Federal Realty Investment Trust Announces Q3 2009 Operating Results

ROCKVILLE, Md., Nov. 4 -- Federal Realty Investment Trust (NYSE:FRT) today reported operating results for its third quarter ended September 30, 2009.

Financial Results

For third quarter 2009 Federal Realty reported funds from operations available for common shareholders (FFO) of $55.6 million, or $0.92 per diluted share, compared to FFO of $58.1 million or $0.98 per diluted share for the third quarter 2008. For the quarter ending September 30, 2009, net income available for common shareholders was $27.3 million, or earnings per diluted share of $0.45, versus $37.0 million and $0.63, respectively, for third quarter 2008.

For the nine months ended September 30, 2009, Federal Realty reported FFO of $151.0 million, or $2.53 per diluted share, and net income available for common shareholders of $65.9 million, or earnings per diluted share of $1.10. Excluding the litigation provision related to a previously disclosed lawsuit involving a property adjacent to Santana Row, year-to-date FFO was $172.0 million, or $2.88 per diluted share, and net income available for common shareholders was $87.0 million, or $1.46 per diluted share. For the nine months ended September 30, 2008, the Trust reported FFO of $169.8 million, or $2.87 per diluted share, and net income available for common shareholders of $95.7 million or $1.62 per diluted share.

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 attributable to the Trust is attached to this press release.

Portfolio Results

In third quarter 2009, same-center property operating income increased 2.6% over third quarter 2008. When redevelopment and expansion properties are excluded from same-center results, property operating income for third quarter 2009 increased 1.8% compared to third quarter 2008.

The overall portfolio was 94.2% leased as of September 30, 2009, compared to 94.0% on June 30, 2009 and 95.5% on September 30, 2008. Federal Realty's same-center portfolio was 94.4% leased on September 30, 2009, compared to 94.2% on June 30, 2009 and 95.8% on September 30, 2008.

During the third quarter of 2009, Federal Realty signed 94 leases for 357,000 square feet of retail space. On a comparable space basis (i.e., spaces for which there was a former tenant), the Trust leased 335,000 square feet at an average cash-basis contractual rent increase per square foot (i.e., excluding the impact of straight-line rents) of 9%. The average contractual rent on this comparable space for the first year of the new leases is $29.38 per square foot, compared to the average contractual rent of $27.00 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 17% for third quarter 2009. As of September 30, 2009, Federal Realty's average contractual, cash basis minimum rent for retail and commercial space in its portfolio was $22.01 per square foot.

"Our 2009 results and outlook for 2010 reflect consistent performance during this challenging economic environment," said Don Wood, president and chief executive officer of Federal Realty Investment Trust. "This level of stability is a testament to the quality of our assets, our locations, and our focused operating 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 $0.66 per share on its common shares, resulting in an indicated annual rate of $2.64 per share. The regular common dividend will be payable in cash on January 15, 2010 to common shareholders of record on January 4, 2010.

Guidance

Federal Realty increased its guidance, excluding the provision for litigation, for 2009 FFO per diluted share to a range of $3.75 to $3.77 and 2009 earnings per diluted share guidance of $1.87 to $1.89. The Trust also established guidance for 2010 FFO per diluted share at a range of $3.80 to $3.88 and 2010 earnings per diluted share guidance of $1.92 to $2.00.

Summary of Other Quarterly Activities and Recent Developments

-- October 19, 2009 - Completed the land exchange between Swedish home furnishings retailer IKEA and Federal Realty at Assembly Square in Somerville, Mass. As a result of the exchange, Federal Realty now owns an additional 16.6 acres of riverfront property for the proposed development of Assembly Square, while IKEA owns an 11.9 acre inland site approved for a 340,000-square-foot store.

-- October 1, 2009 - Announced that Don Briggs, senior vice president, development, would become head of the Trust's Boston office effective October 5. Mr. Briggs has led Federal Realty's development efforts with respect to Assembly Square, in Somerville, Mass. since the Trust acquired the property in 2005 and will continue to be responsible for all aspects of the development of Assembly Square. In addition, Mr.Briggs will take on operational responsibilities for Federal Realty's 2 million square foot portfolio in New England.

-- August 17, 2009 - Announced the closing of $265 million of capital raising activities, comprised of $150 million of 5.95% five-year senior unsecured notes and $115 million of common shares of beneficial interest, including the underwriters' over-allotment option. Federal Realty intends to utilize the proceeds to pursue acquisition opportunities, fund its redevelopment pipeline, pay down its $372 million term loan, and/or for general corporate purposes.

Conference Call Information

Federal Realty's management team will present an in-depth discussion of the Trust's operating performance on its third quarter 2009 earnings conference call, which is scheduled for November 5, 2009, at 11 a.m. Eastern Standard Time. To participate, please call (866) 761-0748 five to ten minutes prior to the call start time and use the passcode FRT EARNINGS (required). Federal Realty will also provide an online webcast 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 December 3, 2009, by dialing (888) 286-8010 and using the passcode 40216191.

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 18.2 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 September 30, 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 42 consecutive years, the longest record in the REIT industry. Federal Realty is an S&P MidCap 400 company and its shares are traded on the NYSE under the symbol FRT. For more information, please visit www.federalrealty.com.