Pennsylvania Real Estate Investment Trust 8K Results of Operations and Financial Condition | PRET 27 Feb 20

Exhibit 99.1

Supplemental Financial and Operating Information

December 31, 2019

www.preit.com

NYSE: PEI

NYSE: PEIPRB, PEIPRC, PEIPRD

Pennsylvania Real Estate Investment Trust

Supplemental Financial and Operating Information

December 31, 2019


Table of Contents
Introduction

Company Information	2

Earnings Release	3

2020 Earnings Guidance	9

Changes in Funds from Operations for the Three Months and Year Ended December 31, 2019	11

Market Capitalization and Capital Resources	12

Operating Results

Statement of Operations – Three Months and Year Ended December 31, 2019 and 2018	13

Computation of Earnings Per Share – Three Months and Year Ended December 31, 2019 and 2018	14

Reconciliation of Net Operating Income and EBITDAre – Three Months and Year Ended December 31, 2019 and 2018	15

Reconciliation of Net Income (GAAP Measure) to Net Operating Income from Consolidated Properties (Non-GAAP Measure) - Three Months Ended December 31, 2019 and December 31, 2018	16

Reconciliation of Equity in Income of Partnerships to Net Operating Income from Equity Method Investments, at Ownership Share (Non-GAAP Measure) - Three Months Ended December 31, 2019 and December 31, 2018	17

Reconciliation of Net Income (GAAP Measure) to Net Operating Income from Consolidated Properties (Non-GAAP Measure) - Year Ended December 31, 2019 and December 31, 2018	18

Reconciliation of Equity in Income of Partnerships to Net Operating Income from Equity Method Investments, at Ownership Share (Non-GAAP Measure) – Year Ended December 31, 2019 and December 31, 2018	19

Reconciliation of Funds From Operations and Funds Available for Distribution – Three Months and Year Ended December 31, 2019 and 2018	20

Condensed Consolidated Balance Sheet	22

Assets and Liabilities - Equity Method Investments, at Ownership Share	23

Operating Statistics

Leasing Activity Summary – Three Months Ended December 31, 2019	24

Leasing Activity Summary – Year Ended December 31, 2019	25

Summarized Sales and Rent Per Square Foot and Occupancy Percentages	26

Mall Occupancy Percentage and Sales Per Square Foot	27

Top Twenty Tenants	28

Lease Expirations	29

Property Information	30

Balance Sheet

Investment in Real Estate - Consolidated Properties	32

Investment in Real Estate - Equity Method Investments at Ownership Share	33

Anchor Replacement Summary	34

Property Redevelopment Table	35

Capital Expenditures – Three Months and Year Ended December 31, 2019	36

Debt Analysis	37

Debt Schedule	39

Selected Debt Ratios	40

Forward Looking Statements	41

Definitions	42

Pennsylvania Real Estate Investment Trust

Company Information

Background

PREIT (NYSE:PEI) is a publicly traded real estate investment trust that owns and manages quality properties in compelling markets. PREIT’s robust portfolio of carefully curated retail and lifestyle offerings mixed with destination dining and entertainment experiences are located primarily in the densely-populated eastern U.S. with concentrations in the mid-Atlantic’s top MSAs. PREIT is focused on enhancing the quality of its portfolio through redevelopment, anchor repositioning, diversifying its tenant mix and densifying properties by adding a mix of uses. Since 2012, the Company has driven a transformation guided by an emphasis on portfolio quality and balance sheet strength driven by disciplined capital expenditures. The portfolio consists of 26 retail properties, 25 of which are operating properties and one is a development property. The 25 operating retail properties have a total of 20.1 million square feet and include 21 shopping malls and four other retail properties.

If you would like to learn more about PREIT or participate in our quarterly earnings conference call, please visit preit.com or contact:

Heather Crowell

EVP, Strategy and Communications

One Commerce Square

2005 Market Street, Suite 1000

Philadelphia, PA 19103

Telephone: (215) 875-0735

Fax: (215) 546-2504

Email: Heather.Crowell@preit.com

Research Coverage

Company	Analyst	Phone Number
Barclays Capital	Ross Smotrich	(212) 526-2306
Citi Investment Research	Michael Bilerman Christy McElroy	(212) 816-1383 (212) 816-6981
Goldman Sachs & Co. LLC	Caitlin Burrows	(212) 902-4736
Green Street Advisors	Vince Tibone	(949) 640-8780
JP Morgan	Michael W. Mueller	(212) 622-6689
Stifel Nicolaus	Simon Yarmak	(443) 224-1346
SunTrust Robinson Humphrey	Ki Bin Kim	(212) 303-4124

Press release announcements are available on the Company's website at www.preit.com.

CONTACT: AT THE COMPANY

Mario Ventresca

EVP & CFO

(215) 875-0703

Heather Crowell

EVP, Strategy and Communications

(215) 454-1241

heather.crowell@preit.com

PREIT Reports Fourth Quarter and Full Year 2019 Results and Provides Balance Sheet Strategy Update

Executed Agreements of Sale for $313 Million in Gross Proceeds

Core Mall NOI-Weighted Sales per square foot Reached $547

Core Mall Leased Space Increased to 96.6%

Philadelphia, February 25, 2020 - PREIT (NYSE: PEI) today reported results for the three months and the year ended December 31, 2019. A description of each non-GAAP financial measure and the related reconciliation to the comparable GAAP financial measure is located in the tables accompanying this release.

	Three Months Ended December 31,						Year Ended December 31,
(per share amounts)	2019			2018			2019			2018
Net income (loss) - basic and diluted	$	(0.29	)	$	(1.23	)	$	(0.52	)	$	(1.98	)
FFO	$	0.28		$	0.42		$	1.33		$	1.43
FFO, as adjusted	$	0.34		$	0.52		$	1.05		$	1.54
FFO from assets sold in 2019	$	-		$	(0.01	)	$	(0.02	)	$	(0.04	)
FFO, as adjusted for assets sold	$	0.34		$	0.51		$	1.03		$	1.50

Joseph F. Coradino, Chairman and Chief Executive Officer of PREIT, said, "As we look into 2020, we are beginning to believe that industry headwinds are moderating and the strategic initiatives underway at PREIT will drive growth and value creation. We have taken proactive steps to manage industry-wide disruption, such that today 47% of our non-anchor space is leased to non-mall retail tenants. We have achieved strong momentum in the first five months of operation at Fashion District Philadelphia, and look forward to the continued success of that project.”

Coradino added, “Our growing sales and traffic, along with modest same store NOI growth projected amid continued retail market uncertainty, demonstrate that our strategy is working. Further, we believe the capital transactions we are embarking upon demonstrate that the quality of our portfolio provides us with opportunities to efficiently access the capital markets.”

•

Same Store NOI, excluding lease termination revenue, decreased 3.0% for the three months ended December 31, 2019 compared to December 31, 2018.

•

The quarter was impacted by an incremental decrease in revenue of $2.3 million as a result of bankruptcies, related store closings and associated write-offs. This was partially offset by incremental revenues from anchor replacements and other leasing activity of $1.1 million in the quarter.

•

Same Store NOI, excluding lease termination revenue, decreased 2.5% for the year ended December 31, 2019 compared to December 31, 2018. Excluding the impact of revenue lost from bankruptcy-related store closings, Same Store NOI, excluding lease termination was positive.

•

For the full year ended December 31, 2019, the Company was impacted by $6.9 million of lower revenue compared to the prior year as a result of bankruptcies, related store closings and associated write-offs, which was partially offset by $3.5 million in incremental rent from anchor replacements and other leasing activity.

•

NOI-weighted sales at our Core Malls increased to $547 per square foot. Core Mall sales per square foot reached $539, a 5.6% increase over the prior year. Average comparable sales per square foot at our top six properties rose 5.0% over the prior year to $646 with two properties generating sales over $700 per square foot.

•

Core Mall total occupancy was 95.5%, an increase of 110 basis points compared to September 30, 2019. Core Mall non-anchor occupancy declined by only 70 basis points from last year despite the impact from bankruptcies and chain liquidations that resulted in 71 store closures in 274,000 square feet during the year ended December 31, 2019.

•

Non-anchor Leased space exceeds occupied space by 170 basis points when factoring in executed new leases slated for future occupancy, excluding Fashion District Philadelphia.

•

Average renewal spreads for the full year were strong in our wholly-owned portfolio at 6.7% for spaces less than 10,000 square feet and 5.5% for large format spaces. Average renewal spreads for the entire portfolio were 2.5% for the year.

•

As part of the Company’s plan to improve our balance sheet, since last quarter, the Company has executed agreements of sale with expected gross proceeds of $312.6 million. These include an agreement for the sale-leaseback of five properties for $153.6 million, the sale of land parcels for multifamily development in the amount of $125.3 million, $29.9 million related to operating outparcel sales, and $3.75 million related to the sale of land for hotel development. Upon closing of these transactions, the Company expects to net nearly $200 million in additional liquidity. These transactions, together with potential modifications to our credit facility covenants, create the runway needed in order to complete the execution of our business plan.

•

The Company anticipates not meeting certain financial covenants during 2020. The Company has had discussions with its lenders to modify the terms of its debt covenants to ensure compliance through September 30, 2020 and anticipates further discussions with lenders to modify the terms of the debt agreements on a long term basis.

Leasing and Redevelopment

•

Excluding Fashion District Philadelphia, 425,000 square feet of leases are signed for 2020 openings, which is expected to contribute annual gross rent of $13.1 million.

