PHILADELPHIA, April 19 /PRNewswire/ -- Pennsylvania Real Estate Investment
Trust (NYSE: PEI) announced today that it has sold a 294,000 square foot
industrial property in Alexandria, Virginia, for total proceeds of
approximately $12 million. In connection with the sale the Company terminated
the lease with the building's sole tenant, CVS Drug Co., which otherwise would
have expired on April 30, 2002. The property is considered non-core by the
Company, and the proceeds of the sale will initially be used to pay down the
Company's line of credit.
The sale of the property for approximately $8 million to Preferred Real
Estate Investment Inc. will result in a gain of approximately $6.6 million
($0.45 per share and OP unit) in the second quarter of 2000. The lease
termination payment of approximately $4 million will be recorded as income in
the second quarter of 2000 in accordance with Generally Accepted Accounting
Principles. The estimated impact of the lease termination payment, including
the benefit from paying down the line of credit, is an increase in Funds
from Operations (FFO) of $3.8 million ($0.26 per share and OP unit) in 2000
and decreases in FFO of $300,000 ($0.02 per share and OP unit) and
$100,000 ($0.01 per share and OP unit) in 2001 and 2002, respectively.
The $6.6 million gain is not taken into account in calculating FFO.
Ronald Rubin, Chief Executive Officer of PREIT, said, "This transaction is
pursuant to our strategic plan to sell non-core properties which do not fit
our long-term objectives. We are very pleased with the gain on this
transaction and anticipate redeploying the proceeds in property that meet our
current target investment criteria."
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 (approximately 9.1 million square feet) and apartment communities
(7,242 units) located primarily in the eastern United States. The Company's
portfolio currently consists of interests in 45 properties in 10 states. In
addition, there are 6 retail properties under development in which the Company
has an interest, which will add approximately 3.0 million square feet to the
portfolio. Pennsylvania Real Estate Investment Trust is headquartered in
Philadelphia, Pennsylvania.
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, the availability of adequate funds at
reasonable cost, 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.
To receive additional information on Pennsylvania Real Estate Investment
Trust via fax at no charge, please dial 1-800-PRO-INFO and enter the ticker
symbol PEI.
SOURCE Pennsylvania Real Estate Investment Trust
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Related links:
http://www.preit.com
CONTACT:
Jonathan B. Weller, President and COO of
Pennsylvania Real Estate Investment Trust, 215-875-0700; or
General Info, Joe Calabrese, Analysts, Pamela Belfor, or Media,
Judith Sylk-Siegel of The Financial Relations Board, 212-661-8030
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