76 Director

Sidney W. Lassen has served as Chairman of the Board and Chief Executive
Officer since our inception in 1986, and has been involved in the acquisition,
development, management, and disposition of shopping center and apartment
properties for over 40 years. Mr. Lassen has previously served as a trustee of
the International Council of Shopping Centers, the national association for the
shopping center industry, and as Chairman, President and Chief Executive
Officer of Hibernia Corporation and Hibernia National Bank. He is also Chairman
of the Board and Chief Executive Officer of Sizeler Realty Co., Inc. and serves
as a Director of Hibernia Corporation. Mr. Lassen also serves on the Board of
Administrators of Tulane University and is Chairman of both the Endowments and
Investments Committee and the Real Estate Committee of the Board of
Administrators of Tulane University.

S-18

Thomas A. Masilla, Jr., a formerly practicing certified public accountant,
was elected to the position of Vice Chairman of the Board in 1994, President
and Principal Operating Officer in 1995 and has served as a Director since
1986. Mr. Masilla also served as our Chief Financial Officer from 1996 through
May 1999. Mr. Masilla has been a corporate executive and manager for more than
30 years, with extensive experience in both the real estate and commercial bank
industries.

J. Terrell Brown has served as a Director since 1995. He has served as
Chairman of GMFS, LLC, a mortgage lending company since May 1999. Prior to May
1999, Mr. Brown served as Chairman and Chief Executive Officer of United
Companies Financial Corporation, a diversified financial services company.

Francis L. Fraenkel has served as a Director since 1993. He has served as
Managing Director of Neuberger Berman, an investment management company, since
December 2000. Mr. Fraenkel served as Managing Director of Delta Capital
Management, LLC from April 1999 until its acquisition by Neuberger Berman in
2000. Mr. Fraenkel also serves as a Trustee of the Battery Park High Yield
Fund.

Harold B. Judell has served as a Director since 1986. He is a senior partner
in the law firm of Foley & Judell, LLP and serves as Chairman of the Board of
Dauphine Orleans Hotel Corporation.

James W. McFarland has served as a Director since 1994. He is the Dean of
the A.B. Freeman School of Business at Tulane University. Dr. McFarland also
serves as a Director of each of Petroleum Helicopters, Inc. and Stewart
Enterprises, Inc.

Richard L. Pearlstone has served as a Director since 1986. He has served as
President of The Pearlstone Group, Inc., an investment firm, since 1995, Chief
Executive Officer of Cross Keys Asset Management, Inc., an investment advisory
firm, since November 1986 and Chief Executive Officer of SNP Management LLC, a
real estate management company, since November 1999.

Theodore H. Strauss has served as a Director since 1994. He is a Senior
Managing Director with Bear Stearns & Co., Inc. Mr. Strauss also serves as a
Director or Trustee, as applicable, of Clear Channel Communications, Inc.,
Hollywood Casino Corporation and Texas Capital Bankshares.

Executive Officers

The following persons currently serve as our executive officers:

Name Age Position
---- --- -----------------------------------------

Sidney W. Lassen.............. 66 Chief Executive Officer
Thomas A. Masilla, Jr......... 54 President and Principal Operating Officer
Robert A. Whelan.............. 33 Chief Financial Officer
James W. Brodie............... 32 Vice President and Secretary

For biographical information for Messrs. Lassen and Masilla, see "Board of
Directors" above.

Robert A. Whelan joined the management team as Chief Financial Officer in
May 1999 and was a real estate consultant with Ernst & Young /Kenneth Leventhal
Real Estate Group prior to joining us. Mr. Whelan is a formerly practicing
certified public accountant and has extensive experience in the acquisition,
disposition, management, financing, and auditing of real estate properties.

James W. Brodie has served as our Vice President since 1991 and our
Secretary since 1999. He also served as our Assistant Secretary from 1997 to
1999. Mr. Brodie has been involved in the acquisition, development, management,
and disposition of shopping center and apartment properties since he joined us
in May 1989.

S-19

UNDERWRITING

Ferris, Baker Watts, Incorporated, J.J.B. Hilliard, W.L. Lyons, Inc.,
Advest, Inc. and Sterne, Agee & Leach, Inc. are acting as the underwriters in
this offering. Subject to the terms and conditions contained in the
underwriting agreement, we have agreed to sell to the underwriters, and the
underwriters have agreed to purchase from us, the number of shares set forth
opposite their names below. The underwriting agreement provides that the
obligation of the underwriters to pay for and accept delivery of our common
stock is subject to approval of certain legal matters by counsel and to certain
other conditions. The underwriters must take and pay for all of the shares of
our common stock, other than those covered by the over-allotment option
described below, if any of these shares are taken.

Number of
Underwriter Shares
----------- ---------

Ferris, Baker Watts, Incorporated..................................
J.J.B. Hilliard, W.L. Lyons, Inc...................................
Advest, Inc........................................................
Sterne, Agee & Leach, Inc..........................................
---------
Total............................................................ 3,000,000
=========

The following table shows the per share and total underwriting discount we
will pay to the underwriters. These amounts are shown assuming both no exercise
and full exercise of the underwriters' option to purchase 450,000 additional
shares of our common stock.

No Full
exercise exercise
-------- --------

Per share.................................................. $ $
Total...................................................... $ $

The underwriters propose to offer our common stock directly to the public at
$ per share and to certain dealers at such price less a concession not in
excess of $ per share. The underwriters may allow, and the dealers may
reallow, a concession not in excess of $ per share to certain dealers.

The common stock offered and sold in this offering will be listed on the New
York Stock Exchange.

We have granted the underwriters an option, exercisable for 30 days after
the date of this prospectus, to purchase up to 450,000 additional shares of
common stock to cover over-allotments, if any, at the public offering price
less the underwriting discounts set forth on the cover page of this prospectus
supplement. If the underwriters exercise this option, the underwriters will
have a firm commitment, subject to certain conditions, to purchase all of the
common stock covered by their option exercise.

We expect to reimburse the underwriters for expenses of approximately
$200,000 at the closing of this offering.

We will also pay Ferris, Baker Watts, Incorporated an advisory fee of 1% of
the gross proceeds of an offering of at least 3,450,000 shares. This fee is
payable immediately upon the closing of the over-allotment option.

We have agreed to indemnify the underwriters against certain liabilities,
including liabilities under the Securities Act, or to contribute to payments
the underwriters may be required to make in respect of those liabilities.

In connection with the offering, the underwriters may engage in certain
transactions that stabilize the price of our common stock. These transactions
consist of bids or purchases for the purpose of pegging, fixing or maintaining
the price of the common stock. If the underwriters create a short position in
our common stock in

S-20

connection with the offering, that is, if they sell more shares than are listed
on the cover of this prospectus supplement, the underwriters may reduce that
short position by exercising all or a portion of the over-allotment option
described above or by purchasing our common stock in the open market. In
general, the purchase of our common stock for the purpose of stabilization or
to reduce a short position could cause the price of our common stock to be
higher than it might be in the absence of such purchases.

Neither we nor the underwriters make any representation or prediction as to
the direction or magnitude of any effect that the transactions described above
may have on the price of our common stock. In addition, neither we nor the
underwriters make any representation that the underwriters will engage in these
transactions or that these transactions, once begun, will not be discontinued
without notice.

EXPERTS

The consolidated financial statements and schedules of Sizeler Property
Investors, Inc. and subsidiaries as of December 31, 2000 and 1999, and for each
of the years in the three-year period ended December 31, 2000, have been
incorporated by reference herein in reliance upon the report of KPMG LLP,
independent accountants, incorporated by reference herein, and upon the
authority of said firm as experts in accounting and auditing.

LEGAL MATTERS

The validity of the common stock offered hereby will be passed upon for us
by Hogan & Hartson L.L.P. Certain legal matters relating to this offering will
be passed upon for the underwriters by Hunton & Williams. The discussion of
legal matters under "Material United States Federal Income Tax Consequences" is
based upon an opinion of Jaeckle Fleischmann & Mugel, LLP.

S-21

++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+The information in this prospectus is not complete and may be changed. We may +
+not issue these securities until the registration statement filed with the +
+Securities and Exchange Commission is effective. This prospectus is not an +
+offer to sell these securities and it is not soliciting an offer to buy these +
+securities in any jurisdiction where the offer or sale is not permitted. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++

Subject to Completion

Preliminary Prospectus dated December 3, 2001

Prospectus

$100,000,000

SIZELER PROPERTY INVESTORS, INC.

DEBT SECURITIES, COMMON STOCK, PREFERRED STOCK, WARRANTS

We may use this prospectus to offer and sell securities from time to time.
The types of securities we may sell include:

. senior debt securities;

. subordinated debt securities;

. shares of common stock;

. shares of preferred stock; or

. warrants to purchase debt securities, preferred stock or common stock.

We will provide the specific terms of these securities in supplements to this
prospectus in connection with each offering. These terms may include:

In the case of In the case of In the case of In the case
any debt preferred of warrants:
securities: securities: stock: . the
. offering . interest . dividends types of
price; rate; rights; securities
. size of . maturity; . liquidation that may
offering; . ranking; preferences; be
. underwriting . redemption acquired
discounts; provisions; upon
. redemption exercise;
provisions;
. limitations and . conversion
on direct . additional privileges; . expiration
or covenants. and date;
beneficial . voting and . exercise
ownership; other price;
and rights. and
. restrictions . terms of
on exercisability.
transfer.

The securities offered will contain other significant terms and conditions.
Please read this prospectus and the applicable prospectus supplement carefully
before you invest.

An investment in securities involves a high degree of risk. See "Risk
Factors" beginning on page 5 of this prospectus for a discussion of risk
factors that you should consider in connection with an investment in the
securities.

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.

------------

The date of this prospectus is December , 2001

TABLE OF CONTENTS

Page
----

ABOUT THIS PROSPECTUS...................................................... 1

WHERE YOU CAN FIND MORE INFORMATION........................................ 1

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE............................ 1

ABOUT SIZELER PROPERTY INVESTORS, INC...................................... 2

RISK FACTORS............................................................... 2
Real Estate Industry Risks............................................... 2
Risks Associated with our Properties..................................... 3
Financing Risks.......................................................... 5
Other Risks.............................................................. 5

DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS............................ 7

USE OF PROCEEDS............................................................ 7

RATIO OF EARNINGS TO FIXED CHARGES......................................... 8

DESCRIPTION OF DEBT SECURITIES............................................. 8
General.................................................................. 8
Denomination, Interest, Registration and Transfer........................ 10
Merger, Consolidation or Sale............................................ 11
Certain Covenants........................................................ 12
Events of Default, Notice and Waiver..................................... 12
Modification of the Indentures........................................... 14
Conversion Rights........................................................ 14
Redemption of Securities................................................. 15
Subordination............................................................ 15
Subrogation.............................................................. 15
Global Securities........................................................ 15

DESCRIPTION OF CAPITAL STOCK............................................... 15
General.................................................................. 15
Description of Common Stock.............................................. 16
Description of Preferred Stock........................................... 17
Description of Stockholder Rights Plan................................... 18

DESCRIPTION OF WARRANTS.................................................... 19
General.................................................................. 19
Exercise of Warrants..................................................... 20
Amendments and Supplements to Warrant Agreements......................... 20
Common Stock Warrant Adjustments......................................... 20

CERTAIN PROVISIONS OF MARYLAND LAW AND OUR CHARTER AND BY-LAWS............. 21
The Board of Directors................................................... 21
Amendment of Charter and By-Laws......................................... 21
Business Combinations.................................................... 22
Control Share Acquisitions............................................... 22
Advance Notice of Director Nominations and New Business.................. 22
Meeting of Stockholders.................................................. 23
Recent Maryland Legislation.............................................. 23
Prohibited Transactions.................................................. 24

MATERIAL UNITED STATES FEDERAL INCOME TAX CONSEQUENCES..................... 25
Introductory Notes....................................................... 25
Taxation of Us as a REIT................................................. 25
Requirements for Qualification........................................... 27

Page
----

Qualified REIT Subsidiaries.............................................. 28
Taxable REIT Subsidiaries................................................ 28
Income Tests............................................................. 28
Asset Tests.............................................................. 29
Annual Distribution Requirements......................................... 30
Failure to Qualify....................................................... 31
Tax Aspects of Our Investments in Partnerships........................... 31
Taxation of Stockholders................................................. 32
Taxation of U.S. Debenture Holders....................................... 35
Taxation of Non-U.S. Debenture Holders................................... 38
Backup Withholding Tax and Information Reporting......................... 38

PLAN OF DISTRIBUTION....................................................... 39

LEGAL MATTERS.............................................................. 40

EXPERTS.................................................................... 40

ABOUT THIS PROSPECTUS

This prospectus is part of a registration statement that we filed with the
SEC using a "shelf" registration process. You should read this prospectus and
the applicable prospectus supplement together with the additional information
described under the heading "Where You Can Find More Information" in this
prospectus. The registration statement that contains this prospectus and the
exhibits to that registration statement contain additional important
information about us and the securities offered under this prospectus.
Specifically, we have filed certain legal documents that control the terms of
the securities offered by this prospectus as exhibits to the registration
statement. We will file certain other legal documents that control the terms of
the securities offered by this prospectus as exhibits to reports we file with
the SEC. That registration statement and the other reports can be read at the
SEC website or at the SEC offices mentioned under the heading "Where You Can
Find More Information."

WHERE YOU CAN FIND MORE INFORMATION

We have filed with the SEC a registration statement under the Securities Act
with respect to the securities offered hereunder. As permitted by the SEC's
rules and regulations, this prospectus does not contain all the information set
forth in the registration statement. For further information regarding our
company and our securities, please refer to the registration statement and the
contracts, agreements and other documents filed as exhibits to the registration
statement. Additionally, we file annual, quarterly and special reports, proxy
statements and other information with the SEC.

You may read and copy all or any portion of the registration statement or
any other materials that we file with the SEC at the SEC's public reference
rooms in Washington, D.C., Chicago, Illinois, and New York, New York. Please
call the SEC at 1-800-SEC-0330 for further information on the operation of the
public reference rooms. Our SEC filings, including the registration statement,
are also available to you on the SEC's website (http://www.sec.gov). We also
have a website (www.sizeler.net) through which you may access our SEC filings.
Please note that our website contains various financial data and analyses
computed or prepared by third parties and that we may not have verified and
confirmed the accuracy of all such data. Therefore, we disclaim all
responsibility for its accuracy. In addition, you may look at our SEC filings
at the offices of the New York Stock Exchange, Inc., which is located at 20
Broad Street, New York, New York 10005. Our SEC filings are available at the
NYSE because our common stock is listed and traded on the NYSE under the symbol
"SIZ".

Information contained on our website is not a part of this prospectus.

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

The SEC allows us to "incorporate by reference" the information contained in
documents that we file with them: that means we can disclose important
information to you by referring you to those documents. The information
incorporated by reference is considered to be part of this prospectus, and
information that we file later with the SEC will automatically update and
supersede this information.

We incorporate by reference the documents listed below and any future
filings we make with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of
the Securities Exchange Act of 1934, as amended, after the initial filing of
the registration statement that contains this prospectus and before we sell all
the securities offered by this prospectus.

. Our Annual Report on Form 10-K for the year ended December 31, 2000.

. Our Quarterly Report on Form 10-Q for the quarter ended March 31, 2001.

. Our Quarterly Report on Form 10-Q for the quarter ended June 30, 2001.

. Our Quarterly Report on Form 10-Q for the quarter ended September 30,
2001.

. Our Current Report on Form 8-K, as filed with the SEC on June 26, 2001.

. Our Current Report on Form 8-K, as filed with the SEC on December 3,
2001

. Our Registration Statement on Form 8-A, as filed with the SEC on August
26, 1998

. Our Registration Statement on Form 8-A/A, as filed with the SEC on May
4, 1989

You may request a free copy of these filings (other than exhibits, unless
they are specifically incorporated by reference in the documents) by writing or
telephoning us at the following address and telephone number:

Sizeler Property Investors, Inc.
Attention: Chief Financial Officer
2542 Williams Boulevard
Kenner, Louisiana 70062
(504) 471-6200

ABOUT SIZELER PROPERTY INVESTORS, INC.

We are a self-administered and self-managed equity real estate investment
trust that acquires, develops, owns and operates income-producing retail
shopping centers and apartment properties in the southeastern region of the
United States. We are a self-administered REIT in that we provide our own
investment and administrative services internally through our own employees. We
are also self-managed as we internally provide, through a wholly-owned
subsidiary, the management, leasing and development services that our
properties require. Our investment objective is to acquire and develop high-
quality properties at attractive initial yields with potential for future
growth in cash flows. As of September 30, 2001, our existing portfolio
contained 15 retail shopping centers with approximately 2.6 million square feet
of gross leasable area and 14 apartment properties containing approximately
3,400 units. During the nine month period ended September 30, 2001, our retail
and apartment properties were, on average, approximately 92% and 97% leased,
respectively. Our principal executive offices are located at 2542 Williams
Boulevard, Kenner, Louisiana 70062. Our telephone number is (504) 471-6200.

RISK FACTORS

Set forth below are the risks that we believe are important to investors in
our common stock, preferred stock, debt securities or other securities, which
we refer to collectively as our "securities." We refer to investors in our
securities as our "security holders." Before you decide to purchase our
securities, you should consider carefully the risks described below, together
with the information provided in the other parts of this prospectus and any
related prospectus supplement. From time to time, we may make forward-looking
statements (within the meaning of Section 27A of the Securities Act and Section
21F of the Exchange Act) in documents filed under the Securities Act, the
Exchange Act, press releases or other public statements. If we make forward-
looking statements, we assume no obligation to update forward-looking
statements. Potential investors should not place undue reliance on forward-
looking statements as they involve numerous risks and uncertainties that could
cause actual results to differ materially from the results stated or implied in
the forward-looking statements. In addition to specific factors that may be
disclosed simultaneously with any forward-looking statement, some of the
factors related to us and our businesses that could cause actual results to
differ materially from a forward-looking statement are set forth below.

Real Estate Industry Risks

We face risks associated with local real estate conditions in areas where we
own properties. We may be affected adversely by general economic conditions and
local real estate conditions. For example, an oversupply of retail space or
apartments in a local area or a decline in the attractiveness of our properties
to shoppers, tenants or residents would have a negative effect on us.

Other factors that may affect general economic conditions or local real
estate conditions include:

. population and demographic trends;

. employment and personal income trends;

. income tax laws;

. changes in interest rates and availability and costs of financing;

. construction costs; and

. weather conditions that may increase or decrease energy costs.