•

On September 19, 2019, the Company’s 50/50 joint venture with Macerich opened Fashion District Philadelphia, a four-level retail hub in Center City spanning nearly 900,000 square feet across three city blocks in the heart of downtown Philadelphia. The project, which represents an impressive collection of retail, entertainment and co-working uses, is 87% committed. Noteworthy post-opening additions include: AMC Theaters, Round One, Wonderspaces, Armani Exchange Outlet and Sephora. Upcoming additions include: Primark, Industrious, Kate Spade, DSW Shoes and more.

•

At Plymouth Meeting Mall, Michael’s will join recently opened Burlington, DICK’s Sporting Goods, Miller’s Ale House and Edge Fitness in the location of the former Macy’s at the end of February 2020.

•

On October 12, 2019, the expansion wing at Woodland Mall opened anchored by a brand new, top-quality Von Maur Department Store. New tenants in the wing include: Urban Outfitters, Tricho Salon & Spa, Williams-Sonoma, Black Rock Bar & Grill, Paddle North and The Cheesecake Factory. In Spring 2020, the expansion area will welcome White House | Black Market and Sephora.

•

At Willow Grove Park, Yard House opened in December 2019 and construction continues on the 51,000 square foot Studio Movie Grill, which is projected to open in the first half of 2020.

•

At Valley Mall, DICK’s Sporting Goods is underway with fixturing and stocking with an anticipated opening in March 2020.

•

At Dartmouth Mall, the 43,000 square foot Burlington is expected to open in March 2020. The redevelopment plan also includes approximately 35,000 square feet of new outparcels to capitalize on the property’s location.

Primary Factors Affecting Financial Results for the Three Months Ended December 31, 2019 and December 31, 2018:

•

Net loss attributable to PREIT common shareholders was $21.7 million, or $0.29 per basic and diluted share for the three months ended December 31, 2019, compared to net loss attributable to PREIT common shareholders of $85.6 million, or $1.23 per basic and diluted share for the three months ended December 31, 2018.

•

Same Store NOI decreased by $2.4 million, or 3.8%. Revenue from new store openings, including contributions from replacement anchors, mitigated the impact of revenue lost to bankruptcies and associated store closings. Lease termination revenue was $0.6 million less than the prior year’s quarter.

•

Non Same Store NOI decreased by $2.0 million, primarily driven by the disposition of Wyoming Valley Mall, anchor closings and associated co-tenancy rents at Valley View Mall and the sale of the Whole Foods parcel at Exton Square, slightly offset by contribution from Fashion District Philadelphia.

•

FFO for the three months ended December 31, 2019 was $0.28 per share and OP Unit compared to $0.42 per share and OP Unit for the three months ended December 31, 2018. Adjustments to FFO in the 2019 quarter included $0.04 per share of provision for employee separation expenses and $0.03 of impairment of development land parcels. Adjustments to FFO in the fourth quarter of 2018 included a loss on mortgage note impairment, provision for employee separation expenses, and net insurance recoveries that totaled $0.10 per share.

•

General and administrative expenses were impacted by the new lease accounting standard that now limits the capitalization of certain leasing costs. We expensed $1.1 million ($0.01 per share) of costs in the three months ended December 31, 2019 that would have been capitalized under the prior standard.

All NOI and FFO amounts referenced as primary factors affecting financial results above include our share of unconsolidated properties’ revenues and expenses. Additional information regarding changes in operating results for the three months and year ended December 31, 2019 and 2018 is included on page 18.

Asset Dispositions

During the fourth quarter of 2019 and in early 2020, the Company has executed agreements of sale for expected gross proceeds of $312.6 million.

Sale/Leaseback: In February 2020, The Company entered into an agreement of sale for the sale and leaseback of five properties for $153.6 million. Structured as a 99-year lease with an option to repurchase, the agreement provides for release of parcels related to multifamily development and is subject to ongoing lease payments at 7% ($10.75 million) with annual 1.25% escalations. Closing on the transaction is subject to customary closing conditions, including due diligence provisions.

Multifamily Land Parcels: In 2020, the Company executed seven agreements of sale for land parcels for anticipated multifamily development in the amount of $125.3 million. The agreements are with four different buyers across seven properties for 3,450 units as part of Phase I of the Company’s previously announced multifamily land sale plan. Closing on the transactions is subject to customary due diligence provisions and securing entitlements.

Outparcels: The Company has executed an agreement of sale with Four Corners Property Trust (“FCPT”) for 14 outparcels, generating $29.9 million in total proceeds. We have closed on the sale of four of the parcels, totaling $10.5 million. The remaining 10 are expected to close in 2020 and are subject to customary due diligence provisions.

Hotel Parcels: The Company has executed two agreements of sale to convey land parcels for anticipated hotel development in the amount of $3.8 million. The agreements are with two separate buyers for approximately 250 rooms. Closings on the transactions are subject to customary due diligence provisions and securing entitlements.

2019 and Year-to-Date 2020 Capital Transaction Summary

The table below summarizes 2019 and 2020 capital activity that is expected to impact the Company’s liquidity position:

		Closed		Under Contract		Total
Gainesville Development Parcel		$	15,000	$	-	$	15,000
New Garden Township Parcel⁽¹⁾			8,250		-		8,250
Wiregrass mortgage loan sale			8,000		-		8,000
Whole Foods Parcel⁽²⁾			10,500		-		10,500
Capital City transaction - incremental capacity⁽³⁾			40,000		-		40,000
Gloucester Premium Outlets Parcel			937		-		937
Fashion District Philadelphia Term Loan expansion ⁽⁴⁾			25,500		-		25,500
Valley View Mall Outparcel Sale			1,400		-		1,400
Sale of Multiple Outparcels ⁽⁵⁾	��		4,000		8,000		12,000
Sale of Land Parcels related to Hotel Development			-		3,750		3,750
Sale of Land Parcels for Multifamily Development			-		125,337		125,337
Sale Leaseback transaction (5 malls)⁽⁵⁾			-		57,000		57,000
Total		$	113,587	$	194,087	$	307,674

⁽¹⁾ Represents cash proceeds; does not include $2.8 million of preferred stock received by the Company.
⁽²⁾ Represents the net liquidity to the Company after adjusting for line capacity. Sale price was $22.1 million.
⁽³⁾ Represents the Company's approximate incremental borrowing capacity by the end of 2019, net of the Capital City mortgage loan defeasance.
⁽⁴⁾ Represents the Company's share of amounts available under the expanded capacity of the Fashion District Philadelphia term loan.
⁽⁵⁾ Represents the net liquidity to the Company after adjusting for line capacity.

Retail Operations

The following table sets forth information regarding sales per square foot in the Company’s mall portfolio, including unconsolidated properties:

A reconciliation of portfolio sales per square foot ⁽¹⁾ for the Core Mall portfolio can be found below:

Comp store sales for the year ended December 31, 2018	$	510
Organic sales growth		14
Impact of non-core malls		15
Comp store sales for the year ended December 31, 2019	$	539
⁽¹⁾ Based on reported sales by all comparable non-anchor tenants that lease individual spaces of less than 10,000 square feet and have occupied the space for at least 24 months.

2020 Outlook

The Company is introducing its earnings guidance for the year ending December 31, 2020 of GAAP Net loss between ($0.68) and ($0.43) per diluted share and estimates FFO for the year will be between $1.04 and $1.28 per diluted share. FFO, as adjusted per share is expected to be between $1.04 and $1.28.

A reconciliation between GAAP net loss and FFO is as follows:

	2020 Guidance Range
(Estimates per diluted share)	Low			High
Net loss attributable to common shareholders	$	(0.68	)	$	(0.43	)
Depreciation and amortization, non-controlling interest and other		1.72			1.71
FFO per share	$	1.04		$	1.28
Adjustments		-			-
FFO per share, as adjusted	$	1.04		$	1.28

Guidance Assumptions:

Our guidance incorporates the following assumptions, among others:

•

Same Store NOI, excluding termination revenue is expected to grow between 0.5% and 1.5% with wholly-owned properties in the range of (0.2%) to 0.8% and joint venture properties increasing between 4.7% and 6.0%;

•

Lease termination revenues of $1.0 to $2.0 million;

•

Share of NOI from Fashion District included in Same Store NOI in Q4 2020;

•

Bankruptcy and store closings reserve of between $2.0 at the midpoint to $3.0 million at the low end of Same Store NOI guidance;

•

Land Sale Gains are expected to be between $14.4 and $28.8 million inclusive of the assumption that we close the hotel land sales and between two and four of the multifamily land sales in 2020;

•

Weighted average shares and OP units of 81.0 million for FFO and 77.0 million for Net (loss) income;

•

Capital expenditures in the range of $125 to $150 million, including redevelopment expenditures, recurring capital expenditures and tenant allowances; and

•

Our guidance does not incorporate the effects of the recently executed sale leaseback transaction, which are estimated to be approximately $0.06 dilutive to FFO per share on an annual basis.

•

Our guidance does not assume any other capital market transactions.

Our 2020 guidance is based on our current assumptions and expectations about market conditions, our projections regarding occupancy, retail sales and rental rates, and planned capital spending. Our guidance is forward-looking, and is 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.

Conference Call Information

Management has scheduled a conference call for 11:00 a.m. Eastern Time on Wednesday,
February 26, 2020, to review the Company’s results and future outlook. To listen to the call, please dial 1-844-885-9139 (domestic toll free), or 1-647-689-4441 (international), and request to join the PREIT call, Conference ID 7187207, at least five minutes before the scheduled start time. Investors can also access the call in a "listen only" mode via the internet at the Company’s website, preit.com. Please allow extra time prior to the call to visit the site and download the necessary software to listen to the Internet broadcast. Financial and statistical information expected to be discussed on the call will also be available on the Company’s website.

For interested individuals unable to join the conference call, the online archive of the webcast will also be available for one year following the call.

About PREIT

strength driven by disciplined capital expenditures. Additional information is available at www.preit.com or on Twitter or LinkedIn.

