PHILADELPHIA, March 3 /PRNewswire/ -- Pennsylvania Real Estate Investment
Trust (NYSE: PEI) announced today the audited results of its operations for
the fourth quarter and full year ended December 31, 1998.

    1998 Full Year and Fourth Quarter Highlights
    -- Funds from operations per share for the year grew to $2.45, on
       14,135,032 million shares/OP units outstanding
    -- Funds from operations for the year increased 61.3% to $34,576,000
    -- Closed $155 million in acquisitions, totaling 1.5 million square feet
       of retail properties and 998 multifamily units, with an additional
       $50 million invested in projects under development.
    -- Net operating income of the shopping center portfolio increased 10.5%
       for the 1998 fourth quarter
       -- Rental income grew 6.9% during the 1998 fourth quarter
       -- Occupancy rate improved from 87.4% to 87.9% for the year
    -- Net operating income of the multifamily portfolio increased 12.6% for
       the 1998 fourth quarter and 6.5% for the year
       -- Rental income grew 6.1% for the 1998 fourth quarter and 3.7% for
          the year
       -- Occupancy rate improved from 94.6% to 95.4% for the year

    Fourth Quarter Results
    Funds from operations (FFO) for the three months ended December 31, 1998
totaled $9,970,000, a 51.3% increase over FFO of $6,591,000 for the comparable
three-month period ended December 31, 1997.  The growth was driven by improved
same-store net operating income in the multifamily and retail portfolios as
well as acquisitions completed through the third quarter of 1998.  Fourth
quarter FFO was $0.69 per share on 14,444,163 weighted average share
equivalents outstanding (including Operating Partnership (OP) units), compared
to $0.67 per share on 9,781,751 weighted average share equivalents for the
three months ended December 31, 1997.  The per share results reflect the fully
diluted effect of the Company's equity offering of 4.6 million shares
completed on December 17, 1997.  As calculated by NAREIT, FFO is defined as
net income excluding extraordinary and unusual items, gain (or loss) on the
sale of property, plus depreciation and amortization.
    Net operating income from wholly owned properties and the Company's
proportionate share of partnerships and joint venture properties, including
its management and development affiliate, PREIT-RUBIN Inc., increased 29.2% to
$17,180,000 for the three months ended December 31, 1998, from $13,297,000 for
the three months ended December 31, 1997.  The increase is mainly due to
acquisitions and the improved results from the multifamily and retail
portfolios.
    Net income for the three months ended December 31, 1998 was $5,374,000, or
$0.40 per basic share, on total weighted average shares outstanding of
13,299,723 compared to $5,435,000, or $0.59 per share, on 9,135,465 total
weighted average shares outstanding for the three months ended December 31,
1997.  Net income for the 1997 period included a gain on the sale of Gateway
Mall, St. Petersburg, Fla., of $2,090,000 or $0.23 per share.

    Twelve Month Results
    For the twelve months ended December 31, 1998 funds from operations (FFO)
totaled $34,576,000, a 61.3% increase over FFO of $21,442,000 for the
twelve-month period ended December 31, 1997, primarily as a result of the
Company's acquisition of The Rubin Organization and interests in eight
shopping centers and three multi-family properties.  Twelve-month FFO was
$2.45 per share on 14,135,032 weighted average share equivalents outstanding
(including OP units), compared to $2.39 per share on 8,954,012 weighted
average share equivalents for 1997.
    Net operating income from wholly owned properties and the Company's
proportionate share of partnerships and joint venture properties, including
PREIT-RUBIN, increased 35.1% to $58,210,000 for the twelve-month period ended
December 31, 1998, from $43,094,000 for 1997.  The increase is mainly due to
the Company's acquisition of The Rubin Organization and interests in eight
shopping centers and three multi-family properties.
    Net income for 1998 calendar year totaled $23,185,000, or $1.74 per basic
share, on 13,297,241 total weighted average shares outstanding, compared to
$11,423,000, or $1.30 per basic share, on 8,792,440 total weighted average
shares outstanding for 1997.  Net income for 1998 includes gain on the sale of
Charter Pointe Apartments, Altamonte Springs, Fla.; Punta Gorda Mall, Punta
Gorda, Fla.; and Ormond Beach Mall, Daytona Beach, Fla., of $3,043,000, or
$0.23 per share, while net income for 1997 includes gains on sales of two
shopping centers of $1,697,000, or $0.19 per share.

    Same Store NOI Growth -- Apartment & Shopping Center Portfolios
    Same store net operating income for the fourth quarter of 1998 for the
Company's portfolio of multifamily properties increased by 12.6% over the
prior comparable three-month period ended December 31, 1997, primarily driven
by an increase in revenues and improved occupancy.  Same store net operating
income for the fourth quarter of 1998 for the Company's shopping center
portfolio increased by 10.5% over the comparable quarter.