We may be unable to compete with our larger competitors and other
alternatives available to tenants or potential tenants of our properties. The
real estate business is highly competitive. We compete for interests in
properties with other real estate investors and purchasers, many of whom have
greater financial resources, revenues, and geographical diversity than we have.
Furthermore, we compete for tenants with other property owners. All of our
shopping center and apartment properties are subject to significant local
competition. We also compete with a wide variety of institutions and other
investors for capital funds necessary to support our investment activities and
asset growth. In addition, our portfolio of retail properties faces competition
from other properties within each submarket where they are located. Our
apartment portfolio competes with providers of other forms of housing, such as
single family housing. Competition from single family housing increases when
low interest rates make mortgages more affordable.

We are subject to significant regulation that inhibits our activities. Local
zoning and use laws, environmental statutes and other governmental requirements
restrict our expansion, rehabilitation and reconstruction activities. These
regulations may prevent us from taking advantage of economic opportunities.
Legislation such as the Americans with Disabilities Act may require us to
modify our properties. Future legislation may impose additional requirements.
We cannot predict what requirements may be enacted or what changes may be
implemented to existing legislation.

Risks Associated with our Properties

We may be unable to renew leases or relet space as leases expire. When a
lease expires, a tenant may elect not to renew it. We may not be able to relet
the property on similar terms, if we are able to relet the property at all.
With respect to our retail properties, our inability to renew a lease of space
to an anchor tenant, or relet the space quickly to another anchor tenant, could
have a material adverse effect on the retail center. We have established an
annual budget for renovation and reletting expenses that we believe is
reasonable in light of each property's operating history and local market
characteristics. This budget, however, may not be sufficient to cover these
expenses.

We have been and may continue to be affected negatively by tenant
bankruptcies and leasing delays. At any time, a shopping center tenant may
experience a downturn in its business that may weaken its financial condition.
Similarly, a general decline in the economy may result in a decline in the
demand for apartments. As a result, our commercial and residential tenants may
delay lease commencement, fail to make rental payments when due, or declare
bankruptcy. Any such event could result in the termination of that tenant's
lease and losses to us.

We receive a substantial portion of our shopping center income as rents
under long-term leases. If retail tenants are unable to comply with the terms
of their leases because of rising costs or falling sales, we may deem it
advisable to modify lease terms to allow tenants to pay a lower rental or a
smaller share of operating costs, taxes and insurance.

Development and Construction Risks Could Impact our Profitability.

We intend to continue to develop and construct apartment communities and
retail properties. Development activities may be conducted through wholly-owned
affiliated companies or through joint ventures with unaffiliated parties. Our
development and construction activities may be exposed to the following risks:

. we may be unable to obtain, or face delays in obtaining, necessary
zoning, land-use, building, occupancy, and other required governmental
permits and authorizations, which could result in increased development
costs;

. we may incur construction costs for a property that exceed original
estimates due to increased materials, labor or other costs, which could
make completion of the property uneconomical, and we may not be able to
increase rents to compensate for the increase in construction costs;

. we may abandon development opportunities that we have already begun to
explore, and we may fail to recover expenses already incurred in
connection with exploring those opportunities;

. we have been and may continue to be unable to complete construction and
lease-up of a property on schedule and meet financial goals for
development projects;

. because occupancy rates and rents at a newly developed property may
fluctuate depending on a number of factors, including market and
economic conditions, we may be unable to meet our profitability goals
for that property; and

. construction costs have been increasing in our existing markets, and
may continue to increase in the future and, in some cases, the costs of
upgrading existing or newly acquired properties have exceeded, and may
continue to exceed, original estimates and we may be unable to charge
rents that would compensate for these increases in costs.

Coverage under our existing insurance policies may be inadequate to cover
losses. We generally maintain insurance policies related to our business,
including casualty, general liability and other policies covering our business
operations, employees and assets. However, we would be required to bear all
losses that are not adequately covered by insurance. Although we believe that
our insurance programs are adequate, we cannot assure you that we will not
incur losses in excess of our insurance coverage, or that we will be able to
obtain insurance in the future at acceptable levels and reasonable cost.

We face risks due to lack of geographic diversity. All of our properties are
located in Louisiana, Florida and Alabama. A downturn in general economic
conditions and local real estate conditions in these geographic regions would
have a particularly strong adverse effect on us.

We face possible environmental liabilities. Current and former real estate
owners and operators may be required by law to investigate and clean up
hazardous substances released at the properties they own or operate. They may
also be liable to the government or to third parties for substantial property
damage, investigation costs and cleanup costs. In addition, some environmental
laws create a lien on the contaminated site in favor of the government for
damages and costs the government incurs in connection with the contamination.
Contamination may affect adversely the owner's ability to sell or lease real
estate or to borrow using the real estate as collateral.

We have no way of determining at this time the magnitude of any potential
liability to which we may be subject arising out of unknown environmental
conditions or violations with respect to the properties we formerly owned.
Environmental laws today can impose liability on a previous owner or operator
of a property that owned or operated the property at a time when hazardous or
toxic substances were disposed of, or released from, the property. A conveyance
of the property, therefore, does not relieve the owner or operator from
liability.

We are not currently aware of any environmental liabilities relating to our
investment properties which would have a material adverse effect on our
business, assets, or results of operations. However, we cannot assure you that
environmental liabilities will not arise in the future.

Financing Risks

We face risks generally associated with our debt. We finance a portion of
our investments in real estate through debt. Although we have never missed a
required payment of principal or interest or otherwise defaulted on a required
payment related to our indebtedness, this debt creates risks, including:

. rising interest rates on our floating rate debt;

. failure to repay or refinance existing debt as it matures, including
our outstanding convertible debentures, which may result in forced
disposition of properties on disadvantageous terms;

. refinancing terms less favorable than the terms of existing debt; and

. failure to meet required payments of principal and/or interest.

We face risks associated with the use of debt to fund acquisitions and
developments, including refinancing risk. We are subject to the risks normally
associated with debt financing, including the risk that our cash flow will be
insufficient to meet required payments of principal and interest. We anticipate
that a portion of the principal of our debt will not be repaid prior to
maturity. Therefore, we will likely need to refinance at least a portion of our
outstanding debt as it matures. There is a risk that we may not be able to
refinance existing debt or that the terms of any refinancing will not be as
favorable as the terms of the existing debt. If principal payments due at
maturity cannot be refinanced, extended or repaid with proceeds from other
sources, such as new equity capital or sales of properties, our cash flow will
not be sufficient to repay all maturing debt in years when significant
"balloon" payments come due.

We may amend our business policies without your approval. Our Board of
Directors determines our growth, investment, financing, capitalization,
borrowing, REIT status, operating and distribution policies. Although the Board
of Directors has no present intention to amend or revise any of these policies,
these policies may be amended or revised without notice to stockholders.
Accordingly, stockholders may not have control over changes in our policies. We
cannot assure you that changes in our policies will serve fully the interests
of all stockholders.

Other Risks

The market value of our common stock could decrease based on our performance
and market perception and conditions. The market value of our common stock may
be based primarily upon the market's perception of our growth potential and
current and future cash dividends, and may be secondarily based upon the real
estate market value of our underlying assets. The market price of our common
stock is influenced by the dividend on our common stock relative to market
interest rates. Rising interest rates may lead potential buyers of our common
stock to expect a higher dividend rate, which would adversely affect the market
price of our common stock. In addition, rising interest rates would result in
increased expense, thereby adversely affecting cash flow and our ability to
service our indebtedness and pay dividends.

We are subject to restrictions that may impede our ability to effect a
change in control. Certain provisions contained in our Charter and By-Laws, our
Shareholder Rights Agreement, certain provisions of Maryland law and severance
agreements with our executive officers may have the effect of discouraging a
third party from making an acquisition proposal for us and thereby inhibit a
change in control. These provisions include the following:

. Our Charter provides for three classes of directors with the term of
office of one class expiring each year, commonly referred to as a
"staggered board." By preventing stockholders from voting on the
election of more than one class of directors at any annual meeting of
stockholders, this provision may have the effect of keeping the current
members of our Board of Directors in control for a longer period of
time than stockholders may desire.

. Our Charter generally limits any holder from acquiring more than 9.9%
(in value or in number, whichever is more restrictive) of our
outstanding equity stock (defined as all of our classes of capital
stock, except our excess stock). While this provision is intended to
assure our ability to remain a qualified REIT for Federal income tax
purposes, the ownership limit may also limit the opportunity for
stockholders to receive a premium for their shares of common stock that
might otherwise exist if an investor were attempting to assemble a
block of shares in excess of 9.9% of the outstanding shares of equity
stock or otherwise effect a change in control.

. In August 1998, our Board of Directors adopted a shareholder rights
plan. Under the terms of the plan, we declared a dividend of rights on
our common stock. The rights issued under the plan will be triggered,
with certain exceptions, if and when any person or group acquires, or
commences a tender offer to acquire, 15% or more of our shares. The
rights plan is intended to prevent abusive hostile takeover attempts by
requiring a potential acquiror to negotiate the terms with our Board of
Directors. However, it could have the effect of deterring or preventing
our acquisition, even if a majority of our stockholders were in favor
of such acquisition, and could have the effect of making it more
difficult for a person or group to gain control of us or to change
existing management.

. We have entered into change of control agreements with each of our
executives providing for the payment of money to these executives upon
the occurrence of a change of control of the Company as defined in
these agreements. If, within 24 months following a change of control,
the Company terminates the executive's employment other than for cause,
or if the executive elects to terminate his employment with the Company
for reasons specified in the agreement, we will make a severance
payment equal to three times the executive's base salary, together with
the executive's bonus, deferred compensation and medical and other
benefits. These agreements may deter changes of control of the Company
because of the increased cost for a third party to acquire control of
the Company.

We may fail to qualify as a REIT. If we fail to qualify as a REIT, we will
not be allowed to deduct distributions to stockholders in computing our taxable
income and will be subject to Federal income tax, including any applicable
alternative minimum tax, at regular corporate rates. In addition, we might be
barred from qualification as a REIT for the four years following
disqualification. The additional tax incurred at regular corporate rates would
reduce significantly the cash flow available for distribution to stockholders
and for debt service.

Furthermore, we would no longer be required by the Internal Revenue Code of
1986, as amended (the "Code") to make any distributions to our stockholders as
a condition to REIT qualification. Any distributions to stockholders that
otherwise would have been subject to tax as capital gain dividends would be
taxable as ordinary income to the extent of our current and accumulated
earnings and profits. Corporate distributees, however, may be eligible for the
dividends received deduction on the distributions, subject to limitations under
the Code.

To qualify as a REIT, we must comply with certain highly technical and
complex requirements. We cannot be certain we have complied with these
requirements because there are few judicial and administrative interpretations
of these provisions. In addition, facts and circumstances that may be beyond
our control may affect our ability to qualify as a REIT. We cannot assure you
that new legislation, regulations, administrative interpretations or court
decisions will not change the tax laws significantly with respect to our
qualification as a REIT or with respect to the federal income tax consequences
of qualification. We believe that we have qualified as a REIT since our
inception and intend to continue to qualify as a REIT. However, we cannot
assure you that we are qualified or will remain qualified.

We may be unable to comply with the strict income distribution requirements
applicable to REITs. To obtain the favorable tax treatment associated with
qualifying as a REIT, among other requirements, we are required each year to
distribute to our stockholders at least 90% of our REIT taxable income. We will
be subject to corporate income tax on any undistributed REIT taxable income. In
addition, we will incur a 4% nondeductible excise tax on the amount by which
our distributions in any calendar year are less than the sum of (i) 95% of our
ordinary income for the year, (ii) 95% of our capital gain net income for the
year, and (iii) any undistributed taxable income from prior years. We could be
required to borrow funds on a short-term basis to meet the distribution
requirements that are necessary to achieve the tax benefits associated with
qualifying as a REIT (and to avoid corporate income tax and the 4% excise tax),
even if conditions were not favorable for borrowing. As of this date, we have
not needed to incur such borrowings.

Notwithstanding our status as a REIT, we are subject to various federal,
state, local and foreign taxes on our income and property. For example, we will
be taxed at regular corporate rates on any undistributed taxable income,
including undistributed net capital gains, provided, however, that properly
designated undistributed capital gains will effectively avoid taxation at the
stockholder level. We may be subject to other federal income taxes as more
fully described in "Material United States Federal Income Tax Consequences--
Taxation of Us as a REIT." We may also have to pay some state income or
franchise taxes because not all states treat REITs in the same manner as they
are treated for federal income tax purposes.

DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

We have made forward-looking statements with respect to our financial
condition, results of operations and business and on the expected impact of
this exchange offer on our financial performance. Words such as "anticipates,"
"expects," "intends," "plans," "believes," "seeks," "estimates" and similar
expressions as they relate to us or our management, are intended to identify
forward-looking statements. These forward-looking statements are not guarantees
of future performance and are subject to risks and uncertainties, including
those described under "Risk Factors" in this prospectus, that could cause
actual results to differ materially from the results contemplated by the
forward-looking statements. The safe harbor for forward-looking statements
provided for in the Private Securities Litigation Reform Act of 1995 does not
apply to statements made in connection with this offering.

In evaluating the securities offered by this prospectus, you should
carefully consider the discussion of risks and uncertainties in the section
entitled "Risk Factors" on pages 5 to 8 of this prospectus.

USE OF PROCEEDS

Unless otherwise described in the applicable prospectus supplement, we
intend to use the net proceeds of any sale of securities for general corporate
purposes, including, without limitation, the repayment of debt and the
development and acquisition of additional properties.

RATIO OF EARNINGS TO FIXED CHARGES

Our ratio of earnings to fixed charges for the years ended December 31,
2000, 1999, 1998, 1997 and 1996 was 1.11, 1.14, 1.16, 1.17 and 1.15,
respectively. For the nine months ended September 30, 2001 and 2000, our ratio
of earnings to fixed charges was 1.15 and 1.10, respectively. For purposes of
computing these ratios, earnings have been calculated by adding fixed charges,
excluding capitalized interest, to pre-tax income from continuing operations.
Fixed charges consist of interest costs, whether expensed or capitalized, the
estimated interest component of rental expenses and amortization of debt
issuance costs. There were no shares of preferred stock outstanding for any of
the periods shown above. Accordingly, the ratio of earnings to combined fixed
charges and preferred stock dividends are identical to the ratio of earnings to
fixed charges.

Ratio of EBITDA to Fixed Charges. Our ratio of EBITDA to fixed charges for
the years ended December 31, 2000, 1999, 1998, 1997 and 1996 was 1.78, 1.84,
1.83, 1.82 and 1.73, respectively. For each of the nine months ended September
30, 2001 and 2000, our ratio of EBITDA to fixed charges was 1.84 and 1.75,
respectively. "EBITDA," as used here, is earnings before interest expense,
income taxes, depreciation and amortization. We have included information
concerning EBITDA because we believe that EBITDA is generally accepted as
providing useful information regarding a company's ability to service and/or
incur debt. EBITDA should not be considered in isolation as a substitute for
net income, cash flows or other consolidated or cash flow data prepared in
accordance with accounting principles generally accepted in the United States
or as a measure of a company's profitability or liquidity. While EBITDA is
frequently used as a measure of operations and ability to meet debt service
requirements, it is not necessarily comparable to similarly titled captions of
other companies due to differences in methods of calculation.

DESCRIPTION OF DEBT SECURITIES

The following is a general description of the debt securities that we may
offer from time to time. The particular terms of the debt securities being
offered and the extent to which such general provisions may apply will be set
forth in the applicable indenture or in one or more indenture supplements and
described in the applicable prospectus supplement.

The debt securities will be issued under one or more separate indentures, as
amended or supplemented from time to time, between us and a trustee to be
selected by us. A copy of a form of indenture is filed as an exhibit to this
prospectus and will be available for inspection at the corporate offices of the
trustee, or as described under the heading "Where You Can Find More
Information" in this prospectus. The indentures will be subject to, and
governed by, the Trust Indenture Act of 1939, as amended. We will execute the
applicable indenture when and if we issue debt securities. The following
summary of certain provisions of the debt securities and the indentures does
not purport to be complete and is subject to, and is qualified in its entirety
by reference to all of the provisions of the indentures, including the
definitions of certain terms and the applicable prospectus supplement. You
should read the indentures carefully to fully understand the terms of the debt
securities.

General

The debt securities will be our direct, unsecured obligations and may be
either senior debt securities or subordinated debt securities.

The indebtedness represented by the senior debt securities will rank equally
with our other senior debt that may be outstanding from time to time. The
payment of principal, premium, if any, and interest on indebtedness represented
by subordinated debt securities will be subordinated, to the extent provided in
a subordinated indenture, in right of payment to the prior payment in full of
our senior debt.

Each indenture will provide that the debt securities may be issued without
limit as to aggregate principal amount, in one or more series, in each case as
established from time to time (i) in or pursuant to authority

granted by a resolution of the Board of Directors; (ii) as established in the
applicable indenture; or (iii) as may be established in one or more
supplemental indentures to the applicable indenture. All debt securities of one
series need not be issued at the same time. Unless otherwise provided, a series
may be reopened for issuances of additional debt securities of that series.
This may be done without the consent of the holders of that series.

Each indenture may provide that there may be more than one trustee, each
with respect to one or more series of debt securities. Any trustee under an
indenture may resign or be removed with respect to one or more series of debt
securities. A successor trustee may be appointed to act with respect to that
series. If two or more persons are acting as trustee with respect to different
series of debt securities, each of those trustees will be a trustee of a trust
under the applicable indenture separate from the trust administered by any
other trustee of that series. Except as otherwise indicated, any action
described to be taken by each trustee may be taken by each trustee with respect
to, and only with respect to, the one or more series of debt securities for
which it is trustee under the applicable indenture.