Rounding

Certain summarized information in the tables above may not total due to rounding.

Pennsylvania Real Estate Investment Trust

2020 Earnings Guidance

(in millions, except per share amounts)

	2019			2020 Guidance									Same Store NOI Growth
	Actual			Low			Midpoint			High			Low			Midpoint			High
Same store NOI, excluding termination fees
Wholly-owned properties	$	184.5		$	184.1		$	185.1		$	186.0			-0.2	%		0.3	%		0.8	%
Joint venture properties		28.5			29.9			30.1			30.3			4.7	%		5.3	%		6.0	%
		213.0			214.0			215.2			216.3			0.5	%		1.0	%		1.5	%
Non-same store NOI		13.2			11.2			11.4			11.6
NOI, excluding lease termination fees		226.2			225.2			226.6			227.9
Lease termination fees		1.5			1.0			1.5			2.0
Total NOI	$	227.7		$	226.2		$	228.1		$	229.9

G&A and leasing expenses
G&A		(46.0	)		(43.0	)		(42.5	)		(42.0	)
Leasing costs expensed under ASC 842		(0.5	)		-			-			-

Other income (expenses)
Corporate revenues		1.9			0.8			0.9			1.0
Land and outparcel sale gains		3.3			14.4			21.6			28.8
Provision for employee separation expenses		(3.7	)		-			-			-
Impairment of mortgage loan/land parcel		(3.6	)		-			-			-
Other, including non-real estate depreciation		(1.7	)		(2.1	)		(2.1	)		(2.0	)
Insurance losses (recoveries)		4.4			-			-			-

Capital costs
Interest expense, gross		(88.5	)		(85.0	)		(84.8	)		(84.6	)
Capitalized interest		13.8			-			-			-
Preferred dividends		(27.4	)		(27.4	)		(27.4	)		(27.4	)
Gain on debt extinguishment, net		24.9			-			-			-

Funds from Operations (FFO)	$	104.6		$	83.9		$	93.8		$	103.7

Adjustments
Impairment of mortgage loan/land parcel		3.6			-			-			-
Provision for employee separation expenses		3.7			-			-			-
Insurance recoveries, net		(4.4	)		-			-			-
Gain on debt extinguishment, net		(24.9	)		-			-			-

FFO as adjusted	$	82.6		$	83.9		$	93.8		$	103.7

Weighted average shares, including OP units		78.9			81.0			81.0			81.0

FFO per share	$	1.33		$	1.04		$	1.16		$	1.28

FFO, as adjusted per share	$	1.05		$	1.04		$	1.16		$	1.28

Pennsylvania Real Estate Investment Trust

2020 Earnings Guidance - Reconciliation of Net Income to FFO and FFO as adjusted (Non-GAAP measures)

(in millions, except per share amounts)

	2019			2020 Guidance
	Actual			Low			Midpoint			High

Net loss	$	(13.0	)	$	(25.4	)	$	(15.5	)	$	(5.6	)
Depreciation and amortization		146.3			136.6			136.6			136.6
Gain on sales of operating assets		(0.1	)		-			-			-
Impairment of real estate assets, other		1.5			0.1			0.1			0.1
Gain on sales of non operating assets		(2.7	)		-			-			-
Preferred share dividends		(27.4	)		(27.4	)		(27.4	)		(27.4	)
Funds From Operations (FFO)	$	104.6		$	83.9		$	93.8		$	103.7

Adjustments
Impairment of mortgage loan/land parcel		3.6			-			-			-
Provision for employee separation expenses		3.7			-			-			-
Insurance recoveries, net		(4.4	)		-			-			-
Gain on debt extinguishment, net		(24.9	)		-			-			-
FFO as adjusted	$	82.6		$	83.9		$	93.8		$	103.7


Net loss		(13.0	)		(25.4	)		(15.5	)		(5.6	)
Preferred share dividends		(27.4	)		(27.4	)		(27.4	)		(27.4	)
Noncontrolling interest		2.1			1.2			1.1			1.0
Dividends on unvested restricted shares		(0.9	)		(0.9	)		(0.9	)		(0.9	)
Net loss used to calculate EPS	$	(39.2	)	$	(52.5	)	$	(42.7	)	$	(32.9	)

Weighted average shares		75.2			77.0			77.0			77.0

Net loss per share	$	(0.52	)	$	(0.68	)	$	(0.55	)	$	(0.43	)

Pennsylvania Real Estate Investment Trust

Changes in Funds from Operations

for the Three Months and the Year Ended December 31, 2019 as compared to the Three Months and the Year Ended December 31, 2018

(all per share amounts on a diluted basis unless otherwise noted; rounded to the nearest half penny; amounts may not total due to rounding)

(in thousands, except per share amounts)	Three Months Ended December 31, 2019			Per Diluted Share and OP Unit			Year Ended December 31, 2019			Per Diluted Share and OP Unit
Funds from Operations, as adjusted December 31, 2018	$	40,576		$	0.52		$	120,431		$	1.54

Changes - Q4 2018 to Q4 2019

Contribution from anchor replacements and new box tenants		888			0.010			2,918			0.035
Impact from 2019 bankruptcies		(2,214	)		(0.030	)		(5,653	)		(0.070	)
Other leasing activity, including base rent and net CAM and real estate tax recoveries		207			0.005			(1,682	)		(0.020	)
Lease termination revenue		(600	)		(0.010	)		(6,726	)		(0.085	)
Credit losses		(237	)		(0.005	)		(378	)		(0.005	)
Other		24			-			560			0.005
Same Store NOI from unconsolidated properties		(429	)		(0.005	)		(1,563	)		(0.020	)
Same Store NOI		(2,361	)		(0.030	)		(12,524	)		(0.160	)
Non Same Store NOI		(1,968	)		(0.025	)		(7,476	)		(0.095	)
Dilutive effect of asset sales		(666	)		(0.010	)		(1,724	)		(0.020	)
General and administrative expenses		(858	)		(0.010	)		(1,552	)		(0.020	)
Capitalization of leasing costs		(1,360	)		(0.015	)		(6,116	)		(0.080	)
Gain on sales of non-operating real estate		(5,408	)		(0.070	)		(5,383	)		(0.070	)
Other		394			0.005			(481	)		(0.005	)
Interest expense, net		(1,692	)		(0.020	)		(2,525	)		(0.030	)
Increase in weighted average shares		-			(0.005	)		-			(0.010	)
Funds from Operations, as adjusted December 31, 2019	$	26,657		$	0.34		$	82,650		$	1.05
Insurance recoveries, net		(132	)		-			4,362			0.055
Gain on debt extinguishment, net		27			-			24,859			0.320
Impairment of development land parcel		(2,098	)		(0.025	)		(3,562	)		(0.045	)
Provision for employee separation expense		(2,611	)		(0.035	)		(3,689	)		(0.045	)
Funds from Operations December 31, 2019	$	21,843		$	0.28		$	104,620		$	1.33

Pennsylvania Real Estate Investment Trust

Market Capitalization and Capital Resources

(in thousands)

	December 31,
	2019			2018
MARKET CAPITALIZATION

EQUITY CAPITALIZATION
Common Shares Outstanding		77,550			70,495
OP Units Outstanding		2,023			8,272
Total Common Shares and OP Units Outstanding		79,573			78,767
Equity Market Capitalization—Common Shares and OP Units	$	424,124		$	467,880
Series B Preferred Shares, Nominal Value		86,250			86,250
Series C Preferred Shares, Nominal Value		172,500			172,500
Series D Preferred Shares, Nominal Value		125,000			125,000
Total Equity Market Capitalization	$	807,874		$	851,630


DEBT CAPITALIZATION
Secured Debt Balance ⁽¹⁾	$	1,280,208		$	1,408,325
Unsecured Debt Balance ^{(2) (3)}		805,000			615,000
Debt Capitalization	$	2,085,208		$	2,023,325
TOTAL MARKET CAPITALIZATION	$	2,893,082		$	2,874,955

Equity Capitalization/Total Market Capitalization		27.9	%		29.6	%
Debt Capitalization/Total Market Capitalization		72.1	%		70.4	%
Unsecured Debt Balance/Total Debt		38.6	%		30.4	%


CAPITAL RESOURCES
Cash and Cash Equivalents	$	26,922		$	27,367
Revolving Facility		400,000			400,000
Amount Outstanding		(255,000	)		(65,000	)
Letters of Credit		-			(5,126	)
Available Revolving Facility ⁽⁴⁾	$	145,000		$	329,874
Term Loans		700,500			675,000
Amount Borrowed		(700,500	)		(675,000	)
Available Term Loans	$	-		$	-
TOTAL	$	171,922		$	357,241
Shelf Registration	$	500,000		$	1,000,000

⁽¹⁾	Includes consolidated mortgage debt, our share of mortgage debt from equity method investments, and $150,500 of secured debt from our share of the FDP Term Loan.

⁽²⁾	The unsecured debt balance includes a 2018 Revolving Facility balance of $255,000 as of December 31, 2019 and $65,000 as of December 31, 2018.

⁽³⁾	The unsecured debt balance includes a Term Loan balance of $550,000 as of December 31, 2019 and 2018, respectively.

⁽⁴⁾

The available Credit Facility borrowings are subject to covenants that may restrict amounts that can be borrowed. Following recent property sales, the NOI from the Company’s remaining unencumbered properties is at a level such that the incremental unsecured amount that the Company may borrow as of December 31, 2019 within the Unencumbered Debt Yield covenant, under the $400.0 million 2018 Revolving Facility, is an aggregate of $25.9 million.