    Comments from Management
    Commenting on the year, Ronald Rubin, Chief Executive Officer of PREIT,
said, "1998 was a very successful year for Pennsylvania Real Estate Investment
Trust.  Twelve months ago we embarked upon an aggressive program aimed at
positioning the Company for increased profitability and enhanced shareholder
value.  Our efforts on growth from our existing properties and new
developments were complemented by the expansion of our portfolio through
acquisitions.  Importantly, as evidenced by strong same store net operating
income growth in both our apartment and shopping center portfolios, the
Company has developed a platform for sustained growth."
    Mr. Rubin went on to say "PREIT enters 1999 with a stronger and more
diverse property portfolio.  Over the past twelve months we completed
$155 million of acquisitions, exceeding our 1998 acquisition target of
$90 million.  Each of these transactions began with our identification of
opportunities that met our strategic objectives, leveraged our strong local
and national tenant relationships, and offers the potential for significant
FFO growth."

    Fourth Quarter Portfolio Update
    Reflective of the Company's long-term growth strategy, PREIT completed two
acquisitions during the fourth quarter of 1998, including:

    -- Northeast Tower Center (Philadelphia, Pa.) -- PREIT acquired an 89%
interest in a 500,000-square-foot power center for a total cost of
approximately $21.3 million, including $17 million of assumed debt and the
issuance of OP units with a value of approximately $3.3 million.  The center
was acquired as part of the merger with The Rubin Organization.
    -- Fox Run (Bear, Del.) and Eagle's Nest (Coral Springs, Fla.) -- The
Company announced in December that it acquired a partner's 50% interest in two
multifamily communities and a parcel of land.  The properties included Fox Run
(414 units), Eagle's Nest (264 units) and an undeveloped 14-acre parcel in
Coral Springs, Fla., which the Company intends to sell.

    Building an Enhanced Portfolio
    Beginning with the merger with The Rubin Organization in late 1997,
PREIT's portfolio size has grown by 103 percent (based on investment in real
estate at cost) with 11 new acquisitions, comprising approximately 3.4 million
square feet of retail properties and 998 multifamily units for total
consideration of $266 million.  During this period, the Company also completed
two retail developments comprising 762,000 square feet for an investment of
$50 million.  In addition, the Company has five shopping centers under
development comprising 2.2 million square feet with completion scheduled
between 2nd Quarter, 1999 and 4th Quarter, 2000.  As a result of this growth,
at year-end, the Company's portfolio included interests in approximately
8.0 million square feet of retail properties and 7,243 multifamily units,
compared with interests in approximately 4.3 million square feet of retail
properties and 7,236 multifamily units at August 31, 1997.
    Jonathan Weller, PREIT's President and Chief Operating Officer, commented,
"Since our merger, we have taken advantage of opportunities to strengthen the
portfolio by acquiring properties where we can bring real value through our
operating strategies.  In all, PREIT acquired interests in eight shopping
centers that demonstrated strong demographics, optimal locations and excellent
development opportunities.  Additionally, we acquired interests in three
multifamily properties that benefit from above average population and job
growth and a limited new supply of multifamily  properties.  Each of the
properties provided a positive contribution to current FFO as well as
opportunities for value-added contributions to enhance future returns.  As
PREIT enters 1999, we believe the Company is very well positioned to build
upon this momentum and take advantage of the numerous opportunities in our
marketplace."

    Line of Credit
    As of December 31, 1998, the Company had $139 million outstanding under
its $150 million unsecured line of credit, compared with $10.3 million at
December 31, 1997.  The increase in the credit facility was primarily due to
acquisitions and investments in properties under development and
redevelopment.  The Company is engaged in negotiations to expand its line of
credit and in this regard has secured a commitment of $65 million from its
lead bank, First Union, to fund its portion of the new line.  The Company
expects to announce the results of these negotiations in the second quarter.
    Edward Glickman, Chief Financial Officer of PREIT, added, "Our objective
in 1999 is to provide the Company with additional capital to fund its
development projects and other high value-added opportunities.  By being
prudent in choosing our opportunities, we are confident that PREIT will have
sufficient resources to execute its business plan.  Going forward, PREIT
intends to maintain balance sheet flexibility by being conservative in its
leveraged policy and keeping a mix of floating-rate and fixed-rate debt.  We
intend to actively seek out new sources of equity and to recycle capital by
harvesting fully realized assets, when appropriate."

    Quarterly Dividend Declared
    The Company declared a quarterly dividend of $0.47 per share payable on
March 15, 1999 to shareholders and unitholders of record as of February 26,
1999.  The March 15, 1999 dividend payment will be PREIT's 88th consecutive
distribution since its initial dividend paid in August of 1962.  Throughout
its history, the Company has never omitted or reduced a shareholder dividend.

