UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) March 31, 2009

 

 

Federal Realty Investment Trust

(Exact name of registrant as specified in its charter)

 

 

 

Maryland		1-07533		52-0782497
(State or other jurisdiction of incorporation)		(Commission File Number)		(IRS Employer Identification No.)

 

1626 East Jefferson Street, Rockville, Maryland		20852-4041
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number including area code: 301/998-8100

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 

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Item 2.02. Results of Operations and Financial Condition.

The following information is being furnished under Item 12-Results of Operations and Financial Condition. This information, including the exhibits attached hereto, shall not be deemed “filed” for any purpose, including for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section. The information in this Current Report on Form 8-K shall not be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or under the Exchange Act, regardless of any general incorporation language in such filing.

On May 6, 2009, Federal Realty Investment Trust issued supplemental data pertaining to its operations, as well as a press release, to report its financial results for the quarter ended March 31, 2009. The supplemental data and press release are furnished as Exhibit 99.1 hereto.

Item 9.01. Financial Statements and Exhibits.

 

(c)

Exhibits

 

99.1		Supplemental information at March 31, 2009 (including press release dated May 6, 2009)

 

2

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

		FEDERAL REALTY INVESTMENT TRUST
Date: May 6, 2009		/s/ Andrew P. Blocher
		Andrew P. Blocher
		Senior Vice President,
		Chief Financial Officer and Treasurer

 

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EXHIBIT INDEX

 

Exh No.		Exhibit
99.1		Supplemental Information at March 31, 2009

 

4

Exhibit 99.1

FEDERAL REALTY INVESTMENT TRUST

SUPPLEMENTAL INFORMATION

March 31, 2009

TABLE OF CONTENTS

 

1.		First Quarter 2009 Earnings Press Release		3
2.		Financial Highlights
		Summarized Income Statements		7
		Summarized Balance Sheets		8
		Funds From Operations / Summary of Capital Expenditures		9
		Market Data		10
		Components of Rental Income		11
3.		Summary of Debt
		Summary of Outstanding Debt and Capital Lease Obligations		12
		Summary of Debt Maturities		13
4.		Summary of Redevelopment Opportunities		14
5.		Real Estate Status Report		15
6.		Retail Leasing Summary		17
7.		Lease Expirations		18
8.		Portfolio Leased Statistics		19
9.		Summary of Top 25 Tenants		20
10.		Reconciliation of Net Income to FFO Guidance		21
11.		Litigation Update
		Litigation Update Summary		22
		“Final Proposal” Document		23
12.		Joint Venture Disclosure
		Summarized Income Statements and Balance Sheets		24
		Summary of Outstanding Debt and Debt Maturities		25
		Real Estate Status Report		26
13.		Glossary of Terms		27

1626 East Jefferson Street

Rockville, Maryland 20852-4041

301/998-8100

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Safe Harbor Language

Certain matters discussed within this Supplemental Information 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 26, 2009, 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 capital;

 

•

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 Supplemental Information. Except as 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 review the risks contained in our Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February 26, 2009.

 

2

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FOR IMMEDIATE RELEASE

 

Investor and Media Inquiries
Gina Birdsall		Janelle Stevenson
Investor Relations		Corporate Communications
301/998-8265		301/998-8185
gbirdsall@federalrealty.com		jmstevenson@federalrealty.com

FEDERAL REALTY INVESTMENT TRUST ANNOUNCES FIRST QUARTER 2009

OPERATING RESULTS

- Strong core operations drive year-over-year results up 6.5% -

ROCKVILLE, Md. (May 6, 2009) – Federal Realty Investment Trust (NYSE:FRT) today reported operating results for its first quarter ended March 31, 2009.

Financial Results

Federal Realty reported funds from operations available for common shareholders (FFO) of $37.8 million or $0.64 per diluted share, and net income available for common shareholders of $10.3 million or earnings per diluted share of $0.17. The Trust’s reported results include a provision for litigation of $20.6 million, or $0.35 per diluted share related to a tentative ruling issued on April 22 awarding damages associated with a previously disclosed lawsuit involving a property adjacent to Santana Row. Excluding the litigation provision, FFO per diluted share increased 6.5% to $0.99 in first quarter 2009 compared to $0.93 in first quarter 2008, while total FFO increased to $58.3 million from $55.2 million reported in first quarter 2008. Net income available for common shareholders excluding the litigation provision was $31.0 million and earnings per diluted share was $0.52 for the quarter ended March 31, 2009 versus $29.9 million and $0.51, respectively, for first quarter 2008. Additional information regarding the litigation can be found in the Trust’s supplemental report furnished to the SEC on Form 8-K.

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

Portfolio Results

In first quarter 2009, same-center property operating income, including redevelopment and expansion properties, increased 1.4% over first quarter 2008. When redevelopment and expansion properties are excluded from same-center results, property operating income for first quarter 2009 decreased 2.1% compared to first quarter 2008.

 

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FEDERAL REALTY INVESTMENT TRUST ANNOUNCES

FIRST QUARTER 2009 OPERATING RESULTS

May 6, 2009

Page 2

The overall portfolio was 94.2% leased as of March 31, 2009, compared to 95.0% on December 31, 2008 and 96.1% on March 31, 2008. Federal Realty’s same-center portfolio was 94.5% leased on March 31, 2009, compared to 95.4% on December 31, 2008 and 96.4% on March 31, 2008.

During the first quarter of 2009, Federal Realty signed 69 leases for 233,000 square feet of retail space. On a comparable space basis (i.e., spaces for which there was a former tenant), the Trust leased 232,000 square feet at an average cash-basis contractual rent increase per square foot (i.e., excluding the impact of straight-line rents) of 16%. The average contractual rent on this comparable space for the first year of the new leases is $31.42 per square foot, compared to the average contractual rent of $26.99 per square foot for the last year of the prior leases. The previous average contractual rent was calculated by including both the minimum rent and any 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 26% for first quarter 2009. As of March 31, 2009, Federal Realty’s average contractual, cash basis minimum rent for retail and commercial space in its portfolio was $21.88 per square foot.

Refinancing Updates

On May 4, Federal Realty closed a new $372 million unsecured term loan, proceeds of which were utilized to retire the Trust’s outstanding $200 million unsecured term loan and provide capital to retire the 8.75% Notes due December 1, 2009. The term loan, which bears interest at an annual rate of LIBOR (subject to a 1.50% floor) plus 300 basis points, will mature in July 2011. The term loan was increased from its initial size of $200 million, reflecting significant demand from high-quality financial institutions for the Trust’s credit at market leading terms.

In April, Federal Realty closed a $24.1 million, ten-year loan secured by Rollingwood Apartments in Silver Spring, Maryland at an effective annual interest rate of 5.72%. The Trust has also obtained a commitment of approximately $139 million for a five-year loan secured by four retail assets located in Northern Virginia that is expected to bear interest at an effective annual rate of 7.72%. This secured financing is expected to close during the second quarter of 2009.

As a result of these financing activities, Federal Realty anticipates that it will have adequate capital to retire all of its 2009 debt maturities, will have significant capacity on its $300 million unsecured credit facility and will have no additional debt maturities until 2011.

 

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FEDERAL REALTY INVESTMENT TRUST ANNOUNCES

FIRST QUARTER 2009 OPERATING RESULTS

May 6, 2009

Page 3

“I am very pleased with our first quarter results, especially in terms of the steady leasing activity we were able to achieve despite a continuing difficult economic environment,” said Donald C. Wood, president and chief executive officer of the Trust. “The combination of strong operating results and support for our financing activities is a testament to the strength and quality of our portfolio and our sustainable low-risk business strategy.”

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 $0.65 per share on its common shares, resulting in an indicated annual rate of $2.60 per share. The regular common dividend will be payable in cash on July 15, 2009 to common shareholders of record on June 24, 2009.

Guidance

Federal Realty left its guidance, excluding the provision for litigation, for 2009 FFO per diluted share unchanged at a range of $3.80 to $3.92, and provided 2009 earnings per diluted share guidance of $1.88 to $2.00. Guidance for 2009 assumes an approximately $10 million increase in interest expense relative to 2008 associated with addressing the Trust’s fourth quarter 2009 debt maturities significantly in advance of the actual maturity dates, repaying the credit facility with excess proceeds from the Trust’s capital raising activities and projected changes in short-term interest rates.

Conference Call Information

Federal Realty’s management team will present an in-depth discussion of the Trust’s operating performance on its first quarter 2009 earnings conference call, which is scheduled for May 7, 2009, at 11 a.m. Eastern Daylight Time. To participate, please call (866) 271-6130 five to ten minutes prior to the call start time and use the passcode FRT EARNINGS (required). 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 5, 2009, by dialing (888) 286-8010 and using the passcode 91157379.

About Federal Realty

Federal Realty Investment Trust is an equity real estate investment trust specializing in the ownership, management and redevelopment of high quality retail assets. Federal Realty’s portfolio (excluding joint venture properties) contains approximately 18.1 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 94.2% leased to national, regional, and local retailers as of March 31, 2009, 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 41 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.