Pennsylvania Real Estate Investment Trust

Statement of Operations – Three Months and Year Ended December 31, 2019 and 2018

	Three Months Ended December 31,						Year Ended December 31,
(in thousands of dollars)	2019			2018			2019			2018
REVENUE:
Real estate revenue:
Lease revenue	$	78,643		$	85,162		$	302,311		$	324,829
Expense reimbursements		4,637			5,014			19,979			21,322
Other real estate revenue		5,049			5,149			12,668			12,078
Total real estate revenue		88,329			95,325			334,958			358,229
Other income		393			717			1,834			4,171
Total revenue		88,722			96,042			336,792			362,400
EXPENSES:
Operating expenses:
Property operating expenses:
CAM and real estate taxes		(27,369	)		(28,666	)		(113,260	)		(113,235	)
Utilities		(3,383	)		(3,847	)		(14,733	)		(15,990	)
Other property operating expenses		(2,750	)		(3,257	)		(8,565	)		(12,007	)
Total property operating expenses		(33,502	)		(35,770	)		(136,558	)		(141,232	)
Depreciation and amortization		(39,699	)		(32,611	)		(137,784	)		(133,116	)
General and administrative expenses		(12,591	)		(10,373	)		(46,010	)		(38,342	)
Provision for employee separation expenses		(2,611	)		(183	)		(3,689	)		(1,139	)
Insurance recoveries, net		(132	)		714			4,362			689
Project costs and other expenses		(17	)		(252	)		(284	)		(693	)
Total operating expenses		(88,552	)		(78,475	)		(319,963	)		(313,833	)
Interest expense, net⁽¹⁾		(17,001	)		(15,291	)		(63,987	)		(61,355	)
Gain on debt extinguishment		27			-			24,859			-
Impairment of assets		(1,455	)		(103,201	)		(1,455	)		(137,487	)
Impairment of development land parcel		(2,098	)		-			(3,562	)		-
Total expenses		(109,079	)		(196,967	)		(364,108	)		(512,675	)
Income (loss) before equity in income of partnerships, gain on sales of real estate by equity method investee, gain on sales of real estate, net, and adjustment to gain on sales of interests in non operating real estate		(20,357	)		(100,925	)		(27,316	)		(150,275	)
Equity in income of partnerships⁽²⁾		2,153			3,189			8,289			11,375
Gain on sales of real estate by equity method investee		-			-			553			2,772
Gain on sales of real estate, net		72			776			2,756			1,525
Gain on sales of interests in non operating real estate		2,718			8,126			2,718			8,100
Net income (loss)		(15,414	)		(88,834	)		(13,000	)		(126,503	)
Less: net income (loss) attributable to noncontrolling interest		565			10,052			2,128			16,174
Net income (loss) attributable to PREIT		(14,849	)		(78,782	)		(10,872	)		(110,329	)
Less: preferred share dividends		(6,844	)		(6,844	)		(27,375	)		(27,375	)
Net income (loss) attributable to PREIT common shareholders	$	(21,693	)	$	(85,626	)	$	(38,247	)	$	(137,704	)

⁽¹⁾	Net of capitalized interest expense of $756 and $1,667 for the three months ended December 31, 2019 and 2018, respectively, and $7,725 and $6,395 for the year ended December 31, 2019 and 2018, respectively.

⁽²⁾	Equity in the income of partnerships is net of capitalized interest expense of $1,471 and $1,438 for the three months ended December 31, 2019 and 2018, respectively, and $6,025 and $4,731 for the year ended December 31, 2019 and 2018, respectively.

Pennsylvania Real Estate Investment Trust

Computation of Earnings Per Share – Three Months and Year Ended December 31, 2019 and 2018

(in thousands, except per share amounts)

	Three Months Ended December 31,						Year Ended December 31,
(in thousands, except per share amounts)	2019			2018			2019			2018
Net loss	$	(15,414	)	$	(88,834	)	$	(13,000	)	$	(126,503	)
Noncontrolling interest		565			10,052			2,128			16,174
Preferred share dividends		(6,844	)		(6,844	)		(27,375	)		(27,375	)
Dividends on unvested restricted shares		(219	)		(130	)		(883	)		(542	)
Net loss used to calculate loss per share—basic and diluted	$	(21,912	)	$	(85,756	)	$	(39,130	)	$	(138,246	)
Basic and diluted loss per share:	$	(0.29	)	$	(1.23	)	$	(0.52	)	$	(1.98	)

(in thousands of shares)
Weighted average shares outstanding—basic		76,557			69,840			75,221			69,749
Effect of common share equivalents⁽¹⁾		-			-			-			-
Weighted average shares outstanding—diluted		76,557			69,840			75,221			69,749

⁽¹⁾

The Company had net losses used to calculate earnings per share for four of the periods presented. Therefore, the effects of common share equivalents for the three months ended December 31, 2019 and December 31, 2018 and the year ended December 31, 2019 and 2018, respectively, are excluded from the calculation of diluted loss per share for these periods because they would be antidilutive.

Pennsylvania Real Estate Investment Trust

Reconciliation of Net Operating Income and Earnings Before Interest, Income Taxes, Depreciation, and Amortization for Real Estate– Three Months and Year Ended December 31, 2019 and 2018

(Non-GAAP Measures)

(in thousands)

Net Operating Income ("NOI") Reconciliation for the Three Months ended December 31, 2019⁽¹⁾

	Same Store				Change						Non Same Store				Total
	2019		2018		$			%			2019		2018		2019		2018
NOI from consolidated properties	$	52,666	$	54,597	$	(1,931	)		-3.5	%	$	2,162	$	4,958	$	54,828	$	59,555
NOI attributable to equity method investments, at ownership share		7,451		7,880		(429	)		-5.4	%		923		95		8,374		7,975
Total NOI		60,117		62,477		(2,360	)		-3.8	%		3,085		5,053		63,202		67,530
Less: lease termination revenue		1,018		1,575		(557	)		-35.4	%		1		-		1,019		1,575
Total NOI excluding lease termination revenue	$	59,099	$	60,902	$	(1,803	)		-3.0	%	$	3,084	$	5,053	$	62,183	$	65,955

Net Operating Income ("NOI") Reconciliation for the Year ended December 31, 2019⁽¹⁾

	Same Store				Change						Non Same Store				Total
	2019		2018		$			%			2019		2018		2019		2018
NOI from consolidated properties	$	185,874	$	196,836	$	(10,962	)		-5.6	%	$	12,526	$	20,163	$	198,400	$	216,999
NOI attributable to equity method investments, at ownership share		28,597		30,161		(1,564	)		-5.2	%		732		572		29,329		30,733
Total NOI		214,471		226,997		(12,526	)		-5.5	%		13,258		20,735		227,729		247,732
Less: lease termination revenue		1,531		8,641		(7,110	)		-82.3	%		18		577		1,549		9,218
Total NOI excluding lease termination revenue	$	212,940	$	218,356	$	(5,416	)		-2.5	%	$	13,240	$	20,158	$	226,180	$	238,514

⁽¹⁾	NOI is a non-GAAP measure. See definition of NOI on page 36.

Earnings Before Interest, Income Taxes, Depreciation, and Amortization for Real Estate ("EBITDAre") Reconciliation⁽¹⁾

	Three Months Ended December 31,						Year Ended December 31,
	2019			2018			2019			2018
Net loss	$	(15,414	)	$	(88,834	)	$	(13,000	)	$	(126,503	)
Depreciation and amortization:
Consolidated		39,699			32,611			137,784			133,116
Unconsolidated properties at ownership share		3,421			2,094			9,874			8,612
Interest expense:
Consolidated		17,001			15,291			63,987			61,355
Unconsolidated properties at ownership share		2,713			2,731			10,711			10,818
Gain on sales of real estate by equity method investee		-			-			(553	)		(2,772	)
Gain on sales of interests in real estate, net		(72	)		(776	)		(2,756	)		(1,525	)
Gain on debt extinguishment, net		(27	)		-			(24,859	)		-
Impairment of development land parcel		-			-			3,562			-
Impairment of assets		1,455			103,201			3,553			137,487
EBITDAre	$	48,776		$	66,318		$	188,303		$	220,588

⁽¹⁾	EBITDAre is a non-GAAP measure. See definition on page 36.

Pennsylvania Real Estate Investment Trust

Reconciliation of Net Income (Loss) to Net Operating Income from Consolidated Properties (Non-GAAP Measure)

Three Months Ended December 31, 2019 and December 31, 2018

(in thousands)

	Three Months Ended December 31,
	2019			2018
Net loss	$	(15,414	)	$	(88,834	)
Other income		(393	)		(717	)
Depreciation and amortization		39,699			32,611
General and administrative expenses		12,591			10,373
Insurance recoveries, net		132			(714	)
Provision for employee separation expenses		2,611			183
Project costs and other expenses		17			252
Interest expense, net		17,001			15,291
Equity in income of partnerships		(2,153	)		(3,189	)
Gain on debt extinguishment, net		(27	)		-
Impairment of assets		1,455			103,201
Impairment of development land parcel		2,098			-
Gain on sales of interests in real estate, net		(72	)		(776	)
Gain on sales of interest in non operating real estate		(2,718	)		(8,126	)
NOI from consolidated properties⁽¹⁾	$	54,828		$	59,555

⁽¹⁾	NOI is a non-GAAP measure. See definition of NOI on page 43.