The prospectus supplement relating to any series of debt securities being
offered will contain the specific terms of that series, including the
following:

(i) the title of such series of debt securities;

(ii) the classification of such series of debt securities as senior debt
securities or subordinated debt securities;

(iii) the aggregate principal amount of such series of debt securities and
any limit on the aggregate principal amount;

(iv) the percentage of the principal amount at which such series of debt
securities will be issued and, if other than the principal amount
thereof, the portion of the principal amount thereof payable upon
declaration of acceleration of the maturity of such series of debt
securities;

(v) if convertible in whole or in part into shares of common stock or
shares of preferred stock, the terms on which such series of debt
securities are convertible, including the initial conversion price
or rate (or method for determining the same), the portion that is
convertible and the conversion period, and any applicable
limitations on the ownership or transferability of the shares of
common stock or shares of preferred stock receivable on conversion;

(vi) the date or dates, or the method for determining the date or dates,
on which the principal of such series of debt securities will be
payable;

(vii) the rate or rates (which may be fixed or variable), or the method by
which such rate or rates will be determined, at which such series of
debt securities will bear interest, if any;

(viii) the date or dates, or the method for determining such date or dates,
from which any such interest will accrue, the dates on which any
interest will be payable, the Regular Record Dates for the Interest
Payment Dates, or the method by which the dates will be determined,
the person to whom the interest will be payable, and the basis upon
which interest will be calculated if other than that of a 360-day
year of twelve 30-day months;

(ix) the place or places where the principal, premium, if any, and
interest on the debt securities will be payable, where the debt
securities may be surrendered for conversion or registration of
transfer or exchange and where notices or demands to or upon us in
respect of the debt securities and the applicable indenture may be
served;

(x) the period or periods within which, the price or prices at which and
the other terms and conditions upon which the debt securities may be
redeemed, in whole or in part, at our option, if we were to have
that option;

(xi) our obligation, if any, to redeem, repay or purchase the debt
securities pursuant to any sinking fund or analogous provision or at
the option of a holder of the debt securities, and the period or
periods

within which or the date and dates on which, the price or prices at
which and the other terms and conditions upon which such debt
securities will be redeemed, repaid or purchased, in whole or in part,
pursuant to the obligation;

(xii) if other than U.S. dollars, the currency or currencies in which the
debt securities are denominated and payable, which may be a foreign
currency or units of two or more foreign currencies or a composite
currency or currencies, and the terms and conditions relating
thereto;

(xiii) whether the amount of payments of principal, premium, if any, or
interest on the debt securities may be determined with reference to
an index, formula or other method (which index, formula or method
may, but need not be, based on a currency, currencies, currency
unit or units or composite currency or currencies) and the manner
in which those amounts will be determined;

(xiv) any additions to, modifications of or deletions from the terms of
the debt securities with respect to Events of Default or covenants
set forth in the applicable indenture;

(xv) whether such debt securities will be issued in certificated or
book-entry form;

(xvi) whether such debt securities will be in registered or bearer form
and, if in registered form, the denominations thereof if other than
$1,000 and any integral multiple thereof and, if in bearer form,
the denominations thereof and terms and conditions relating
thereto;

(xvii) the applicability, if any, of the defeasance and covenant
defeasance provisions of the applicable indenture;

(xviii) if such debt securities are to be issued upon the exercise of
warrants, the time, manner and place for such debt securities to be
authenticated and delivered; and

(xix) any other terms of such debt securities not inconsistent with the
provisions of the applicable indenture.

The debt securities may provide for less than the entire principal amount
to be payable upon declaration of acceleration of the maturity of such debt
securities. Special federal income tax, accounting and other considerations
applicable to Original Issue Discount Securities will be described in the
applicable prospectus supplement.

The indentures will not contain any provisions that would limit our ability
to incur indebtedness or that would afford holders of debt securities
protection in the event of a highly leveraged or similar transaction in which
we are involved or in the event of a change in control, unless otherwise
specified in the applicable prospectus supplement. Restrictions on ownership
and transfers of our common stock and shares of preferred stock are designed
to preserve our status as a REIT and, therefore, may act to prevent or hinder
a change of control. See "Description of Capital Stock--General" and "Risk
Factors--Other Risks." You should read the applicable prospectus supplement
carefully for information with respect to any deletions from, modifications of
or additions to our Events of Default. The applicable prospectus supplement
may also contain changes to the covenants described below, including any
addition of a covenant or other provision providing event risk or similar
protection.

Denomination, Interest, Registration and Transfer

Unless otherwise described in the applicable prospectus supplement, the
debt securities of any series will be issuable in denominations of $1,000 and
integral multiples thereof.

Unless otherwise specified in the applicable prospectus supplement, the
principal, applicable premium and interest on any series of debt securities
will be payable at the corporate trust office of the applicable trustee. The
address of that trustee will be stated in the applicable prospectus
supplement. However, at our option, payment of interest may be made by check
mailed to the address of the person entitled thereto as it appears in

the applicable register for such debt securities. Such payment may also be made
by wire transfer of funds to that person at an account maintained within the
United States.

Any interest not punctually paid or duly provided for on any interest
payment date with respect to a debt security will from that time cease to be
payable to the holder on the applicable regular record date. It may be paid to
the person in whose name the debt security is registered at the close of
business on a special record date for the payment of that interest which record
date will be fixed by the applicable trustee. Notice of the payment will be
given to the holder of that debt security not less than ten days before the
record date. It may also be paid at any time in any other lawful manner, all as
more completely described in the applicable indenture.

Subject to certain limitations imposed upon debt securities issued in book-
entry form, the debt securities of any series will be exchangeable for other
debt securities of the same series upon surrender of the debt securities at the
corporate trust office of the applicable trustee. In addition, subject to
certain limitations imposed upon debt securities issued in book-entry form, the
debt securities of any series may be surrendered for conversion or registration
of transfer or exchange at the corporate trust office of the applicable
trustee. Every debt security surrendered for conversion, registration of
transfer or exchange must be duly endorsed or accompanied by a written
instrument of transfer. No service charge will be made for any registration of
transfer or exchange of any debt securities, but we may require payment of a
sum sufficient to cover any tax or other governmental charge payable in
connection therewith. If the applicable prospectus supplement refers to any
transfer agent (in addition to the applicable trustee) initially designated by
us with respect to any series of debt securities, we may at any time rescind
the designation of that transfer agent or approve a change in the location
through which any of those transfer agents act. However, we will be required to
maintain a transfer agent in each place of payment for that series. We may at
any time designate additional transfer agents with respect to any series of
debt securities.

We will not nor will any trustee be required to do any of the following:

. issue, register the transfer of or exchange debt securities of any
series during a period beginning at the opening of business 15 days
before any selection of debt securities of that series to be redeemed
and ending at the close of business on the day of mailing of the
relevant notice of redemption;

. register the transfer of or exchange any debt security, or portion of
any debt security, called for redemption, except the unredeemed portion
of any debt security being redeemed in part;

. exchange any bearer security so selected for redemption, except to
exchange such bearer security for a registered security of that series
of like tenor when immediately surrendered for redemption; or

. issue, register the transfer of or exchange any debt security which has
been surrendered for repayment at the option of the holder, except the
portion, if any, of such debt security not to be so repaid.

Merger, Consolidation or Sale

We will be permitted to consolidate with, or sell, lease or convey all or
substantially all of our assets to, or merge with or into, any other entity,
if:

. either we will be the continuing entity, or the successor entity (if
other than us) formed by or resulting from any such consolidation or
merger or which has received the transfer of such assets will expressly
assume payment of the principal, premium, if any, and interest on all
of the debt securities and the due and punctual performance and
observance of all of the covenants and conditions contained in each
indenture;

. immediately after giving effect to the transaction, no Event of Default
under the applicable indenture has occurred and is continuing; and

. an officer's certificate and legal opinion covering such conditions
will be delivered to each trustee.

Certain Covenants

Existence. Except as described above under "--Merger, Consolidation or
Sale," we are required to do or cause to be done all things necessary to
preserve and keep in full force and effect our existence.

Payment of Dividends. We will not be permitted to declare or pay any
dividends or make any distributions to holders of our capital stock (other than
dividends or distributions necessary to maintain our REIT status), or purchase,
redeem or otherwise acquire or retire any of our capital stock if at the time
of such action an event of default has occurred and is continuing or would
exist immediately after giving effect to such action. See "Events of Default,
Notice and Waiver" below.

Provision of Financial Information. We will, to the extent permitted under
the Exchange Act, file with the Securities and Exchange Commission the annual
reports, quarterly reports and other documents, which we refer to as the
Financial Information, which we may be required to file with the Commission
pursuant to Sections 13 or 15(d) of the Exchange Act on or before the
respective dates by which we may be required so to file those documents. We
will also, within 15 days of each Required Filing Date, to all holders of debt
securities, as their names and addresses appear in the Security Register, mail
copies of the annual reports and quarterly reports. These reports will be sent
without cost to each holder of debt securities. We will also file with the
trustees copies of the Financial Information. If our filing of such documents
with the Commission is not permitted under the Exchange Act, we will promptly
upon written request and payment of the reasonable cost of duplication and
delivery, supply copies of these documents to any prospective holder of debt
securities.

Additional Covenants And/or Modifications to The Covenants Described Above.
Any additional covenants and/or modifications to the covenants we have
described above with respect to any debt securities or series of debt
securities will be set forth in the applicable indenture or an indenture
supplemental to the applicable indenture and described in the prospectus
supplement relating to those debt securities. These covenants will include any
covenants relating to limitations on incurrence of indebtedness or other
financial covenants.

Events of Default, Notice and Waiver

The following will be Events of Default under the applicable indenture with
respect to the debt securities of any series: (i) default for 30 days in the
payment of any installment of interest on any debt security of that series;
(ii) default in the payment of principal of (and premium, if any, on) any debt
security of that series at its maturity, upon redemption or otherwise; (iii)
default in making any sinking fund payment as required for any debt security of
that series; (iv) default in the performance or breach of any other of our
covenants or warranties contained in the applicable indenture (other than a
covenant added to the indenture solely for the benefit of a series of debt
securities issued thereunder other than that series), that continues for 60
days after written notice as provided in the applicable indenture; (v) default
in the payment of an aggregate principal amount exceeding $1,000,000 of any of
our indebtedness, mortgage, indenture or other instrument under which that
indebtedness is issued or by which the indebtedness is secured. However, the
default must have occurred after the expiration of any applicable grace period
and must have resulted in the acceleration of the maturity of the indebtedness,
but only if that indebtedness is not discharged or the acceleration is not
rescinded or annulled within a specified period of time; (vi) certain events of
bankruptcy, insolvency or reorganization, or court appointment of a receiver,
liquidator or trustee of the Company; and (vii) any other Event of Default
provided with respect to a particular series of debt securities.

If an Event of Default under any indenture with respect to debt securities
of any series at the time outstanding occurs and is continuing, then the
applicable trustee or the holders of not less than 25% of the principal amount
of the outstanding debt securities of that series will have the right to
declare the principal amount (or, if the debt securities of that series are
Original Issue Discount Securities or indexed securities, such portion of the
principal amount as may be specified in the terms thereof) of all the debt
securities of that series to be due and payable immediately by written notice
to us (and to the applicable trustee if given by the holders). However, at any
time after that declaration of acceleration with respect to debt securities of
that series

(or of all debt securities then outstanding under any indenture, as the case
may be) has been made, but before a judgment or decree for payment of the money
due has been obtained by the applicable trustee, the holders of not less than a
majority in principal amount of outstanding debt securities of that series (or
of all debt securities then outstanding under the applicable indenture, as the
case may be) may rescind and annul such declaration and its consequences. This
rescission may occur if:

. we have deposited with the applicable trustee all required payments of
the principal, premium, if any, and interest on the debt securities of
the series (or of all debt securities then outstanding under the
applicable indenture, as the case may be), plus certain fees, expenses,
disbursements and advances of the applicable trustee; and

. all Events of Default, other than the non-payment of accelerated
principal (or specified portion thereof), with respect to debt
securities of such series (or of all debt securities then outstanding
under the applicable indenture, as the case may be) have been cured or
waived as provided in the indenture.

Each indenture will provide that the holders of not less than a majority in
principal amount of the outstanding debt securities of any series (or of all
debt securities then outstanding under the applicable indenture, as the case
may be) may waive any past default with respect to such series and its
consequences. This waiver does not apply to the following:

. a default in the payment of the principal of, premium, if any, or
interest on any debt security of the series; or

. a covenant or provision contained in the applicable indenture that
cannot be modified or amended without the consent of the holder of each
outstanding debt security affected by that default.

Each indenture will provide that no holders of debt securities of any series
may institute any proceedings, judicial or otherwise, with respect to that
indenture or for any remedy allowed under the indenture. However, proceedings
may be instituted in the cases of failure of the applicable trustee, for 60
days, to act after it has received a written request to institute proceedings
in respect of an Event of Default from the holders of not less than 25% in
principal amount of the outstanding debt securities of the series, as well as
an offer of indemnity reasonably satisfactory to it. However, this provision
will not prevent any holder of debt securities from instituting suit for the
enforcement of payment of the principal of, premium, if any, and interest on,
and any additional amounts in respect of those debt securities at the
respective due dates.

Subject to provisions in each indenture relating to its duties in case of
default, no trustee will be under any obligation to exercise any of its rights
or powers under an indenture at the request or direction of any holders of any
series of debt securities then outstanding under that indenture. However, if
such holders have offered to the trustee reasonable security or indemnity the
trustee is obligated to exercise its rights or powers under the applicable
indenture. The holders of not less than a majority in principal amount of the
outstanding debt securities of any series (or of all debt securities then
outstanding under an indenture, as the case may be) will have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the applicable trustee exercising any trust or power conferred
upon that trustee. However, a trustee may refuse to follow any direction which
is in conflict with any law or the applicable indenture, which may involve that
trustee in personal liability or which may be unduly prejudicial to the holders
of debt securities of that series not joining therein.

Within 120 days after the close of each fiscal year, we will be required to
deliver to each trustee a certificate, signed by one of several specified
officers. This certificate will state whether or not the officer has knowledge
of any default under the applicable indenture. If the officer has this
knowledge, the certificate will specify each default and the nature and status
of that default.

Modification of the Indentures

Modifications and amendments of an indenture will not be permitted to be
made unless the consent of the holders of not less than a majority in principal
amount of all outstanding debt securities issued under that indenture which are
affected by the modification or amendment is obtained. However, none of these
modifications or amendments may, without the consent of the holder of each such
debt security affected thereby, do any of the following things:

. change the stated maturity of the principal of, or any installment of
interest, or premium on any such debt security;

. reduce the principal amount of, or the rate or amount of interest on
any such debt security;

. reduce any premium payable on redemption of, any such debt security;

. reduce the amount of principal of an Original Issue Discount Security
that would be due and payable upon declaration of acceleration of the
maturity thereof or would be provable in bankruptcy, or adversely
affect any right of repayment of the holder of any such debt security;

. change the place of payment, or the coin or currency, for payment of
principal or premium, if any, or interest on any such debt security;

. impair the right to institute suit for the enforcement of any payment
on or with respect to any such debt security;

. reduce the stated percentage of outstanding debt securities of any
series necessary to modify or amend the applicable indenture, to waive
compliance with certain provisions of that indenture or certain
defaults and consequences thereunder;

. reduce the quorum or voting requirements set forth in the applicable
indenture;

. modify any of the foregoing provisions or any of the provisions
relating to the waiver of certain past defaults or certain covenants,
except to increase the required percentage to effect such action; or

. to provide that certain other provisions may not be modified or waived
without the consent of the holder of such debt security.

The holders of not less than a majority in principal amount of outstanding
debt securities of each series affected by those covenants in the indenture
will have the right to waive compliance by us with certain covenants in the
indenture.

We may amend and modify each indenture and substitute the respective trustee
thereunder without the consent of any holder of debt securities for any of the
following purposes:

. to evidence the succession of another entity to us as obligor under the
applicable indenture;

. to add or change any provisions of an indenture to facilitate the
issuance of, or to liberalize certain terms of, debt securities in
bearer form, or to permit or facilitate the issuance of debt securities
in uncertificated form, provided that such action will not adversely
affect the interests of the holders of the debt securities of any
series in any material respect; or

. to cure any ambiguity, defect or inconsistency in an indenture,
provided that such action will not adversely affect the interests of
holders of debt securities of any series issued under such indenture in
any material respect.

Conversion Rights

The terms and conditions, if any, upon which the debt securities are
convertible into shares of common stock or shares of preferred stock will be
set forth in the applicable prospectus supplement relating thereto. The terms
will include:

. whether such debt securities are convertible into shares of common
stock or shares of preferred stock;

. the conversion price (or manner of calculation thereof);

. the conversion period;

. provisions as to whether conversion will be at the option of the
holders or the Company; and

. the events requiring an adjustment of the conversion price and
provisions affecting conversion in the event of the redemption of such
debt securities and any restrictions on conversion, including
restrictions directed at maintaining our REIT status.

Redemption of Securities

Each indenture will provide that our debt securities may be redeemed at any
time at our option, in whole or in part, at a stated redemption price, except
as may otherwise be provided in connection with any debt securities or series
of debt securities under the applicable indenture.

Subordination

The payment of the principal of, or premium, if any, and interest on any
subordinated debt securities will be expressly subordinated, to the extent and
in the manner set forth in an indenture governing such subordinated debt
securities, in right of payment to the prior payment in full of all of our
senior debt. Such subordination provisions will be described in detail in the
applicable prospectus supplement.

Subrogation

Subject to the payment in full in cash of all amounts then due (whether by
acceleration of the maturity thereof or otherwise) on account of all senior
debt at the time outstanding, the holders of a subordinated debt security will
be subrogated to the rights of the holders of senior debt to receive payments
or distributions of cash, property or securities of the Company applicable to
the senior debt until the principal of (and premium, if any) and interest on
the subordinated debt securities is paid in full.

Global Securities

The debt securities of a series may be issued in whole or in part in the
form of one or more Global securities that will be deposited with, or on behalf
of, a depositary identified in the applicable prospectus supplement relating to
that series. Global securities, if any, issued in the United States are
expected to be deposited with the Depository Trust Company. Global securities
may be issued in either registered or bearer form and in either temporary or
permanent form. The specific terms of the depositary arrangement with respect
to a series of debt securities will be described in the applicable prospectus
supplement relating to such series.

DESCRIPTION OF CAPITAL STOCK

The following description is only a summary of certain terms and provisions
of our capital stock. You should refer to our Charter and By-Laws for the
complete provisions thereof.

General

The total number of shares of capital stock of all classes that we are
authorized to issue is 70,000,000. Currently, the Charter authorizes the
issuance of 51,484,000 shares of common stock, par value $.0001 per share,
40,000 shares of Series A preferred stock, par value $.0001 per share,
2,476,000 shares of Series B preferred stock, par value $.0001 per share, and
16,000,000 shares of excess stock, par value $.0001 per share. As of November
23, 2001, 8,420,000 shares of common stock were issued and outstanding. The
outstanding common stock is currently listed on the New York Stock Exchange
under the symbol "SIZ". We intend to apply to the New York Stock Exchange to
list any additional shares of common stock pursuant to any prospectus
supplement, and we anticipate that such shares will be so listed.

