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News Release

Federal Realty Investment Trust Announces Third Quarter 2003 Operating Results; Board of Trustees Approves Residential Rebuild on Santana Row's Building 7

ROCKVILLE, Md.--(BUSINESS WIRE)--Nov. 3, 2003--Federal Realty Investment Trust (NYSE:FRT) today reported operating results for the quarter ended September 30, 2003.

    --  Funds from operations (FFO) was $0.66 per diluted share for
        the third quarter and net income per diluted share was $0.44.

    --  When compared to third quarter 2002, same-center property
        operating income increased 3.1% excluding redevelopment or
        expansion properties, and 4.1% when redevelopments and
        expansions are included.

    --  Cash rent increases on lease rollovers were 14% for the third
        quarter on 408,000 square feet of comparable retail space.

    --  At Santana Row, 96% of the residential units and 85% of the
        Phase I retail square footage were leased as of October 23,
        2003.

    --  Through October 31, 2003, the Trust acquired four shopping
        center assets (committing a total of $125.5 million of
        capital) and completed five dispositions generating net
        proceeds of $29.0 million.

    Financial Results

Federal Realty reported FFO of $33.3 million for the third quarter of 2003, or $0.66 per diluted share. This compares to FFO of $29.7 million for the third quarter of 2002, or $0.67 per diluted share. Net income available for common shareholders was $21.7 million, or $0.44 per diluted share for the quarter ended September 30, 2003. For the third quarter of 2002, the Trust reported net income available for common shareholders of $13.6 million, or $0.31 per diluted share.

Portfolio Results

On a same-center basis, excluding redevelopment or expansion properties, property operating income increased 3.1% over third quarter 2002. When redevelopment or expansion properties are included in the same-center results, property operating income increased 4.1% from third quarter 2002. As of September 30, 2003, retail occupancy on a same-center basis was 95.2% compared to 94.8% on June 30, 2003, and 95.5% on September 30, 2002. Overall occupancy was 93.9% as of September 30, 2003, compared to 93.1% on June 30, 2003, and 95.5% on September 30, 2002.

During the third quarter, the Trust signed 84 leases for over 493,000 square feet of retail space. On a comparable space basis (i.e. spaces for which there was a former tenant), the Trust leased 408,000 square feet at an average cash-basis contractual rent increase per square foot (i.e. excluding the impact of straight-line rents) of 14%. The weighted-average contractual rent on this comparable space for the first year of the new lease was $17.56 per square foot compared to the weighted-average contractual rent of $15.36 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. For the first nine months of 2003, Federal Realty has leased over 1 million square feet of comparable retail space at an average contractual rent increase of 16%. On a GAAP basis (i.e. including the impact of straight-line rents), rent increases per square foot were 24% on the 408,000 square feet of comparable space re-leased during the third quarter, and 27% year-to-date. As of September 30, 2003, Federal Realty's weighted-average contractual rent for retail space in its portfolio was $17.49 per square foot.

"We met or exceeded third quarter expectations for each of our key production and financial measures, including leasing, occupancy and earnings," stated Donald C. Wood, Federal Realty's President and Chief Executive Officer. "In addition, we have effectively recycled capital from slower growth assets, including Greenwich Avenue and Coolidge Corner, into higher growth assets, such as Mercer Mall and Plaza del Mercado, as well as a growing number of value-added redevelopment opportunities in our existing portfolio."

Santana Row

At Santana Row, Federal Realty's mixed-use community in San Jose, Calif., 85% of the Phase I retail space was leased as of October 23, 2003, with 90 tenants open and operating, representing 73% of the available Phase I retail space as of that date. In comparison, on July 25, 2003, Santana Row's Phase I retail space was 81% leased with 80 tenants open, representing 65% of the available retail space. The Container Store, a 32,000 square foot component of Santana Row Phase II opened for business on October 23, ahead of schedule, and Best Buy remains on schedule to open on November 7.

With respect to the residential component of Santana Row, 96% of the 255, Phase I residential units were leased as of October 23, 2003. As a result of continued strong demand for residential units at Santana Row, the Trust's Board of Trustees recently approved the development of 96 townhomes and 160 flats on the Building 7 podium to replace the units that were destroyed in the August, 2002 fire. Construction is expected to commence shortly, with delivery of the first units expected in early 2005 with the balance delivered later in that year. The Trust will invest nearly $60 million of incremental capital to complete the residential development, and expects to earn an unleveraged return of at least 10.5% on its incremental investment upon stabilization in 2006.

"Phase II of Santana Row, which was 95% pre-leased to Best Buy and The Container Store, is coming on line ahead of schedule, under budget, and above our projected returns," said Mr. Wood. "Using the knowledge we've gained from the lease-up of the 255 residential units in Phase I, and an extensive redesign with a focus on cost, we are confident in our ability to develop these new 256 units on time, on budget and at attractive incremental returns."

Guidance

Federal Realty today reconfirmed previous expectations for 2003 FFO per diluted share of $2.60, before the impact of the $3.4 million (or $0.07 per diluted share) change in accounting related to the redemption of preferred shares in the second quarter pursuant to EITF Issue D-42, and increased net income per diluted share expectations to $1.26. In addition, the Trust provided initial guidance for 2004 FFO per diluted share of between $2.72 and $2.76, or $1.06 to $1.10 of net income per diluted share.