	Same Store						Non Same Store						Total
	2019			2018			2019			2018			2019			2018
Real estate revenue
Base rent	$	52,006		$	52,481		$	3,137		$	6,416		$	55,144		$	58,897
CAM reimbursement income		9,960			10,261			550			956			10,510			11,217
Real estate tax income		8,607			9,463			141			633			8,748			10,096
Percentage rent		3,729			3,318			40			71			3,769			3,389
Lease termination revenue		963			1,563			1			-			964			1,563
		75,265			77,086			3,869			8,076			79,134			85,162
Less: credit losses		(518	)		-			27			-			(491	)		-
Lease revenue		74,747			77,086			3,896			8,076			78,644			85,162
Expense reimbursements		4,294			4,431			343			584			4,637			5,015
Other real estate revenue		4,711			4,643			337			505			5,048			5,148
Total real estate revenue		83,752			86,160			4,576			9,165			88,328			95,325
Property operating expenses
CAM and real estate taxes		(25,427	)		(25,473	)		(1,943	)		(3,193	)		(27,370	)		(28,666	)
Utilities		(3,109	)		(3,302	)		(274	)		(545	)		(3,383	)		(3,847	)
Credit losses		-			(281	)		-			(110	)		-			(391	)
Other property operating expenses		(2,551	)		(2,507	)		(197	)		(359	)		(2,748	)		(2,866	)
Total property operating expenses		(31,087	)		(31,563	)		(2,414	)		(4,207	)		(33,501	)		(35,770	)
NOI from consolidated properties⁽¹⁾	$	52,665		$	54,597		$	2,162		$	4,958		$	54,827		$	59,555
Less: Lease termination revenue		963			1,563			1			-			964			1,563
NOI from consolidated properties excluding lease termination revenue⁽¹⁾	$	51,702		$	53,034		$	2,161		$	4,958		$	53,863		$	57,992
% change in Same Store NOI from consolidated properties excluding lease termination revenue				(2.5%)

⁽¹⁾	NOI is a non-GAAP measure. See definition of NOI on page 43.

Pennsylvania Real Estate Investment Trust

Reconciliation of Equity in Income of Partnerships to Net Operating Income from Equity Method Investments, at Ownership Share (Non-GAAP Measure)

Three Months Ended December 31, 2019 and December 31, 2018

(in thousands)

	Three Months Ended December 31,
	2019			2018
Equity in income of partnerships	$	2,153		$	3,189
Other income		(29	)		(46	)
Depreciation and amortization		3,421			2,095
Interest expense and other expenses, net		2,829			2,737
NOI from equity method investments at ownership share⁽¹⁾	$	8,374		$	7,975

⁽¹⁾	NOI is a non-GAAP measure. See definition of NOI on page 43.

	Same Store						Non Same Store						Total
	2019			2018			2019			2018			2019			2018
Real estate revenue
Base rent	$	6,692		$	7,050		$	1,098		$	180		$	7,790		$	7,230
CAM reimbursement income		1,551			1,583			596			7			2,147			1,590
Real estate tax income		998			1,055			107			43			1,105			1,098
Percentage rent		133			195			109			39			242			234
Lease termination revenue		55			12			-			-			55			12
		9,429			9,895			1,910			269			11,339			10,164
Less: credit losses		30			-			(47	)		-			(17	)		-
Lease revenue		9,459			9,895			1,863			269			11,322			10,164
Expense reimbursements		472			483			134			71			606			554
Other real estate revenue		359			415			838			144			1,197			559
Total real estate revenue		10,290			10,793			2,835			484			13,125			11,277
Property operating expenses
CAM and real estate taxes		(2,115	)		(2,159	)		(1,411	)		(343	)		(3,526	)		(2,502	)
Utilities		(180	)		(197	)		(111	)		(43	)		(291	)		(240	)
Credit losses		-			31			-			(7	)		-			24
Other property operating expenses		(544	)		(588	)		(390	)		4			(934	)		(584	)
Total property operating expenses		(2,839	)		(2,913	)		(1,912	)		(389	)		(4,751	)		(3,302	)
NOI from equity method investments at ownership share⁽¹⁾	$	7,451		$	7,880		$	923		$	95		$	8,374		$	7,975
Less: Lease termination revenue		55			12			-			-			55			12
NOI from equity method investments at ownership share excluding lease termination revenue⁽¹⁾	$	7,396		$	7,868		$	923		$	95		$	8,319		$	7,963
% change in Same Store NOI from equity method investments at ownership share excluding lease termination revenue				(6.0%)

⁽¹⁾	NOI is a non-GAAP measure. See definition of NOI on page 43.

Pennsylvania Real Estate Investment Trust

Reconciliation of Net Income (Loss) to Net Operating Income from Consolidated Properties (Non-GAAP Measure)

Year Ended December 31, 2019 and December 31, 2018

(in thousands)

	Year Ended December 31,
	2019			2018
Net income (loss)	$	(13,000	)	$	(126,503	)
Other income		(1,834	)		(4,171	)
Depreciation and amortization		137,784			133,116
General and administrative expenses		46,010			38,342
Insurance recoveries, net		(4,362	)		(689	)
Provision for employee separation expenses		3,689			1,139
Project costs and other expenses		283			693
Interest expense, net		63,987			61,355
Impairment of assets		1,455			137,487
Impairment of development land parcel		3,562			-
Equity in income of partnerships		(8,289	)		(11,375	)
Gain on debt extinguishment, net		(24,859	)		-
Gain on sales of real estate by equity method investee		(553	)		(2,772	)
Gain on sales of interests in real estate, net		(2,756	)		(1,525	)
Gain on sales of interest in non operating real estate		(2,717	)		(8,100	)
NOI from consolidated properties⁽¹⁾	$	198,400		$	216,997

⁽¹⁾	NOI is a non-GAAP measure. See definition of NOI on page 43.

	Same Store						Non Same Store						Total
	2019			2018			2019			2018			2019			2018
Real estate revenue
Base rent	$	200,625		$	200,858		$	18,194		$	25,751		$	218,819		$	226,609
CAM reimbursement income		40,606			40,998			3,268			4,108			43,874			45,106
Real estate tax income		34,614			37,010			1,629			3,085			36,243			40,095
Percentage rent		4,657			4,204			47			87			4,704			4,291
Lease termination revenue		1,426			8,152			18			577			1,444			8,729
		281,928			291,222			23,156			33,608			305,084			324,830
Less: credit losses		(2,467	)		-			(306	)		-			(2,773	)		-
Lease revenue		279,461			291,222			22,850			33,608			302,311			324,830
Expense reimbursements		17,936			18,585			2,043			2,737			19,979			21,322
Other real estate revenue		10,705			10,925			1,963			1,152			12,668			12,077
Total real estate revenue		308,102			320,732			26,856			37,497			334,958			358,229
Property operating expenses														-			-
CAM and real estate taxes		(101,521	)		(99,740	)		(11,739	)		(13,495	)		(113,260	)		(113,235	)
Utilities		(13,035	)		(13,616	)		(1,698	)		(2,374	)		(14,733	)		(15,990	)
Credit losses		-			(2,089	)		-			(333	)		-			(2,422	)
Other property operating expenses		(7,672	)		(8,452	)		(893	)		(1,133	)		(8,565	)		(9,585	)
Total property operating expenses		(122,228	)		(123,897	)		(14,330	)		(17,335	)		(136,558	)		(141,232	)
NOI from consolidated properties⁽¹⁾	$	185,874		$	196,835		$	12,526		$	20,162		$	198,400		$	216,997
Less: Lease termination revenue		1,426			8,152			18			577			1,444			8,729
NOI from consolidated properties excluding lease termination revenue⁽¹⁾	$	184,448		$	188,683		$	12,508		$	19,585		$	196,956		$	208,268
% change in Same Store NOI from consolidated properties excluding lease termination revenue				(2.2%)

⁽¹⁾	NOI is a non-GAAP measure. See definition of NOI on page 43.

Pennsylvania Real Estate Investment Trust

Reconciliation of Equity in Income of Partnerships to Net Operating Income from Equity Method Investments, at Ownership Share (Non-GAAP Measure)

Year Ended December 31, 2019 and December 31, 2018

(in thousands)

	Year Ended December 31,
	2019			2018
Equity in income of partnerships	$	8,289		$	11,375
Other income		(75	)		(82	)
Depreciation and amortization		9,874			8,612
Interest expense and other expenses, net		11,242			10,828
NOI from equity method investments at ownership share⁽¹⁾	$	29,330		$	30,733

⁽¹⁾	NOI is a non-GAAP measure. See definition of NOI on page 43.

	Same Store						Non Same Store						Total
	2019			2018			2019			2018			2019			2018
Real estate revenue
Base rent	$	26,523		$	27,693		$	1,703		$	1,320		$	28,226		$	29,013
CAM reimbursement income		6,341			6,307			686			44			7,027			6,351
Real estate tax income		3,798			3,869			241			180			4,039			4,049
Percentage rent		383			417			109			39			492			456
Lease termination revenue		105			489			-			-			105			489
		37,150			38,775			2,739			1,583			39,889			40,358
Less: credit losses		48			-			13			-			61			-
Lease revenue		37,198			38,775			2,752			1,583			39,950			40,358
Expense reimbursements		1,874			2,006			284			244			2,158			2,250
Other real estate revenue		1,165			1,137			1,552			719			2,717			1,856
Total real estate revenue		40,237			41,918			4,588			2,546			44,825			44,464
Property operating expenses
CAM and real estate taxes		(8,575	)		(8,499	)		(2,655	)		(1,557	)		(11,230	)		(10,056	)
Utilities		(766	)		(818	)		(230	)		(234	)		(996	)		(1,052	)
Credit losses		-			(34	)		-			(45	)		-			(79	)
Other property operating expenses		(2,298	)		(2,406	)		(971	)		(138	)		(3,269	)		(2,544	)
Total property operating expenses		(11,639	)		(11,757	)		(3,856	)		(1,974	)		(15,495	)		(13,731	)
NOI from equity method investments at ownership share⁽¹⁾	$	28,598		$	30,161		$	732		$	572		$	29,330		$	30,733
Less: Lease termination revenue		105			489			-			-			105			489
NOI from equity method investments at ownership share excluding lease termination revenue⁽¹⁾	$	28,493		$	29,672		$	732		$	572		$	29,225		$	30,244
% change in Same Store NOI from equity method investments at ownership share excluding lease termination revenue				(4.0%)

⁽¹⁾	NOI is a non-GAAP measure. See definition of NOI on page 43.

