CHELSEA PROPERTY GROUP, INC.
103 EISENHOWER PARKWAY
ROSELAND, NEW JERSEY 07068

PROXY STATEMENT

          The accompanying Proxy is solicited by the Board of Directors of Chelsea Property Group, Inc., a Maryland corporation (the “Company”), for use at a Special Meeting of Stockholders (the “Meeting”) to be held on January 16, 2003, at 10:00 in the morning, or any adjournment thereof, at which stockholders of record at the close of business on December 4, 2002 shall be entitled to vote. The cost of solicitation of proxies will be borne by the Company. The Company has retained The Altman Group, Inc. to assist in the solicitation of proxies for a fee estimated at $10,000, plus out-of-pocket expenses. The Company also may use the services of its Directors, officers, employees and others to solicit proxies, personally or by telephone; arrangements may also be made with brokerage houses and other custodians, nominees, fiduciaries and stockholders of record to forward solicitation material to the beneficial owners of stock held of record by such persons. The Company may reimburse such solicitors for reasonable out-of-pocket expenses incurred by them in soliciting, but no compensation will be paid for their services.

          Each proxy executed and returned by a stockholder may be revoked at any time before it is voted by timely submission of written notice of revocation or by submission of a duly executed proxy bearing a later date (in either case directed to the Secretary of the Company) or, if a stockholder is present at the Meeting, he may elect to revoke his proxy and vote his shares personally. The date of this Proxy Statement is the approximate date on which this Proxy Statement and form of Proxy were first sent or given to stockholders.

           Stockholders of record may vote either via the Internet or by telephone. Specific instructions to be followed by registered stockholders interested in voting via the Internet or the telephone are shown on the enclosed proxy card. The Internet and telephone voting procedures are designed to authenticate the stockholder's identity and to allow stockholders to vote their shares and confirm that their instructions have been properly recorded.

          On December 4, 2002, the Company had outstanding and entitled to vote with respect to all matters to be acted upon at the Meeting 41,459,414 shares of Common Stock. Each holder of Common Stock is entitled to one vote for each share of stock held by such holder. The presence of holders representing a majority of all the votes entitled to be cast at the Meeting will constitute a quorum at the Meeting. In accordance with Maryland law, abstentions, but not broker non-votes, are counted for purposes of determining the presence or absence of a quorum for the transaction of business. Each proposal must receive the affirmative vote of the holders of at least two-thirds of the outstanding shares of Common Stock entitled to vote thereon at the Meeting in order to be approved. Abstentions and broker non-votes are not counted in determining the votes cast with respect to any of the matters submitted to a vote of stockholders. Accordingly, abstentions and broker non-votes will have the same effect as votes against the proposals.

          It is expected that the following business will be considered at the Meeting and action taken thereon:

1. AMENDMENT TO ARTICLES OF INCORPORATION INCREASING
AUTHORIZED SHARES

          Pursuant to Article IV of its Restated Articles of Incorporation, as amended, the Company is presently authorized to issue 50,000,000 shares of Common Stock with a par value of $.01 per share. In May 2002, the Company effected a two-for-one stock split of its Common Stock, but did not at that time double the authorized number of shares of Common Stock. Accordingly, it is proposed to amend paragraph A of Article IV of the Articles of Incorporation of the Company to read as set forth below in order to increase the number of shares of Common Stock which the Company is authorized to issue from 50,000,000 to 100,000,000 shares of Common Stock:

          At December 4, 2002, there were 41,459,414 shares of Common Stock issued and outstanding and 9,459,652 shares were reserved for issuance upon exercise of vested stock options and conversion of limited partnership units. Until the approval of the amendment, certain holders of the units have agreed not to convert their units into Common Stock. As the result, no shares are presently available for future issuance by the Board of Directors.

           The Board of Directors believes that it is in the best interests of the Company and its stockholders to increase the number of authorized shares of Common Stock. The increase in authorized shares will provide flexibility with respect to future transactions, including acquisitions of other businesses where the Company would have the option to use its common stock (or securities convertible into or exercisable for common stock) as consideration (rather than cash), financing future growth, financing transactions, stock splits and other corporate purposes. The additional shares will enable the Company to avoid the time consuming and costly need to hold a special meeting of stockholders in every case. The Board of Directors believes that, in the future, occasions may arise where the time required to obtain stockholder approval might adversely delay the Company's ability to enter into a desirable transaction or deny it the flexibility to facilitate the effective use of its securities. Authorized but unissued shares of Common Stock may be used by the Company from time to time as appropriate and opportune situations arise.

          Stockholders of the Company will not have any preemptive rights with respect to the additional shares being authorized. No further approval by stockholders would be necessary prior to the issuance of any additional shares of Common Stock, except as may be required by law or applicable New York Stock Exchange rules. In certain circumstances, generally relating to the number of shares to be issued and the identity of the recipient, the rules of the New York Stock Exchange require stockholder authorization in connection with the issuance of such additional shares. Subject to law and the rules of the New York Stock Exchange, the Board of Directors has the sole discretion to issue additional shares of Common Stock on such terms and for such consideration as may be determined by the Board of Directors. The issuance of any additional shares of Common Stock may have the effect of diluting the percentage of stock ownership of the present stockholders of the Company.