"We're thrilled to return to positive FFO growth for the first time since 2001," said Larry E. Finger, Federal Realty's Senior Vice President and Chief Financial Officer. "This demonstrates the quality of our portfolio and the successful execution of our plan."

    Summary of Other Quarterly Activities and Recent Developments

    --  November 3, 2003 - Federal Realty announced the acquisition of
        Plaza del Mercado, an approximately 96,000 square foot
        shopping center in Silver Spring, Md. anchored by a CVS
        Pharmacy and an undersized Giant Food. The Trust acquired the
        fee interest in the shopping center for $20.0 million in cash
        in an off-market transaction, representing a capitalization
        rate of 8.1% based on management's estimate of projected,
        cash-basis property operating income over the next 12 months.
        Redevelopment opportunities, which include a potential grocer
        expansion and additional gross leaseable area, are projected
        to increase the yield and value of the property in the next
        few years, subject to entitlement, leasing and redevelopment
        risk. In addition, Federal Realty announced the sale of 234
        Greenwich Avenue, a 15,000 square foot street retail asset,
        for $7.95 million, which represented a 5.97% capitalization
        rate based on management's estimate of projected, cash-basis
        property operating income over the next 12 months.

    --  October 15, 2003 - Federal Realty announced the acquisition of
        Mercer Mall, a community shopping center in Mercer County,
        N.J. The Trust entered into a master lease for the 390,000
        square foot primary portion of the shopping center, and
        acquired a fee interest in 20,000 additional square feet of
        the Property. The Property is currently 80% occupied, and has
        significant redevelopment opportunities including the lease-up
        of vacant anchor spaces, the addition of gross leaseable area,
        and an upgrade of common areas and facades. Federal Realty
        expects to increase the yield and value of the property
        through a redevelopment and expansion of Mercer Mall, subject
        to entitlement, leasing and redevelopment risk.

    --  October 8, 2003 - The Trust closed and funded a new $550
        million unsecured credit facility. The new facility,
        consisting of a $100 million three-year term loan, a $150
        million five-year term loan and a $300 million revolving
        credit facility, replaced Federal Realty's $300 million
        revolving credit facility and $125 million term loan, both of
        which were scheduled to expire on December 19, 2003.

    --  September 16, 2003 - Federal Realty announced the sale of
        Coolidge Corner, a 13,000 square foot Street Retail building
        in Brookline, Mass., and a 17.7-acre land parcel in Hillsboro,
        Ore. The sales price for Coolidge Corner represented a 7.4%
        capitalization rate based on management's estimate of
        projected, cash-basis property operating income over the next
        12 months. The Trust projected Coolidge Corner would generate
        a growth rate in annualized property operating income well
        below Federal Realty's expectations for its portfolio.
        Together, the sales generated combined net proceeds of $17.3
        million for the Trust.

    --  August 11, 2003 - Federal Realty announced that its Board of
        Trustees increased the common dividend to $0.49 per common
        share, marking the 36th consecutive year that the Trust has
        increased its common dividend, the longest such record in the
        REIT sector.

    Conference Call Information

Federal Realty's management team will present an in-depth discussion of the Trust's operating performance on its third quarter earnings conference call, which is scheduled for Tuesday, November 4, 2003, at 1 p.m. EST. To participate, please call (800) 857-7003 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) 925-2730.

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 16.2 million square feet located primarily in strategic metropolitan markets in the Northeast, Mid-Atlantic, and Western United States. The operating portfolio was 94% occupied by over 2,000 national, regional, and local retailers as of September 30, 2003, with no single tenant accounting for more than 2.5% 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 consummate
        additional financings or obtain replacement financing on terms
        which are acceptable to us, our ability to meet existing
        financial covenants and the possibility of increases in
        interest 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, including
        our Santana Row project, 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;

    --  risk of delay and cost overruns in construction of the
        residential units on Building 7;

    --  risks that we will be unable to lease the new residential
        units on Building 7 at the rates, or as quickly, as we have
        projected;

    --  risks that the costs of operating the residential units on
        Building 7, including real estate taxes and insurance, will be
        higher than anticipated;

    --  risks that we may not proceed or obtain necessary approvals
        for any redevelopment of Plaza del Mercado or Mercer Mall, 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 current report on Form 8-K filed with
        the SEC on March 25, 2003, our annual report on Form 10-K
        filed with the SEC on March 26, 2003 and our quarterly reports
        on Form 10-Q.