 

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FEDERAL REALTY INVESTMENT TRUST ANNOUNCES

FIRST QUARTER 2009 OPERATING RESULTS

May 6, 2009

Page 4

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 26, 2009 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 capital;

 

¿

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 close any pending financing activities, 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 26, 2009.

 

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Federal Realty Investment Trust

Summarized Income Statements

March 31, 2009

 

 

 

		Three months ended March 31,
		2009				2008
		(in thousands, except per share data)
		(unaudited)
Revenue
Rental income		$	127,330			$	121,867
Other property income			2,604				3,386
Mortgage interest income			1,267				1,116
Total revenue			131,201				126,369
Expenses
Rental expenses			28,705				27,266
Real estate taxes			13,892				12,385
General and administrative			5,145				6,942
Litigation provision			20,632				—
Depreciation and amortization			28,592				25,389
Total operating expenses			96,966				71,982
Operating income			34,235				54,387
Other interest income			90				339
Interest expense			(23,569	)			(24,353	)
Income from real estate partnership			202				331
Income from continuing operations			10,958				30,704
Discontinued operations
Income from discontinued operations			—				614
Gain on sale of real estate from discontinued operations			915				—
Results from discontinued operations			915				614
Net income			11,873				31,318
Net income attributable to noncontrolling interests			(1,389	)			(1,332	)
Net income attributable to the Trust			10,484				29,986
Dividends on preferred stock			(135	)			(135	)
Net income available for common shareholders		$	10,349			$	29,851
EARNINGS PER COMMON SHARE, BASIC
Continuing operations		$	0.16			$	0.50
Discontinued operations			0.01				0.01
		$	0.17			$	0.51
Weighted average number of common shares, basic			58,841				58,503
EARNINGS PER COMMON SHARE, DILUTED
Continuing operations		$	0.16			$	0.50
Discontinued operations			0.01				0.01
		$	0.17			$	0.51
Weighted average number of common shares, diluted			58,960				58,780

 

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Federal Realty Investment Trust

Summarized Balance Sheets

March 31, 2009

 

 

 

		March 31, 2009				December 31, 2008
		(in thousands)
		(unaudited)
ASSETS
Real estate, at cost
Operating		$	3,568,470			$	3,567,035
Construction-in-progress			125,074				106,650
			3,693,544				3,673,685
Less accumulated depreciation and amortization			(865,987	)			(846,258	)
Net real estate			2,827,557				2,827,427
Cash and cash equivalents			22,460				15,223
Accounts and notes receivable			71,781				73,688
Mortgage notes receivable			46,495				45,780
Investment in real estate partnership			28,726				29,252
Prepaid expenses and other assets			93,943				101,406
TOTAL ASSETS		$	3,090,962			$	3,092,776
LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities
Mortgages payable and capital lease obligations		$	446,362			$	452,810
Notes payable			353,856				336,391
Senior notes and debentures			950,401				956,584
Accounts payable and other liabilities			218,716				200,037
Total liabilities			1,969,335				1,945,822
Shareholders’ equity
Preferred stock			9,997				9,997
Common shares and other shareholders’ equity			1,079,497				1,104,605
Total shareholders’ equity of the Trust			1,089,494				1,114,602
Noncontrolling interest			32,133				32,352
Total shareholders’ equity			1,121,627				1,146,954
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY		$	3,090,962			$	3,092,776

 

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Federal Realty Investment Trust

Funds From Operations / Summary of Capital Expenditures

March 31, 2009

 

 

 

		Three months ended March 31,
		2009				2008
		(in thousands, except per share data)
Funds from Operations available for common shareholders (FFO) (1)
Net income attributable to the Trust		$	10,484			$	29,986
Gain on sale of real estate			(915	)			—
Depreciation and amortization of real estate assets			25,436				22,950
Amortization of initial direct costs of leases			2,667				2,022
Depreciation of joint venture real estate assets			354				330
Funds from operations			38,026				55,288
Dividends on preferred stock			(135	)			(135	)
Income attributable to operating partnership units			—				232
Income attributable to unvested shares			(130	)			(196	)
FFO (3)			37,761				55,189
Litigation provision, net of allocation to unvested shares (3)			20,565				—
FFO excluding litigation provision (3)		$	58,326			$	55,189
FFO per diluted share (2)		$	0.64			$	0.93
Litigation provision per diluted share (3)			0.35				—
FFO per diluted share excluding litigation provision (2) (3)		$	0.99			$	0.93
Weighted average number of common shares, diluted			58,960				59,161
Summary of Capital Expenditures
Non-maintenance capital expenditures
Redevelopment and expansions		$	20,827			$	28,922
Tenant improvements and incentives			3,767				5,409
Total non-maintenance capital expenditures			24,594				34,331
Maintenance capital expenditures			1,320				2,536
Total capital expenditures		$	25,914			$	36,867
Dividends and Payout Ratios
Regular common dividends declared		$	38,404			$	35,851
Dividend payout ratio as a percentage of FFO			101	%			65	%
Dividend payout ratio as a percentage of FFO excluding litigation provision (3)			66	%			65	%

 

Notes:

(1)	See Glossary of Terms.

(2)

Effective January 1, 2009, we adopted FSP EITF No. 03-6-1, “Determining Whether Instruments Granted in Share-Based Payment Transactions are Participating Securities”, and consequently have calculated FFO per diluted share under the two-class method, as defined in SFAS No. 128, for all periods presented. The implementation resulted in a decrease to the March 31, 2008 reported FFO per diluted share from $0.94 to $0.93.

(3)

FFO includes a charge of $20.6 million, or $0.35 per diluted share, related to litigation regarding a parcel of land located adjacent to our Santana Row property. FFO excluding litigation provision excludes this $20.6 million charge. See additional information in the litigation update section of this Form 8-K.

 

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Federal Realty Investment Trust

Market Data

March 31, 2009

 

 

 

		March 31,
		2009				2008
		(in thousands, except per share data)
Market data
Common shares outstanding (1)			59,081				58,781
Market price per common share		$	46.00			$	77.95
Common equity market capitalization		$	2,717,726			$	4,581,979
Series 1 preferred shares outstanding (2)			400				400
Liquidation price per Series 1 preferred share		$	25.00			$	25.00
Series 1 preferred equity market capitalization		$	10,000			$	10,000
Equity market capitalization		$	2,727,726			$	4,591,979
Total debt (3)			1,750,619				1,636,457
Total market capitalization		$	4,478,345			$	6,228,436
Total debt to market capitalization at then current market price			39	%			26	%
Total debt to market capitalization at constant common share price of $77.95			27	%			26	%
Fixed rate debt ratio:
Fixed rate debt and capital lease obligations			80	%			99	%
Variable rate debt			20	%			1	%
			100	%			100	%

 

Notes:

(1)	Amounts do not include 373,260 and 380,938 Operating Partnership Units outstanding at March 31, 2009 and 2008, respectively.

(2)	These shares, issued March 8, 2007, are unregistered.

(3)

Total debt includes capital leases, mortgages payable, notes payable, senior notes and debentures, net of premiums and discounts from our consolidated balance sheet. It does not include the $24.4 million which is the Trust’s 30% share of the total mortgages payable of $81.3 million and $81.5 million, at March 31, 2009 and 2008, respectively, of the partnership with a discretionary fund created and advised by ING Clarion Partners.

 

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Federal Realty Investment Trust

Components of Rental Income

March 31, 2009

 

 

 

				Three months ended March 31,
				2009			2008
				(in thousands)
Minimum rents
Retail and commercial (1)				$	93,566		$	89,612
Residential (2)					5,272			4,013
Cost reimbursements					25,652			24,564
Percentage rents					1,501			2,380
Other					1,339			1,298
Total rental income				$	127,330		$	121,867

 

Notes:

(1)

Minimum rents include $1.4 million and $1.5 million for the three months ended March 31, 2009 and 2008, respectively, to recognize minimum rents on a straight-line basis. In addition, minimum rents include $0.4 million and $0.6 million for the three months ended March 31, 2009 and 2008, respectively, to recognize income from the amortization of in-place leases in accordance with SFAS No. 141.

(2)	Residential minimum rents consist of the rental amounts for residential units at Rollingwood Apartments, the Crest at Congressional Plaza Apartments, Santana Row, and Arlington East (Bethesda Row). The first rental units at Arlington East were delivered and became rent paying in May 2008.