Pennsylvania Real Estate Investment Trust

Reconciliation of Net Income to Funds From Operations and Funds Available for Distribution (Non-GAAP Measures)

Three Months and Year Ended December 31, 2019 and 2018

(in thousands, except per share amounts)

	Three Months Ended December 31,						Year Ended December 31,
	2019			2018			2019			2018
FUNDS FROM OPERATIONS

Net loss	$	(15,414	)	$	(88,834	)	$	(13,000	)	$	(126,503	)
Depreciation and amortization on real estate
Consolidated properties		39,296			32,265			136,422			131,694
PREIT's share of equity method investments		3,421			2,095			9,874			8,612
Gain on sales of real estate by equity method investee		-			-			-			(2,772	)
Gain on sales of interests in real estate, net		(72	)		(776	)		(2,756	)		(1,525	)
Impairment of assets		1,455			95,079			1,455			129,365
Dividends on preferred shares		(6,843	)		(6,844	)		(27,375	)		(27,375	)
Funds from operations attributable to common shareholders and OP Unit holders⁽¹⁾	$	21,843		$	32,985		$	104,620		$	111,496
Insurance recoveries, net		132			(714	)		(4,362	)		(689	)
Gain on debt extinguishment, net		(27	)		-			(24,859	)		-
Impairment of mortgage note receivable		-			8,122			-			8,122
Accelerated amortization of financing costs		-			-			-			363
Impairment of development land parcel		2,098			-			3,562			-
Provision for employee separation expenses		2,611			183			3,689			1,139
Funds from operations, as adjusted, attributable to common shareholders and OP Unit holders	$	26,657		$	40,576		$	82,650		$	120,431

FUNDS AVAILABLE FOR DISTRIBUTION⁽¹⁾
Funds from operations, as adjusted, attributable to common shareholders and OP Unit holders⁽¹⁾	$	26,657		$	40,576		$	82,650		$	120,431
Adjustments:
Straight line rent		(1,288	)		(323	)		(5,710	)		(2,540	)
Recurring capital expenditures		(4,295	)		(11,673	)		(17,590	)		(25,378	)
Tenant allowances		(6,041	)		(6,780	)		(12,122	)		(24,100	)
Amortization of non-cash deferred compensation		579			1,533			6,212			6,925
Capitalized leasing costs		(238	)		(1,598	)		(906	)		(7,022	)
Amortization of above- and below-market lease intangibles		(16	)		(21	)		(67	)		(208	)
Funds available for distribution to common shareholders and OP Unit holders⁽¹⁾	$	15,359		$	21,714		$	52,468		$	68,108

Funds from operations attributable to common shareholders and OP Unit holders per diluted share and OP Unit⁽¹⁾	$	0.28		$	0.42		$	1.33		$	1.43
Funds from operations, as adjusted, attributable to common shareholders and OP Unit holders per diluted share and OP Unit	$	0.34		$	0.52		$	1.05		$	1.54
Funds available for distribution to common shareholders and OP Unit holders per diluted share and OP Unit⁽¹⁾	$	0.19		$	0.28		$	0.67		$	0.87

⁽¹⁾	Non-GAAP measures. See definitions on page 43.

(Continued on next page)

Pennsylvania Real Estate Investment Trust

Reconciliation of Net Income to Funds From Operations and Funds Available for Distribution (Non-GAAP Measures)

Three Months and Year Ended December 31, 2019 and 2018

(in thousands, except per share amounts)

	Three Months Ended December 31,				Year Ended December 31,
	2019		2018		2019			2018
PAYOUT RATIOS ⁽²⁾
Payout ratio of funds from operations attributable to common shareholders and OP Unit holders						63.3	%		58.3	%
Payout ratio of funds from operations attributable to common shareholders and OP Unit holders, as adjusted						80.2	%		54.1	%
Payout ratio of funds available for distribution attributable to common shareholders and OP Unit holders						126.3	%		95.5	%

Weighted average number of shares outstanding		76,557		69,840		75,221			69,749
Weighted average effect of full conversion of OP Units		2,023		8,273		3,221			8,273
Effect of common share equivalents		485		23		453			203
Total weighted average shares outstanding, including OP Units		79,065		78,136		78,895			78,225

⁽²⁾	Year ended December 31, 2019 and December 31, 2018, respectively.

Pennsylvania Real Estate Investment Trust

Condensed Consolidated Balance Sheet

	December 31,
	2019			2018
(in thousands of dollars)
ASSETS:
INVESTMENTS IN REAL ESTATE, at cost:
Operating properties	$	3,100,530		$	3,063,531
Construction in progress		106,028			115,182
Land held for development		5,881			5,881
Total investments in real estate		3,212,439			3,184,594
Accumulated depreciation		(1,205,868	)		(1,118,582	)
Net investments in real estate		2,006,571			2,066,012
INVESTMENTS IN PARTNERSHIPS, at equity:		159,993			131,124
OTHER ASSETS:
Cash and cash equivalents		12,211			18,084
Tenant and other receivables, net		41,556			38,914
Intangible assets		14,541			17,868
Deferred costs and other assets, net		103,889			110,805
Assets held for sale		12,506			22,307
Total assets	$	2,351,267		$	2,405,114
LIABILITIES:
Mortgage loans payable, net	$	899,753		$	1,047,906
Term Loans, net		548,025			547,289
Revolving Facilities		255,000			65,000
Tenants’ deposits and deferred rent		13,006			15,400
Distributions in excess of partnership investments		87,916			92,057
Fair value of derivative liabilities		13,126			3,010
Accrued expenses and other liabilities		107,016			87,901
Total liabilities		1,923,842			1,858,563
EQUITY:
Total equity		427,425			546,551
Total liabilities and equity	$	2,351,267		$	2,405,114

Pennsylvania Real Estate Investment Trust

Assets and Liabilities - Equity Method Investments, at Ownership Share (Non-GAAP)

(in thousands)

	December 31,
(in thousands of dollars)	2019			2018
ASSETS:
Investments in real estate, at cost:
Operating properties	$	433,654		$	276,977
Construction in progress		126,210			211,637
Total investments in real estate		559,864			488,614
Accumulated depreciation		(113,986	)		(106,066	)
Net investments in real estate		445,878			382,548
Cash and cash equivalents		14,711			9,283
Deferred costs and other assets, net		21,018			14,564
Total assets		481,607			406,395
LIABILITIES AND PARTNERS’ INVESTMENT:
Mortgage loans payable, net		225,764			231,426
FDP Term Loan, net		150,500			125,000
Other liabilities		33,266			10,902
Total liabilities		409,530			367,328
Net investment	$	72,077		$	39,067
Reconciliation to comparable GAAP balance sheet item:
Investment in partnerships, at equity	$	159,993		$	131,124
Distributions in excess of partnership investments		(87,916	)		(92,057	)
Net investment	$	72,077		$	39,067

The non-GAAP financial information presented above includes financial information attributable to our share of unconsolidated properties. This proportionate financial information is non-GAAP financial information, but we believe that it is helpful information because it reflects the pro rata contribution from our unconsolidated properties that are owned through investments accounted for under GAAP using the equity method of accounting. Under such method, our investments in these entities are recorded in the balance sheet caption entitled “Investment in partnerships, at equity.” In the case of deficit investment balances, such amounts are recorded in “Distributions in excess of partnership investments.”

To derive the proportionate financial information reflected in the tables above we multiplied the percentage of our economic interest in each partnership on a property-by-property basis by each line item. Under the partnership agreements relating to our current unconsolidated partnerships with third parties, we own a 25% to 50% economic interest in such partnerships, and there are generally no provisions in such partnership agreements relating to special non-pro rata allocations of income or loss, and there are no preferred or priority returns of capital or other similar provisions. While this method approximates our indirect economic interest in our pro rata share of the assets and liabilities of our unconsolidated partnerships, we do not control these partnerships or have a direct legal claim to the assets, liabilities, revenues or expenses of the unconsolidated partnerships beyond our rights as an equity owner in the event of any liquidation of such entity. Our percentage ownership is not necessarily indicative of the legal and economic implications of our ownership interest.

