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News Release

Federal Realty Investment Trust Announces First Quarter 2008 Operating Results

ROCKVILLE, Md., May 7 /PRNewswire-FirstCall/ -- Federal Realty Investment Trust (NYSE: FRT) today reported operating results for its first quarter ended March 31, 2008.

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    -- Funds from operations available for common shareholders (FFO) per
       diluted share was $0.94 and earnings per diluted share was $0.51 for
       first quarter 2008, compared to $0.88 and $0.41, respectively, for
       first quarter 2007.

    -- Same-center property operating income for first quarter 2008 increased
       3.7% including redevelopments and expansions, and 3.1% excluding
       redevelopments and expansions, over first quarter 2007.

    -- Rent increases on lease rollovers of comparable retail space for first
       quarter 2008 were 23% on a cash-basis and 37% on a GAAP-basis.

    -- Guidance for 2008 FFO per diluted share remains unchanged at $3.89 to

    Financial Results

In first quarter 2008, Federal Realty generated FFO of $55.4 million, or $0.94 per diluted share. This compares to FFO of $49.6 million, or $0.88 per diluted share in first quarter 2007. Net income available for common shareholders was $29.9 million and earnings per diluted share was $0.51 for the quarter ended March 31, 2008 versus $23.1 million and $0.41, respectively, for first quarter 2007.

FFO is a non-GAAP supplemental earnings measure which the Trust considers meaningful in measuring its operating performance. A reconciliation of FFO and FFO per diluted share to net income is attached to this press release.

Portfolio Results

In first quarter 2008, same-center property operating income, including redevelopment and expansion properties, increased 3.7% over first quarter 2007. When redevelopment and expansion properties are excluded from same- center results, property operating income for first quarter 2008 increased 3.1% compared to first quarter 2007.

The Trust's overall portfolio was 96.1% leased as of March 31, 2008, compared to 96.6% on March 31, 2007. Federal Realty's same-center portfolio was 96.2% leased on March 31, 2008, compared to 96.9% on March 31, 2007.

During first quarter 2008, the Trust signed 85 leases for 296,000 square feet of retail space. On a comparable space basis (i.e., spaces for which there was a former tenant), the Trust leased 269,000 square feet at an average cash-basis contractual rent increase per square foot (i.e., excluding the impact of straight-line rents) of 23%. The average contractual rent on this comparable space for the first year of the new lease is $29.29 per square foot compared to the average contractual rent of $23.73 per square foot for the last year of the prior lease. The previous 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 averaged 37% for first quarter 2008.

"We remain pleased with the performance of the core portfolio as we, along with the consumer and retailers, continue to navigate this uncertain economic environment," commented Donald C. Wood, president and chief executive officer of Federal Realty Investment Trust. "There is no doubt that our focus on owning and operating high quality retail and mixed-use assets in some of the nation's strongest markets will benefit our shareholders both in the near- term, as we gain clarity with respect to economic conditions, and for the long-term."

Regular Quarterly Dividends

Federal Realty also announced today that its Board of Trustees left the regular dividend rate on its common shares unchanged, declaring a regular quarterly cash dividend of $0.61 per share on its common shares, resulting in an indicated annual rate of $2.44 per share. The regular common dividend will be payable on July 15, 2008 to common shareholders of record as of June 24, 2008.


Federal Realty left its guidance for 2008 FFO per diluted share unchanged at a range of $3.89 to $3.94, and revised its 2008 earnings per diluted share guidance to a range of $2.10 to $2.15.

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 May 8, 2008, at 12 p.m. Eastern Daylight Time. To participate, please call (866) 770-7146 five to ten minutes prior to the call's start time and use the passcode FRT 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 30 days following the call. A telephone recording of the call will also be available through June 6, 2008, by dialing (888) 286- 8010 and using the passcode 85669510.