 

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Federal Realty Investment Trust

Summary of Outstanding Debt and Capital Lease Obligations

March 31, 2009

 

 

 

		Maturity date		Stated interest rate as of March 31, 2009					Balance as of March 31, 2009							Weighted average effective rate at March 31, 2009 (i)
									(in thousands)
Mortgage loans (a)
Secured fixed rate
Federal Plaza		06/01/11		6.750	%					32,976
Tysons Station		09/01/11		7.400	%					6,028
Courtyard Shops		07/01/12		6.870	%					7,679
Bethesda Row		01/01/13		5.370	%					19,996
Bethesda Row		02/01/13		5.050	%					4,405
White Marsh Plaza (b)		04/01/13		6.040	%					10,058
Crow Canyon		08/11/13		5.400	%					21,113
Melville Mall (c)		09/01/14		5.250	%					24,291
THE AVENUE at White Marsh		01/01/15		5.460	%					59,752
Barracks Road		11/01/15		7.950	%					41,191
Hauppauge		11/01/15		7.950	%					15,528
Lawrence Park		11/01/15		7.950	%					29,197
Wildwood		11/01/15		7.950	%					25,663
Wynnewood		11/01/15		7.950	%					29,754
Brick Plaza		11/01/15		7.415	%					30,492
Shoppers’ World		01/31/21		5.910	%					5,833
Mount Vernon (d)		04/15/28		5.660	%					11,556
Chelsea		01/15/31		5.360	%					8,063
Subtotal										383,575
Net unamortized discount										(408	)
Total mortgage loans										383,167						6.79	%
Notes payable
Unsecured fixed rate
Other		04/01/12		6.500	%					2,321
Perring Plaza renovation		01/31/13		10.000	%					1,135
Unsecured variable rate
Term loan (e)		11/06/09		LIBOR + 0.575	%					200,000
Revolving credit facility (f)		07/27/10		LIBOR + 0.425	%					141,000
Escondido (Municipal bonds) (g)		10/01/16		0.549	%					9,400
Total notes payable										353,856						1.44	%		(j	)
Senior notes and debentures
Unsecured fixed rate
8.75% notes (h)		12/01/09		8.750	%					168,855
4.50% notes		02/15/11		4.500	%					75,000
6.00% notes		07/15/12		6.000	%					175,000
5.40% notes		12/01/13		5.400	%					135,000
5.65% notes		06/01/16		5.650	%					125,000
6.20% notes		01/15/17		6.200	%					200,000
7.48% debentures		08/15/26		7.480	%					29,200
6.82% medium term notes		08/01/27		6.820	%					40,000
Subtotal										948,055
Net unamortized premium										2,346
Total senior notes and debentures										950,401						6.40	%
Capital lease obligations
Various		Various through 2106		Various						63,195						6.94	%
Total debt and capital lease obligations									$	1,750,619
Total fixed rate debt and capital lease obligations									$	1,400,219			80	%		6.54	%
Total variable rate debt										350,400			20	%		1.38	%		(j	)
TOTAL DEBT AND CAPITAL LEASES OBLIGATIONS									$	1,750,619			100	%		5.50	%

 

		Three months ended March 31,
		2009		2009 (l)		2008
Operational Statistics
Ratio of EBITDA to combined fixed charges and preferred share dividends (k)		2.46x		3.27x		2.95x
Ratio of adjusted EBITDA to combined fixed charges and preferred share dividends (k)		2.42x		3.23x		2.95x

 

Notes:

(a)	Mortgage loans do not include our 30% share ($24.4 million) of the $81.3 million debt of the partnership with a discretionary fund created and advised by ING Clarion Partners.

(b)	The interest rate of 6.04% represents the weighted average interest rate for two mortgage loans secured by this property. The loan balance represents an interest-only loan of $4.35 million at a stated rate of 6.18% and the remaining balance at a stated rate of 5.96%.

(c)

We acquired control of Melville Mall through a 20-year master lease and secondary financing. Because we control this property and retain substantially all of the economic benefit and risk associated with it, this property is consolidated and the mortgage loan is reflected on the balance sheet though it is not our legal obligation.

(d)	The interest rate is fixed at 5.66% for the first ten years and then will be reset to a market rate in 2013. The lender has the option to call the loan on April 15, 2013 or anytime thereafter.

(e)

The weighted average effective interest rate, before amortization of debt fees, was 2.14% for the three months ended March 31, 2009. On May 4, 2009, we refinanced our existing $200 million term loan with a new $372 million term loan which bears interest at LIBOR, subject to a 1.50% floor, plus 300 basis points and will mature in July 2011. The $200 million term loan was repaid with the proceeds from the new $372 million term loan.

(f)

The maximum amount drawn under our revolving credit facility during the three months ended March 31, 2009 was $172.5 million. The weighted average effective interest rate on borrowings under our revolving credit facility, before amortization of debt fees, was 1.52% for the three months ended March 31, 2009. This credit facility matures on July 27, 2010, subject to a one-year extension at our option

(g)	The bonds bear interest at a variable rate determined weekly which would enable the bonds to be remarketed at 100% of their principal amount.

(h)

On January 12, 2009, February 5, 2009, and February 27, 2009, we purchased and retired $5.0 million, $0.9 million, and $0.2 million, respectively, using funds borrowed on our $300 million revolving credit facility. On April 1, 2009, we purchased and retired $5.0 million of the outstanding $168.9 million balance of our 8.75% notes. The notes were repaid with funds borrowed on our $300 million revolving credit facility.

(i)	The weighted average effective interest rate includes the amortization of any deferred financing fees, discounts and premiums, if applicable.

(j)	The weighted average effective interest rate excludes $0.1 million in quarterly financing fees on our revolving credit facility which had a $141.0 million balance on March 31, 2009.

(k)

Fixed charges consist of interest on borrowed funds (including capitalized interest), amortization of debt discount or premium and expense and the portion of rent expense representing an interest factor. EBITDA includes $0.9 million in gain on sale for the three months ended March 31, 2009. Adjusted EBITDA is reconciled to net income attributable to the Trust in the Glossary of Terms.

(l)	Adjusted to exclude a $20.6 million litigation provision charge for the three months ended March 31, 2009 related to litigation regarding a parcel of land located adjacent to our Santana Row property. See additional information in the litigation update section of this Form 8-K.

 

12

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Federal Realty Investment Trust

Summary of Debt Maturities

March 31, 2009

 

 

DEBT MATURITIES

(in thousands)

The following table reflects contractual debt maturities as of March 31, 2009. Given all of the financing related activities that we have completed since March 31, 2009 and that we expect to complete by December 31, 2009, we have also included “pro-forma” total debt maturity columns to reflect our projected debt maturities after completion of those financing activities. Specifically, the pro-forma total debt maturity columns assume completion of all of the following:

 

•

Closing on May 4, 2009 of a new $372 million term loan maturing in July 2011

 

•

Repayment on May 4, 2009 of our $200 million term loan that was scheduled to mature on November 6, 2009

 

•

Repayment on May 4, 2009 of the $141 million outstanding balance on our revolving credit facility

 

•

Closing on April 14, 2009 of a $24.1 million loan secured by Rollingwood Apartments which will mature in May 2019

 

•

Closing in second quarter 2009 of a $139 million loan secured by four retail assets in Northern Virginia which will mature in 2014. We can give no assurance that we will be successful in closing this loan.

 

•

Repayment of the $168.9 million of 8.75% notes that are due on December 1, 2009

 

		As of March 31, 2009															Pro-forma
Year		Scheduled Amortization			Maturities						Total						Maturities			Total
2009		$	7,286		$	368,855		(1	)		$	376,141					$	—		$	8,258
2010			9,880			141,000		(2	)			150,880						—			12,223
2011			9,906			112,252						122,158						484,252			496,677
2012			9,973			181,916						191,889						181,916			194,593
2013			9,215			186,884						196,099						186,884			199,010
2014			9,164			20,127						29,291						147,635			158,763
2015			6,924			198,391						205,315						198,391			205,728
2016			2,976			134,400						137,376						134,400			137,810
2017			3,184			200,000						203,184						200,000			203,646
2018			3,400			—						3,400						—			3,889
Thereafter			60,072			72,876						132,948						93,036			153,279
Total		$	131,980		$	1,616,701					$	1,748,681		(3	)		$	1,626,514		$	1,773,876

 

Notes:

(1)

On April 1, 2009, we purchased and retired $5.0 million of the outstanding $168.9 million balance of our 8.75% notes. The notes were repaid with funds borrowed on our $300 million revolving credit facility. On May 4, 2009, we refinanced our existing $200 million term loan with a new $372 million term loan which bears interest at LIBOR, subject to a 1.50% floor, plus 300 basis points and will mature in July 2011.

(2)	Our $300 million four-year revolving credit facility matures on July 27, 2010, subject to a one-year extension at our option. As of March 31, 2009, there was $141.0 million drawn under this credit facility.

(3)	The total debt maturities differs from the total reported on the consolidated balance sheet due to the unamortized net discount or premium on certain mortgage loans, senior notes and debentures as of March 31, 2009.

 

13

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Federal Realty Investment Trust

Summary of Redevelopment Opportunities

March 31, 2009

 

 

Current Redevelopment Opportunities (1) ($ millions)

Property

Location

Opportunity

Projected ROI (2)

Projected Cost (1)

Cost to Date

Projects Anticipated to Stabilize in 2009 (3) (5)

Santana Row

San Jose, CA

5-story building with 15,000 square feet of ground level retail and 65,000 square feet of office space

8

%

$

42

$

22

Hollywood Galaxy Building

Hollywood, CA

Re-tenanting three level entertainment center and converting project into urban neighborhood community center

12

%

16

14

Houston Street

San Antonio, TX

Construction of a new building with ground level leased to Walgreen’s pharmacy and office above

10

%

8

8

Village of Shirlington - Phase III & IV

Arlington, VA

Ground lease to hotel operator and ground floor retail as part of office building development (by others)

16

%

7

4

Subtotal: Projects Anticipated to Stabilize in 2009 (3) (4) (5)

10

%

$

73

$

48

Projects Anticipated to Stabilize in 2010 (3)

Lancaster

Lancaster, PA

Renovation and expansion of existing grocer, new bank pad, and façade renovation

10

%

$

2

$

—

Bethesda Row (Hampden Lane)

Bethesda, MD

Construction of new three level building leased to fitness center and 2 additional ground level retail spaces.