Our Board of Directors is authorized by the Charter, to classify and
reclassify any of our unissued shares of capital stock, by, among other
alternatives, setting, altering or eliminating the designation, preferences,
conversion or other rights, voting powers, qualifications and terms and
conditions of redemption of, limitations as to dividends and any other
restrictions on, our capital stock. The power of the Board of Directors to
classify and reclassify any of the shares of capital stock includes the
authority to classify or reclassify such shares into a class or classes of
preferred stock or other stock.

Pursuant to the provisions of the Charter, if a transfer of stock occurs
such that any person would own, beneficially or constructively (applying the
applicable attribution rules of the Code), more than 9.9% (in value or in
number, whichever is more restrictive) of our outstanding equity stock
(excluding shares of excess stock), then the amount in excess of the 9.9% limit
will automatically be converted into shares of excess stock, any such transfer
will be void from the beginning, and we will have the right to redeem such
stock. These restrictions also apply to any transfer of stock that would result
in our being "closely held" within the meaning of Section 856(h) of the Code or
otherwise failing to qualify as a REIT for federal income tax purposes. Upon
any transfer that results in excess stock, such excess stock shall be held in
trust for the exclusive benefit of one or more charitable beneficiaries
designated by us. Upon the satisfaction of certain conditions, the person who
would have been the record holder of equity stock if the transfer had not
resulted in excess stock may designates a beneficiary of an interest in the
trust. Upon such transfer of an interest in the trust, the corresponding shares
of excess stock in the trust shall be automatically exchanged for an equal
number of shares of equity stock of the same class as such stock had been prior
to it becoming excess stock and shall be transferred of record to the
designated beneficiary. Excess stock has no voting rights, except as required
by law, and any vote cast by a purported transferee in respect of shares of
excess stock prior to the discovery that shares of equity stock had been
converted into excess stock shall be void from the beginning. Excess stock
shall be entitled to dividends equal to the dividends declared on any class of
equity stock from which the excess stock has been converted, which dividends
shall be held in trust for the benefit of the charitable beneficiary. Any
dividend paid prior to our discovery that equity stock has been converted to
excess stock shall be paid to the trustee of the trust upon demand. In the
event of our liquidation, each holder of excess stock shall be entitled to
receive that portion of our assets that would have been distributed to the
equity stock in respect of which such excess stock was issued. The trustee of
the trust holding excess stock shall distribute such assets to the
beneficiaries of such trust. These restrictions will not prevent the settlement
of a transaction entered into through the facilities of any interdealer
quotation system or national securities exchange upon which shares of our
capital stock are traded. Notwithstanding the prior sentence, certain
transactions may be settled by providing shares of excess stock.

Our board of directors, upon at least 15 days' written notice from a
transferee prior to a proposed transfer that would result in the intended
transferee "beneficially owning" (after the application of the applicable
attribution rules of the Code) equity stock in excess of the 9.9% ownership
limit and the satisfaction of such other conditions as the board of directors
may direct, may in its sole and absolute discretion exempt a person from the
ownership limit. Our board of directors may in its sole and absolute discretion
exempt a person from the limitation on a person "constructively owning" equity
stock in excess of the 9.9% ownership limit if (x) such person does not and
represents that it will not directly or "constructively own" (after the
application of the applicable attribution rules of the Code) more than a 9.9%
interest in a tenant of ours; (y) we obtain such representations and
undertakings as are reasonably necessary to ascertain this fact; and (z) such
person agrees that any violation or attempted violation of such
representations, undertakings and agreements will result in such equity stock
in excess of the ownership limit being converted into and exchanged for excess
stock. Our board of directors may from time to time increase or decrease the
9.9% limit, provided that the 9.9% limit may be increased only if five persons
could "beneficially own" or "constructively own" (applying the applicable
attribution rules of the Code) no more than 50.0% in value of the shares of
equity stock then outstanding.

Description of Common Stock

Distributions. Subject to the preferential rights of any shares of preferred
stock currently outstanding or subsequently classified and to the provisions of
our Charter regarding restrictions on transfer and ownership of

shares of common stock, as a holder of our common stock, you will be entitled
to receive distributions, if, as and when declared by our board of directors,
out of our assets that we may legally use for distributions to stockholders and
to share ratably in our assets that we may legally distribute to our
stockholders in the event of our liquidation, dissolution or winding-up after
payment of, or adequate provision for, all of our known debts and liabilities.
We currently pay regular quarterly distributions on our common stock.

Relationship to Preferred Stock and Other Shares of Common Stock. Your
rights as a holder of shares of common stock will be subject to, and may be
adversely affected by, the rights of holders of preferred stock that have been
issued and that may be issued in the future. Our board of directors may cause
preferred stock to be issued to obtain additional capital, in connection with
acquisitions, to our officers, directors and employees pursuant to benefit
plans or otherwise and for other corporate purposes.

As a holder of our common stock, you will have no preferences, conversion,
sinking fund, redemption rights or preemptive rights to subscribe for any of
our securities. Subject to the provisions of our charter regarding restrictions
on ownership and transfer, all shares of common stock have equal distribution,
liquidation, voting and other rights.

Voting Rights. Subject to the provisions of our charter regarding
restrictions on transfer and ownership of shares of common stock, as a holder
of common stock, you will have one vote per share on all matters submitted to a
vote of stockholders, including the election of directors. Except as provided
with respect to any other class or series of shares of capital stock, the
holders of common stock will possess the exclusive voting power.

There is no cumulative voting in the election of directors, which means that
the holders of a plurality of the outstanding shares of common stock can elect
all of the directors then standing for election and the holders of the
remaining shares of common stock, if any, will not be able to elect any
directors, except as otherwise provided for any series of our preferred stock.

Stockholder Liability. Under Maryland law applicable to Maryland
corporations, you will not be liable as a shareholder for our obligations
solely as a result of your status as a stockholder.

Transfer Agent. The registrar and transfer agent for shares of our common
stock is The Bank of New York.

Description of Preferred Stock

General. Shares of preferred stock may be issued from time to time, in one
or more series, as authorized by the Board of Directors. Before issuance of
shares of each series, the Board is required to fix for each such series,
subject to the provisions of Maryland law and our Charter, the powers,
designations, preferences and relative, participating, optional or other
special rights of such series and qualifications, limitations or restrictions
thereof, including such provisions as may be desired concerning voting,
redemption, dividends, dissolution or the distribution of assets, conversion or
exchange, and such other matters as may be fixed by resolution of the Board of
Directors or a duly authorized committee thereof. The Board could authorize the
issuance of shares of preferred stock with terms and conditions which could
have the effect of discouraging a takeover or other transaction which holders
of some, or a majority of, shares of common stock might believe to be in their
best interests, or in which holders of some, or a majority of, shares of common
stock might receive a premium for their shares of common stock over the then
market price of such shares. The shares of preferred stock will, when issued,
be fully-paid and non-assessable and will have no preemptive rights.

The prospectus supplement relating to any shares of preferred stock offered
thereby will contain the specific terms, including:

(i) The title and stated value of such shares of preferred stock;

(ii) The number of such shares of preferred stock offered, the
liquidation preference per share and the offering price of such
shares of preferred stock;

(iii) The dividend rate(s), period(s) and/or payment date(s) or method(s)
of calculation thereof applicable to such shares of preferred stock;

(iv) The date from which dividends on such shares of preferred stock will
accumulate, if applicable;

(v) The procedures for any auction and remarketing, if any, for such
shares of preferred stock;

(vi) The provision for a sinking fund, if any, for the shares of
preferred stock;

(vii) The provisions for redemption, if applicable, of the shares of
preferred stock;

(viii) Any listing of the shares of preferred stock on any securities
exchange;

(ix) The terms and conditions, if applicable, upon which the shares of
preferred stock will be convertible into shares of common stock of
the Company, including the conversion price (or manner of
calculation thereof);

(x) A discussion of federal income tax considerations applicable to such
shares of preferred stock;

(xi) The relative ranking and preferences of such shares of preferred
stock as to dividend rights and rights upon liquidation, dissolution
or winding up of our affairs;

(xii) Any limitations on issuance of any series of shares of preferred
stock ranking senior to or on a parity with such series of shares of
preferred stock as to dividend rights and rights upon liquidation,
dissolution or winding up of our affairs;

(xiii) Any limitations on direct or beneficial ownership and restrictions
on transfer of such shares of preferred stock, in each case as may
be appropriate to preserve our status as a REIT; and

(xiv) Any other specific terms, preferences, rights, limitations or
restrictions of such shares of preferred stock.

The Registrar and Transfer Agent for the shares of preferred stock will be
set forth in the applicable prospectus supplement.

The description of the provisions of the shares of preferred stock set forth
in this prospectus and in the related prospectus supplement is only a summary,
does not purport to be complete and is subject to, and is qualified in its
entirety by, reference to the definitive Articles Supplementary to our Charter
relating to such series of shares of preferred stock. You should read these
documents carefully to fully understand the terms of the shares of preferred
stock. In connection with any offering of shares of preferred stock, Articles
Supplementary will be filed with the SEC as an exhibit or incorporated by
reference in the Registration Statement.

Description of Stockholder Rights Plan

Our board of directors has adopted a stockholder rights plan. As a result,
we issued one right for each outstanding share of common stock. One right will
be issued for each additional share of common stock that we issue, including
any shares of common stock issued under this prospectus. Each right entitles
the holder to purchase on one-thousandth of a share of our Series A preferred
stock at an exercise price of $40. The rights become exercisable 10 business
days after any party acquires or announces an offer to acquire 15% or more of
our common stock or certain similar event. The rights expire on August 27,
2008, unless earlier redeemed. The rights are redeemable at $0.01 per right at
any time before 10 business days following the time that any party acquires 15%
or more of our common stock, commences a tender offer for 15% or more of our
common stock, or our board of directors determines that a substantial
stockholder's ownership may be adverse to the interests of our other
stockholders or our qualification as a REIT. In certain circumstances, the
rights will be exercisable for the stock of any entity into which we merge or
to which we convey a substantial portion of our assets.

DESCRIPTION OF WARRANTS

General

We may issue warrants for the purchase of debt securities, shares of
preferred stock or shares of common stock. Warrants may be issued independently
or together with any other securities offered by any prospectus supplement and
may be attached to or separate from such securities. Each series of warrants
will be issued under a separate warrant agreement to be entered into between us
and a warrant agent specified in the applicable prospectus supplement. The
warrant agent will act solely as our agent in connection with the warrants of
such series and will not assume any obligation or relationship of agency or
trust for or with any holders or beneficial owners of warrants. The following
summary of certain provisions of the securities warrant agreement and the
warrants does not purport to be complete and is subject to, and is qualified in
its entirety by reference to, all the provisions of the securities warrant
agreement and the securities warrant certificates relating to each series of
warrants which will be filed with the SEC and incorporated by reference as an
exhibit to the Registration Statement of which this prospectus is a part at or
before the time of the issuance of that series of warrants.

If warrants are offered, the applicable prospectus supplement will describe
the terms of those warrants, including, in the case of warrants for the
purchase of debt securities, the following:

. the offering price;

. the denominations and terms of the series of debt securities
purchasable upon exercise of such warrants;

. the designation and terms of any series of debt securities with which
such warrants are being offered and the number of such warrants being
offered with such debt securities;

. the date, if any, on and after which such warrants and the related
series of debt securities will be transferable separately;

. the principal amount of the series of debt securities purchasable upon
exercise of each such securities warrant and the price at which such
principal amount of debt securities of such series may be purchased
upon such exercise;

. the date on which the right to exercise such warrants shall commence
and the date on which such right will expire;

. whether the warrants will be issued in registered or bearer form;

. any special United States Federal income tax consequences;

. the terms, if any, on which we may accelerate the date by which the
warrants must be exercised; and

. any other material terms of such warrants.

In the case of warrants for the purchase of shares of preferred stock or
shares of common stock, the applicable prospectus supplement will describe the
terms of those warrants, including the following where applicable:

. the offering price;

. the type and aggregate number of shares purchasable upon exercise of
the warrants, the exercise price, and in the case of warrants for
shares of preferred stock, the designation, aggregate number and terms

of the series of shares of preferred stock with which the warrants are
being offered, if any, and the number of such warrants being offered with
the shares of preferred stock;

. the date, if any, on and after which the warrants and the related
series of shares of preferred stock, if any, or shares of common stock
will be transferable separately;

. the date on which the right to exercise such warrants shall commence
and the date on which such right will expire;

. any special United States Federal income tax consequences; and

. any other material terms of the warrants.

Warrant certificates may be exchanged for new warrant certificates of
different denominations, may (if in registered form) be presented for
registration of transfer, and may be exercised at the corporate trust office of
the warrant agent or any other office indicated in the applicable prospectus
supplement. Before the exercise of any securities warrant to purchase debt
securities, holders of such warrants will not have any of the rights of holders
of the debt securities purchasable upon such exercise, including the right to
receive payments of principal, premium, if any, or interest, if any, on such
debt securities or to enforce covenants in the applicable indenture. Before the
exercise of any warrants to purchase shares of preferred stock or shares of
common stock, holders of such warrants will not have any rights of holders of
such shares of preferred stock or shares of common stock, including the right
to receive payments of dividends, if any, on such shares of preferred stock or
shares of common stock, or to exercise any applicable right to vote.

Exercise of Warrants

Each warrant will entitle the holder thereof to purchase such principal
amount of debt securities or number of shares of preferred stock or shares of
common stock, as the case may be, at such exercise price as shall in each case
be set forth in, or calculable from, the prospectus supplement relating to the
offered warrants. After the close of business on the expiration date (or such
later date to which such expiration date may be extended by us), unexercised
warrants will become void.

Warrants may be exercised by delivering to the warrant agent payment as
provided in the applicable prospectus supplement of the amount required to
purchase the shares of common stock purchasable upon such exercise, together
with certain information set forth on the reverse side of the securities
warrant certificate. Warrants will be deemed to have been exercised upon
receipt of payment of the exercise price, subject to the receipt within five
(5) business days, of the securities warrant certificate evidencing such
warrants. Upon receipt of such payment and the securities warrant certificate
properly completed and duly executed at the corporate trust office of the
securities warrant agent or any other office indicated in the applicable
prospectus supplement, we will, as soon as practicable, issue and deliver the
shares of common stock purchasable upon such exercise. If fewer than all of the
warrants represented by such securities warrant certificate are exercised, a
new securities warrant certificate will be issued for the remaining amount of
warrants.

Amendments and Supplements to Warrant Agreements

The warrant agreements may be amended or supplemented without the consent of
the holders of the warrants issued under the warrant agreement to effect
changes that are not inconsistent with the provisions of the warrants and that
do not adversely affect the interests of the holders of the warrants.

Common Stock Warrant Adjustments

Unless otherwise indicated in the applicable prospectus supplement, the
exercise price of, and the number of shares of common stock covered by, a
common stock warrant will be subject to adjustment in certain events,
including:

. payment of a dividend on the shares of common stock payable in shares
of common stock and stock splits, combinations or reclassifications of
the shares of common stock;

. issuance to all holders of shares of common stock of rights or warrants
to subscribe for or purchase shares of common stock at less than their
current market price (as defined in the warrant agreement for that
series of shares of common stock warrants); and

. certain distributions of evidences of indebtedness or assets (including
securities but excluding cash dividends or distributions paid out of
consolidated earnings or retained earnings), or of subscription rights
and warrants (excluding those referred to above).

No adjustment in the exercise price of, and the number of shares of common
stock covered by, a common stock warrant will be made for regular quarterly or
other periodic or recurring cash dividends or distributions or for cash
dividends or distributions to the extent paid from consolidated earnings or
retained earnings. No adjustment will be required unless such adjustment would
require a change of at least 1% in the exercise price then in effect. Except as
stated above, the exercise price of, and the number of shares of common stock
covered by, a common stock warrant will not be adjusted for the issuance of
shares of common stock or any securities convertible into or exchangeable for
shares of common stock, or carrying the right or option to purchase or
otherwise acquire the foregoing, in exchange for cash, other property or
services.

In the event of any (i) consolidation or merger of the Company with or into
any entity (other than a consolidation or a merger that does not result in any
reclassification, conversion, exchange or cancellation of outstanding shares of
common stock); (ii) sale, transfer, lease or conveyance of all or substantially
all of the assets of the Company; or (iii) reclassification, capital
reorganization or exchange of the shares of common stock (other than solely a
change in par value or from par value to no par value), then any holder of a
common stock warrant will be entitled, on or after the occurrence of any such
event, to receive on exercise of such common stock warrant the kind and amount
of shares or other securities, cash or other property (or any combination
thereof) that the holder would have received had such holder exercised such
holder's common stock warrant immediately before the occurrence of such event.
If the consideration to be received upon exercise of the common stock warrant
following any such event consists of shares of common stock of the surviving
entity, then from and after the occurrence of such event, the exercise price of
such common stock warrant will be subject to the same anti-dilution and other
adjustments described in the second preceding paragraph, applied as if such
common stock warrant were shares of common stock.

CERTAIN PROVISIONS OF MARYLAND LAW AND OUR CHARTER AND BY-LAWS

The following paragraphs summarize certain provisions of Maryland law and
our Charter and Bylaws. The summary does not purport to be complete and is
subject to and qualified in its entirety by reference to Maryland law and the
Charter, including any Articles Supplementary, and Bylaws. You should read
these documents carefully to fully understand the terms of Maryland law, our
Charter and our Bylaws.

The Board of Directors

Our Board of Directors is currently comprised of eight directors. Our Bylaws
provide that the Board may alter the number of directors to a number not
exceeding 15 nor below the minimum permitted in our Bylaws. Our Charter
provides that the members of the Board shall be divided, as evenly as possible,
into three classes, with approximately one-third of the directors elected by
the stockholders annually. Each director is to serve for a three year term or
until his or her successor is duly elected and has qualified. Holders of shares
will have no right to cumulative voting in the election of directors. We have
elected to be governed by the recent Maryland law described below as it relates
to a classified board.

Amendment of Charter and By-Laws

Our Charter generally may be amended only by the affirmative vote of the
holders of a majority of the votes entitled to be cast on the matter. However,
any amendment relating to our REIT qualification restrictions,

our Series A Preferred Stock (issued in connection with our stockholder rights
plan), our board of directors, our election to be exempt from the Maryland
business combination statute, indemnification and limitation of liability or
charter amendments requires the advice and recommendation of at least 75% of
our board of directors. In addition, charter amendments regarding our
classified board of directors, by-law amendments, our election under the
Maryland business combination statute, indemnification and limitation of
liability and amendments require the affirmative approval of 75% of the votes
entitled to be cast on the matter. This 75% vote is also required to amend the
Charter to provide for cumulative voting in the election of directors.

