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News Release

Federal Realty Investment Trust Announces First Quarter 2004 Operating Results

ROCKVILLE, Md.--(BUSINESS WIRE)--May 5, 2004--Federal Realty Investment Trust (NYSE:FRT) today reported operating results for its first quarter ended March 31, 2004.

    --  Funds from Operations (FFO) per diluted share increased 7.8%
        over first quarter 2003.

    --  Earnings per diluted share increased 7.7% versus the quarter
        ending March 31, 2003.

    --  Compared to first quarter 2003, same-center property
        operating income increased 3.7% excluding redevelopments and
        expansions, and 4.0% including redevelopments and expansions.

    --  Cash rent increases on lease rollovers were 17.0% for the
        first quarter on 375,000 square feet of comparable retail
        space.

    --  FFO per diluted share guidance for 2004 was increased to a
        range of $2.81 to $2.84.

    Financial Results

Federal Realty reported FFO per diluted share of $0.69 in first quarter 2004, a 7.8% increase over the $0.64 reported in first quarter 2003. On an absolute basis, FFO available to common shareholders was $34.8 million for the first quarter of 2004 compared to $28.9 million for last year's first quarter. Net income available for common shareholders was $14.4 million, and earnings per diluted share were $0.28 for the quarter ended March 31, 2004, versus $11.5 million and $0.26, respectively, for the first quarter of 2003.

Donald Wood, Federal Realty's President and Chief Executive Officer commented, "In the first quarter of 2004, we continued to successfully execute all aspects of the Trust's business plan. We increased the value of our existing portfolio through re-leasing and redevelopment, we acquired Westgate Mall, an asset that is accretive today and whose performance will improve through the recapture of spaces that currently have under-market rents, and we accessed both the public debt and equity markets to further improve our financial flexibility and strengthen our balance sheet."

Portfolio Results

On a same-center basis, including redevelopment and expansion properties, property operating income increased 4.0% over first quarter 2003. When redevelopment and expansion properties are excluded from the same-center results, property operating income increased 3.7% from first quarter 2003.

As of March 31, 2004, Federal Realty's same-center portfolio was 96.2% leased compared to 96.0% on December 31, 2003, and 96.2% on March 31, 2003. Overall, the Trust's portfolio was 93.3% leased as of March 31, 2004, compared to 93.1% on December 31, 2003, and 94.3% on March 31, 2003.

During the first quarter, the Trust signed 84 leases for over 450,000 square feet of retail space. On a comparable space basis (i.e. spaces for which there was a former tenant), the Trust leased 375,000 square feet at a weighted-average cash-basis contractual rent increase per square foot (i.e. excluding the impact of straight-line rents) of 17.0%. The weighted-average contractual rent on this comparable space for the first year of the new lease is $21.98 per square foot compared to the weighted-average contractual rent of $18.78 per square foot for the last year of the prior lease. The previous weighted-average contractual rent is calculated by including both the minimum rent and the percentage rent actually paid during the last year of the lease term for the re-leased space. On a GAAP basis (i.e. including the impact of straight-line rents), rent increases per square foot for comparable retail space were 26.9% for the first quarter of 2004. As of March 31, 2004, Federal Realty's weighted-average contractual rent for retail and commercial space in its portfolio was $18.04 per square foot.

At Santana Row, Federal Realty's mixed-use community in San Jose, Calif., 90% of the retail space was leased to 102 tenants as of March 31, 2004. With respect to the residential component of Santana Row, 95% of the 255 existing residential units were leased as of March 31, 2004, and the development of the 256 Phase IV residential units remains on schedule and on budget.

Guidance

Federal Realty is today increasing guidance for 2004 FFO per diluted share to a range of $2.81 to $2.84, or $1.22 to $1.25 of earnings per diluted share.

    Summary of Other Quarterly Activities and Recent Developments

    --  April 2, 2004 - Federal Realty sold approximately 2.2 million
        common shares of beneficial interest in a public offering
        underwritten by Wachovia Securities and Legg Mason Wood Walker
        Incorporated. The sale generated approximately $99.1 million
        of proceeds to the Trust, or $45.33 per share, a 3.00%
        discount from the previous day's New York Stock Exchange
        closing price of $46.73. The Trust used the net proceeds from
        the sale to repay the amounts outstanding under its revolving
        credit facility, which had been used to acquire Westgate Mall
        on March 31, 2004.

    --  March 31, 2004 - Federal Realty announced the acquisition of
        Westgate Mall, a 637,000 square foot shopping center in San
        Jose, California. The Trust acquired the fee interest in the
        shopping center for $97.0 million in cash from a private
        owner. Federal Realty expects to increase the value of the
        property through the re-leasing of retail space that is
        currently substantially below market. In addition, the Trust
        is evaluating potential long-term redevelopment opportunities
        for the shopping center. Westgate Mall was 98% leased as of
        March 31, 2004, with the tenancy consisting primarily of
        strong national and regional merchants including Safeway,
        Target, Burlington Coat Factory, Ross Dress For Less,
        Nordstrom Rack, Barnes & Noble, Any Mountain Sporting Goods,
        Old Navy, and Michaels.