About Federal Realty

Federal Realty Investment Trust is an equity real estate investment trust specializing in the ownership, management, development, and redevelopment of high quality retail assets. Federal Realty's portfolio (excluding joint venture properties) contains approximately 18.2 million square feet located primarily in strategically selected metropolitan markets in the Northeast, Mid-Atlantic, and California. In addition, the Trust has an ownership interest in approximately 1.0 million square feet of retail space through a joint venture in which the Trust has a 30% interest. Our operating portfolio (excluding joint venture properties) was 96.1% leased to national, regional, and local retailers as of March 31, 2008, with no single tenant accounting for more than approximately 2.7% of annualized base rent. Federal Realty has paid quarterly dividends to its shareholders continuously since its founding in 1962, and has increased its dividend rate for 40 consecutive years, the longest record in the REIT industry. Federal Realty is an S&P MidCap 400 company and its shares are traded on the NYSE under the symbol FRT.

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. These factors include, but are not limited to, the risk factors described in our Annual Report on Form 10-K filed on February 27, 2008 and include the following:

    -- risks that our tenants will not pay rent or that we may be unable to
       renew leases or re-let space at favorable rents as leases expire;

    -- risks that we may not be able to proceed with or obtain necessary
       approvals for any redevelopment or renovation project, and that
       completion of anticipated or ongoing property redevelopments or
       renovations may cost more, take more time to complete, or fail to
       perform as expected;

    -- risks that the number of properties we acquire for our own account, and
       therefore the amount of capital we invest in acquisitions, may be
       impacted by our real estate partnership;

    -- risks normally associated with the real estate industry, including
       risks that occupancy levels at our properties and the amount of rent
       that we receive from our properties may be lower than expected, that
       new acquisitions may fail to perform as expected, that competition for
       acquisitions could result in increased prices for acquisitions, that
       environmental issues may develop at our properties and result in
       unanticipated costs, and, because real estate is illiquid, that we may
       not be able to sell properties when appropriate;

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

    -- risks of financing, such as our ability to consummate additional
       financings or obtain replacement financing on terms which are
       acceptable to us, our ability to meet existing financial covenants and
       the limitations imposed on our operations by those covenants, and the
       possibility of increases in interest rates that would result in
       increased interest expense; and

    -- risks related to our status as a real estate investment trust, commonly
       referred to as a REIT, for federal income tax purposes, such as the
       existence of complex tax 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.

Given these uncertainties, readers are cautioned not to place undue reliance on any forward-looking statements that we make, including those in this press release. Except as may be required by law, we make no promise to update any of the forward-looking statements as a result of new information, future events or otherwise. You should carefully review the risks and risk factors included in our Annual Report on Form 10-K filed February 27, 2008.

    Investor and Media Inquiries

    Andrew Blocher
    Senior Vice President,
    Capital Markets and Investor Relations

    Vikki Kayne
    Vice President,
    Marketing and Corporate Communications

    Federal Realty Investment Trust
    Summarized Balance Sheets
    March 31, 2008

                                                 March 31,        December 31,
                                                   2008              2007
                                                       (in thousands)
    ASSETS                                      (unaudited)

    Real estate, at cost
      Operating                                 $3,350,969        $3,304,922
      Construction-in-progress                     143,834           147,925
                                                 3,494,803         3,452,847
    Less accumulated depreciation and
     amortization                                 (778,805)         (756,703)
    Net real estate                              2,715,998         2,696,144

    Cash and cash equivalents                       27,654            50,691
    Accounts and notes receivable                   64,588            61,108
    Mortgage notes receivable                       40,698            40,638
    Investment in real estate partnership           29,551            29,646
    Prepaid expenses and other assets              100,641           111,070
    TOTAL ASSETS                                $2,979,130        $2,989,297


      Mortgages payable and capital lease
       obligations                                $448,178          $450,084
      Notes payable                                210,766           210,820
      Senior notes and debentures                  977,513           977,556
      Accounts payable and other
       liabilities                                 197,904           204,387
    Total liabilities                            1,834,361         1,842,847

