PREIT Advances Transformation Efforts with Execution of Multi-property Agreement of Sale with Institutional Buyer

PHILADELPHIA, July 28, 2015 /PRNewswire/ -- Pennsylvania Real Estate Investment Trust (NYSE: PEI) announced today that it has entered into an Agreement of Sale for three malls to an institutional buyer.  The assets under agreement of sale, which are subject to customary closing conditions, are: Gadsden Mall in Gadsden, AL, Wiregrass Commons Mall in Dothan, AL and New River Valley Mall in Christiansburg, VA.

Sales per square foot for the assets under agreement of sale follow:

• New River Valley Mall: $279
• Wiregrass Commons Mall: $297
• Gadsden Mall: $310

Excluding these properties, and Uniontown Mall, the sale of which is expected imminently,  sales per square foot as of June 30, 2015 were $431. 

The three assets are expected to be sold in one transaction for $95.4 million.  This would constitute a total of 10 malls sold under the Company's disposition program.  Total funds raised through assets sales including malls, power centers and various parcels would total over $560 million. 

In addition to these transactions, the Company is also negotiating agreements of sale on two additional non-core malls, which it hopes to execute within the next several weeks. Upon completion of these transactions and assuming the sale of Palmer Park Mall,  the portfolio composition would be modified as follows:

"Upon completion of these transactions, our evolution into a high-quality mall REIT is nearly complete," said Joseph F. Coradino, CEO of PREIT. "Our methodic and efficient disposition program, coupled with our disciplined capital allocation strategy, has transformed our platform into one which is expected to generate sales exceeding $450 per square foot resulting in an enhanced relationship with retailers, a cultural shift within the Company and opportunity to drive future growth and enhance shareholder value." 

About PREIT
PREIT is a real estate investment trust specializing in the ownership and management of differentiated retail shopping malls designed to fit the dynamic communities they serve. Founded in 1960 as Pennsylvania Real Estate Investment Trust, the Company owns and operates approximately 28 million square feet of space in properties in 12 states in the eastern half of the United States with concentration in the Mid-Atlantic region and Greater Philadelphia.  PREIT is headquartered in Philadelphia, Pennsylvania, and is publicly traded on the NYSE under the symbol PEI.  Information about the Company can be found at preit.com or on Twitter or LinkedIn.

Forward Looking Statements

This press release, together with other statements and information publicly disseminated by us, contain certain "forward-looking statements" within the meaning of the federal securities laws. Forward-looking statements relate to expectations, beliefs, projections, future plans, strategies, anticipated events, trends and other matters that are not historical facts. These forward-looking statements reflect our current views about future events, achievements or results and are subject to risks, uncertainties and changes in circumstances that might cause future events, achievements or results to differ materially from those expressed or implied by the forward-looking statements. In particular, our business might be materially and adversely affected by uncertainties affecting real estate businesses generally as well as the following, among other factors: our substantial debt and stated value of preferred shares and our high leverage ratio; constraining leverage, unencumbered debt yield, interest and tangible net worth covenants under our 2013 Revolving Facility and our Term Loans; potential losses on impairment of certain long-lived assets, such as real estate, or of intangible assets, such as goodwill, including such losses that we might be required to record in connection with any dispositions of assets; changes in the retail industry, including consolidation and store closings, particularly among anchor tenants; our ability to sell properties that we seek to dispose of or our ability to obtain estimated sale prices; the effects of online shopping and other uses of technology on our retail tenants; risks relating to development and redevelopment activities; current economic conditions and the state of employment growth and consumer confidence and spending, and the corresponding effects on tenant business performance, prospects, solvency and leasing decisions and on our cash flows, and the value and potential impairment of our properties; our ability to refinance our existing indebtedness when it matures, on favorable terms or at all; our ability to raise capital, including through the issuance of equity or equity-related securities if market conditions are favorable, through joint ventures or other partnerships, through sales of properties or interests in properties, or through other actions; our ability to identify and execute on suitable acquisition opportunities and to integrate acquired properties into our portfolio; our partnerships and joint ventures with third parties to acquire or develop properties; our short and long-term liquidity position; general economic, financial and political conditions, including credit and capital market conditions, changes in interest rates or unemployment; our ability to maintain and increase property occupancy, sales and rental rates, in light of the relatively high number of leases that have expired or are expiring in the next two years; acts of violence at malls, including our properties, or at other similar spaces, and the potential effect on traffic and sales; changes to our corporate management team and any resulting modifications to our business strategies; increases in operating costs that cannot be passed on to tenants; concentration of our properties in the Mid-Atlantic region; changes in local market conditions, such as the supply of or demand for retail space, or other competitive factors; and potential dilution from any capital raising transactions or other equity issuances.  Additional factors that might cause future events, achievements or results to differ materially from those expressed or implied by our forward-looking statements include those discussed in our Annual Report on Form 10-K for the year ended December 31, 2014 in the section entitled "Item 1A. Risk Factors." We do not intend to update or revise any forward-looking statements to reflect new information, future events or otherwise.

CONTACTS:

Robert McCadden
EVP & CFO
(215) 875-0735

Heather Crowell
VP, Corporate Communications and Investor Relations
(215) 454-1241
[email protected]

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SOURCE PREIT

Related Links

http://www.preit.com

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