10

%

14

2

Subtotal: Projects Anticipated to Stabilize in 2010 (3) (4)

10

%

$

16

$

2

Total: Projects Anticipated to Stabilize in 2009 and 2010 (3) (4)

10

%

$

89

$

50

Potential future redevelopment pipeline includes (6):

Property

Location

Opportunity

Assembly Square

Somerville, MA

Potential substantial transit oriented mixed-use development

Bala Cynwyd

Bala Cynwyd, PA

Redevelopment of nine acres of land for a transit oriented mixed-use project or retail center

Barracks Road

Charlottesville, VA

Anchor re-tenanting, pad re-tenanting, and site improvements

Bethesda Row

Bethesda, MD

Acquire and develop ground floor retail space in a new Class A office building

Brick Plaza

Brick, NJ

Redevelopment and expansion of existing pad site, plus additional pad site

Courthouse Center

Rockville, MD

Center redevelopment adjacent to Rockville Town Square

Federal Plaza

Rockville, MD

Pad building opportunities

Flourtown

Flourtown, PA

Anchor re-tenanting, small shop renovation, and site improvements

Hollywood Peterson Building

Hollywood, CA

Co-terminus leases create potential for property redevelopment and expansion

Huntington

Huntington, NY

Pad site additions

Langhorne

Levittown, PA

Pad site addition

Linden Square

Wellesley, MA

Additional phases of infill redevelopment

Mercer Mall

Lawrenceville, NJ

Construction of new outparcel

Mid-Pike Plaza

Rockville, MD

Co-terminus leases create potential for retail redevelopment or transit oriented mixed-use development

Pike 7

Vienna, VA

Co-terminus leases create potential for retail redevelopment or transit oriented mixed-use development

Santana Row

San Jose, CA

Future phases of mixed-use development

Town Center of New Britain

New Britain, PA

Renovation and expansion of existing grocer

Troy

Parsippany, NJ

Pad site addition

Westgate

San Jose, CA

Convert 30,000 square feet of basement space to leasable area

Notes:

 

(1)

These current redevelopment opportunities are being pursued by the Trust. There is no guaranty that the Trust will ultimately complete any or all of these opportunities, that the Projected Return on Investment (ROI) or Projected Costs will be the amounts shown or that stabilization will occur as anticipated. The projected ROI and Projected Cost are management’s best estimate based on current information and may change over time.

(2)

Projected ROI reflects only the deal specific cash, unleveraged Incremental Property Operating Income (POI) generated by the redevelopment and is calculated as Incremental POI divided by cost. Incremental POI is the POI generated by the redevelopment after deducting rent being paid for the redevelopment space and any other space taken out of service to accommodate the redevelopment. Projected ROI does NOT include peripheral impacts, such as the impact on future lease rollovers at the property or the impact on the long-term value of the property.

(3)	Stabilization is the year in which 95% occupancy of the redeveloped space is achieved.

(4)	All subtotals and totals reflect cost weighted-average ROIs.

(5)	Excludes $55 million of development capital at Linden Square, anticipated at acquisition of this in-process development.

(6)	These future redevelopment opportunities are being explored by the Trust. There is no guaranty that the Trust will ultimately pursue or complete any or all of these opportunities.

 

14

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Federal Realty Investment Trust

Real Estate Status Report

March 31, 2009

 

 

 

Property Name					MSA Description		Year Acquired		Real Estate at Cost			Mortgage and/or Capital Lease Obligation (1)			GLA (2)		% Leased			Grocery Anchor GLA (3)		Grocery Anchor (3)		Other Principal Tenants
									(in thousands)			(in thousands)
Washington Metropolitan Area
Bethesda Row		(4	)		Washington, DC-MD-VA		1993-2006/2008		$	187,540		$	25,432		520,000		95	%		40,000		Giant Food		Barnes & Noble / Landmark Theater
Congressional Plaza		(5	)		Washington, DC-MD-VA		1965			70,277					334,000		96	%		28,000		Whole Foods		Buy Buy Baby / Container Store
Courthouse Center					Washington, DC-MD-VA		1997			4,228					37,000		77	%
Falls Plaza/Falls Plaza-East					Washington, DC-MD-VA		1967-1972			11,837					144,000		99	%		51,000		Giant Food		CVS / Staples
Federal Plaza					Washington, DC-MD-VA		1989			61,898			32,976		248,000		97	%						TJ Maxx / Micro Center / Ross
Friendship Center					Washington, DC-MD-VA		2001			33,373					119,000		66	%						Borders / Maggiano’s
Gaithersburg Square					Washington, DC-MD-VA		1993			23,992					209,000		76	%						Bed, Bath & Beyond / Ross
Idylwood Plaza					Washington, DC-MD-VA		1994			15,558					73,000		89	%		30,000		Whole Foods
Laurel					Washington, DC-MD-VA		1986			47,827					386,000		100	%		61,000		Giant Food		Marshalls
Leesburg Plaza		(6	)		Washington, DC-MD-VA		1998			34,294					236,000		99	%		55,000		Giant Food		Petsmart / Pier One / Office Depot
Loehmann’s Plaza					Washington, DC-MD-VA		1983			32,516					268,000		98	%		58,000		Giant Food		Bally Total Fitness / Loehmann’s
Mid-Pike Plaza					Washington, DC-MD-VA		1982/2007			44,570					309,000		100	%						Toys R Us / Bally Total Fitness / AC Moore
Mount Vernon/South Valley/7770 Richmond Hwy		(6	)		Washington, DC-MD-VA		2003-2006			77,111			11,556		565,000		95	%		62,000		Shoppers Food Warehouse		Bed, Bath & Beyond / Michaels / Home Depot / TJ Maxx / Gold’s Gym
Old Keene Mill					Washington, DC-MD-VA		1976			5,796					92,000		91	%		24,000		Whole Foods
Pan Am					Washington, DC-MD-VA		1993			28,176					227,000		100	%		63,000		Safeway		Micro Center / Michaels
Pentagon Row					Washington, DC-MD-VA		1998			87,826					296,000		99	%		45,000		Harris Teeter		Bally Total Fitness / Bed, Bath & Beyond / DSW / Cost Plus World Market
Pike 7					Washington, DC-MD-VA		1997			34,830					164,000		95	%						DSW / Staples / TJ Maxx
Quince Orchard					Washington, DC-MD-VA		1993			21,092					248,000		73	%		24,000		Magruders		Staples
Rockville Town Square					Washington, DC-MD-VA		2006-2007			37,336					182,000		97	%						CVS / Gold’s Gym
Rollingwood Apartments					Washington, DC-MD-VA		1971			7,282					N/A		93	%
Sam’s Park & Shop					Washington, DC-MD-VA		1995			12,315					49,000		100	%						Petco
Tower					Washington, DC-MD-VA		1998			19,790					112,000		69	%						Talbots
Tyson’s Station					Washington, DC-MD-VA		1978			3,667			6,028		49,000		98	%						Trader Joes
Village at Shirlington		(4	)		Washington, DC-MD-VA		1995			50,826			6,267		244,000		98	%		28,000		Harris Teeter		AMC Loews / Carlyle Grand Café
Wildwood					Washington, DC-MD-VA		1969			17,544			25,663		84,000		97	%		20,000		Balducci’s		CVS
					Total Washington Metropolitan Area					971,501					5,195,000		94	%
Philadelphia Metropolitan Area
Andorra					Philadelphia, PA-NJ		1988			22,994					267,000		94	%		24,000		Acme Markets		Kohl’s / Staples / L.A. Fitness
Bala Cynwyd					Philadelphia, PA-NJ		1993			34,454					282,000		100	%		45,000		Acme Markets		Lord & Taylor / L.A. Fitness
Ellisburg Circle					Philadelphia, PA-NJ		1992			27,684					268,000		99	%		47,000		Genuardi’s		Buy Buy Baby / Stein Mart
Feasterville					Philadelphia, PA-NJ		1980			11,880					111,000		89	%		53,000		Genuardi’s		OfficeMax
Flourtown					Philadelphia, PA-NJ		1980			15,352					191,000		85	%		42,000		Genuardi’s
Langhorne Square					Philadelphia, PA-NJ		1985			18,981					216,000		97	%		55,000		Redner’s Warehouse Mkts.		Marshalls
Lawrence Park					Philadelphia, PA-NJ		1980			29,610			29,197		353,000		99	%		53,000		Acme Markets		CHI / TJ Maxx / HomeGoods
Northeast					Philadelphia, PA-NJ		1983			22,597					285,000		90	%						Burlington Coat / Marshalls
Town Center of New Britain					Philadelphia, PA-NJ		2006			14,337					125,000		81	%		36,000		Giant Food		Rite Aid
Willow Grove					Philadelphia, PA-NJ		1984			27,159					216,000		97	%						Barnes & Noble / Marshalls / Toys R Us
Wynnewood					Philadelphia, PA-NJ		1996			36,326			29,754		255,000		97	%		98,000		Genuardi’s		Bed, Bath & Beyond / Borders / Old Navy
					Total Philadelphia Metropolitan Area					261,374					2,569,000		95	%
California
Colorado Blvd					Los Angeles-Long Beach, CA		1996-1998			16,556					68,000		97	%						Pottery Barn / Banana Republic
Crow Canyon					San Ramon, CA		2005-2007			64,969			21,113		242,000		92	%		58,000		Save Mart		Loehmann’s / Rite Aid
Escondido		(7	)		San Diego, CA		1996			28,464					222,000		94	%						Cost Plus World Market / TJ Maxx / Toys R Us
Fifth Ave					San Diego, CA		1996-1997			12,969					51,000		94	%						Urban Outfitters
Hermosa Ave					Los Angeles-Long Beach, CA		1997			5,423					22,000		90	%
Hollywood Blvd		(8	)		Los Angeles-Long Beach, CA		1999			37,669					153,000		85	%						DSW / L.A. Fitness
Kings Court		(6	)		San Jose, CA		1998			11,576					79,000		99	%		25,000		Lunardi’s Super Market		Longs Drug Store
Old Town Center					San Jose, CA		1997			34,053					96,000		95	%						Borders / Gap Kids / Banana Republic
Santana Row					San Jose, CA		1997			518,884					565,000		97	%						Crate & Barrel / Container Store / Best Buy / Borders / CineArts Theatre
Third St Promenade					Los Angeles-Long Beach, CA		1996-2000			78,288					211,000		100	%						J. Crew / Banana Republic / Old Navy / Abercrombie & Fitch
Westgate					San Jose, CA		2004			116,222					645,000		96	%		38,000		Safeway		Target / Burlington Coat Factory / Barnes & Noble / Ross
150 Post Street					San Francisco, CA		1997			37,553					102,000		98	%						Brooks Brothers / H & M
					Total California					962,626					2,456,000		95	%
New York / New Jersey
Brick Plaza					Monmouth-Ocean, NJ		1989			56,574			30,492		409,000		100	%		66,000		A&P		AMC Loews / Barnes & Noble / Sports Authority
Forest Hills					New York, NY		1997			8,094					46,000		100	%						Midway Theatre
Fresh Meadows					New York, NY		1997			68,946					403,000		98	%		15,000		Island of Gold		Kohl’s / AMC Loews
Hauppauge					Nassau-Suffolk, NY		1998			27,795			15,528		133,000		99	%		61,000		Shop Rite		AC Moore
Huntington					Nassau-Suffolk, NY		1988/2007			38,604					279,000		100	%						Buy Buy Baby / Toys R Us / Bed, Bath & Beyond / Barnes & Noble
Melville Mall		(9	)		Nassau-Suffolk, NY		2006			68,628			24,291		248,000		100	%		54,000		Waldbaum’s		Kohl’s / Marshalls
Mercer Mall		(4	)		Trenton, NJ		2003			104,995			50,990		501,000		99	%		75,000		Shop Rite		Bed, Bath & Beyond / DSW / TJ Maxx / Raymour & Flanigan
Troy					Newark, NJ		1980			24,632					207,000		86	%		64,000		Pathmark		L.A. Fitness
					Total New York / New Jersey					398,268					2,226,000		98	%