Pennsylvania Real Estate Investment Trust

Leasing Activity Summary – Three Months Ended December 31, 2019

		Number		GLA		Term		Initial Rent per square foot ("psf")		Previous Rent psf		Initial Gross Rent Renewal Spread⁽¹⁾						Average Rent Renewal Spread⁽²⁾			Annualized Tenant Improvements psf⁽³⁾
												$			%			%
Non Anchor
New Leases
Under 10k square feet ("sf")	Consolidated		20		55,697		7.2	$	45.74	n/a		n/a			n/a			n/a			$	15.00
	Unconsolidated⁽⁴⁾		-		-		-		-	n/a		n/a			n/a			n/a				-
Total Under 10k sf			20		55,697		7.2	$	45.74	n/a		n/a			n/a			n/a			$	15.00

Over 10k sf	Unconsolidated⁽⁴⁾		2		36,277		10.0	$	19.81	n/a		n/a			n/a			n/a			$	9.41
Total New Leases			22		91,974		8.3	$	35.51	n/a		n/a			n/a			n/a			$	12.34

Renewal Leases
Under 10k sf	Consolidated		18		47,676		3.5	$	51.22	$	49.26	$	1.96			4.0	%		6.7	%	$	-
	Unconsolidated⁽⁴⁾		2		10,379		3.0	$	52.17	$	69.65	$	(17.48	)		(25.1	%)		(28.2	%)		-
Total Under 10k sf			20		58,055		3.4	$	51.39	$	52.91	$	(1.52	)		(2.9	%)		(1.2	%)	$	-

Over 10k sf	Consolidated		2		38,094		1.0	$	12.21	$	12.21	$	-			0.0	%		0.0	%	$	-
	Unconsolidated⁽⁴⁾		-		-		-		-		-	$	-			0.0	%		0.0	%	$	-
Total Over 10k sf			2		38,094		1.0	$	12.21	$	12.21	$	0.00			0.0	%		0.0	%		-
Total Fixed Rent			22		96,149		2.5	$	35.87	$	36.78	$	(0.92	)		(2.5	%)		(1.0	%)	$	-
Percentage in Lieu	Consolidated		17		111,826		3.2	$	25.13	$	39.00	$	(13.87	)		(35.6	%)				$	-
	Unconsolidated⁽⁴⁾		2		19,680		3.0	$	17.92	$	17.95	$	(0.03	)		(0.2	%)
Total Percentage in Lieu			19		131,506		3.1	$	24.05	$	35.85	$	(11.80	)		(32.9	%)
Total Renewal Leases			41		227,655		2.9	$	29.04	$	36.24	$	(7.20	)		(19.9	%)				$	-
Total Non Anchor			63		319,629		4.4	$	30.90

Anchor
New Leases			-		-		-	$	0.00	n/a		n/a			n/a			n/a			n/a
Renewal Leases	Consolidated		1		80,983		1.0	$	4.86	$	4.63	$	0.23			5.0	%	n/a			$	-
Total			1		80,983		5.0	$	4.86

⁽¹⁾

Initial gross rent renewal spread is computed by comparing the initial rent psf in the new lease to the final rent psf amount in the expiring lease. For purposes of this computation, the rent amount includes minimum rent, CAM charges, estimated real estate tax reimbursements and marketing charges, but excludes percentage rent. In certain cases, a lower rent amount may be payable for a period of time until specified conditions in the lease are satisfied.

⁽²⁾

Average rent renewal spread is computed by comparing the average rent psf over the new lease term to the final rent psf amount in the expiring lease. For purposes of this computation, the rent amount includes minimum rent and fixed CAM charges, but excludes pro rata CAM charges, estimated real estate tax reimbursements, marketing charges and percentage rent.

⁽³⁾	Tenant improvements and certain other leasing costs are presented as annualized amounts per square foot and are spread uniformly over the initial lease term.

⁽⁴⁾

We own a 25% to 50% interest in each of our unconsolidated properties and do not control such properties. Our percentage ownership is not necessarily indicative of the legal and economic implications of our ownership interest. See “—Use of Non-GAAP Measures” for further details on our ownership interests in our unconsolidated properties.

Pennsylvania Real Estate Investment Trust

Leasing Activity Summary – Year Ended December 31, 2019

		Number		GLA		Term		Initial Rent per square foot ("psf")		Previous Rent psf		Initial Gross Rent Renewal Spread⁽¹⁾						Average Rent Renewal Spread⁽²⁾			Annualized Tenant Improvements psf⁽³⁾
												$			%			%
Non Anchor
New Leases
Under 10k square feet ("sf")	Consolidated		102		269,421		6.8	$	42.74	n/a		n/a			n/a			n/a			$	12.87
	Unconsolidated⁽⁴⁾		7		23,445		5.5		47.05	n/a		n/a			n/a			n/a				11.72
Total Under 10k sf			109		292,866		6.7	$	43.09	n/a		n/a			n/a			n/a			$	12.79

Over 10k sf	Consolidated		4		67,272		10.0	$	19.32	n/a		n/a			n/a			n/a				20.74
	Unconsolidated⁽⁴⁾		2		36,277		10.0	$	19.81	n/a		n/a			n/a			n/a				9.41
Total Over 10k sf			6		103,549		10.0	$	19.48	n/a		n/a			n/a			n/a				16.96
Total New Leases			115		396,415		7.6	$	36.92	n/a		n/a			n/a			n/a			$	14.17

Renewal Leases
Under 10k sf	Consolidated		86		181,723		3.5	$	60.38	$	57.62	$	2.76			4.8	%		6.7	%	$	1.75
	Unconsolidated⁽⁴⁾		18		53,676		3.2	$	66.35	$	76.44	$	(10.09	)		(13.2	%)		(10.5	%)	$	1.67
Total Under 10k sf			104		235,399		3.4	$	61.74	$	61.91	$	(0.17	)		(0.3	%)		1.7	%	$	1.73

Over 10k sf	Consolidated		13		239,249		3.8	$	16.04	$	15.27	$	0.77			5.0	%		5.5	%	$	0.47
	Unconsolidated⁽⁴⁾		1		11,306		1.0	$	14.15	$	14.15	$ -				0.0	%		0.0	%	$ -
Total Over 10k sf			14		250,555		3.7		15.95		15.22		0.74			4.8	%		5.3	%		0.46
Total Fixed Rent			118		485,954		3.6	$	38.13	$	37.84	$	0.30			0.8	%		2.5	%	$	1.06
Percentage in Lieu	Consolidated		71		281,565		2.4	$	28.83	$	42.63	$	(13.80	)		(32.4	%)
	Unconsolidated⁽⁴⁾		2		19,680		3.0	$	17.92	$	17.95	$	(0.03	)		(0.2	%)
Total Percentage in Lieu			73		301,245		2.4	$	28.12	$	41.02	$	(12.90	)		(31.5	%)
Total Renewal Leases			191		787,199		3.1	$	34.30	$	39.05	$	(4.75	)		(12.2	%)				$	0.74
Total Non Anchor			306		1,183,614		4.6	$	35.18

Anchor
New Leases			1		43,840		10.0	$	16.50	n/a		n/a			n/a			n/a			$	12.11
Renewal Leases	Consolidated		8		807,083		3.7	$	3.78	$	4.35	$	(0.57	)		(13.1	%)	n/a			$	-
Total			9		850,923		4.0	$	4.44

⁽¹⁾

⁽²⁾

⁽³⁾	Tenant improvements and certain other leasing costs are presented as annualized amounts per square foot and are spread uniformly over the initial lease term.

⁽⁴⁾

Pennsylvania Real Estate Investment Trust

Summarized Sales and Rent Per Square Foot and Occupancy Percentages

	December 31, 2019																						December 31, 2018
											Actual Occupancy						Leased Occupancy																Actual Occupancy
	% Rolling 12 Mo. NOI			Average Comp Sales		Average Gross Rent⁽¹⁾⁽²⁾		Occupancy Cost			Total			Non- Anchor			Total			Non- Anchor			% Rolling 12 Mo. NOI			Average Comp Sales		Average Gross Rent⁽¹⁾⁽²⁾		Occupancy Cost			Total			Non- Anchor
Malls		88.5	%	$	539	$	59.63		12.3	%		95.5	%		92.9	%		96.6	%		94.6	%		86.5	%	$	510	$	60.32		12.9	%		96.0	%		93.6	%
Non-Core Malls		3.8	%	$	336		43.72		12.8	%		63.1	%		74.9	%		63.1	%		74.9	%		5.4	%	334		43.10			12.7	%		86.6	%		84.8	%
Malls Total		92.3	%	$	524	$	58.67		12.3	%		92.5	%		91.6	%		93.6	%		93.2	%		91.9	%	$	496	$	59.10		12.9	%		95.2	%		92.9	%
Other Retail Properties		5.6	%	n/a			25.59		-			92.8	%		92.2	%		93.3	%		92.7	%		5.1	%	n/a		25.06		n/a				87.8	%		92.4	%
Total Retail Properties		97.9	%	$	524	$	49.78		12.3	%		92.6	%		91.7	%		93.5	%		93.1	%		97.0	%	n/a		$	50.32	n/a				94.3	%		92.8	%
Sold Properties		1.9	%	n/a		n/a		n/a			n/a			n/a			n/a			n/a				2.9	%	379		47.97		n/a				64.0	%		82.2	%
Other Properties ⁽³⁾		0.2	%	n/a		n/a		n/a			n/a			n/a			n/a			n/a				0.1	%	n/a		n/a		n/a			n/a			n/a
Total Portfolio		100.0	%	$	524	$	49.78		12.3	%		92.6	%		91.7	%		93.5	%		93.1	%		100.0	%	$	491	$	50.25		12.9	%		92.7	%		92.6	%

⁽¹⁾	Average gross rent for malls includes all non-anchor space owned by the Company and leased to tenants that occupy individual spaces of less than 10,000 square feet. Average gross rent for other retail properties includes all non-anchor space owned by the Company regardless of size.

⁽²⁾	Average gross rent for mall tenants greater than 10,000 sf was $21.33 per square foot as of December 31, 2019 and $22.20 per square foot as of December 31, 2018.

⁽³⁾	Operating metrics for Fashion District Philadelphia as of December 31, 2019 and 2018, respectively, are excluded because the property was under redevelopment until September 2019.