    Minority interests                              32,280            31,818

    Shareholders' equity
      Preferred stock                                9,997             9,997
      Common shares and other
       shareholders' equity                      1,102,492         1,104,635
    Total shareholders' equity                   1,112,489         1,114,632
     EQUITY                                     $2,979,130        $2,989,297

    Federal Realty Investment Trust
    Summarized Income Statements
    March 31, 2008

                                               Three months ended March 31,
                                                  2008              2007
                                         (in thousands, except per share data)
      Rental income                               $122,721          $111,763
      Other property income                          3,386             2,370
      Mortgage interest income                       1,116             1,130
        Total revenue                              127,223           115,263

      Rental expenses                               27,327            24,298
      Real estate taxes                             12,563            10,568
      General and administrative                     6,934             5,608
      Depreciation and amortization                 25,400            24,912
        Total operating expenses                    72,224            65,386

    Operating income                                54,999            49,877

      Other interest income                            341               225
      Interest expense                             (24,353)          (27,337)
      Income from real estate partnership              331               284
    Income from continuing operations
     before minority interests                      31,318            23,049

      Minority interests                            (1,332)           (1,296)
    Income from continuing operations               29,986            21,753

    Discontinued operations
      Income from discontinued operations                -             1,383
        Results from discontinued operations             -             1,383

    Net income                                      29,986            23,136

      Dividends on preferred stock                    (135)              (36)
    Net income available for common
     shareholders                                  $29,851           $23,100

      Continuing operations                          $0.51             $0.39
      Discontinued operations                            -              0.03
                                                     $0.51             $0.42

      Weighted average number of common
       shares, basic                                58,503            55,422

      Continuing operations                          $0.51             $0.39
      Discontinued operations                            -              0.02
                                                     $0.51             $0.41

      Weighted average number of common
       shares, diluted                              58,811            55,921

    Federal Realty Investment Trust
    Funds From Operations
    March 31, 2008

                                              Three months ended March 31,
                                                 2008              2007
    Funds from Operations available      (in thousands, except per share data)
     for shareholders (FFO) (1)
    Net income                                     $29,986           $23,136
    Depreciation and amortization of real
     estate assets                                  22,950            23,942
    Amortization of initial direct costs
     of leases                                       2,022             2,070
    Depreciation of joint venture real
     estate assets                                     330               268
      Funds from operations                         55,288            49,416
    Dividends on preferred stock                      (135)              (36)
    Income attributable to operating
     partnership units                                 232               245
      FFO                                          $55,385           $49,625

    FFO per diluted share                            $0.94             $0.88

        Weighted average number of common
         shares, diluted                            59,192            56,345

    (1) See Glossary of Terms.

    Federal Realty Investment Trust
    Reconciliation of Net Income to FFO Guidance
    March 31, 2008

                                                    2008 Guidance
                                     ($ millions except per share amounts) (1)

       Net income                             $124      to        $127
       Gain on sale of real estate               0                   0
       Depreciation and amortization of
        real estate & real estate
        partnership assets                      97                  97
       Amortization of initial direct
        costs of leases                          9                   9
       Funds from operations                   230                 233
       Income attributable to operating
        partnership units                        1                   1
       Dividends on preferred stock             (1)                 (1)
       Funds from operations available
        for common shareholders                231      to         234

       Weighted Average Shares (diluted)      59.4

       Funds from operations available
        for common shareholders per
        diluted share                        $3.89               $3.94

    (1) Individual items may not add up to total due to rounding.

SOURCE  Federal Realty Investment Trust
    -0-                             05/07/2008
    /CONTACT:  Investor and Media Inquiries: Andrew Blocher, Senior Vice
President, Capital Markets and Investor Relations, +1-301-998-8166,
ablocher@federalrealty.com, or Vikki Kayne, Vice President, Marketing and
Corporate Communications, +1-301-998-8178, vkayne@federalrealty.com, both of
Federal Realty Investment Trust/
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CO:  Federal Realty Investment Trust
ST:  Maryland

-- NEW120 --
1053 05/07/2008 16:42 EDT http://www.prnewswire.com