 

15

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Federal Realty Investment Trust

Real Estate Status Report

March 31, 2009

 

 

 

Property Name					MSA Description		Year Acquired		Real Estate at Cost			Mortgage and/or Capital Lease Obligation (1)			GLA (2)		% Leased			Grocery Anchor GLA (3)		Grocery Anchor (3)		Other Principal Tenants
									(in thousands)			(in thousands)
New England
Assembly Square					Boston-Cambridge-Quincy, MA-NH		2005-2008			142,234					332,000		100	%						AC Moore / Bed, Bath & Beyond / Christmas Tree Shops / Kmart / Staples / Sports Authority / TJ Maxx
Chelsea Commons					Boston-Cambridge- Quincy, MA-NH		2006-2008			29,038			8,063		222,000		91	%		16,000		Sav-A-Lot		Home Depot
Dedham Plaza					Boston-Cambridge- Quincy, MA-NH		1993			31,280					242,000		83	%		80,000		Star Market
Linden Square					Boston-Cambridge- Quincy, MA-NH		2006-2007			141,727					217,000		82	%		50,000		Roche Brothers Supermarkets		CVS / Fitness Club for Women / Wellesley Volkswagen, Buick
North Dartmouth					Boston-Cambridge- Quincy, MA-NH		2006			9,368					48,000		100	%		48,000		Stop & Shop
Queen Anne Plaza					Boston-Cambridge- Quincy, MA-NH		1994			15,650					149,000		100	%		50,000		Hannaford		TJ Maxx
Saugus Plaza					Boston-Cambridge- Quincy, MA-NH		1996			13,693					171,000		94	%		55,000		Super Stop & Shop		Kmart
					Total New England					382,990					1,381,000		92	%
Baltimore
Governor Plaza					Baltimore, MD		1985			22,019					269,000		100	%		16,500		Aldi		Bally Total Fitness / Office Depot
Perring Plaza					Baltimore, MD		1985			26,607					402,000		98	%		58,000		Shoppers Food Warehouse		Home Depot / Burlington Coat Factory / Jo-Ann Stores
THE AVENUE at White Marsh		(10	)		Baltimore, MD		2007			94,607			59,752		298,000		100	%						AMC Loews / Old Navy / Barnes & Noble / AC Moore
The Shoppes at Nottingham Square					Baltimore, MD		2007			27,568					52,000		100	%
White Marsh Plaza					Baltimore, MD		2007			24,927			10,058		80,000		98	%		54,000		Giant Food
White Marsh Other					Baltimore, MD		2007			31,968					49,000		100	%
					Total Baltimore					227,696					1,150,000		99	%
Chicago
Crossroads					Chicago, IL		1993			24,031					173,000		71	%						Golfsmith / Guitar Center
Finley Square					Chicago, IL		1995			31,299					315,000		97	%						Bed, Bath & Beyond / Buy Buy Baby / Petsmart
Garden Market					Chicago, IL		1994			11,535					140,000		100	%		63,000		Dominick’s		Walgreens
North Lake Commons					Chicago, IL		1994			13,693					129,000		90	%		77,000		Dominick’s
					Total Chicago					80,558					757,000		91	%
South Florida
Courtyard Shops					Miami-Ft Lauderdale		2008			38,829			7,679		130,000		94	%		49,000		Publix
Del Mar Village					Miami-Ft Lauderdale		2008			53,931					178,000		92	%		44,000		Winn Dixie		CVS
					Total South Florida					92,760					308,000		93	%
Other
Barracks Road					Charlottesville, VA		1985			45,237			41,191		488,000		94	%		99,000		Harris Teeter / Kroger		Bed, Bath & Beyond / Barnes & Noble / Old Navy
Bristol Plaza					Hartford, CT		1995			27,371					272,000		84	%		74,000		Stop & Shop		TJ Maxx
Eastgate					Raleigh-Durham-Chapel Hill, NC		1986			25,212					153,000		98	%						Stein Mart
Gratiot Plaza					Detroit, MI		1973			18,675					217,000		99	%		69,000		Kroger		Bed, Bath & Beyond / Best Buy / DSW
Greenwich Avenue					New Haven-Bridgeport- Stamford-Waterbury		1995			13,936					36,000		100	%						Saks Fifth Avenue
Houston St					San Antonio, TX		1998			68,957					182,000		73	%						Hotel Valencia
Lancaster		(11	)		Lancaster, PA		1980			10,851			4,907		107,000		98	%		39,000		Giant Food		Michaels
Shoppers’ World					Charlottesville, VA		2007			29,541			5,833		169,000		95	%		28,000		Whole Foods		Staples
Shops at Willow Lawn					Richmond-Petersburg, VA		1983			75,991					476,000		87	%		60,000		Kroger		Old Navy / Staples / Ross
					Total Other					315,771					2,100,000		90	%
Grand Total									$	3,693,544		$	446,770		18,142,000		94	%

 

Notes:

(1)	The mortgage or capital lease obligations differ from the total reported on the consolidated balance sheet due to the unamortized discount or premium on certain mortgage payables.

(2)	Excludes newly created redevelopment square footage not yet in service, as well as residential and hotel square footage.

(3)	Grocery anchor is defined as a grocery tenant leasing 15,000 square feet or more.

(4)	Portion of property subject to capital lease obligation.

(5)	The Trust has a 64.1% ownership interest in the property.