    --  March 3, 2004 - Federal Realty announced that its Board of
        Trustees had declared a regular quarterly cash dividend of
        $0.49 per share on its common shares, resulting in an
        indicated annual rate of $1.96 per share.

    --  January 21, 2004 - Federal Realty priced a $75 million
        offering of seven-year senior unsecured notes. The 4.50% notes
        are due February 15, 2011, and were offered at 99.698% of par.
        Proceeds from the offering were primarily used to repay
        existing corporate debt.

    --  January 13, 2004 - Federal Realty increased its previously
        issued FFO per diluted share guidance for 2003 to $2.69, and
        to a range of $2.78 to $2.82 for 2004. The increase in FFO
        guidance resulted from the final settlement of the Santana Row
        fire insurance claim.

    --  January 5, 2004 - Federal Realty announced the sale of four
        Street Retail properties, totaling 62,000 square feet, in West
        Hartford, Conn. - 967 and 970 Farmington Avenue, 27-43 LaSalle
        Road, and 1253 New Britain Avenue - for $15.7 million,
        generating a book gain of approximately $7.9 million. The
        sales price reflects a 7.6% capitalization rate based on
        Federal Realty's estimates of forward 12-month property
        operating income.

    Conference Call Information

Federal Realty's management team will present an in-depth discussion of the Trust's operating performance on its first quarter earnings conference call, which is scheduled for Thursday, May 6, 2004, at 11 a.m. EDT. To participate, please call (888) 566-5771 five to ten minutes prior to the call's start time and use the Passcode EARNINGS (required). The conference leader is Andrew Blocher. Federal Realty will also provide an online Web Simulcast on the company's Web site, www.federalrealty.com, which will remain available for 14 days following the call. A telephone recording of the call will also be available for 14 days by dialing (800) 679-9654.

Federal Realty Investment Trust is an equity real estate investment trust specializing in the ownership, management, development, and redevelopment of shopping centers and Street Retail properties. Federal Realty's portfolio contains approximately 16.9 million square feet located primarily in strategic metropolitan markets in the Northeast, Mid-Atlantic, and California. The operating portfolio was approximately 93% leased to more than 2,200 national, regional, and local retailers as of March 31, 2004, with no single tenant accounting for more than 2.4 % of rental revenue. Federal Realty has paid quarterly dividends to its shareholders continuously since its founding in 1962, and has increased its dividend rate for 36 consecutive years, the longest consecutive record in the REIT industry.

Shares of Federal Realty are traded on the NYSE under the symbol FRT. Additional information about Federal Realty can be found on the Internet at www.federalrealty.com.

Safe Harbor Language

Certain matters discussed within this press release may be deemed to be forward-looking statements within the meaning of the federal securities laws. Although Federal Realty believes the expectations reflected in the forward-looking statements are based on reasonable assumptions, it can give no assurance that its expectations will be attained. The factors that may impact these expectations include:

    --  risks of financing, such as our ability to meet existing
        financial covenants and the possibility of increases in rental
        rates that would result in increased interest expense;

    --  risks that our growth will be limited if we cannot obtain
        additional capital;

    --  risks normally associated with the real estate industry,
        including risks that our tenants will not pay rent or that we
        may be unable to renew leases or relet space at favorable
        rents as leases expire, that new acquisitions or our
        development, construction and renovation projects may fail to
        perform as expected, that competition for acquisitions could
        result in increased prices, that we may have environmental
        risks at our properties, and, because real estate is illiquid,
        that we may not be able to sell properties when appropriate;

    --  risks that we may not proceed with or obtain necessary
        approvals for any redevelopment, and that any redevelopment or
        expansion that we do pursue may not perform as anticipated;

    --  risks related to our status as a REIT for federal income tax
        purposes, such as the existence of complex regulations
        relating to our status as a REIT, the effect of future changes
        in REIT requirements as a result of new legislation and the
        adverse consequences of the failure to qualify as a REIT; and

    --  those additional risks detailed from time to time in our SEC
        reports, including our annual report on Form 10-K, our
        quarterly reports on Form 10-Q, and our statement of risk
        factors on Form 8-K.

Federal Realty assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events.


Federal Realty Investment Trust
Summarized Operating Results
March 31, 2004

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

                         Financial Highlights
                 (in thousands, except per share data)
                              (unaudited)
OPERATING RESULTS                                      Three months
                                                      ended March 31,
----------------------------------------------------
                                                       2004     2003
                                                     -------- --------

Revenue
    Rental income                                    $89,643  $79,247
    Other property income                              5,091    4,083
    Interest and other income                          1,439    1,215
                                                     -------- --------
                                                      96,173   84,545

Expenses
    Rental                                            22,401   21,527
    Real estate taxes                                  9,223    7,736
                                                     -------- --------
        Total property operating expenses             31,624   29,263
                                                     -------- --------
    Property operating income  (1)                   64,549   55,282