Our bylaws may be amended only by the board of directors or by 75% of the
aggregate voting power of all classes of capital stock.

Business Combinations

As a Maryland corporation, we are subject to certain restrictions concerning
certain "business combinations" (including a merger, consolidation, share
exchange or, in certain circumstances, an asset transfer or issuance or
reclassification of equity securities) between us and an "interested
stockholder." Interested stockholders are persons (i) who beneficially own 10%
or more of the voting power of our shares or (ii) are affiliates or associates
of us who, at any time within the two-year period prior to the date in
question, was the beneficial owner of 10% or more of the voting power of our
shares. Such business combinations are prohibited for 5 years after the most
recent date on which the interested stockholder became an interested
stockholder. Thereafter, any such business combination must be recommended by
the Board of Directors and approved by the affirmative vote of at least (i) 80%
of the votes entitled to be cast by holders of our outstanding voting shares
and (ii) 66 2/3% of the votes entitled to be cast by holders of our outstanding
voting shares other than shares held by the interested stockholder or an
affiliate or associate of the interested stockholder with whom the business
combination is to be effected, unless, among other things, the corporation's
stockholders receive a minimum price for their shares and the consideration is
received in cash or in the same form as previously paid by the interested
stockholder for its shares. These provisions of Maryland law do not apply,
however, to business combinations that are approved or exempted by the Board of
Directors prior to the time that the interested stockholder becomes an
interested stockholder.

Control Share Acquisitions

Maryland law provides that, with certain exceptions, "control shares" of a
corporation acquired in a "control share acquisition" have no voting rights
except to the extent approved by the stockholders by the affirmative vote of
two-thirds, excluding shares of stock owned by the acquiring person or by
officers or directors who are employees of the corporation. "Control shares"
are shares of voting stock which, if aggregated with all other such shares
previously acquired by such a person, would entitle the acquiring person to
exercise voting power in electing directors within one of the following ranges
of voting power: (i) 10% or more but less than 33 1/3%, (ii) 33 1/3% or more
but less than a majority, or (iii) a majority or more of all voting power.
Control shares do not include shares the acquiring person is then entitled to
vote as a result of having previously obtained stockholder approval. A "control
share acquisition" means, subject to certain exceptions, the acquisition of,
ownership of or the power to direct the exercise of voting power with respect
to, control shares.

As permitted under Maryland law, our Bylaws contain a provision opting out
of the control share acquisition statute.

Advance Notice of Director Nominations and New Business

Pursuant to our Bylaws, a stockholder seeking to nominate persons for
election to our Board of Directors or propose other business to be conducted at
an annual meeting of stockholders or to nominate persons for

election of directors at any special meeting of stockholders called for the
purpose of electing directors must provide the required notice to our chairman
of the board (i) in the case of an annual meeting, generally not less than 90
days nor more than 120 days prior to the first anniversary of the date of
mailing of the notice for the preceding year's annual meeting and (ii) in the
case of a special meeting, not later than the earlier of the 10th day following
the day on which notice of the special meeting was mailed or public disclosure
of the date of the special meeting.

The purpose of requiring such advance notice by stockholders is to provide
the Board of Directors a meaningful opportunity to consider the qualifications
of the proposed nominees or the advisability of the other proposed business
and, to the extent deemed necessary or advisable by the Board of Directors, to
inform stockholders and make recommendations about such qualifications or
business, as well as to provide a more orderly procedure for conducting
meetings of stockholders. Although our Bylaws do not give the Board of
Directors any power to disapprove of stockholder nominations or proposals for
action, they may have the effect of precluding a contest for the election of
directors or the consideration of stockholder proposals if the proper
procedures are not followed. In addition, these provisions may discourage or
deter a third party from conducting a solicitation of proxies to elect its own
slate of directors or to approve its own proposal, without regard to whether
consideration of such nominees or proposals might be harmful or in the best
interests of the Company and its stockholders. The provisions in our Bylaws
regarding advance notice provisions could have the effect of discouraging a
takeover or other transaction in which holders of some, or a majority, of the
shares of common stock might receive a premium for their shares over the then
prevailing market price or which such holders might believe to be otherwise in
their best interests.

Meetings of Stockholders

Under our bylaws, annual meetings of stockholders are to be held in May of
the following year at a date and time as determined by our board, the Chairman
of the Board or the President. Special meetings of stockholders may be called
only by a majority of the directors then in office, by the Chairman or the
President and must be called by the Secretary upon the written request of the
holders of a majority of the shares of our common stock entitled to vote at a
meeting. Only matters set forth in the notice of the meeting may be considered
and acted upon at such a meeting. Our bylaws provide that any action required
or permitted to be taken at a meeting of stockholders may be taken without a
meeting by unanimous written consent, if that consent sets forth that action
and is signed by each stockholder entitled to vote on the matter and a written
waiver of any right to dissent is signed by each stockholder entitled to notice
of the meeting but not entitled to vote at that meeting.

Recent Maryland Legislation

In 1999, Maryland enacted legislation which allows publicly held Maryland
corporations to elect to be governed by all or any part of Maryland law
provisions relating to extraordinary actions and unsolicited takeovers. The
election to be governed by one or more of these provisions can be made by a
Maryland corporation in its articles or bylaws or by resolution adopted by its
board of directors so long as the corporation has at least three directors who,
at the time of electing to be subject to the provisions, are not:

. officers or employees of the corporation;

. persons seeking to acquire control of the corporation;

. directors, officers, affiliates or associates of any person seeking to
acquire control; or

. nominated or designated as directors by a person seeking to acquire
control.

Articles supplementary must be filed with the Maryland State Department of
Assessments and Taxation if a Maryland corporation elects to be subject to any
or all of the provisions by board resolution or bylaw amendment. Stockholder
approval is not required for the filing of articles supplementary.

The Maryland legislation provides that a corporation can elect to be subject
to all or any portion of the following provisions, notwithstanding any contrary
provisions contained in that corporation's existing charter documents:

. Classified Board: The corporation may divide its board into three
classes which, to the extent possible, will have the same number of
directors, the terms of which will expire at the third annual meeting
of stockholders after the election of each class;

. Two-thirds Stockholder Vote to Remove Directors Only for Cause: The
stockholders may remove any director only by the affirmative vote of at
least two-thirds of all votes entitled to be cast by the stockholders
generally in the election of directors, but a director may not be
removed without cause;

. Size of Board Fixed by Vote of Board: The number of directors will be
fixed only by resolution of the board;

. Board Vacancies Filled by the Board for the Remaining Term: Vacancies
that result from an increase in the size of the board, or the death,
resignation, or removal of a director, may be filled only by the
affirmative vote of a majority of the remaining directors even if they
do not constitute a quorum. Directors elected to fill vacancies will
hold office for the remainder of the full term of the class of
directors in which the vacancy occurred, as opposed to until the next
annual meeting of stockholders, and until a successor is elected and
qualifies; and

. Stockholder Calls of Special Meetings: Special meetings of stockholders
may be called by the secretary of the corporation only upon the written
request of stockholders entitled to cast at least a majority of all
votes entitled to be cast at the meeting and only in accordance with
procedures set out in the MGCL.

We have not elected to be governed by the specific provisions of the 1999
legislation other than regarding removal of directors. However, our articles
and/or bylaws, as applicable, already provide for a classified board, that the
number of directors is to be determined by a resolution of the board, subject
to a minimum number, and that our secretary must call a special meeting of
stockholders only upon the written request of the holders of a majority of our
outstanding securities entitled to vote. In addition, we can elect to be
governed by any or all of the provisions of the Maryland legislation at any
time in the future.

Prohibited Transactions

Our Charter prohibits us from entering into certain transactions, such as
the following:

. Investing more than 10% of our assets in unimproved real property or
mortgage loans on unimproved real property;

. Investing in commodities or commodity futures contracts, other than
interest rate futures used solely for hedging purposes;

. Issuing equity securities redeemable at the option of the holder
thereof;

. Subject to certain exceptions, issuing options and warrants to purchase
common stock at an exercise price of less than the fair market value of
the common stock;

. Investing in real estate contracts for sale, unless the real estate
contracts are in recordable form and appropriately recorded in the
chain of title;

. Investing in mortgage loans unless an appraisal is obtained for the
underlying property; and

. Allowing our aggregate borrowing to exceed 300% of our net assets,
unless the independent directors on our board of directors determine
that a higher level of borrowing is appropriate.

MATERIAL UNITED STATES FEDERAL INCOME TAX CONSEQUENCES

Introductory Notes

The following is a description of the material Federal income tax
considerations to a holder of our common stock and our debentures. An
applicable prospectus supplement will contain information about additional
Federal income tax considerations, if any, relating to particular offerings of
our common stock, preferred stock, debt securities or warrants. The following
discussion is not exhaustive of all possible tax considerations and does not
provide a detailed discussion of any state, local or foreign tax
considerations, nor does it discuss all of the aspects of Federal income
taxation that may be relevant to a prospective stockholder in light of his or
her particular circumstances or to stockholders (including insurance companies,
tax-exempt entities, financial institutions or broker-dealers, foreign
corporations, and persons who are not citizens or residents of the United
States) who are subject to special treatment under the Federal income tax laws.

Jaeckle Fleischmann & Mugel, LLP has provided an opinion to the effect that
this discussion, to the extent that it contains descriptions of applicable
Federal income tax law, is correct in all material respects and fairly
summarizes the Federal income tax laws referred to herein. This opinion is
filed as an exhibit to the registration statement of which this prospectus is a
part. This opinion, however, does not purport to address the actual tax
consequences of the purchase, ownership and disposition of our common stock or
any of our other securities to any particular holder. The opinion, and the
information in this section, is based on the Code, current, temporary and
proposed Treasury regulations, the legislative history of the Code, current
administrative interpretations and practices of the Internal Revenue Service,
and court decisions. The reference to Internal Revenue Service interpretations
and practices includes Internal Revenue Service practices and policies as
endorsed in private letter rulings, which are not binding on the Internal
Revenue Service except with respect to the taxpayer that receives the ruling.
In each case, these sources are relied upon as they exist on the date of this
prospectus. No assurance can be given that future legislation, regulations,
administrative interpretations and court decisions will not significantly
change current law, or adversely affect existing interpretations of existing
law, on which the opinion and the information in this section are based. Any
change of this kind could apply retroactively to transactions preceding the
date of the change. Moreover, opinions of counsel merely represent counsel's
best judgment with respect to the probable outcome on the merits and are not
binding on the Internal Revenue Service or the courts. Accordingly, even if
there is no change in applicable law, no assurance can be provided that such
opinion, or the statements made in the following discussion, will not be
challenged by the Internal Revenue Service or will be sustained by a court if
so challenged.

EACH PROSPECTIVE PURCHASER IS ADVISED TO CONSULT THE APPLICABLE PROSPECTUS
SUPPLEMENT, AS WELL AS HIS OR HER OWN TAX ADVISOR, REGARDING THE SPECIFIC TAX
CONSEQUENCES TO HIM OR HER OF THE ACQUISITION, OWNERSHIP AND SALE OF SECURITIES
OF AN ENTITY ELECTING TO BE TAXED AS A REAL ESTATE INVESTMENT TRUST, INCLUDING
THE FEDERAL, STATE, LOCAL, FOREIGN, AND OTHER TAX CONSEQUENCES OF SUCH
ACQUISITION, OWNERSHIP, SALE, AND ELECTION AND OF POTENTIAL CHANGES IN
APPLICABLE TAX LAWS.

Taxation of Us as a REIT

General. We have elected to be taxed as a REIT under Sections 856 through
859 of the Code, commencing with our taxable year which ended December 31,
1987. Our qualification and taxation as a REIT depends upon our ability to meet
on a continuing basis, through actual annual operating results, distribution
levels and diversity of stock ownership, the various qualification tests and
organizational requirements imposed under the Code, as discussed below. We
believe that we are organized and have operated in such a manner as to qualify
under the Code for taxation as a REIT since our inception, and we intend to
continue to operate in such a manner. No assurances, however, can be given that
we will operate in a manner so as to qualify or remain qualified as a REIT. See
"--Failure to Qualify" below.

The following is a general summary of the material Code provisions that
govern the Federal income tax treatment of a REIT and its stockholders. These
provisions of the Code are highly technical and complex. This summary is
qualified in its entirety by the applicable Code provisions, the regulations
promulgated thereunder ("Treasury Regulations"), and administrative and
judicial interpretations thereof.

Jaeckle Fleischmann & Mugel, LLP has provided to us an opinion to the effect
that we have been organized and have operated in conformity with the
requirements for qualification and taxation as a REIT, effective for each of
our taxable years ended December 31, 1997 through December 31, 2000, and our
current and proposed organization and method of operation will enable us to
continue to meet the requirements for qualification and taxation as a REIT for
taxable year 2001 and thereafter. This opinion is filed as an exhibit to the
registration statement of which this prospectus is a part. It must be
emphasized that this opinion is conditioned upon certain assumptions and
representations made by us to Jaeckle Fleischmann & Mugel, LLP as to factual
matters relating to our organization and operation and that of our
subsidiaries. In addition, this opinion is based upon our factual
representations concerning our business and properties as described in the
reports filed by us under the federal securities laws.

Qualification and taxation as a REIT depends upon our ability to meet on a
continuing basis, through actual annual operating results, the various
requirements under the Code described in this prospectus with regard to, among
other things, the sources of our gross income, the composition of our assets,
our distribution levels, and our diversity of stock ownership. Jaeckle
Fleischmann & Mugel, LLP will not review our operating results on an ongoing
basis. While we intend to operate so that we qualify as a REIT, given the
highly complex nature of the rules governing REITs, the ongoing importance of
factual determinations, and the possibility of future changes in our
circumstances, no assurance can be given that we satisfy all of the tests for
REIT qualification or will continue to do so.

If we qualify for taxation as a REIT, we generally will not be subject to
Federal corporate income taxes on net income that we currently distribute to
stockholders. This treatment substantially eliminates the "double taxation" (at
the corporate and stockholder levels) that generally results from investment in
a corporation.

Notwithstanding our REIT election, however, we will be subject to Federal
income tax in the following circumstances. First, we will be taxed at regular
corporate rates on any undistributed taxable income, including undistributed
net capital gains, provided, however, that properly designated undistributed
capital gains will effectively avoid taxation at the shareholder level. Second,
under certain circumstances, we may be subject to the "alternative minimum tax"
on any items of tax preference and alternative minimum tax adjustments. Third,
if we have (i) net income from the sale or other disposition of "foreclosure
property" (which is, in general, property acquired by foreclosure or otherwise
on default of a loan secured by the property) that is held primarily for sale
to customers in the ordinary course of business or (ii) other nonqualifying
income from foreclosure property, we will be subject to tax at the highest
corporate rate on such income. Fourth, if we have net income from prohibited
transactions (which are, in general, certain sales or other dispositions of
property (other than foreclosure property) held primarily for sale to customers
in the ordinary course of business), such income will be subject to a 100% tax
on prohibited transactions. Fifth, if we should fail to satisfy the 75% gross
income test or the 95% gross income test (as discussed below), and have
nonetheless maintained our qualification as a REIT because certain other
requirements have been met, we will be subject to a 100% tax equal to the gross
income attributable to the greater of either (i) the amount by which 75% of our
gross income exceeds the amount qualifying under the 75% test for the taxable
year or (ii) the amount by which 90% of our gross income exceeds the amount of
our income qualifying under the 95% test for the taxable year, multiplied in
either case by a fraction intended to reflect our profitability. Sixth, if we
should fail to distribute during each calendar year at least the sum of (i) 85%
of our REIT ordinary income for such year; (ii) 95% of our REIT capital gain
net income for such year (for this purpose such term includes capital gains
which we elect to retain but which we report as distributed to our
stockholders. See "--Annual Distribution Requirements" below); and (iii) any
undistributed taxable income from prior years, we would be subject to a 4%
excise tax on the excess of such required distribution over the amounts
actually distributed. Seventh, if we acquire any asset from a C corporation
(i.e., a corporation generally subject to full corporate level tax) in a
transaction in which the basis of the asset in our hands is determined by
reference to the basis of the asset (or any other property) in the

hands of the C corporation, and we recognize gain on the disposition of such
asset during the 10-year period beginning on the date on which such asset was
acquired by us, then, to the extent of such property's built-in gain (the
excess of the fair market value of such property at the time of acquisition by
us over the adjusted basis of such property at such time), such gain will be
subject to tax at the highest regular corporate rate applicable assuming that
we made or would make an election pursuant to Notice 88-19 or Treasury
Regulations that were promulgated in 2000. Eighth, we would be subject to a
100% penalty tax on amounts received (or on certain expenses deducted by a
taxable REIT subsidiary) if arrangements among us, our tenants and a taxable
REIT subsidiary were not comparable to similar arrangements among unrelated
parties.

Requirements for Qualification

The Code defines a REIT as a corporation, trust or association (i) which is
managed by one or more trustees or directors; (ii) the beneficial ownership of
which is evidenced by transferable shares or by transferable certificates of
beneficial interest; (iii) which would be taxable as a domestic corporation but
for Code Sections 856 through 859; (iv) which is neither a financial
institution nor an insurance company subject to certain provisions of the Code;
(v) the beneficial ownership of which is held by 100 or more persons; (vi) of
which not more than 50% in value of the outstanding capital stock is owned,
directly or indirectly, by five or fewer individuals (as defined in the Code to
include certain entities) during the last half of each taxable year after
applying certain attribution rules; (vii) that makes an election to be treated
as a REIT for the current taxable year or has made an election for a previous
taxable year which has not been revoked and (viii) which meets certain other
tests, described below, regarding the nature of its income and assets. The Code
provides that conditions (i) through (iv), inclusive, must be met during the
entire taxable year and that condition (v) must be met during at least 335 days
of a taxable year of 12 months, or during a proportionate part of a taxable
year of less than 12 months. Condition (vi) must be met during the last half of
each taxable year other than the first taxable year for which an election to
become a REIT is made. For purposes of determining stock ownership under
condition (vi), a supplemental unemployment compensation benefits plan, a
private foundation or a portion of a trust permanently set aside or used
exclusively for charitable purposes generally is considered an individual.
However, a trust that is a qualified trust under Code Section 401(a) generally
is not considered an individual, and beneficiaries of a qualified trust are
treated as holding shares of a REIT in proportion to their actuarial interests
in the trust for purposes of condition (vi). Conditions (v) and (vi) do not
apply until after the first taxable year for which an election is made to be
taxed as a REIT. We have issued sufficient common stock with sufficient
diversity of ownership to allow us to satisfy requirements (v) and (vi). In
addition, our Charter contains restrictions regarding the transfer of our stock
and the issuance of excess stock intended to assist in continuing to satisfy
the stock ownership requirements described in (v) and (vi) above. See
"Description of Capital Stock--General." These restrictions, however, may not
ensure that we will be able to satisfy these stock ownership requirements. If
we fail to satisfy these stock ownership requirements, we will fail to qualify
as a REIT.