(6)	Property owned in a “downreit” partnership, of which a wholly owned subsidiary of the Trust is the sole general partner, with third party partners holding operating partnership units.

(7)	The Trust has a 70% ownership interest in the property.

(8)	The Trust has a 90% ownership interest in the property.

(9)	On October 16, 2006, the Trust acquired control of Melville Mall through a 20 year master lease and secondary financing. Since the Trust controls this property and retains substantially all of the economic benefit and risks associated with it, we consolidate this property and its operations.

(10)	50% of the ownership of this property is in a “downreit” partnership, of which a wholly owned subsidiary of the Trust is the sole general partner, with third party partners holding operating partnership units.

(11)	Property subject to capital lease obligation.

 

16

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Federal Realty Investment Trust

Retail Leasing Summary (1)

March 31, 2009

 

 

Total Lease Summary - Comparable (2)

Quarter		Number of Leases Signed		% of Comparable Leases Signed			GLA Signed		Contractual Rent (3) Per Sq. Ft.			Prior Rent (4) Per Sq. Ft.			Annual Increase in Rent			Cash Basis % Increase Over Prior Rent			Straight- lined Basis % Increase Over Prior Rent			Weighted Average Lease Term (5)		Tenant Improvements & Incentives (6)			Tenant Improvements & Incentives Per Sq. Ft.
1st Quarter 2009		68		100	%		232,105		$	31.42		$	26.99		$	1,029,234		16	%		26	%		6.1		$	2,413,756		$	10.40
4th Quarter 2008		74		100	%		329,622		$	21.62		$	19.18		$	803,054		13	%		24	%		5.0		$	1,733,441		$	5.26
3rd Quarter 2008		68		100	%		351,310		$	25.03		$	20.28		$	1,669,056		23	%		42	%		7.8		$	2,728,958		$	7.77
2nd Quarter 2008		84		100	%		239,207		$	36.39		$	29.21		$	1,717,881		25	%		42	%		7.3		$	2,316,197		$	9.68
Total - 12 months		294		100	%		1,152,244		$	27.70		$	23.17		$	5,219,225		20	%		34	%		6.6		$	9,192,352		$	7.98

New Lease Summary - Comparable (2)

 

Quarter		Number of Leases Signed		% of Comparable Leases Signed			GLA Signed		Contractual Rent (3) Per Sq. Ft.			Prior Rent (4) Per Sq. Ft.			Annual Increase in Rent			Cash Basis % Increase Over Prior Rent			Straight- lined Basis % Increase Over Prior Rent			Weighted Average Lease Term (5)		Tenant Improvements & Incentives (6)			Tenant Improvements & Incentives Per Sq. Ft.
1st Quarter 2009		24		35	%		73,535		$	32.54		$	32.28		$	19,630		1	%		12	%		9.2		$	2,398,456		$	32.62
4th Quarter 2008		15		20	%		67,903		$	28.76		$	24.20		$	309,272		19	%		37	%		8.7		$	1,583,441		$	23.32
3rd Quarter 2008		26		38	%		93,768		$	43.16		$	29.76		$	1,257,073		45	%		65	%		9.0		$	2,224,958		$	23.73
2nd Quarter 2008		31		37	%		115,097		$	34.23		$	26.46		$	894,253		29	%		47	%		8.5		$	1,770,940		$	15.39
Total - 12 months		96		33	%		350,303		$	35.21		$	28.13		$	2,480,228		25	%		42	%		8.8		$	7,977,795		$	22.77

Renewal Lease Summary - Comparable (2) (7)

 

Quarter		Number of Leases Signed		% of Comparable Leases Signed			GLA Signed		Contractual Rent (3) Per Sq. Ft.			Prior Rent (4) Per Sq. Ft.			Annual Increase in Rent			Cash Basis % Increase Over Prior Rent			Straight- lined Basis % Increase Over Prior Rent			Weighted Average Lease Term (5)		Tenant Improvements & Incentives (6)			Tenant Improvements & Incentives Per Sq. Ft.
1st Quarter 2009		44		65	%		158,570		$	30.90		$	24.53		$	1,009,604		26	%		35	%		4.6		$	15,300		$	0.10
4th Quarter 2008		59		80	%		261,719		$	19.76		$	17.88		$	493,783		11	%		20	%		3.6		$	150,000		$	0.57
3rd Quarter 2008		42		62	%		257,542		$	18.43		$	16.83		$	411,984		10	%		25	%		6.7		$	504,000		$	1.96
2nd Quarter 2008		53		63	%		124,110		$	38.40		$	31.76		$	823,628		21	%		38	%		6.2		$	545,257		$	4.39
Total - 12 months		198		67	%		801,941		$	24.42		$	21.01		$	2,738,999		16	%		29	%		5.2		$	1,214,557		$	1.51

Total Lease Summary - Comparable and Non-comparable (2)

 

Quarter		Number of Leases Signed		GLA Signed		Contractual Rent (3) Per Sq. Ft.			Weighted Average Lease Term (5)		Tenant Improvements & Incentives (6)			Tenant Improvements & Incentives Per Sq. Ft.
1st Quarter 2009		69		233,172		$	31.35		6.1		$	2,430,940		$	10.43
4th Quarter 2008		78		334,127		$	21.92		5.0		$	1,898,706		$	5.68
3rd Quarter 2008		76		369,323		$	26.12		8.1		$	3,721,035		$	10.08
2nd Quarter 2008		90		253,048		$	36.40		7.5		$	2,940,855		$	11.62
Total - 12 months		313		1,189,670		$	28.15		6.8		$	10,991,536		$	9.24

 

Notes:

(1)	Leases on this report represent retail activity only; office and residential leases are not included.

(2)	Comparable leases represent those leases signed on spaces for which there was a former tenant.

(3)	Contractual rent represents contractual minimum rent under the new lease for the first 12 months of the term.

(4)	Prior rent represents minimum rent and percentage rent, if any, paid by the prior tenant in the final 12 months of the term.

(5)	Weighted average is determined on the basis of square footage.

(6)	See Glossary of Terms.

(7)	Renewal leases represent expiring leases rolling over with the same tenant in the same location. All other leases are categorized as new.

 

17

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Federal Realty Investment Trust

Lease Expirations

March 31, 2009

 

 

Assumes no exercise of lease options

 

		Anchor Tenants (1)								Small Shop Tenants								Total
Year		Expiring SF		% of Anchor SF			Minimum Rent PSF (2)			Expiring SF		% of Small Shop SF			Minimum Rent PSF (2)			Expiring SF		% of Total SF			Minimum Rent PSF (2)
2009		255,000		3	%		$	14.75		593,000		8	%		$	27.15		848,000		5	%		$	23.42
2010		647,000		7	%		$	12.36		858,000		12	%		$	29.09		1,505,000		9	%		$	21.90
2011		869,000		9	%		$	13.07		1,135,000		15	%		$	30.42		2,004,000		12	%		$	22.90
2012		1,028,000		11	%		$	12.90		1,083,000		15	%		$	31.14		2,111,000		12	%		$	22.26
2013		1,054,000		11	%		$	15.45		1,019,000		14	%		$	31.92		2,073,000		12	%		$	23.54
2014		1,349,000		14	%		$	15.55		640,000		9	%		$	32.24		1,989,000		12	%		$	20.92
2015		521,000		5	%		$	15.24		490,000		7	%		$	27.90		1,011,000		6	%		$	21.37
2016		384,000		4	%		$	17.85		424,000		6	%		$	31.35		808,000		5	%		$	24.93
2017		623,000		6	%		$	17.31		421,000		6	%		$	30.34		1,044,000		6	%		$	22.57
2018		640,000		7	%		$	11.35		304,000		4	%		$	34.87		944,000		6	%		$	18.93
Thereafter		2,258,000		23	%		$	16.74		388,000		4	%		$	37.31		2,646,000		15	%		$	19.76
Total (3)		9,628,000		100	%		$	14.99		7,355,000		100	%		$	30.90		16,983,000		100	%		$	21.88

Assumes all lease options are exercised

 

		Anchor Tenants (1)								Small Shop Tenants								Total
Year		Expiring SF		% of Anchor SF			Minimum Rent PSF (2)			Expiring SF		% of Small Shop SF			Minimum Rent PSF (2)			Expiring SF		% of Total SF			Minimum Rent PSF (2)
2009		104,000		1	%		$	13.96		337,000		5	%		$	27.41		441,000		3	%		$	24.24
2010		166,000		2	%		$	11.42		511,000		7	%		$	30.51		677,000		4	%		$	25.83
2011		203,000		2	%		$	5.55		655,000		9	%		$	28.88		858,000		5	%		$	23.36
2012		268,000		3	%		$	14.60		625,000		8	%		$	32.27		893,000		5	%		$	26.97
2013		127,000		1	%		$	15.35		530,000		7	%		$	32.08		657,000		4	%		$	28.85
2014		249,000		3	%		$	12.47		510,000		7	%		$	33.06		759,000		4	%		$	26.30
2015		242,000		3	%		$	16.12		421,000		6	%		$	26.33		663,000		4	%		$	22.60
2016		125,000		1	%		$	20.84		413,000		6	%		$	32.31		538,000		3	%		$	29.65
2017		127,000		1	%		$	26.70		544,000		7	%		$	29.88		671,000		4	%		$	29.27
2018		330,000		3	%		$	14.78		458,000		6	%		$	35.59		788,000		5	%		$	26.87
Thereafter		7,687,000		80	%		$	15.10		2,351,000		32	%		$	30.85		10,038,000		59	%		$	18.79
Total (3)		9,628,000		100	%		$	14.99		7,355,000		100	%		$	30.90		16,983,000		100	%		$	21.88

 

Notes:

(1)	Anchor is defined as a tenant leasing 15,000 square feet or more.