    Focus for 1999
    Mr. Rubin added, "Looking forward we are optimistic that 1999 will be
another year of solid achievement and financial growth for PREIT.  The Company
is well positioned to fulfill its development and redevelopment pipeline which
currently includes five power centers, three strip centers and one enclosed
mall.  On the acquisition front, we remain focused on identifying properties,
in both the multifamily and retail sector, that can benefit from PREIT's
redevelopment and repositioning competencies.  Additionally, we are confident
about the financial strength of the Company and PREIT's prospects for solid
internal growth."
    Pennsylvania Real Estate Investment Trust, founded in 1960 and one of the
first equity REITs in the U.S., has a primary investment focus on shopping
centers (8.0 million square feet) and apartment communities (7,243 units)
located primarily in the eastern United States.  The Company's portfolio
currently consists of 48 properties in 10 states.  In addition, there are
5 retail properties under development.  Pennsylvania Real Estate Investment
Trust is headquartered in Philadelphia, Pa.
    With the exception of the historical information contained in the release,
the matters described herein contain forward-looking statements that are made
pursuant to the Safe Harbor provisions of the Private Securities Litigation
Reform Act of 1995.  Such statements involve various risks and may cause
actual results to differ materially.  These risks include, but are not limited
to, the ability of the Company to grow internally or by acquisition, and to
integrate acquired businesses, changing industry and competitive conditions,
and other risks outside the control of the company referred to in the
Company's registration statement and periodic reports filed with the
Securities and Exchange Commission.
    A supplemental quarterly financial package is available on the Company's
web site at http://www.preit.com.


                  Pennsylvania Real Estate Investment Trust
                           Selected Financial Data

    FUNDS FROM OPERATIONS

                         Three Months Ended          Twelve Months Ended
                      Dec 31, 1998  Dec 31, 1997 Dec 31, 1998  Dec 31, 1997

    Income before
      minority interest
      in operating
      partnership and
      extraordinary
      item              $6,106,000    $5,829,000  $24,878,000   $13,035,000
    Less:  (Gains) loss
      on sales of
      interests in real
      estate                     -   (2,090,000)  (3,043,000)   (1,697,000)
    Provision for
      losses on
      investments                -             -            -       500,000
    Add:  Wholly owned
      & consolidated
      partnership, net   2,955,000     2,017,000    9,285,000     6,730,000
    Unconsolidated
      partnerships
      & joint ventures   1,075,000       996,000    4,067,000     3,513,000
    Excess purchase
      price over net
      asset acquired        29,000        29,000      115,000        29,000
    Less:  Depreciation
      of non-real estate
      assets               (57,000)      (57,000)    (228,000)     (228,000)
    Amortization of
      deferred financing
      assets              (138,000)     (133,000)    (498,000)     (440,000)
    FUNDS FROM
      OPERATIONS        $9,970,000(a) $6,591,000  $34,576,000(a)$21,442,000

    FUNDS FROM
      OPERATIONS PER
      SHARE AND
      OP UNITS               $0.69         $0.67        $2.45         $2.39

    Weighted average
      number of shares
      outstanding       13,299,723     9,135,465   13,297,241     8,792,440

    Weighted average
      effect of full
      conversion of
      OP units           1,144,440       646,286      837,791       161,572

    Total weighted
      average shares
      of outstanding
      including OP
      units             14,444,163     9,781,751   14,135,032     8,954,012

    (a)  Includes the non-cash effect of straight-line rents of $200,000 and
    $910,000 for the 4th quarter and year to date 1998, respectively.

    OPERATING RESULTS
                          Three Months Ended          Twelve Months Ended

                      Dec 31, 1998  Dec 31, 1997 Dec 31, 1998  Dec 31, 1997
    REVENUES
     Gross revenues
      from real estate $19,669,000   $13,753,000  $61,745,000   $44,061,000
     Interest and other
      income               250,000        78,000      650,000       218,000
                        19,919,000    13,831,000   62,395,000    44,279,000
    EXPENSES
     Property operating
      expenses           6,700,000     5,606,000   22,519,000    17,880,000
     Depreciation and
      amortization       2,923,000     2,066,000    9,406,000     6,895,000
     General &
      administrative
      expenses             893,000       677,000    3,351,000     3,388,000
     Interest expense    4,299,000     3,605,000   10,591,000    10,328,000
     Provision for
      losses on
      investments                -             -            -       500,000
                        14,815,000    11,954,000   45,867,000    38,991,000