In addition, a corporation may not elect to become a REIT unless its taxable
year is the calendar year. Our taxable year is the calendar year.

To qualify as a REIT, we cannot have at the end of any taxable year any
undistributed earnings and profits that are attributable to a non-REIT taxable
year. We believe that we have complied with this requirement. In particular, we
should not succeed to the earnings and profits of Sizeler Real Estate
Management Co. Inc. as a result of our acquisition of that entity in October
2001 because we intend to make a Code Section 338(h)(10) election, which will
cause us to be treated as acquiring the assets rather than the stock of such
entity.

For our tax years beginning prior to January 1, 1998, pursuant to applicable
Treasury Regulations, to be taxed as a REIT, we were required to maintain
certain records and request on an annual basis certain information from our
stockholders designed to disclose the actual ownership of our outstanding
shares. We have complied with such requirements. For our tax years beginning
January 1, 1998 and after, these records and informational requirements are no
longer a condition to REIT qualification. Instead, a monetary penalty will be
imposed for failure to comply with these requirements. If we comply with these
regulatory rules, and we do not know, or exercising reasonable diligence would
not have known, whether we failed to meet requirement (vi) above, we will be
treated as having met the requirement.

Qualified REIT Subsidiaries

If a REIT owns a corporate subsidiary that is a "qualified REIT subsidiary,"
the separate existence of that subsidiary will be disregarded for federal
income tax purposes. Generally, a qualified REIT subsidiary is a corporation,
other than a taxable REIT subsidiary, all of the capital stock of which is
owned by the REIT. All assets, liabilities and items of income, deduction and
credit of the qualified REIT subsidiary will be treated as assets, liabilities
and items of income, deduction and credit of the REIT itself. A qualified REIT
subsidiary of ours will not be subject to federal corporate income taxation,
although it may be subject to state and local taxation in some states.

Taxable REIT Subsidiaries

A "taxable REIT subsidiary" is an entity taxable as a corporation in which
we own stock and that elects with us to be treated as a taxable REIT subsidiary
under Section 856(l) of the Code. In addition, if one of our taxable REIT
subsidiaries owns, directly or indirectly, securities representing more than
35% of the vote or value of a subsidiary corporation, that subsidiary will also
be treated as a taxable REIT subsidiary of ours. A taxable REIT subsidiary is
subject to federal income tax, and state and local income tax where applicable,
as a regular "C" corporation.

Generally, a taxable REIT subsidiary can perform impermissible tenant
services without causing us to receive impermissible tenant services income
under the REIT income tests. However, several provisions regarding the
arrangements between a REIT and its taxable REIT subsidiaries ensure that a
taxable REIT subsidiary will be subject to an appropriate level of federal
income taxation. For example, a taxable REIT subsidiary is limited in its
ability to deduct interest payments made to us. In addition, we will be
obligated to pay a 100% penalty tax on some payments that we receive or on
certain expenses deducted by the taxable REIT subsidiary if the economic
arrangements among us, our tenants and the taxable REIT subsidiary are not
comparable to similar arrangements among unrelated parties. We currently do not
have any taxable REIT subsidiaries.

Income Tests

In order for us to maintain qualification as a REIT, certain separate
percentage tests relating to the source of our gross income must be satisfied
annually. First, at least 75% of our gross income (excluding gross income from
prohibited transactions) for each taxable year must be derived directly or
indirectly from investments relating to real property or mortgages on real
property (including "rents from real property," gain, and, in certain
circumstances, interest) or from certain types of temporary investments.
Second, at least 95% of our gross income (excluding gross income from
prohibited transactions) for each taxable year must be derived from such real
property investments described above, dividends, interest and gain from the
sale or disposition of stock or securities, some payments under hedging
instruments, or from any combination of the foregoing.

Rents received by us will qualify as "rents from real property" in
satisfying the above gross income tests only if several conditions are met.
First, the amount of rent must not be based in whole or in part on the income
or profits of any person. However, amounts received or accrued generally will
not be excluded from "rents from real property" solely by reason of being based
on a fixed percentage or percentages of receipts or sales.

Second, rents received from a tenant will not qualify as "rents from real
property" if we, or a direct or indirect owner of 10% or more of our stock,
actually or constructively owns 10% or more of such tenant (a "Related Party
Tenant"). We may, however, lease our properties to a taxable REIT subsidiary
and rents received from that subsidiary will not be disqualified from being
"rents from real property" by reason of our ownership interest in the
subsidiary if at least 90% of the property in question is leased to unrelated
tenants and the rent paid by the taxable REIT subsidiary is substantially
comparable to the rent paid by the unrelated tenants for comparable space.

Third, if rent attributable to personal property that is leased in
connection with a lease of real property is greater than 15% of the total rent
received under the lease, then the portion of rent attributable to such
personal property will not qualify as "rents from real property." Under prior
law, this 15% test was based on relative

adjusted tax basis of both the real and personal property. For taxable years
beginning after December 31, 2000, the test is based on relative fair market
value of the real and personal property.

Generally, for rents to qualify as "rents from real property" for the
purposes of the gross income tests, we are only allowed to provide services
that are both "usually or customarily rendered" in connection with the rental
of real property and not otherwise considered "rendered to the occupant."
Income received from any other service will be treated as "impermissible tenant
service income" unless the service is provided through an independent
contractor that bears the expenses of providing the services and from whom we
derive no revenue or through a taxable REIT subsidiary, subject to specified
limitations. The amount of impermissible tenant service income we receive is
deemed to be the greater of the amount actually received by us or 150% of our
direct cost of providing the service. If the impermissible tenant service
income exceeds 1% of our total income from a property, then all of the income
from that property will fail to qualify as rents from real property. If the
total amount of impermissible tenant service income from a property does not
exceed 1% of our total income from that property, the income will not cause the
rent paid by tenants of that property to fail to qualify as rents from real
property, but the impermissible tenant service income itself will not qualify
as rents from real property.

If we fail to satisfy one or both of the 75% or 95% gross income tests for
any taxable year, we may nevertheless qualify as a REIT for such year if we are
entitled to relief under certain provisions of the Code. These relief
provisions generally will be available if our failure to meet such tests was
due to reasonable cause and not due to willful neglect, if we attach a schedule
of the sources of our income to our federal income tax return for such years,
and if any incorrect information on the schedules was not due to fraud with
intent to evade tax. It is not possible, however, to state whether in all
circumstances we would be entitled to the benefit of these relief provisions.
As discussed above in "--General," even if these relief provisions were to
apply, a tax would be imposed with respect to the excess net income.

Asset Tests

At the close of each quarter of our taxable year, we must satisfy six tests
relating to the nature of our assets.

1. At least 75% of the value of our total assets must be represented by
"real estate assets," cash, cash items and government securities. Our real
estate assets include, for this purpose, our allocable share of real estate
assets held by the partnerships in which we own an interest, and the non-
corporate subsidiaries of these partnerships, as well as stock or debt
instruments held for less than one year purchased with the proceeds of an
offering of shares or long term debt.

2. Not more than 25% of our total assets may be represented by securities,
other than those in the 75% asset class.

3. Except for certain investments in REITs, qualified REIT subsidiaries, and
taxable REIT subsidiaries, the value of any one issuer's securities owned by us
may not exceed 5% of the value of our total assets.

4. Except for certain investments in REITs, qualified REIT subsidiaries and
taxable REIT subsidiaries, we may not own more than 10% of any one issuer's
outstanding voting securities.

5. Except for certain investments in REITs, qualified REIT subsidiaries and
taxable REIT subsidiaries, we may not own more than 10% of the total value of
the outstanding securities of any one issuer, other than securities that
qualify as "straight debt" under the Internal Revenue Code.

6. Not more than 20% of our total assets may be represented by the
securities of one or more taxable REIT subsidiaries.

For purposes of these asset tests, any shares of qualified REIT subsidiaries
are not taken into account, and any assets owned by the qualified REIT
subsidiary are treated as owned directly by the REIT.

Securities, for purposes of the assets tests, may include debt we hold.
However, debt we hold in an issuer will not be taken into account for purposes
of the 10% value test if the debt securities meet the "straight debt" safe
harbor and either (1) the issuer is an individual, (2) the only securities of
the issuer that we hold are straight debt or (3) if the issuer is a
partnership, we hold at least a 20 percent profits interest in the partnership.

Debt will meet the "straight debt" safe harbor if the debt is a written
unconditional promise to pay on demand or on a specified date a sum certain in
money (1) which is not convertible, directly or indirectly, into stock and (2)
the interest rate (or the interest payment dates) of which is not contingent on
the profits, the borrower's discretion or similar factors.

With respect to each issuer in which we currently own an interest that does
not qualify as a REIT, a qualified REIT subsidiary or a taxable REIT
subsidiary, we believe that our pro rata share of the value of the securities,
including unsecured debt, of any such issuer does not exceed 5% of the total
value of our assets and that we comply with the 10% voting securities
limitation and 10% value limitation (taking into account the "straight debt"
exceptions with respect to certain issuers). With respect to our compliance
with each of these asset tests, however, we cannot provide any assurance that
the Internal Revenue Service might not disagree with our determinations.

After initially meeting the asset tests after the close of any quarter, we
will not lose our status as a REIT if we fail to satisfy the 25%, 20% or 5%
asset tests or the 10% value limitation at the end of a later quarter solely by
reason of changes in the relative values of our assets. If the failure to
satisfy the 25%, 20%, or 5% asset tests or the 10% value limitation results
from an increase in the value of our assets after the acquisition of securities
or other property during a quarter, the failure can be cured by a disposition
of sufficient non-qualifying assets within 30 days after the close of that
quarter. We have maintained and intend to continue to maintain adequate records
of the value of our assets to ensure compliance with the asset tests and to
take any available actions within 30 days after the close of any quarter as may
be required to cure any noncompliance with the 25%, 20%, or 5% asset tests or
the 10% value limitation. We cannot ensure that these steps always will be
successful. If we were to fail to cure the noncompliance with the asset tests
within this 30 day period, we could fail to qualify as a REIT.

Annual Distribution Requirements

We, in order to qualify as a REIT, are required to distribute dividends
(other than capital gain dividends) to our stockholders in an amount at least
equal to (i) the sum of (a) 90% of our "REIT taxable income" (computed without
regard to the dividends paid deduction and our net capital gain) and (b) 90% of
the net income (after tax), if any, from foreclosure property, minus (ii) the
sum of certain items of noncash income. Such distributions generally must be
paid in the taxable year to which they relate. Dividends may be paid in the
following year in two circumstances. First, dividends may be declared in the
following year if the dividends are declared before we timely file our tax
return for the year and if made before the first regular dividend payment made
after such declaration. Second, if we declare a dividend in October, November
or December of any year with a record date in one of these months and pay the
dividend on or before January 31 of the following year, we will be treated as
having paid the dividend on December 31 of the year in which the dividend was
declared. To the extent that we do not distribute all of our net capital gain
or distribute at least 90%, but less than 100%, of our "REIT taxable income,"
as adjusted, we will be subject to tax on the nondistributed amount at regular
capital gains and ordinary corporate tax rates. Furthermore, if we should fail
to distribute during each calendar year at least the sum of (i) 85% of our REIT
ordinary income for such year; (ii) 95% of our REIT capital gain income for
such year; and (iii) any undistributed taxable income from prior periods, we
will be subject to a 4% excise tax on the excess of such required distribution
over the amounts actually distributed.

We may elect to retain and pay tax on net long-term capital gains and
require our stockholders to include their proportionate share of such
undistributed net capital gains in their income. If we make such election,
stockholders would receive a tax credit attributable to their share of the
capital gains tax paid by us, and would receive an increase in the basis of
their shares in us in an amount equal to the stockholder's share of the
undistributed net long-term capital gain reduced by the amount of the credit.
Further, any undistributed net long-term capital gains that are included in the
income of our stockholders pursuant to this rule will be treated as distributed
for purposes of the 4% excise tax.

We have made and intend to continue to make timely distributions sufficient
to satisfy the annual distribution requirements. It is possible, however, that
we, from time to time, may not have sufficient cash or liquid assets to meet
the distribution requirements due to timing differences between the actual
receipt of income and actual payment of deductible expenses and the inclusion
of such income and deduction of such expenses in arriving at our taxable
income, or if the amount of nondeductible expenses such as principal
amortization or capital expenditures exceeds the amount of noncash deductions.
In the event that such timing differences occur, in order to meet the
distribution requirements, we may arrange for short-term, or possibly long-
term, borrowing to permit the payment of required dividends. If the amount of
nondeductible expenses exceeds noncash deductions, we may refinance our
indebtedness to reduce principal payments and may borrow funds for capital
expenditures.

Under certain circumstances, we may be able to rectify a failure to meet the
distribution requirement for a year by paying "deficiency dividends" to
stockholders in a later year that may be included in our deduction for
dividends paid for the earlier year. Thus, we may avoid being taxed on amounts
distributed as deficiency dividends; however, we will be required to pay
interest to the Internal Revenue Service based upon the amount of any deduction
taken for deficiency dividends.

Failure to Qualify

If we fail to qualify for taxation as a REIT in any taxable year and no
relief provisions apply, we will be subject to tax (including any applicable
alternative minimum tax) on our taxable income at regular corporate rates.
Distributions to stockholders in any year in which we fail to qualify will not
be deductible by us, nor will such distributions be required to be made. In
such event, to the extent of current and accumulated earnings and profits, all
distributions to stockholders will be taxable as ordinary income, and, subject
to certain limitations in the Code, corporate distributees may be eligible for
the dividends received deduction. Unless entitled to relief under specific
statutory provisions, we will also be disqualified from taxation as a REIT for
the four taxable years following the year during which qualification was lost.
It is not possible to state whether in all circumstances we would be entitled
to such statutory relief.

Tax Aspects of Our Investments in Partnerships

General. Many of our investments are held through subsidiary partnerships
and limited liability companies in which we own a 99% interest and a third
party owns a 1% interest. This structure may involve special tax
considerations. These tax considerations include the following:

1. the status of each subsidiary partnership and limited liability company
as a partnership (as opposed to an association taxable as a corporation)
for income tax purposes; and

2. the taking of actions by any of the subsidiary partnerships or limited
liability companies that could adversely affect our qualification as a
REIT.

We believe that each of the subsidiary partnerships and each of the limited
liability companies that are not disregarded entities for federal income tax
purposes will be treated for tax purposes as partnerships (and not as
associations taxable as corporations). If any of the partnerships were to be
treated as a corporation, it would be subject to an entity level tax on its
income. In such a situation, the character of our assets and items of gross
income would change, which could preclude us from satisfying the asset tests
and possibly the income tests, and in turn prevent us from qualifying as a
REIT. In addition, if any of the partnerships were treated as a corporation, it
is likely that we would hold more than 10% of the voting power or value of the
entity and would fail to qualify as a REIT. See Material United States Federal
Income Tax Consequences--Asset Tests."

A REIT that is a partner in a partnership will be deemed to own its
proportionate share of the assets of the partnership and will be deemed to earn
its proportionate share of the partnership's income. In addition, the assets
and gross income of the partnership retain the same character in the hands of
the REIT for purposes of the gross income and asset tests applicable to REITs.
Thus, our proportionate share of the assets and items of

income of each subsidiary partnership and limited liability company that is
treated as a partnership for federal income tax purposes is treated as our
assets and items of income for purposes of applying the asset and income tests.
We have control over all of the subsidiaries that are treated as partnerships
for federal income tax purposes and intend to operate them in a manner that is
consistent with the requirements for our qualification as a REIT.

Taxation of Stockholders

Taxation of Taxable U.S. Stockholders. As used in the remainder of this
discussion, the term "U.S. Stockholder" means a beneficial owner of common
stock that is for United States federal income tax purposes:

1. a citizen or resident, as defined in Section 7701(b) of the Code, of the
United States;

2. a corporation or partnership, or other entity treated as a corporation
or partnership for federal income tax purposes, created or organized in
or under the laws of the United States or any state or the District of
Columbia;

3. an estate the income of which is subject to United States federal income
taxation regardless of its source; or

4. in general, a trust subject to the primary supervision of a United
States court and the control of one or more United States persons.

Generally, in the case of a partnership that holds our common stock, any
partner that would be a U.S. Stockholder if it held the common stock directly
is also a U.S. Stockholder. As long as we qualify as a REIT, distributions made
to our taxable U.S. Stockholders out of current or accumulated earnings and
profits (and not designated as capital gain dividends or retained capital
gains) will be taken into account by them as ordinary income, and corporate
stockholders will not be eligible for the dividends received deduction as to
such amounts. Distributions in excess of current and accumulated earnings and
profits will not be taxable to a stockholder to the extent that they do not
exceed the adjusted basis of such stockholder's common stock, but rather will
reduce the adjusted basis of such shares as a return of capital. To the extent
that such distributions exceed the adjusted basis of a stockholder's common
stock, they will be included in income as long-term capital gain (or short-term
capital gain if the shares have been held for one year or less), assuming the
shares are a capital asset in the hands of the stockholder. In addition, any
dividend declared by us in October, November or December of any year payable to
a stockholder of record on a specific date in any such month shall be treated
as both paid by us and received by the stockholder on December 31 of such year,
provided that the dividend is actually paid by us during January of the
following calendar year. For purposes of determining what portion of a
distribution is attributable to current or accumulated earnings and profits,
earnings and profits will first be allocated to distributions made to holders
of the shares of preferred stock. Stockholders may not include in their
individual income tax returns any net operating losses or capital losses of
ours.