    Interest                                          21,319   17,579
    Administrative                                     4,182    3,274
    Depreciation and amortization                     20,622   17,333
                                                     -------- --------
        Total other expenses                          46,123   38,186
                                                     -------- --------

Income before minority interests and discontinued
 operations                                           18,426   17,096

Minority Interests                                    (1,189)  (1,070)
                                                     -------- --------
Income from continuing operations                     17,237   16,026
                                                     -------- --------

    Operating income from discontinued operations        (48)     350
    Gain on sale of real estate                           57        -
                                                     -------- --------
Income from discontinued operations                        9      350
                                                     -------- --------

Net income                                            17,246   16,376

Dividends on preferred stock                          (2,869)  (4,856)
                                                     -------- --------
Net income available for common shareholders         $14,377  $11,520
                                                     ======== ========


FUNDS FROM OPERATIONS AVAILABLE FOR COMMON SHAREHOLDERS
--------------------------------------------------------------

  Net income available for common shareholders       $14,377  $11,520
  Gain on sale of real estate                            (57)       -
  Depreciation and amortization of real estate
   assets                                             18,726   15,798
  Amortization of initial direct costs of leases       1,498    1,354
  Income attributable to operating partnership units     235      206
                                                     -------- --------
  Funds from operations available for common
   shareholders                                      $34,779  $28,878
                                                     ======== ========

  Weighted average number of common shares, diluted   50,613   45,354
                                                     ======== ========

  Funds from operations per share                      $0.69    $0.64
                                                     ======== ========

EARNINGS PER COMMON SHARE, BASIC
----------------------------------------------------
      Income from continuing operations                $0.29    $0.25
      Discontinued operations                           0.00     0.01
                                                     -------- --------
                                                       $0.29    $0.26
                                                     ======== ========

          Weighted average number of common shares,
           basic                                      49,163   44,271
                                                     ======== ========

EARNINGS PER COMMON SHARE, DILUTED
----------------------------------------------------
      Income from continuing operations                $0.28    $0.25
      Discontinued operations                           0.00     0.01
                                                     -------- --------
                                                       $0.28    $0.26
                                                     ======== ========

       Weighted average number of common shares,
        diluted                                       50,613   45,354
                                                     ======== ========


(1)  See Glossary of Terms

Federal Realty Investment Trust
Summarized Balance Sheet
March 31, 2004
----------------------------------------------------------------------

                         Financial Highlights
                 (in thousands, except per share data)

CONSOLIDATED BALANCE SHEETS
-----------------------------------------------
                                                 March      December
                                                   31,         31,
                                                  2004        2003
                                               ----------- -----------
                                               (unaudited)
ASSETS

Real estate, at cost
  Operating                                    $2,491,842  $2,342,315
  Development                                     105,106     127,834
                                               ----------- -----------
                                                2,596,948   2,470,149
  Less accumulated depreciation and
   amortization                                  (532,280)   (514,177)
                                               ----------- -----------
Net real estate investments                     2,064,668   1,955,972

Cash and cash equivalents                          27,940      34,968
Mortgage notes receivable                          42,419      41,500
Accounts receivable                                34,916      31,207
Other assets                                       79,112      79,788
                                               ----------- -----------
TOTAL ASSETS                                   $2,249,055  $2,143,435
                                               =========== ===========

LIABILITIES AND SHAREHOLDERS' EQUITY

Liabilities
    Obligations under capital leases, mortgages
     and construction loans                      $413,528    $414,357
    Notes payable                                 426,537     361,323
    Senior notes and debentures                   570,500     535,000
    Other liabilities                             125,899     111,799
                                               ----------- -----------
Total liabilities                               1,536,464   1,422,479

Minority interests                                 28,952      29,582

Shareholders' equity
    Preferred stock                               135,000     135,000
    Common shares and other shareholders'
     equity                                       548,639     556,374
                                               ----------- -----------
Total shareholders' equity                        683,639     691,374
                                               ----------- -----------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY     $2,249,055  $2,143,435
                                               =========== ===========

Federal Realty Investment Trust
Reconciliation of 2004 EPS to 2004 FFO Guidance
March 31, 2004
----------------------------------------------------------------------
($ millions except per share amounts)
                                           Forecast      Per Share
                                           ---------    -----------

 Net Income Available to Common               to             to
  Shareholders                            $63     $65  $1.22    $1.25
 Depreciation and Amortization of
  Real Estate Assets                       82      82   1.57     1.57
 Income Attributable to Operating
  Partnership Units                         1       1   0.02     0.02
                                     ---------   ----- ------   ------
 Funds from Operations                   $146 to $148  $2.81 to $2.84
                                     =========   ===== ======   ======

 Weighted Average Shares (diluted)       52.1

CONTACT: Federal Realty Investment Trust
Investor Inquiries:
Andrew Blocher, 301-998-8166
ablocher@federalrealty.com
or
Media Inquiries:
Kristine Warner, 301-998-8212
kwarner@federalrealty.com

SOURCE: Federal Realty Investment Trust