PREIT Secures $173M in Financing

Source: PREIT

Pennsylvania Real Estate Investment Trust (“PREIT”)has completed three non-recourse mortgage loans with total proceeds of $173 million that are secured separately by Exton Square, Francis Scott Key and Viewmont Malls. Year to date, the Company has completed 14 financings for an aggregate of more than $820 million.

Ron Rubin, Chairman and Chief Executive Officer of the Company said "We are pleased to have completed these financings and are excited about the progress we are making at our transformed Cherry Hill Mall, Plymouth Meeting Mall, and Voorhees Town Center properties. In 2009, visitors to these malls are sure to enjoy the shopping, dining and entertainment experiences we are creating at these vibrant New Jersey and Pennsylvania properties."

PREIT closed a $70 million non-recourse mortgage loan secured by Exton Square Mall in Exton, Pennsylvania. This mortgage loan, provided by the lenders for the previous mortgage loan, carries a fixed interest rate of 7.50% for the term of the five year loan. Exton Square Mall, acquired in 2003, is a 1.1 million square foot enclosed mall anchored by Boscov's, JCPenney, Macy's and Sears. As of September 30, 2008, non-anchor occupancy was 83.6% and twelve-month same-store sales were $359 per square foot.

PREIT also closed a $55 million non-recourse mortgage loan secured by Francis Scott Key Mall in Frederick, Maryland. The five-year, interest-only loan, provided by a commercial bank, carries a variable interest rate of LIBOR plus 2.35% that was swapped to a fixed rate of 5.245% for its full term. Francis Scott Key Mall, acquired in 2003, is a 711,000 square foot enclosed mall anchored by JCPenney, Macy's and Sears. As of September 30, 2008, non-anchor occupancy was 92.3% and twelve-month same-store sales were $355 per square foot.

Finally, a $48 million non-recourse mortgage loan secured by Viewmont Mall in Scranton, Pennsylvania was also closed. The five-year, interest only loan, provided by a commercial bank, carries a variable interest rate of LIBOR plus 2.35% that was swapped to a fixed rate of 5.245% for its full term. Viewmont Mall, acquired in 2003, is a 750,000 square foot enclosed mall anchored by JCPenney, Macy's and Sears. As of September 30, 2008, non-anchor occupancy was 92.5% and twelve-month same-store sales were $375 per square foot.

The proceeds from these three financings were used to repay the previous $93 millionExton Square Mall mortgage, repay a portion of the amount outstanding under the Company's Credit Facility and for general corporate purposes.