In general, any gain or loss realized upon a taxable disposition of shares
by a stockholder who is not a dealer in securities will be treated as a long-
term capital gain or loss if the shares have been held for more than one year,
otherwise as short-term capital gain or loss. However, any loss upon a sale or
exchange of common stock by a stockholder who has held such shares for six
months or less (after applying certain holding period rules) will be treated as
long-term capital loss to the extent of distributions from us required to be
treated by such stockholder as long-term capital gain.

Distributions that we properly designate as capital gain dividends will be
taxable to stockholders as gains (to the extent that they do not exceed our
actual net capital gain for the taxable year) from the sale or disposition of a
capital asset held for greater than one year. If we designate any portion of a
dividend as a capital gain dividend, a U.S. Stockholder will receive an
Internal Revenue Service Form 1099-DIV indicating the amount that will be
taxable to the stockholder as capital gain. However, stockholders that are
corporations may be required to treat up to 20% of certain capital gain
dividends as ordinary income. A portion of capital gain dividends received by
noncorporate taxpayers may be subject to tax at a 25% rate to the extent
attributable

to certain gains realized on the sale of real property. In addition,
noncorporate taxpayers are generally taxed at a maximum rate of 20% on net
long-term capital gain (generally, the excess of net long-term capital gain
over net short-term capital loss) attributable to gains realized on the sale of
property held for greater that one year.

Distributions we make and gain arising from the sale or exchange by a
stockholder of shares of our stock will not be treated as passive activity
income, and, as a result, stockholders generally will not be able to apply any
"passive losses" against such income or gain. Distributions we make (to the
extent they do not constitute a return of capital) generally will be treated as
investment income for purposes of computing the investment interest limitation.
Gain arising from the sale or other disposition of our stock (or distributions
treated as such) will not be treated as investment income under certain
circumstances.

Upon any taxable sale or other disposition of our stock, a U.S. Stockholder
will recognize gain or loss for federal income tax purposes on the disposition
of our stock in an amount equal to the difference between

. the amount of cash and the fair market value of any property received
on such disposition; and

. the U.S. Stockholder's adjusted basis in such stock for tax purposes.

Gain or loss will be capital gain or loss if the stock has been held by the
U.S. Stockholder as a capital asset. The applicable tax rate will depend on the
stockholder's holding period in the asset (generally, if an asset has been held
for more than one year it will produce long-term capital gain) and the
stockholder's tax bracket. A U.S. Stockholder who is an individual or an estate
or trust and who has long-term capital gain or loss will be subject to a
maximum capital gain rate of 20%. U.S. Stockholders that acquire, or are deemed
to acquire, stock after December 31, 2000 and who hold the stock for more than
five years and certain low income taxpayers may be eligible for a lower long-
term capital gains rate. However, to the extent that the capital gain realized
by a non-corporate stockholder on the sale of REIT stock corresponds to the
REIT's "unrecaptured Section 1250 gain," such gain would be subject to tax at a
rate of 25%. Stockholders are advised to consult with their own tax advisors
with respect to their capital gain tax liability.

Taxation of Tax-Exempt Stockholders. Provided that a tax-exempt stockholder
has not held its common stock as "debt financed property" within the meaning of
the Internal Revenue Code, the dividend income from us will not be unrelated
business taxable income, referred to as UBTI, to a tax-exempt stockholder.
Similarly, income from the sale of common stock will not constitute UBTI unless
the tax-exempt stockholder has held its stock as debt financed property within
the meaning of the Internal Revenue Code or has used the common stock in a
trade or business. However, for a tax-exempt stockholder that is a social club,
voluntary employee benefit association, supplemental unemployment benefit
trust, or qualified group legal services plan exempt from federal income
taxation under Internal Revenue Code Sections 501(c)(7), (c)(9), (c)(17) and
(c)(20), respectively, or a single parent title-holding corporation exempt
under Section 501(c)(2) the income of which is payable to any of the
aforementioned tax-exempt organizations, income from an investment in us will
constitute UBTI unless the organization properly sets aside or reserves such
amounts for purposes specified in the Internal Revenue Code. These tax exempt
stockholders should consult their own tax advisors concerning these "set aside"
and reserve requirements.

A "qualified trust" (defined to be any trust described in Code Section
401(a) and exempt from tax under Code Section 501(a)) that holds more than 10%
of the value of the shares of a REIT may be required, under certain
circumstances, to treat a portion of distributions from the REIT as UBTI. This
requirement will apply for a taxable year only if (i) the REIT satisfies the
requirement that not more than 50% of the value of its shares be held by five
or fewer individuals (the "five or fewer requirement") only by relying on a
special "look-through" rule under which shares held by qualified trust
stockholders are treated as held by the beneficiaries of such trusts in
proportion to their actuarial interests therein; and (ii) the REIT is
"predominantly held" by qualified trusts. A REIT is "predominantly held" by
qualified trusts if either (i) a single qualified trust holds more than 25% of
the value of the REIT shares, or (ii) one or more qualified trusts, each owning
more than 10% of the value of the REIT shares, hold in the aggregate more than
50% of the value of the REIT shares. If the foregoing requirements are met, the
percentage of any REIT dividend treated as UBTI to a

qualified trust that owns more than 10% of the value of the REIT shares is
equal to the ratio of (i) the UBTI earned by the REIT (computed as if the REIT
were a qualified trust and therefore subject to tax on its UBTI) to (ii) the
total gross income (less certain associated expenses) of the REIT for the year
in which the dividends are paid. A de minimis exception applies where the ratio
set forth in the preceding sentence is less than 5% for any year.

The provisions requiring qualified trusts to treat a portion of REIT
distributions as UBTI will not apply if the REIT is able to satisfy the five or
fewer requirement without relying on the "look-through" rule. The restrictions
on ownership of stock in our Charter should prevent application of the
foregoing provisions to qualified trusts purchasing our stock, absent a waiver
of the restrictions by the Board of Directors.

Taxation of Non-U.S. Stockholders. The rules governing U.S. Federal income
taxation of nonresident alien individuals, foreign corporations, foreign
partnerships and other foreign stockholders (collectively, "Non-U.S.
Stockholders") are complex, and no attempt will be made herein to provide more
than a limited summary of such rules. The discussion does not consider any
specific facts or circumstances that may apply to a particular Non-U.S.
Stockholder. Prospective Non-U.S. Stockholders should consult with their own
tax advisors to determine the impact of U.S. Federal, state and local income
tax laws with regard to an investment in common stock, including any reporting
requirements.

Distributions that are not attributable to gain from sales or exchanges by
us of U.S. real property interests and not designated by us as capital gain
dividends or retained capital gains will be treated as dividends of ordinary
income to the extent that they are made out of our current or accumulated
earnings and profits. Such distributions ordinarily will be subject to a
withholding tax equal to 30% of the gross amount of the distribution unless an
applicable tax treaty reduces such rate. However, if income from the investment
in our stock is treated as effectively connected with the Non-U.S.
Stockholder's conduct of a U.S. trade or business, the Non-U.S. Stockholder
generally will be subject to a tax at graduated rates in the same manner as
U.S. stockholders are taxed with respect to such dividends (and may also be
subject to a branch profits tax of up to 30% if the stockholder is a foreign
corporation). We expect to withhold U.S. income tax at the rate of 30% on the
gross amount of any dividends paid to a Non-U.S. Stockholder that are not
designated as capital gain dividends, unless (i) a lower treaty rate applies
and the Non-U.S. Stockholder files an IRS Form W-8BEN evidencing eligibility
for that reduced rate is filed with us or (ii) the Non-U.S. Stockholder files
an IRS Form W-8ECI with us claiming that the distribution is income treated as
effectively connected to a U.S. trade or business.

Distributions in excess of our current and accumulated earnings and profits
will not be taxable to a stockholder to the extent that they do not exceed the
adjusted basis of the stockholder's stock, but rather will reduce the adjusted
basis of such shares. To the extent that such distributions exceed the adjusted
basis of a Non-U.S. Stockholder's shares, they will give rise to tax liability
if the Non-U.S. Stockholder would otherwise be subject to tax on any gain from
the sale or disposition of his or her stock as described below. We may be
required to withhold U.S. income tax at the rate of at least 10% on
distributions to Non-U.S. Stockholders that are not paid out of current or
accumulated earnings and profits unless the Non-U.S. Stockholders provide us
with withholding certificates evidencing their exemption from withholding tax.
If it cannot be determined at the time that such a distribution is made whether
or not such distribution will be in excess of current and accumulated earnings
and profits, the distribution will be subject to withholding at the rate
applicable to dividends. However, the Non-U.S. Stockholder may seek a refund of
such amounts from the Service if it is subsequently determined that such
distribution was, in fact, in excess of our current and accumulated earnings
and profits.

For any year in which we qualify as a REIT, distributions that are
attributable to gain from sales or exchanges by us of U.S. real property
interests will be taxed to a Non-U.S. Stockholder under the provisions of the
Foreign Investment in Real Property Tax Act of 1980 ("FIRPTA"). Under FIRPTA,
these distributions are taxed to a Non-U.S. Stockholder as if such gain were
effectively connected with a U.S. business. Thus, Non-U.S. Stockholders will be
taxed on such distributions at the normal capital gain rates applicable to U.S.
stockholders (subject to applicable alternative minimum tax and a special
alternative minimum tax in the case

of nonresident alien individuals). Also, distributions subject to FIRPTA may be
subject to a 30% branch profits tax in the hands of a corporate Non-U.S.
Stockholder not entitled to treaty relief or exemption. We are required by
applicable Treasury Regulations to withhold 35% of any distribution that could
be designated by us as a capital gain dividend. This amount is creditable
against the Non-U.S. Stockholder's FIRPTA tax liability.

Gain recognized by a Non-U.S. Stockholder upon the sale or exchange of our
stock generally would not be subject to United States taxation unless:

. the investment in our stock is effectively connected with the Non-U.S.
Stockholder's U.S. trade or business, in which case the Non-U.S.
Stockholder will be subject to the same treatment as domestic
stockholders with respect to any gain;

. the Non-U.S. Stockholder is a non-resident alien individual who is
present in the United States for 183 days or more during the taxable
year and has a tax home in the United States, in which case the non-
resident alien individual will be subject to a 30% tax on the
individual's net capital gains for the taxable year; or

. our stock constitutes a U.S. real property interest within the meaning
of FIRPTA, as described below.

Our stock will not constitute a United States real property interest if we
are a domestically-controlled REIT. We will be a domestically-controlled REIT
if, at all times during a specified testing period, less than 50% in value of
our stock is held directly or indirectly by Non-U.S. Stockholders.

We believe that, currently, we are a domestically controlled REIT and,
therefore, that the sale of our stock would not be subject to taxation under
FIRPTA. Because our stock is publicly traded, however, we cannot guarantee that
we are or will continue to be a domestically-controlled REIT.

Even if we do not qualify as a domestically-controlled REIT at the time a
Non-U.S. Stockholder sells our stock, gain arising from the sale still would
not be subject to FIRPTA tax if:

. the class or series of shares sold is considered regularly traded under
applicable Treasury regulations on an established securities market,
such as the NYSE; and

. the selling Non-U.S. Stockholder owned, actually or constructively, 5%
or less in value of the outstanding class or series of stock being sold
throughout the five-year period ending on the date of the sale or
exchange.

If gain on the sale or exchange of our stock were subject to taxation under
FIRPTA, the Non-U.S. Stockholder would be subject to regular U.S. income tax
with respect to any gain in the same manner as a taxable U.S. Stockholder,
subject to any applicable alternative minimum tax and special alternative
minimum tax in the case of non-resident alien individuals.

State and Local Taxes. We and our stockholders may be subject to state or
local taxation in various state or local jurisdictions, including those in
which we or they transact business or reside (although U.S. Stockholders who
are individuals generally should not be required to file state income tax
returns outside of their state of residence with respect to our operations and
distributions). The state and local tax treatment of us and our stockholders
may not conform to the Federal income tax consequences discussed above.
Consequently, prospective stockholders should consult their own tax advisors
regarding the effect of state and local tax laws on an investment in our common
stock.

Taxation of U.S. Debenture Holders

Stated Interest. This discussion assumes that any debentures will be treated
as debt, not equity, for federal income tax purposes. Each U.S. holder of a
debenture and the Company must report the debenture as debt for such purposes.
The stated interest on a debenture therefore will be taxable to a U.S. holder
as ordinary interest income at the time it either accrues or is received,
depending on such U.S. holder's method of accounting for federal income tax
purposes.

Original Issue Discount. Generally, a debenture will bear original issue
discount ("OID") if and to the extent of any excess of the debenture's "stated
redemption price at maturity" over its "issue price." The "stated redemption
price at maturity" of a debt instrument is the sum of its principal amount plus
all other payments required thereunder, other than payments of "qualified
stated interest" (defined generally as stated interest that is unconditionally
payable in cash or in property (other than debt instruments of the issuer) at
least annually at a single fixed rate). The "issue price" of a debenture will
be the fair market value of the debenture on the date of issuance if the
debentures are deemed to be "traded on an established securities market" under
the Code and as provided in Treasury Regulations. If the debentures are not so
traded, the "issue price" of a debenture will be its "stated redemption price
at maturity." Holders should consult their tax advisor regarding whether the
debentures will be considered "traded on an established market" under the
applicable regulations.

OID would not be includible in a U.S. holder's income, however, if the U.S.
holder is treated as having acquired the debenture at a "premium."

A U.S. holder will be treated as having acquired a debenture at a "premium"
if the adjusted basis of the debenture in the hands of the U.S. holder on the
date of issuance exceeds the sum of all amounts payable on the debenture other
than payments of qualified stated interest.

If a U.S. holder's adjusted basis in a debenture is less than or equal to
the debenture's adjusted issue price, the U.S. holder must include OID in
income as it accrues (and may be subject to the market discount rules discussed
below). The amount of accrued OID includible in income by such a U.S. holder
would be the sum of the "daily portions" of OID with respect to the new
debenture for each day during the taxable year or portion of the taxable year
in which such U.S. holder held such new debenture ("accrued OID"). The daily
portion is determined by allocating to each day in any "accrual period" a pro
rata portion of the OID allocable to that accrual period. The "accrual period"
for a debenture may be of any length and may vary in length over the term of
the debenture, provided that each accrual period is no longer than one year and
each scheduled payment of principal or interest occurs on the first day or the
final day of an accrual period. The amount of OID allocable to any accrual
period is an amount equal to the excess, if any, of (i) the product of the
debenture's adjusted issue price at the beginning of such accrual period and
its yield to maturity (determined on the basis of compounding at the close of
each accrual period and properly adjusted for the length of the accrual period)
over (ii) the amount of any qualified stated interest allocable to the accrual
period. OID allocable to a final accrual period is the difference between the
amount payable at maturity (other than a payment of qualified stated interest)
and the adjusted issue price at the beginning of the final accrual period. The
"adjusted issue price" of a debenture at the beginning of any accrual period is
equal to its issue price increased by the accrued OID for each prior accrual
period (determined without regard to the amortization of any acquisition or
bond premium) and reduced by any payments made on such debenture (other than
qualified stated interest) on or before the first day of the accrual period.
Special rules will apply for calculating OID for an initial short accrual
period. As OID accrues and is included in a U.S. holder's income, it is added
to the U.S. holder's tax basis in the new debentures.

Market Discount. Generally, the market discount rules discussed below will
apply to any debenture if the U.S. holder's tax basis in the debenture is less
than the debenture's "adjusted issue price." If the debentures do not have OID,
the market discount rules generally will apply if the stated redemption price
at maturity exceeds the holder's initial tax basis in the debentures.

Gain recognized on the disposition (including a redemption) of a debenture
that has accrued market discount will be treated as ordinary income, not
capital gain, to the extent of the accrued market discount, provided that the
amount of market discount exceeds a statutory de minimis amount. "Market
discount" is defined as the excess, if any, of (i) the stated redemption price
at maturity (or, in the case of a debt obligation with OID, the adjusted issue
price) over (ii) the tax basis of the debt obligation in the hands of the U.S.
holder immediately after its acquisition.

Unless a U.S. holder elects otherwise, the accrued market discount would be
the amount calculated by multiplying the market discount by a fraction, the
numerator of which is the number of days the obligation has been held by the
U.S. holder and the denominator of which is the number of days after the U.S.
holder's acquisition of the obligation up to and including its maturity date. A
U.S. holder of a debenture acquired at market discount may also be required to
defer the deduction of all or a portion of the interest on any indebtedness
incurred or maintained to carry the debenture until it is disposed of in a
taxable transaction.

If a U.S. holder of a debenture acquired at market discount disposes of such
debenture in any transaction other than a sale, exchange or involuntary
conversion, even though otherwise nontaxable (e.g., a gift), such U.S. holder
will be deemed to have realized an amount equal to the fair market value of the
debenture and would be required to recognize as ordinary income any accrued
market discount to the extent of the deemed gain.

A U.S. holder of a debenture acquired at market discount may elect to
include the market discount in income as it accrues, either on a straight-line
basis or, if elected, on a constant interest rate basis. The current income
inclusion election would apply to all market discount obligations acquired by
the electing U.S. holder on or after the first day of the first taxable year to
which the election applies. The election may be revoked only with the consent
of the Internal Revenue Service. If a U.S. holder of a debenture so elects to
include market discount in income currently, the rules discussed above with
respect to ordinary income recognition resulting from sales and certain other
disposition transactions and to deferral of interest deductions would not
apply.

Amortizable Bond Premium. Generally, a U.S. holder who acquires a debenture
will have amortizable bond premium to the extent of the excess, if any, of its
basis in the debenture over the amount payable on maturity of the debenture (or
on an earlier call date if use of the earlier call date results in a smaller
amortizable bond premium).

A U.S. holder may elect to amortize any bond premium under Section 171 of
the Code on a constant yield basis over the period from the acquisition date to
the maturity date of the debenture (or, in certain circumstances, until an
earlier call date) and, except as future Treasury Regulations may otherwise
provide, reduce the amount of interest included in income in respect of the
debenture by such amount. A U.S. holder who elects to amortize bond premium
must reduce its adjusted basis in the debenture by the amount of such allowable
amortization. An election to amortize the bond premium would apply to all
amortizable bond premium on all taxable bonds held at or acquired after the
beginning of the U.S. holder's taxable year as to which the election is made,
and may be revoked only with the consent of the Internal Revenue Service.

The amount of amortizable bond premium does not include any amount
attributable to the conversion feature of the new debenture. The value of the
conversion feature for purposes of the amortization of bond premium may be
determined under any reasonable method.