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


Federal Realty Investment Trust
Income Statement
September 30, 2003
----------------------------------------------------------------------

                         Financial Highlights
                 (in thousands, except per share data)
                              (unaudited)

                                    Three Months      Nine Months
                                       Ended             Ended
                                    September 30,     September 30,
OPERATING RESULTS                   2003    2002      2003     2002
----------------------------       ------- -------  -------- --------

Revenues
   Rental income                   $81,387 $72,041  $241,482 $213,532
   Interest and other income         4,911   4,412    13,191   11,392
   Other property income               931   1,644     3,805    3,762
                                   ------- -------  -------- --------
                                    87,229  78,097   258,478  228,686
Expenses
   Rental                           19,126  17,450    60,068   49,196
   Real estate taxes                 8,998   7,813    25,673   22,917
                                   ------- -------  -------- --------
Total property operating expenses   28,124  25,263    85,741   72,113
                                   ------- -------  -------- --------

Property operating income           59,105  52,834   172,737  156,573

   Interest                         18,719  13,540    54,550   45,313
   Administrative                    3,221   3,713     9,642   10,209
   Restructuring expenses                -       -         -    8,489
   Depreciation and amortization    18,710  16,037    54,223   47,718
                                   ------- -------  -------- --------
Total other expenses                40,650  33,290   118,415  111,729
                                   ------- -------  -------- --------
   Operating income before minority
    interests and discontinued
    operations                      18,455  19,544    54,322   44,844
   Minority interests               (1,053) (1,081)   (3,257)  (3,357)
                                   ------- -------  -------- --------
   Income from continuing
    operations                      17,402  18,463    51,065   41,487
   Operating income from
    discontinued operations             21      41       309    1,567
   Gain on sale of real estate net
    of loss on abandoned
    developments held for sale       7,172       -     7,723    9,454
                                   ------- -------  -------- --------
          Net income                24,595  18,504    59,097   52,508
   Preferred stock redemption -
    excess of redemption cost over
    carrying value                       -       -    (3,423)       -
   Dividends on preferred stock     (2,869) (4,856)  (12,215) (14,568)
                                   ------- -------  -------- --------
          Net income
           available for common
           shareholders            $21,726 $13,648   $43,459  $37,940
                                   ======= =======  ======== ========

Funds from Operations
      Net income available for
       common shareholders         $21,726 $13,648   $43,459  $37,940
      Gain on sale of real
       estate net of loss on
       abandoned developments
       held for sale                (7,172)      -    (7,723)  (9,454)
      Depreciation and
       amortization of real
       estate assets                16,974  14,614    49,146   43,672
      Amortization of initial
       direct costs of leases        1,427   1,175     4,173    3,546
      Income attributable to
       operating partnership
       units                           375     263       816      777
                                   ------- -------  -------- --------
      Funds from operations
                                   $33,330 $29,700   $89,871  $76,481
                                   ======= =======  ======== ========
       Weighted average number
        of common shares,
        diluted                     50,216  44,036    48,004   42,421
                                   ======= =======  ======== ========
      Funds from operations
       per share                     $0.66   $0.67     $1.87    $1.80
                                   ======= =======  ======== ========

   Earnings per common share,
    basic
      Income from continuing
       operations                    $0.30   $0.32     $0.76    $0.65
      Discontinued operations         0.14       -      0.17     0.27
                                   ------- -------  -------- --------
                                     $0.44   $0.32     $0.93    $0.92
                                   ======= =======  ======== ========
      Weighted average number
       of common shares, basic      48,935  42,802    46,810   41,155
                                   ======= =======  ======== ========

   Earnings per common share,
    diluted
      Income from continuing
       operations                    $0.30   $0.31     $0.75    $0.65
      Discontinued operations         0.14       -      0.17     0.26
                                   ------- -------  -------- --------
                                     $0.44   $0.31     $0.92    $0.91
                                   ======= =======  ======== ========
      Weighted average number
       of common shares, diluted    50,216  44,036    48,004   42,421
                                   ======= =======  ======== ========



Federal Realty Investment Trust
Balance Sheet
September 30, 2003
----------------------------------------------------------------------

                         Financial Highlights
                            (in thousands)


BALANCE SHEET DATA
------------------                             September    December
                                                   30,         31,
                                                  2003        2002
                                               ----------- -----------
Assets                                         (unaudited)

Real estate, at cost
   Operating                                   $2,185,976  $1,966,338
   Development                                    189,572     340,488
                                               ----------- -----------
                                                2,375,548   2,306,826
   Less accumulated depreciation and
    amortization                                 (499,017)   (450,697)
                                               ----------- -----------
                                                1,876,531   1,856,129
Other Assets
   Mortgage notes receivable                       33,656      35,577
   Cash and investments                            38,013      23,123
   Receivables                                     23,487      18,722
   Other assets                                    72,357      65,827
                                               ----------- -----------
Total Assets                                   $2,044,044  $1,999,378
                                               =========== ===========

Liabilities and Shareholders' Equity

   Obligations under capital leases, mortgages
    and construction loans                       $354,914    $383,812
   Notes payable                                  334,609     207,711
   Senior notes                                   535,000     535,000
   5 1/4% Convertible subordinated debentures           -      75,000
   Other liabilities                              139,630     153,568
                                               ----------- -----------
Total Liabilities                               1,364,153   1,355,091

Preferred stock                                   135,000     235,000

Common Shares and Other Shareholders' Equity      544,891     409,287
                                               ----------- -----------
Total Liabilities and Shareholders' Equity     $2,044,044  $1,999,378
                                               =========== ===========

    CONTACT: Federal Realty Investment Trust, Rockville
             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