      Income before equity
       in unconsolidated
       entities, gains on
       sales of interests
       in real estate and
       minority interest
       in operating
       partnership       5,104,000     1,877,000   16,528,000     5,288,000
    Equity in income of
      PREIT-RUBIN         (952,000)      258,000     (678,000)      258,000
    Equity in income of
      partnerships and
      joint ventures     1,954,000     1,604,000    5,985,000     5,792,000
    Gains (loss) on sales
      of interests in
      real estate (b)(c)         -     2,090,000(c) 3,043,000(b)  1,697,000(c)
    Income before
      minority interest
      in operating
      partnership
      and extraordinary
      item               6,106,000     5,829,000   24,878,000    13,035,000
    Minority interest in
      operating
      partnership         (462,000)     (394,000)  (1,423,000)     (394,000)
    Income before
      extraordinary item 5,644,000     5,435,000   23,455,000    12,641,000
    Loss on early
      extinguishment of
      debt                (270,000)            -     (270,000)   (1,218,000)
    NET INCOME          $5,374,000    $5,435,000  $23,185,000   $11,423,000

    PER SHARE DATA
    Net income before
      gains (loss) on
      sales of interests
      in real estate         $0.40         $0.36        $1.51         $1.11
    Gains (loss) on
      sales of interests
      in real estate (b)(c)      -          0.23(c)      0.23(b)       0.19(c)
    BASIC INCOME PER SHARE   $0.40         $0.59        $1.74         $1.30

    DILUTED INCOME PER SHARE $0.40         $0.59        $1.74         $1.30

    Weighted average
      number of shares
      outstanding       13,299,723     9,135,465   13,297,241     8,792,440

    (b)  Year to date 1998 includes gains on sale of interests in Punta Gorda
    Mall, Punta Gorda, Fla., Ormond Beach Mall, Daytona Beach, Fla., and
    Charter Pointe Apartments in Altemonte, Springs, Fla.

    (c)  4th quarter 1997 includes gain on sales of interests in Gateway
    mall, St. Petersburg, Fla..  Year to date 1997 includes gain on sale of
    interest in Gateway Mall, St. Petersburg, Fla., offset by loss on sale of
    interest in property in Margate, Fla.


    EQUITY IN INCOME OF PARTNERSHIPS
    AND JOINT VENTURES
                          Three Months Ended            Twelve Months Ended
                      Dec 31, 1998  Dec 31, 1997 Dec 31, 1998  Dec 31, 1997

    Gross revenues
     from real estate  $16,042,000   $14,989,000  $57,792,000   $53,840,000
    Expenses:
     Property operating
      expenses           5,641,000     5,840,000   20,662,000    20,903,000
     Mortgage and bank
      loan interest      4,278,000     4,148,000   16,647,000    13,146,000
     Refinancing
      prepayment fee (a)         -             -            -     2,436,000
     Depreciation and
      amortization       2,174,000     2,061,000    8,348,000     7,264,000
                        12,093,000    12,049,000   45,657,000    43,749,000
                         3,949,000     2,940,000   12,133,000    10,091,000
    Partner's Share     (1,995,000)   (1,336,000)  (6,148,000)   (4,299,000)

    EQUITY IN INCOME OF
     PARTNERSHIPS AND
     JOINT VENTURES     $1,954,000    $1,604,000   $5,985,000    $5,792,000

    (a) The Company's share for twelve months is $1,218,000.



               Supplemental Information for Wholly Owned Properties
    and the Company's Proportionate Share of Partnerships and Joint Ventures

    EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION
    AND AMORTIZATIONS ("EBITDA")

                           Three Months Ended        Twelve Months Ended
                           Dec 31,       Dec 31,      Dec 31,       Dec 31,
                              1998          1997         1998          1997

    Gross Revenues     $19,669,000   $13,753,000  $61,745,000   $44,061,000
    Operating expenses  (6,700,000)   (5,606,000) (22,519,000)  (17,880,000)
    Net operating
     income: Wholly
      owned properties  12,969,000     8,147,000   39,226,000    26,181,000
    Company's proportionate
     share of partnerships
     and joint ventures
     net operating income5,139,000     4,622,000   18,222,000    15,991,000
    Company's proportionate
     share of PREIT-RUBIN
     net operating income (928,000)      922,000      762,000       922,000
    Combined net
     operating income   17,180,000    13,691,000   58,210,000    43,094,000
    Interest income        250,000        78,000      650,000       218,000
    General and
     administrative
     expenses             (893,000)     (678,000)  (3,351,000)   (3,388,000)
    EBITDA             $16,537,000   $13,091,000  $55,509,000   $39,924,000

    MORTGAGE NOTES AND
      BANK LOANS PAYABLE
    Wholly Owned Properties
    Mortgage notes payable                       $162,003,000   $99,364,000
    Bank Loans payable                            135,273,000     4,575,000
                                                  297,276,000   103,939,000
    Company's Proportionate Share of
      Partnerships and Joint Ventures
    Mortgage notes payable                        106,973,000   103,237,000
    Bank loans payable                              2,441,000     4,112,000
    Total mortgage notes and bank loans payable  $406,690,000  $211,288,000

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