Federal Realty Acquires Controlling Interest in Plaza El Segundo

ROCKVILLE, Md., Jan. 3, 2012 /PRNewswire/ -- Federal Realty Investment Trust (NYSE:FRT) today announced the acquisition of a controlling interest in Plaza El Segundo, a 381,000 square foot, landmark, retail property in El Segundo, California along with a 100% interest in an adjacent, unimproved 8.1-acre land parcel for future development.  The property is located at the northeast corner of Sepulveda Boulevard and Rosecrans Avenue and serves Los Angeles's affluent beach communities, including Manhattan Beach, Hermosa Beach and Redondo Beach and benefits from the significant daytime population of the El Segundo office market.  At closing, the Trust paid cash consideration of $8.5 million for Plaza El Segundo and assumed its pro-rata share of an existing $175 million mortgage loan secured by the property, and will receive approximately 75% of the cash flow associated with the operating property.

(Logo:  http://photos.prnewswire.com/prnh/20120103/PH29242LOGO )

"Plaza El Segundo is a great addition to our California portfolio and will complement our ownership and tenant relationships on Third Street Promenade as well as Santana Row", commented Jeff Berkes, president – West Coast Region.  "We've recently opened a Southern California office which, along with the acquisition of Plaza El Segundo, will facilitate our growth in California."

Plaza El Segundo is a market dominant retail center that boasts demographics that enhance Federal Realty's already sector-leading position, with 169,000 people and average household incomes of $102,000 within a three-mile radius.  Plaza El Segundo is comprised of three distinct shopping districts:  The Plaza, a 273,000 square foot, high quality community shopping center anchored by Whole Foods, Best Buy, Home Goods, and Dicks Sporting Goods, The Collection, a 53,000 square foot lifestyle center featuring tenants such as Anthropologie, J Crew, Banana Republic, H&M and MAC Cosmetics, and The Edge, which offers 55,000 square feet of small shops, boutiques, restaurants and service uses.  All three districts boast high tenant sales productivity, solid occupancy cost ratios and strong leasing demand as evidenced by the replacement of Borders Books with The Container Store during the Trust's feasibility period.

In addition, Federal Realty acquired an 8.1-acre, unimproved land parcel immediately adjacent to Plaza El Segundo for $15.9 million.  Located at the hard corner of Sepulveda Boulevard and Rosecrans Avenue, the site has existing entitlements for 70,000 square feet of retail and restaurant space.  Average daily traffic counts at the intersection are 100,000 cars, and this is the first time in nearly 35 years that a hard corner of this heavily trafficked intersection has been available for development.  Pending site plan approvals and market conditions, construction could commence in 2013.

"Federal Realty's continued focus on maintaining the quality of our balance sheet allowed us to absorb the existing secured financing on the property. Coupled with our ability and desire to work with the sellers to meet their specific needs, Federal Realty maintained a competitive advantage in this acquisition," commented Donald Wood, Federal Realty's president and chief executive officer. "Plaza El Segundo will be accretive to earnings immediately, and will provide value creation for the Trust in both the medium and longer term."

About Federal Realty

Since 1962, Federal Realty has been a proven leader in the ownership, operation, and redevelopment of high quality retail real estate in the country's best markets.   Federal Realty's portfolio (excluding joint venture properties) contains approximately 18.6 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 93.3% leased to national, regional, and local retailers as of September 30, 2011, with no single tenant accounting for more than approximately 2.6% 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 44 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.  For more information, please visit www.federalrealty.com.

About Plaza El Segundo

Located in the sophisticated, yet relaxed atmosphere that is distinctively Southern California casual, this open-air costal shopping destination offers upscale retail that caters to the thriving and affluent South Bay beach communities.  Conveniently clustered in three districts and inclusive of large-scale sculptures, water features and foliage, the project is comprised of three distinct sections incorporating different architectural themes and retail types--in all totaling just under 400,000 square feet of building space. Since opening in late 2006, Plaza El Segundo has become one of the South Bay's primary retail destinations.  Plaza El Segundo is a property of Federal Realty Investment Trust www.federalrealty.com (NYSE:FRT), headquartered in Rockville, Maryland. For more information go to: www.plazaelsegundo.com.

SOURCE Federal Realty Investment Trust