The amortized bond premium deduction is treated as an offset to interest
income on the related security for federal income tax purposes and is limited
to the purchaser's investment income from the debt instrument for the year. No
deduction of unamortized bond premium will be allowed on conversion of a
debenture into our common stock. Each U.S. holder is urged to consult its tax
advisors as to the consequences of the treatment of such premium as an offset
to interest income for federal income tax purposes. If an election to amortize
the bond premium is not made, a U.S. holder must include the full amount of
each interest payment in income in accordance with its regular method of
accounting and will generally receive a tax benefit from the bond premium only
upon computing its gain or loss upon the sale or other disposition or payment
of the principal amount of the new debenture.

Election to Treat All Interest as Original Issue Discount. A U.S. holder may
elect to include in gross income all interest that accrues on the debentures
using the constant-yield method with the modifications described below. For
this purpose, interest includes stated interest, OID, market discount and de
minimis market discount, as adjusted by an acquisition premium or amortizable
bond premium. In applying the constant-yield method, the issue price of the
debenture will equal the electing U.S. holder's adjusted basis in the debenture
immediately after its acquisition, the issue date of the debenture will be the
date of its acquisition by the electing U.S. holder and no payments on the
debenture will be treated as payments of qualified stated interest.

Sale or Redemption. Unless a nonrecognition provision applies, the sale,
exchange, redemption (including pursuant to an offer by us) or other
disposition of a debenture will be a taxable event for Federal income tax
purposes. In such event, a U.S. holder will recognize gain or loss equal to the
difference between (i) the amount of cash plus the fair market value of any
property received upon such sale, exchange, redemption or other taxable
disposition (other than in respect of accrued and unpaid interest thereon,
which will be taxable as ordinary income) and (ii) the U.S. holder's adjusted
tax basis therein (as increased by any market discount previously included in
income by the U.S. holder and decreased by any amortizable bond premium
deducted over the term of the debenture by the U.S. holder). Subject to the
discussion under "--Market Discount," such gain or loss should be capital gain
or loss and will be long-term capital gain or loss if the debenture had been
held by the U.S. holder for more than one year at the time of such sale,
exchange, redemption or other disposition.

Taxation of Non-U.S. Debenture Holders

Interest and OID on New Debentures. Neither interest paid by us to a non-
U.S. holder nor any original issue discount will be subject to U.S. Federal
income or withholding tax if (i) such interest is not effectively connected
with the conduct of a trade or business within the United States by such non-
U.S. holder, (ii) the non-U.S. holder does not actually or constructively own
10% or more of the total combined voting power of all of our classes of stock
entitled to vote, (iii) the non-U.S. holder is not a controlled foreign
corporation with respect to which we are a "related person" within the meaning
of the Code, and (iv) either (a) the non- U.S. holder certifies to us, under
penalties of perjury, that the non-U.S. holder is not a U.S. person and
provides the beneficial owner's name and address on a U.S. Treasury Form W-8
(or suitable substitute form) or (b) a securities clearing organization, bank
or other financial institution that holds customers' securities in the ordinary
course of its trade or business and holds the new debenture certifies, under
penalties of perjury, that such Form W-8 (or suitable substitute form) has been
received from the non-U.S. holder by it or by such a financial institution
between it and the non-U.S. holder and furnishes the payor with a copy thereof.
If the foregoing exceptions do not apply, payments on the new debentures may be
subject to U.S. withholding tax at a rate of 30% (or such lower rate as may be
applied under an applicable tax treaty).

Backup Withholding Tax and Information Reporting

U.S. Holders. In general, information-reporting requirements will apply to
certain U.S. holders with regard to payments of dividends on our stock, OID,
interest, and payments of the proceeds of the sale of our stock and debentures,
unless an exception applies.

The payor will be required to withhold tax on such payments at the rate of
30.5% (scheduled to be reduced incrementally to 28% by 2006) if (i) the payee
fails to furnish a taxpayer identification number, or TIN, to the payor or to
establish an exemption from backup withholding, or (ii) the Internal Revenue
Service notifies the payor that the TIN furnished by the payor is incorrect.

In addition, a payor of interest on our debentures or dividends on our stock
will be required to withhold tax at a rate of 30.5% (scheduled to be reduced
incrementally to 28% by 2006) if (i) there has been a notified payee under-
reporting with respect to interest, dividends or original issue discount
described in Section 3406(c) of the Code, or (ii) there has been a failure of
the payee to certify under the penalty of perjury that the payee is not subject
to backup withholding under the Internal Revenue Code.

Some holders, including corporations, may be exempt from backup withholding.
Any amounts withheld under the backup withholding rules from a payment to a
holder will be allowed as a credit against the holder's United States Federal
income tax and may entitle the holder to a refund, provided that the required
information is furnished to the Internal Revenue Service.

Non-U.S. Holders. Generally, information reporting will apply to payments of
dividends on our stock, interest, including OID, and backup withholding as
described above for a U.S. holder, unless the payee certifies that it is not a
U.S. person or otherwise establishes an exemption.

The payment of the proceeds from the disposition of our stock or debentures
to or through the U.S. office of a U.S. or foreign broker will be subject to
information reporting and backup withholding as described above for U.S.
holders unless the non-U.S. holder satisfies the requirements necessary to be
an exempt non-U.S. holder or otherwise qualifies for an exemption. The proceeds
of a disposition by a non-U.S. holder of stock or debentures to or through a
foreign office of a broker generally will not be subject to information
reporting or backup withholding. However, if the broker is a U.S. person, a
controlled foreign corporation for U.S. tax purposes, a foreign person 50% or
more of whose gross income from all sources for specified periods is from
activities that are effectively connected with a U.S. trade or business, a
foreign partnership if partners who hold more than 50% of the interests in the
partnership are U.S. persons, or a foreign partnership that is engaged in the
conduct of a trade or business in the U.S., then information reporting
generally will apply as though the payment was made through a U.S. office of a
U.S. or foreign broker.

Applicable Treasury Regulations provide presumptions regarding the status of
holders when payments to the holders cannot be reliably associated with
appropriate documentation provided to the payor. Under these Treasury
Regulations, some holders are required to provide new certifications with
respect to payments made after December 31, 2000. Because the application of
these Treasury Regulations varies depending on the stockholder's particular
circumstances, you are advised to consult your tax advisor regarding the
information reporting requirements applicable to you.

PLAN OF DISTRIBUTION

We may sell securities to one or more underwriters for public offer and sale
by them or may sell securities offered hereby to the public directly or through
agents. Any underwriter or agent involved in the offer and sale of the
securities will be named in the applicable prospectus supplement.

The distribution of the securities may be effected from time to time in one
or more transactions at a fixed price or prices, which may be changed, at
prices related to the prevailing market prices at the time of sale or at
negotiated prices (any of which may represent a discount from the prevailing
market prices). We also may, from time to time, authorize underwriters acting
as our agents to offer and sell the securities upon the terms and conditions as
are set forth in the applicable prospectus supplement. In connection with the
sale of securities, underwriters may be deemed to have received compensation
from us in the form of underwriting discounts or commissions and may also
receive commissions from purchasers of securities for whom they may act as
agent. Underwriters may sell securities to or through dealers, and such dealers
may receive compensation in the form of discounts, concessions or commissions
from the underwriters and/or commissions from the purchasers for whom they may
act as agent.

Any underwriting compensation paid by us to underwriters or agents in
connection with the offering of securities and any discounts, concessions or
commissions allowed by underwriters to participating dealers, will be set forth
in the applicable prospectus supplement. Underwriters, dealers and agents
participating in the distribution of the securities may be deemed to be
underwriters, and any discounts and commissions received by them and any profit
realized by them on resale of the securities may be deemed to be underwriting
discounts and commissions, under the Securities Act. Underwriters, dealers and
agents may be entitled, under agreements entered into with us, to
indemnification against and contribution toward certain civil liabilities,
including liabilities under the Securities Act.

If so indicated in the applicable prospectus supplement, we will authorize
the underwriters, dealers or other persons acting as our agents to solicit
offers by certain institutions to purchase securities from us at the public
offering price set forth in that prospectus supplement pursuant to delayed
delivery contracts providing for payment and delivery on the date or dates
stated in such prospectus supplement. Each contract will be for an amount not
less than, and the aggregate principal amount of securities sold pursuant to
contracts will not be less than nor greater than, the respective amounts stated
in the applicable prospectus supplement. Institutions with whom contracts, when
authorized, may be made include commercial and savings banks, insurance

companies, pension funds, investment companies, educational and charitable
institutions, and other institutions but will in all cases be subject to the
approval of us. Contracts will not be subject to any conditions except that (i)
the purchase by an institution of the securities covered by its contract will
not at the time of delivery be prohibited under the laws of any jurisdiction in
the United States to which such institution is subject; and (ii) if the
securities are being sold to underwriters, we have sold to such underwriters
the total principal amount of the securities less the principal amount thereof
covered by the contracts.

Some of the underwriters and their affiliates may be customers of, engage in
transactions with and perform services for us and our subsidiaries in the
ordinary course of business.

LEGAL MATTERS

The legality of the securities have been passed upon for us by Jaeckle
Fleischmann & Mugel, LLP. The discussion of legal matters under "Material
United States Federal Income Tax Consequences" is based upon an opinion of
Jaeckle Fleischmann & Mugel, LLP.

EXPERTS

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[SIZELER LOGO]

Sizeler Property Investors, Inc.

3,000,000 Shares

Common Stock

---------------------

PROSPECTUS SUPPLEMENT

---------------------

Ferris, Baker Watts
Incorporated

J.J.B. Hilliard, W. L. Lyons, Inc.

Advest, Inc.

Sterne, Agee & Leach, Inc.

December , 2001

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

Item 14. Other Expenses of Issuance and Distribution.

The following table sets forth the various expenses in connection with the
issuance and distribution of the securities, other than underwriting discounts
and commissions. All of the amounts shown are estimated except the Securities
and Exchange Commission ("Commission") registration fee.

Commission Registration Fee........................................ $25,000
New York Stock Exchange, Inc. Listing Fee.......................... 10,000
Blue Sky fees and expenses......................................... 5,000
Printing and engraving expenses.................................... 70,000
Trustee, Transfer Agent and Registrar Expenses..................... 5,000
Legal fees and expenses............................................ 320,000
Accounting fees and expenses....................................... 30,000
Miscellaneous...................................................... 5,000
--------
Total............................................................ $470,000
========

Item 15. Indemnification of Directors and Officers.

Sizeler Property Investors, Inc. (the "Company") is organized in the State
of Maryland. The Maryland General Corporation Law ("MGCL") permits a
corporation to include in its charter a provision limiting the liability of
its directors and officers to the corporation and its stockholders for money
damages except for liability resulting from (i) actual receipt of an improper
personal benefit or profit in money, property or services or (ii) active and
deliberate dishonesty established by a final judgment as being material to the
cause of action.

The MGCL permits a corporation to indemnify a director or officer who has
been successful, on the merits or otherwise, in the defense of any proceeding
to which the person is made a party by reason of his or her service in that
capacity. The MGCL permits a corporation to indemnify its present and former
directors and officers, among others, in connection with any proceeding to
which they may be made a party by reason of their service in those or other
capacities unless it is established that (i) the act or omission of the
indemnified party was material to the matter giving rise to the proceeding and
(a) was committed in bad faith or (b) was the result of active and deliberate
dishonesty, (ii) the indemnified party actually received an improper personal
benefit in money, property or services or (iii) in the case of any criminal
proceeding, the indemnified party had reasonable cause to believe that the act
or omission was unlawful.

The indemnity may include judgments, penalties, fines, settlements and
reasonable expenses actually incurred by the director or officer in connection
with the proceeding; provided, however, that if the proceeding is one by or in
the right of the Maryland corporation, indemnification is not permitted with
respect to any proceeding in which the director or officer has been adjudged
to be liable to the corporation.

In addition, a director or officer of a Maryland corporation may not be
indemnified with respect to any proceeding charging improper personal benefit
to the director or officer in which the director or officer was adjudged to be
liable on the basis that personal benefit was improperly received. The
termination of any proceeding by conviction or upon a plea of nolo contendere
or its equivalent or an entry of an order of probation prior to judgment
creates a rebuttal presumption that the director or officer did not meet the
requisite standard of conduct required for permitted indemnification. The
termination of any proceeding by judgment, order or settlement, however, does
not create a presumption that the director or officer did not meet the
requisite standard of conduct for permitted indemnification.

As a condition to advancing expenses to a director who is a party to a
proceeding, the MGCL requires the Company to obtain (a) a written affirmation
by the director or officer of his or her good faith belief that he or

II-1

she has met the standard of conduct necessary for indemnification by is and
(b) a written statement by or on his or her behalf to repay the amount paid or
reimbursed by the Company if it shall ultimately be determined that the
standard of conduct was not met.

The Company's Charter provides that the Company will indemnify its
directors and officers, whether serving the Corporation or at its request any
other entity, to the full extent required or permitted by Maryland law,
including the advance of expenses under the procedures and to the full extent
permitted by law. The Company's Charter contains a provision which limits a
director's or officer's personal liability for monetary damages to the Company
or its stockholders. The Company's Charter also provides that the Company will
indemnify other employees and agents to the extent authorized by the Company's
board of directors or the Company's Bylaws. The Bylaws of the Company do not
authorize any such indemnification for non-director, non-officer employees or
agents.

The Company has entered into an indemnification agreement (the
"Indemnification Agreement") with each of its directors and officers, and the
Board of Directors has authorized the Company to enter into an Indemnification
Agreement with each of the future directors and officers of the Company. The
MGCL permits a corporation to indemnify its directors and officers. However,
the protection that is specifically afforded by the MGCL authorizes other
arrangements for indemnification of directors and officers, including
insurance. The Indemnification Agreement is intended to provide
indemnification to the maximum extent allowable by, or not in violation of, or
offensive to, any law of the State of Maryland.

The Indemnification Agreement provides that the Company shall indemnify a
director or officer who is a party to the agreement (the "Indemnitee"), if he
or she was or is a party to or otherwise involved in any proceeding by reason
of the fact that he or she was or is a director or officer of the Company, or
was or is serving at its request in a certain capacity of another entity,
against losses incurred in connection with the defense or settlement of such
proceeding. This indemnification shall be provided to the fullest extent
permitted by the Indemnification Agreement. This is similar to the
indemnification provided by the MGCL except that indemnification is not
available under the Indemnification Agreement to the Indemnitee who pays any
amount in settlement of a proceeding without the Company's written consent.

Item 16. Exhibits.

The following exhibits are included as part of this Registration Statement:

1* Form of underwriting agreement.

3.1 Articles of Incorporation of the Registrant (incorporated by reference
to exhibit 3(i) of the Registrant's Form 8-K filed with the SEC on June
26, 2001).

3.2 Bylaws, as amended, of the Registrant (incorporated by reference to
exhibit 3.2 of the Registrant's Registration Statement on Form S-4 filed
with the SEC on October 25, 2001).

4.1 Form of Articles Supplementary creating Registrant's 10.0% Series B
Cumulative Redeemable Preferred Stock (incorporated by reference to
Exhibit 4.1 of the Registrant's Registration Statement on Form S-4 filed
with the SEC on October 25, 2001).

4.2 Form of Indenture for the Registrant's 9.0% Cumulative Subordinated
Debentures due 2009 (incorporated by reference to exhibit 4.3 of the
Registrant's Registration Statement on Form S-4 filed with the SEC on
October 25, 2001).

4.3* Form of Warrant Agreement.

5* Opinion of Jaeckle Fleischmann & Mugel, LLP regarding legality of
securities being registered.

8* Opinion of Jaeckle Fleischmann & Mugel, LLP regarding certain tax
matters.

12 Statement of ratio of earnings to fixed charges (incorporated by
reference to exhibit 12 to the Registrant's Registration Statement on
Form S-3 filed with the SEC on October 25, 2001).

23.1 Consent of KPMG LLP (filed herewith).

23.2 Consent of Jaeckle Fleischmann & Mugel, LLP (incorporated by reference
to Exhibit 5).

24 Powers of Attorney (incorporated by reference to exhibit 24 of the
Registrant's Registration Statement on Form S-3 filed with the SEC on
October 25, 2001).

25* Statement of Eligibility of Trustee.

II-2

--------
* To be filed, if applicable, subsequent to the effectiveness of this
registration statement by an amendment to the registration statement or
incorporated by reference pursuant to a Current Report on Form 8-K in
connection with the offering of securities.

Item 17. Undertakings.

(a) The undersigned Registrant hereby undertakes:

(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement:

(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933, as amended (the "Securities Act");

(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the Registration Statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20 percent change
in the maximum aggregate offering price set forth in the "Calculation
of Registration Fee" table in the effective Registration Statement; and

(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the Registration Statement
or any material change to such information in the Registration
Statement;

provided, however, that (a)(1)(i) and (a)(1)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the Registrant pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in the
Registration Statement.

(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a
new Registration Statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.

(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.

(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.

(c) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Commission such indemnification is
against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses incurred or
paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities
being registered, the Registrant will, unless in the opinion of its counsel
the matter has been settled by controlling precedent, submit

II-3

to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities
Act and will be governed by the final adjudication of such issue.

(d) The undersigned registrant hereby undertakes to file an application for
the purpose of determining the eligibility of the trustee to act under
subsection (a) of Section 310 of the Trust Indenture Act in accordance with
the rules and regulations prescribed by the Commission under Section 305(b)(2)
of the Act.

II-4

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this amendment to the
Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Kenner, State of Louisiana as of the
3rd day of December 2001.

Sizeler Property Investors, Inc.

/s/ Thomas A. Masilla, Jr.
By:__________________________________
Thomas A. Masilla, Jr.
Vice Chairman, President and
Principal Operating Officer

II-5

Pursuant to the requirements of the Securities Act of 1933, this amendment
to the Registration Statement has been signed by Thomas A. Masilla, Jr. on
December 3, 2001, individually and as attorney-in-fact for the following
persons:

Signature Title
--------- -----

Sidney W. Lassen Chairman of the Board and
Chief Executive Officer
(Principal Executive
Officer)

Thomas A. Masilla, Jr. Vice Chairman, President /s/ Thomas A. Masilla, Jr.
and Director (Principal ---------------------------
Operating Officer) Thomas A. Masilla, Jr.
Individually and as
Attorney-in-Fact
Robert A. Whelan Chief Financial Officer
(Chief Financial and
Principal Accounting
Officer)

J. Terrell Brown Director

Francis L. Fraenkel Director

Harold B. Judell Director

James W. MacFarland Director

Richard L. Pearlstone Director

Theodore H. Strauss Director

II-6