(2)	Minimum Rent reflects in-place contractual (cash-basis) rent as of March 31, 2009.

(3)	Represents occupied square footage as of March 31, 2009.

 

18

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Federal Realty Investment Trust

Portfolio Leased Statistics

March 31, 2009

 

 

Overall Portfolio Statistics (1)

 

		At March 31, 2009							At March 31, 2008
Type		Size		Leased		Leased %			Size		Leased		Leased %
Retail Properties (2) (sf)		18,142,000		17,098,000		94.2	%		18,197,000		17,480,000		96.1	%
Residential Properties (3) (units)		903		850		94.1	%		723		693		95.9	%

Same Center Statistics (1)

 

		At March 31, 2009							At March 31, 2008
Type		Size		Leased		Leased %			Size		Leased		Leased %
Retail Properties (2) (4) (sf)		16,974,000		16,036,000		94.5	%		17,244,000		16,618,000		96.4	%
Residential Properties (3) (units)		723		676		93.5	%		723		693		95.9	%

 

Notes:

(1)	See Glossary of Terms.

(2)	Leasable square feet; excludes redevelopment square footage not yet placed in service.

(3)

Overall portfolio and Same Center statistics at March 31, 2009 and 2008 include Rollingwood, The Crest at Congressional and the residential rental units at Santana Row. Overall portfolio statistics as of March 31, 2009, include the 180 residential units at Arlington East (Bethesda Row) which were first delivered in May 2008 and continued to be delivered through 2008.

(4)	Excludes properties purchased, sold or under redevelopment.

 

19

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Federal Realty Investment Trust

Summary of Top 25 Tenants

March 31, 2009

 

 

 

Rank		Tenant Name		Annualized Base Rent				Percentage of Total Annualized Base Rent			Tenant GLA			Percentage of Total GLA			Number of Stores Leased
1		Bed, Bath & Beyond, Inc.		$	9,751,000			2.62	%		647,000			3.57	%		15
2		Ahold USA, Inc.		$	8,369,000			2.25	%		571,000			3.15	%		11
3		TJX Companies		$	7,029,000			1.89	%		540,000			2.98	%		15
4		Safeway, Inc.		$	6,719,000			1.81	%		481,000			2.65	%		9
5		Gap, Inc.		$	6,438,000			1.73	%		220,000			1.21	%		11
6		CVS Corporation		$	6,219,000			1.67	%		205,000			1.13	%		18
7		Barnes & Noble, Inc.		$	4,725,000			1.27	%		201,000			1.11	%		8
8		OPNET Technologies, Inc.		$	3,729,000			1.00	%		83,000			0.46	%		2
9		Best Buy Stores, L.P.		$	3,459,000			0.93	%		99,000			0.55	%		3
10		Staples, Inc.		$	3,441,000			0.93	%		187,000			1.03	%		9
11		DSW, Inc		$	3,263,000			0.88	%		125,000			0.69	%		5
12		Supervalu Inc.(Acme/Sav-A- Lot/Star Mkt/Shoppers Food)		$	3,227,000			0.87	%		338,000			1.86	%		7
13		Wells Fargo Bank, N.A. (includes Wachovia Corporation)		$	3,186,000			0.86	%		73,000			0.40	%		16
14		L.A. Fitness International LLC		$	3,061,000			0.82	%		178,000			0.98	%		4
15		Home Depot, Inc.		$	2,832,000			0.76	%		335,000			1.85	%		4
16		Ross Stores, Inc.		$	2,810,000			0.76	%		149,000			0.82	%		5
17		Kohl’s Corporation		$	2,793,000			0.75	%		322,000			1.77	%		3
18		Wakefern Food Corporation		$	2,693,000			0.72	%		136,000			0.75	%		2
19		Borders Group, Inc.		$	2,689,000			0.72	%		100,000			0.55	%		4
20		Bank of America, N.A.		$	2,614,000			0.70	%		64,000			0.35	%		18
21		Great Atlantic & Pacific Tea Co		$	2,517,000			0.68	%		217,000			1.20	%		4
22		Container Store, Inc.		$	2,496,000			0.67	%		52,000			0.29	%		2
23		A.C. Moore, Inc.		$	2,483,000			0.67	%		141,000			0.78	%		6
24		AMC Entertainment Inc.		$	2,378,000			0.64	%		166,000			0.92	%		4
25		Dollar Tree Stores, Inc.		$	2,357,000			0.63	%		158,000			0.87	%		14
		Totals - Top 25 Tenants		$	101,278,000			27.23	%		5,788,000			31.92	%		199
		Total: (1)		$	371,574,000	(2)					18,142,000	(3)					2,439

 

Notes:

(1)	Does not include amounts related to leases these tenants have with our partnership with a discretionary fund created and advised by ING Clarion Partners.

(2)	Reflects annual in-place contractual (cash-basis) rent as of March 31, 2009.

(3)	Excludes redevelopment square footage not yet placed in service.

 

20

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Federal Realty Investment Trust

Reconciliation of Net Income to FFO Guidance

March 31, 2009

 

 

 

		2009 Guidance
		(Dollars in millions except per share amounts) (1)
Funds from Operations available for common shareholders (FFO)
Net income attributable to the Trust		$	90			$	98
Gain on sale of real estate			1				1
Depreciation and amortization of real estate & real estate partnership assets			104				104
Amortization of initial direct costs of leases			9				9
Funds from operations			204				211
Dividends on preferred stock			(1	)			(1	)
Income attributable to operating partnerships units			1				1
Income attributable to unvested shares			(1	)			(1	)
FFO			204				212
Litigation provision (2)			21				21
FFO excluding litigation provision		$	226			$	233
Weighted average number of common shares, diluted			59.4				59.4
FFO per diluted share		$	3.44			$	3.56
Litigation provision (2)			0.36				0.36
FFO per diluted share excluding litigation provision		$	3.80			$	3.92

 

Notes:

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

(2)	See additional information in the litigation update section of this Form 8-K.

 

21

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Federal Realty Investment Trust

Litigation Update

March 31, 2009

 

 

In May 2003, a breach of contract action was filed against us which alleged that a one page document entitled “Final Proposal” constituted a ground lease of a parcel of property located adjacent to our Santana Row property and gave the plaintiff the option to require that we acquire the property at a price determined in accordance with a formula included in the “Final Proposal.” The “Final Proposal” explicitly stated that it was subject to approval of the terms and conditions of a formal agreement. A trial as to liability only was held in June 2006 and a jury rendered a verdict against us. A trial on the issue of damages was held in April 2008 and the court recently issued a tentative ruling awarding damages to the plaintiff of approximately $14.4 million plus interest. A final judgment awarding damages and determining interest is not expected to be entered for a few weeks. We and the plaintiff have filed briefs with the court addressing various items raised in the court’s tentative ruling. The plaintiff has alleged in its brief that the damages award should be $15.5 million. Based on our calculations and estimates provided by the plaintiff, interest is estimated to be in a range of approximately $2.1 million to $8.4 million. We believe and have recently filed arguments supporting a lower damages amount and will file arguments supporting a lower interest amount towards the low end of the range. However, based on the tentative ruling and information currently available, our best estimate of damages is $14.3 million plus interest of $7.1 million for a total of $21.4 million. Accordingly, we have increased our accrual for this matter from $0.8 million at December 31, 2008, to $21.4 million at March 31, 2009. The increase in our accrual of $20.6 million is presented as a separate line item in our consolidated statement of operations. Other costs may be asserted by the plaintiff, however, we are unable to estimate the amount or a reasonable range of likely outcomes at this time. Furthermore, we continue to believe that the “Final Proposal” which included express language that it was subject to formal documentation was not a binding contract and that we should have no liability whatsoever. Accordingly, we intend to appeal the judgment once the final judgment on damages is entered.

See page 23 for a copy of the “Final Proposal”.

 

22

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Steven J. Guttman		August 24, 2000
President & Chief Executive Officer
Santana Row, Winchester Blvd,
San Jose, CA. 95128

 

		Re: Land Lease / Town & Country
		350 So. Winchester Blvd. San Jose, CA.

FINAL PROPOSAL

 

1.

Ground Lease at $100,000 per month. Lease to include increases of three (3%) annually.

 

2.

First National is given a 10 year put at a capitalization rate of 9% at the then current annual rental. Federal Realty to cooperate with a tax free exchange.

 

3.