2. AMENDMENT TO ARTICLES OF INCORPORATION GRANTING POWER TO
BOARD OF DIRECTORS TO INCREASE AUTHORIZED SHARES

           In 1999, Maryland law was amended to specifically authorize a company to have a provision in its Articles of Incorporation which eliminates the further requirement to seek stockholder approval for increases in capitalization. The Company believes it is advantageous to avail itself of these benefits. Currently, the Company is required to obtain the approval of its Board of Directors and its stockholders each time it proposes to increase its number of authorized shares of stock.

           It is proposed to amend Article V of the Articles of Incorporation of the Company to add a new Paragraph H immediately after the existing Paragraph G to read as set forth below:

          The Board of Directors believes it is in the best interests of the Company and its stockholders to have the flexibility to increase its authorized shares of capital stock without the time consuming and costly need to hold future special meetings. The Board of Directors believes that, in the future, occasions may arise where the time required to obtain stockholder approval might adversely delay the Company’s ability to enter into a desirable transaction or deny it the flexibility to facilitate the effective use of its securities.

           The proposals may have anti-takeover effects. While the proposals might have such an effect, the Board of Directors does not intend or view the proposals as anti-takeover measures because of existing provisions in the Company's Articles of Incorporation limiting ownership of its stock in order to maintain its qualification as a REIT under the Internal Revenue Code.

           The Board of Directors of the Company recommends a vote FOR the authorization and approval of the proposals.

Security Ownership of Certain Beneficial Owners and Management

        As of November 22, 2002, to the knowledge of the Company, the following is a schedule of all persons who beneficially owned more than 5% of the outstanding stock of the Company:

                                                 Number of Shares       Percent
Name and Address                                Beneficially Owned      of Stock
----------------                                ------------------      --------

Taunus Corporation (1)                                3,878,002           9.4%
31 W. 52nd Street
New York, NY 10019

Cohen & Steers Realty et al.                          3,264,550           7.9%
757 Third Avenue
New York, NY 10017

David C. Bloom                                        2,512,922           5.7%
c/o Chelsea Property Group, Inc.
103 Eisenhower Parkway
Roseland, NJ 07068(2)

(1)      Includes shares owned by RREEF America, L.L.C.

(2)      Includes limited partnership interests in the Partnership (the "Units") convertible into shares of Common Stock of the Company and vested options to purchase shares of Common Stock under the Company's stock option plans.

          The following table sets forth information concerning the security ownership of directors and executive officers as of November 22, 2002.

                                                 Number of Shares       Percent
Name                                           Beneficially Owned(1)    of Stock
----                                           ------------------       --------

David C. Bloom(2)                                     2,512,922           5.7%
William D. Bloom (2)                                  1,070,470           2.5%
Brendan T. Byrne (2)                                     48,000             *
Leslie T. Chao(2)                                       573,760           1.4%
Thomas J. Davis(2)                                      140,000             *
Robert Frommer(2)                                        79,560             *
Barry M. Ginsburg(2)(3)                                 759,916           1.8%
Philip D. Kaltenbacher(2)(4)                            799,238           1.9%
Reuben S. Leibowitz(2)(5)                               145,200             *
Michael J. Clarke(2)                                     78,806             *
Directors and Executive officers as a
    group(6) (21 persons)                             6,682,010          14.0%

___________________

*        Less than 1%

(1)      Includes Units which are convertible into shares of Common Stock of the Company.
(2)      Includes vested options to purchase shares of Common Stock granted under the Company's stock option plans.
(3)      Includes Units beneficially owned by Mr. Ginsburg's family and trusts for the benefit of Mr. Ginsburg's family.
(4)      Includes 371,862 Units owned by Mr. Kaltenbacher as trustee for his daughters and 2,000 Units owned by Mr. Kaltenbacher's wife, as to which Mr. Kaltenbacher disclaims beneficial ownership.
(5)      Includes 34,000 shares of Common Stock owned by the wife or children of Mr. Leibowitz, by a foundation or by a charitable organization and 4,200 shares owned by the mother-in-law of Mr. Leibowitz. Mr. Leibowitz disclaims beneficial ownership of all these shares.
(6)      Includes Units convertible into 4,323,026 shares of Common Stock and vested options to purchase 1,852,008 shares of Common Stock granted under the Option Plans.

3. OTHER MATTERS

Stockholder Proposals

           Proposals of stockholders intended to be presented at the Company's 2003 Annual Meeting of Stockholders must be received by the Company on or prior to December 27, 2002 to be eligible for inclusion in the Company's Proxy Statement and form of Proxy to be used in connection with such meeting.

Other Business

           At the date of this Proxy Statement, the only business which the Board of Directors intends to present or knows that others will present at the Meeting is that hereinabove set forth. If any other matter or matters are properly brought before the meeting, or any adjournment thereof, it is the intention of the persons named in the accompanying form of Proxy to vote the Proxy on such matters in accordance with their judgment.

Dated: December 10, 2002