PREIT Highlights Successful Sale of Eight Properties in 2014; Plans to Divest Five Additional Properties

PREIT has Sold Interests in 16 properties for More Than $420 Million Since Initiating its Portfolio Review Program in 2012

Total Value of Properties Sold During 2014 was Approximately $192 Million

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PREIT

Jan 05, 2015, 08:00 ET

PHILADELPHIA, Jan. 5, 2015 /PRNewswire/ -- Pennsylvania Real Estate Investment Trust (PREIT/NYSE: PEI) announced today that in 2014 it successfully completed the sale of eight properties for $191.7 million.

These transactions were pursuant to the Company's strategic disposition program, under which PREIT has been divesting non-core properties to improve overall portfolio quality and focus resources on assets that represent the greatest value creation opportunities. PREIT commenced its disposition program in 2012 and has sold its interests in 16 assets to date, including six non-core enclosed malls which generated average sales per square foot of less than $250. The interests sold had a total value of $424.1 million.

Properties, or interests in properties, sold in 2014 include:

South Mall, with sales of $227 per square foot, for $23.6 million;
Nittany and North Hanover Malls, with sales of $243 and $275 per square foot, respectively, for $32.3 million;
50% interest in Whitehall Mall, outparcels proximate to the Company's Magnolia and Francis Scott Key Malls, and an anchor pad underlying a Bon Ton store in multiple transactions totaling $29.3 million; and
50% interest in The Gallery, the Company's downtown Philadelphia property, for $106.5 million, in a strategic transaction designed to maximize the Company's financial and execution opportunities with the project.

The Company also announced today that it has identified five properties that it will seek to divest in 2015:

Palmer Park Mall in Easton, PA
Uniontown Mall in Uniontown, PA
Lycoming Mall in Williamsport, PA
Washington Crown Center in Washington, PA
Springfield Park in Springfield, PA

"PREIT has an outstanding portfolio of premier assets, supported by a healthy and flexible balance sheet, and we continue to unlock the value inherent in the Company for the benefit of our investors," said Joseph F. Coradino, CEO of PREIT. "We continue to be extremely effective in executing on our ongoing disposition program as demonstrated by the number of dispositions we completed in 2014. Through our disciplined and strategic disposition program, we are transforming our portfolio and enhancing value for shareholders as evidenced by the more than 28% return our investors enjoyed in 2014. By proactively marketing additional assets for sale in 2015, we are confident that we are taking the right steps to continue a portfolio transformation that will set us apart from our peers while generating significant proceeds to further upgrade our core, high-quality properties."

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 over 29 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 befound at preit.com or on Twitter or LinkedIn.

Forward Looking Statements
This press release contains 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, stated value of preferred shares and our high leverage ratio; constraining leverage, interest and tangible net worth covenants under our 2013 Revolving Facility, our 2014 Term Loans and Letter of Credit; 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 to our corporate management team and any resulting modifications to our business strategies; 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; current economic conditions and their effect on employment, 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; general economic, financial and political conditions, including credit market conditions, changes in interest rates or unemployment; changes in the retail industry, including consolidation and store closings, particularly among anchor tenants; the effects of online shopping and other uses of technology on our retail tenants; our ability to sell properties that we seek to dispose of or our ability to obtain estimated sale prices; 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; increases in operating costs that cannot be passed on to tenants; risks relating to development and redevelopment activities; 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. 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 most recent Annual Report on Form 10-K and in any subsequent Quarterly Report on Form 10-Q 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

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SOURCE PREIT