Federal Realty to be given a call at the end of ten years at a 9% capitalization rate.

 

4.

First National to be offered an option to lease office space of up to 5000 square feet in the new Santana Row complex at $ 4.00 per square feet per month, subject to the terms and conditions of a new lease.

 

5.

First National to be reimbursed $75,000 to buy out the current lease holder, New Things West.

 

6.

Federal Realty to pay for the moving expenses of First National Mortgage not to exceed $25,000.00.

 

7.

Federal Realty to prepare a legal agreement for First National’s review to finalize the agreement.

 

8.

Effective date of agreement as of date of vacating premises.

 

9.

The above agreement must be accepted via fax to 408-249-9214 no later than 10:00 am California time on August 25, 2000, at which time this counter offer will automatically expire.

The above terms are hereby accepted by the parties subject only to approval of the terms and conditions of a formal agreement.

 

FIRST NATIONAL MORTGAGE COMPANY				FEDERAL REALTY INVESTMENT TRUST
/s/ Hal Dryan				/s/ Steven J. Guttman
Hal Dryan, Chairman				Steven J. Guttman, President & Chief Executive Officer

FN-0336

Trial Ex. 021.001

 

23

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Federal Realty Investment Trust

Summarized Income Statements and Balance Sheets - Joint Venture

March 31, 2009

 

 

CONSOLIDATED INCOME STATEMENTS

 

		Three months ended March 31,
		2009				2008
		(in thousands)
Revenues
Rental income		$	4,665			$	4,617
Other property income			23				63
			4,688				4,680
Expenses
Rental			1,106				874
Real estate taxes			550				465
Depreciation and amortization			1,271				1,185
			2,927				2,524
Operating income			1,761				2,156
Interest expense			(1,133	)			(1,135	)
Net income		$	628			$	1,021

CONSOLIDATED BALANCE SHEETS

 

		March 31, 2009				December 31, 2008
		(in thousands)
ASSETS
Real estate, at cost		$	202,523				202,519
Less accumulated depreciation and amortization			(15,799	)			(14,609	)
Net real estate			186,724				187,910
Cash and cash equivalents			2,368				2,604
Other assets			6,049				7,066
TOTAL ASSETS		$	195,141			$	197,580
LIABILITIES AND PARTNERS’ CAPITAL
Liabilities
Mortgages payable		$	81,320			$	81,365
Other liabilities			6,773				7,363
Total liabilities			88,093				88,728
Partners’ capital			107,048				108,852
TOTAL LIABILITIES AND PARTNERS’ CAPITAL		$	195,141			$	197,580

 

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Federal Realty Investment Trust

Summary of Outstanding Debt and Debt Maturities - Joint Venture

March 31, 2009

 

 

OUTSTANDING DEBT

 

		Maturity		Stated Interest Rate as of March 31, 2009			Balance
							(in thousands)
Mortgage Loans
Secured Fixed Rate
Campus Plaza		12/01/09		4.530	%(a)		$	11,000
Pleasant Shops		12/01/09		4.530	%(a)			12,400
Plaza del Mercado		07/05/14		5.770	%(b)			13,035
Atlantic Plaza		12/01/14		5.120	%(a)			10,500
Barcroft Plaza		07/01/16		5.990	%(a)(c)			20,785
Greenlawn Plaza		07/01/16		5.900	%(a)			13,600
		Total Fixed Rate Debt					$	81,320

Debt Maturities

(in thousands)

 

Year		Scheduled Amortization			Maturities			Total			Percent of Debt Maturing			Cumulative Percent of Debt Maturing
2009			140			23,400			23,540		28.9	%		28.9	%
2010			196			—			196		0.2	%		29.1	%
2011			208			—			208		0.3	%		29.4	%
2012			220			—			220		0.3	%		29.7	%
2013			233			—			233		0.3	%		30.0	%
2014			142			22,396			22,538		27.7	%		57.7	%
2015			—			—			—		0.0	%		57.7	%
2016			—			34,385			34,385		42.3	%		100.0	%
Total		$	1,139		$	80,181		$	81,320		100.0	%

 

Notes:

(a)	Interest only until maturity.

(b)	Effective July 5, 2007, principal and interest payments are due based on a 30-year amortization schedule.

(c)	The stated interest rate represents the weighted average interest rate for two mortgage loans secured by this property. The loan balance represents a note of $16.6 million at a stated rate of 6.06% and a note of $4.2 million at a stated rate of 5.71%.

 

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Federal Realty Investment Trust

Real Estate Status Report - Joint Venture

March 31, 2009

 

 

 

Property Name		MSA Description		Year Acquired		Real Estate at Cost			Mortgage or Capital Lease Obligation			GLA		% Leased			Grocery Anchor GLA (1)		Grocery Anchor (1)		Other Principal Tenants
						(in thousands)			(in thousands)
Washington Metropolitan Area
Barcroft Plaza		Washington, DC-MD-VA		2006-2007			34,059		$	20,785		100,000		94	%		46,000		Harris Teeter		Bank of America
Free State Shopping Center		Washington, DC-MD-VA		2007			65,846					279,000		99	%		73,000		Giant Food		TJ Maxx / Ross / Office Depot
Plaza del Mercado		Washington, DC-MD-VA		2004			21,070			13,035		96,000		91	%		25,000		Giant Food		CVS
		Total Washington Metropolitan Area					120,975					475,000		97	%
New York / New Jersey
Greenlawn Plaza		Nassau-Suffolk, NY		2006			19,983			13,600		106,000		100	%		46,000		Waldbaum’s		Tuesday Morning
		Total New York / New Jersey					19,983					106,000		100	%
New England
Atlantic Plaza		Boston-Worcester- Lawrence-Lowell- Brockton, MA		2004			16,521			10,500		124,000		96	%		63,000		Shaw’s Supermarket		Sears
Campus Plaza		Boston-Worcester- Lawrence-Lowell- Brockton, MA		2004			22,127			11,000		116,000		100	%		46,000		Roche Brothers		Burlington Coat Factory
Pleasant Shops		Boston-Worcester- Lawrence-Lowell- Brockton, MA		2004			22,917			12,400		129,000		96	%		38,000		Foodmaster		Marshalls
		Total New England					61,565					369,000		97	%
Grand Totals						$	202,523		$	81,320		950,000		97	%

 

Note:

(1)	Grocery anchor is defined as a grocery tenant leasing 15,000 square feet or more.

 

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Glossary of Terms

Adjusted EBITDA: Adjusted EBITDA is a non-GAAP measure that means net income or loss plus depreciation and amortization, net interest expense, income taxes, gain or loss on sale of real estate and impairments of real estate, if any. Adjusted EBITDA is presented because it approximates a key performance measure in our debt covenants, but it should not be considered an alternative measure of operating results or cash flow from operations as determined in accordance with GAAP. The reconciliation of Adjusted EBITDA to net income attributable to the Trust for the three months ended March 31, 2009 and 2008 is as follows:

 

		Three Months Ended March 31,
		2009				2008
		(in thousands)
Net income attributable to the Trust		$	10,484			$	29,986
Depreciation and amortization			28,592				25,400
Interest expense			23,569				24,353
Other interest income			(90	)			(341	)
EBITDA			62,555				79,398
Gain on sale of real estate			(915	)			—
Adjusted EBITDA		$	61,640			$	79,398

Funds From Operations (FFO): FFO is a supplemental measure of real estate companies’ operating performances. The National Association of Real Estate Investment Trusts (“NAREIT”) defines FFO as follows: net income, computed in accordance with GAAP plus depreciation and amortization of real estate assets and excluding extraordinary items and gains and losses on sale of real estate. NAREIT developed FFO as a relative measure of performance and liquidity of an equity REIT in order to recognize that the value of income-producing real estate historically has not depreciated on the basis determined under GAAP. However, FFO does not represent cash flows from operating activities in accordance with GAAP (which, unlike FFO, generally reflects all cash effects of transactions and other events in the determination of net income); should not be considered an alternative to net income as an indication of our performance; and is not necessarily indicative of cash flow as a measure of liquidity or ability to pay dividends. We consider FFO a meaningful, additional measure of operating performance primarily because it excludes the assumption that the value of real estate assets diminishes predictably over time, and because industry analysts have accepted it as a performance measure. Comparison of our presentation of FFO to similarly titled measures for other REITs may not necessarily be meaningful due to possible differences in the application of the NAREIT definition used by such REITs.

Property Operating Income: Rental income, other property income and mortgage interest income, less rental expenses and real estate taxes and excluding operating results from discontinued operations.

Overall Portfolio: Includes all operating properties owned in reporting period.

Same Center: Information provided on a same center basis is provided for only those properties that were owned and operated for the entirety of both periods being compared, excludes properties that were redeveloped, expanded or under development and properties purchased or sold at any time during the periods being compared.

Tenant Improvements and Incentives: Represents not only the total dollars committed for the improvement (fit-out) of a space as it relates to a specific lease but may also include base building costs (i.e. expansion, escalators or new entrances) which are required to make the space leasable. Incentives include amounts paid to tenants as an inducement to sign a lease that do not represent building improvements.

 

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