Pennsylvania Real Estate Investment Trust

Mall Occupancy Percentage and Sales Per Square Foot

	December 31, 2019											December 31, 2018								Change
	% of Mall NOI			Avg Comp Sales ⁽¹⁾		Total Occupancy %			Non- Anchor Occupancy %			Avg Comp Sales ⁽¹⁾		Total Occupancy %			Non-Anchor Occupancy %			Avg Comp Sales ⁽¹⁾			Total Occupancy %			Non- Anchor Occupancy %
Top 6 Malls
Willow Grove Park		6.5	%	$	760		97.1	%		95.0	%	$	726		94.4	%		90.3	%		4.7	%		2.7	%		4.7	%
Cherry Hill Mall		13.8	%	725			98.3	%		97.9	%	678			98.7	%		98.4	%		6.9	%		(0.4	%)		(0.5	%)
Woodland Mall		6.0	%	635			98.7	%		98.4	%	573			99.5	%		99.5	%		10.8	%		(0.8	%)		(1.1	%)
Lehigh Valley Mall		5.9	%	601			90.4	%		84.1	%	579			90.9	%		85.4	%		3.8	%		(0.5	%)		(1.3	%)
Springfield Town Center		10.8	%	555			94.2	%		92.3	%	548			93.1	%		90.7	%		1.3	%		1.1	%		1.6	%
Mall at Prince Georges		7.4	%	555			99.0	%		98.0	%	546			98.4	%		96.6	%		1.6	%		0.6	%		1.4	%
		50.5	%	$	646		96.0	%		94.0	%	$	616		95.4	%		93.2	%		4.9	%		0.6	%		0.8	%

Malls 7-12
Dartmouth Mall		3.9	%		543		99.6	%		99.4	%	525			99.5	%		99.2	%		3.5	%		0.1	%		0.2	%
Jacksonville Mall		4.0	%		508		99.0	%		98.0	%	509			99.9	%		99.8	%		(0.3	%)		(0.9	%)		(1.8	%)
Magnolia Mall		3.4	%		471		99.7	%		99.4	%	435			99.8	%		99.7	%		8.2	%		(0.1	%)		(0.3	%)
Capital City Mall		5.1	%		453		99.5	%		99.3	%	424			99.0	%		98.5	%		6.9	%		0.5	%		0.8	%
Patrick Henry Mall		4.6	%		452		96.8	%		95.4	%	411			97.5	%		96.4	%		10.1	%		(0.7	%)		(1.0	%)
Viewmont Mall		4.2	%		438		99.7	%		99.4	%	432			99.9	%		99.8	%		1.5	%		(0.2	%)		(0.4	%)
		25.2	%		471		99.1	%		98.5	%	$	448		99.3	%		98.9	%		5.2	%		(0.2	%)		(0.4	%)

Malls 13-18
Valley Mall		4.6	%		425		99.4	%		98.9	%	401			98.1	%		96.3	%		5.9	%		1.3	%		2.6	%
Moorestown Mall		3.3	%		411		93.8	%		85.5	%	397			93.1	%		83.7	%		3.5	%		0.7	%		1.8	%
Springfield Mall		1.6	%		406		91.5	%		91.5	%	417			96.8	%		96.8	%		(2.7	%)		(5.3	%)		(5.3	%)
Cumberland Mall		3.0	%		389		88.9	%		81.8	%	371			92.9	%		88.4	%		5.0	%		(4.0	%)		(6.6	%)
Francis Scott Key Mall		3.8	%		375		92.5	%		88.3	%	364			94.2	%		90.9	%		2.9	%		(1.7	%)		(2.6	%)
Plymouth Meeting Mall		3.9	%		355		87.5	%		81.2	%	330			91.7	%		87.2	%		7.6	%		(4.2	%)		(6.0	%)
		20.2	%		395		92.4	%		87.0	%	$	382		94.2	%		90.0	%		3.5	%		(1.8	%)		(3.0	%)

All Core Malls		95.9	%	$	539		95.5	%		92.9	%	$	510		96.0	%		93.6	%		5.7	%		(0.5	%)		(0.7	%)

Non-Core Malls
Valley View Mall		1.8	%	352			70.7	%		91.0	%	359			95.0	%		92.6	%		(1.9	%)		(24.3	%)		(1.6	%)
Exton Square Mall		2.3	%	317			59.2	%		65.8	%	313			83.7	%		80.9	%		1.3	%		(24.5	%)		(15.1	%)
All Non-Core Malls		4.1	%	$	336		63.1	%		74.9	%	$	334		86.6	%		84.8	%		0.6	%		(23.5	%)		(9.9	%)

All Malls		100.0	%	$	524		92.5	%		91.6	%	$	496		95.2	%		92.9	%		5.6	%		(2.7	%)		(1.3	%)

⁽¹⁾	Based on reported sales by all comparable non-anchor tenants that lease individual spaces of less than 10,000 square feet and have occupied the space for at least 24 months.

Pennsylvania Real Estate Investment Trust

Top Twenty Tenants

December 31, 2019

Tenant	Brands	Locations at Consolidated Properties		Locations at Unconsolidated Properties		Total Number of Locations ⁽¹⁾		Percentage of Annualized Gross Rent⁽²⁾
Foot Locker, Inc.	Champs, Foot Locker, Footaction, House of Hoops by Foot Locker, Kids Foot Locker, Lady Foot Locker, Nike Yardline, Footaction Flight 23	41		8		49			4.4	%
L Brands, Inc.	Bath & Body Works, Pink, Victoria's Secret	36		6		42			3.9	%
Signet Jewelers Limited	Kay Jewelers, Piercing Pagoda, Totally Pagoda, Zales Jewelers, Silver & Gold Connection	54		9		63			3.1	%
Dick's Sporting Goods, Inc.	Dick's Sporting Goods, Field & Stream	10		2		12			2.9	%
American Eagle Outfitters, Inc.	Aerie, American Eagle Outfitters	16		4		20			2.5	%
Express, Inc	Express, Express Factory Outlet, Express Men	13		3		16			2.0	%
Gap, Inc.	Banana Republic, Gap/Gap Kids/Gap Outlet, Old Navy	12		9		21			1.8	%
J.C. Penney Company, Inc.	JC Penney, Penneys Firestone	13		1		14			1.7	%
Macy's	Bloomingdale's, Macy's	12		2		14			1.6	%
Cineworld Group	Regal Cinemas	4			-	4			1.6	%
Genesco Inc.	Johnston & Murphy, Journeys, Journeys Kidz, Underground by Journeys	26		4		30			1.5	%
Dave & Buster's, Inc.	Dave & Buster's	3			-	3			1.4	%
Luxottica Group S.p.A.	Lenscrafters, Pearle Vision, Sunglass Hut, Sunglass Hut Outlet	25		6		31			1.4	%
Ascena Retail Group, Inc.	Ann Taylor, Dress Barn, Justice, Lane Bryant, Loft, Loft Outlet	22		5		27			1.4	%
H&M Hennes & Mauritz L.P.	H&M	13			-	13			1.2	%
Forever 21, Inc.	Forever 21	11		1		12			1.2	%
Darden Concepts, Inc.	Bahama Breeze, Capital Grille, Olive Garden, Seasons 52, Yard House	9			-	9			1.2	%
The Children's Place, Inc.	The Children's Place	14		3		17			1.1	%
Shoe Show, Inc.	Shoe Department, Shoe Dept. Encore, Shoe Show	20		2		22			1.1	%
Abercrombie & Fitch Stores, In	Abercrombie & Fitch, Hollister Co., Abercrombie Kids	12		2			14		0.9	%
Total Top 20 Tenants		366		67		433			37.9	%
Total Leases			1,472	319			1,791		100.0	%

⁽¹⁾	Excludes tenants from Fashion District Philadelphia.

⁽²⁾	Includes our share of tenant gross rent from partnership properties based on PREIT’s ownership percentage in the respective equity method investments as of December 31, 2019.

Pennsylvania Real Estate Investment Trust

Lease Expirations as of December 31, 2019

(dollars in thousands except per square foot (“psf”) amounts)

Non-Anchors ⁽¹⁾
			Gross Leasable Area ("GLA")					Annualized Gross Rent
Lease Expiration Year	Number of Leases Expiring		Expiring GLA ⁽²⁾		Percent of Total			Gross Rent in Expiring Year		PREIT’s Share of Gross Rent in Expiring Year ⁽³⁾		Percent of PREIT’s Total			Average Expiring Gross Rent psf
2019 and Prior	109			226,347		2.8	%	$	18,952	$	18,138		5.8	%	$	83.73
2020	238			997,816		12.2	%		37,836		32,727		10.5	%		37.92
2021	245			1,032,220		12.6	%		38,575		32,640		10.5	%		37.37
2022	204			618,992		7.6	%		30,954		26,657		8.6	%		50.01
2023	179			1,110,090		13.6	%		40,415		35,751		11.5	%		36.41
2024	165			704,924		8.6	%		37,326		33,955		10.9	%		52.95
2025	161			752,745		9.2	%		39,853		32,204		10.4	%		52.94
2026	116			580,749		7.1	%		31,411		24,623		7.9	%		54.09
2027	93			637,293		7.8	%		25,140		23,489		7.6	%		39.45
2028	74			612,485		7.5	%		22,357		21,048		6.8	%		36.50
2029	58			502,978		6.2	%		17,505		16,672		5.4	%		34.80
Thereafter	40			401,653		4.9	%		12,884		12,480		4.0	%		32.08
Total/Average		1,682		8,178,292		100	%	$	353,208	$	310,385		100	%	$	43.19

Anchors⁽¹⁾
			Gross Leasable Area ("GLA")					Annualized Gross Rent
Lease Expiration Year	Number of Leases Expiring		Expiring GLA ⁽²⁾		Percent of Total			Gross Rent in Expiring Year		PREIT’s Share of Gross Rent in Expiring Year ⁽³⁾		Percent of PREIT’s Total			Average Expiring Gross Rent psf
2020	2			206,412		4.2	%	$	689		689		2.5	%	$	3.34
2021	7			648,162		13.1	%		3,977		2,760		10.2	%		6.14
2022	7			1,001,974		20.3	%		3,797		3,442		12.7	%		3.79
2023	3			348,592		7.1	%		1,894		1,894		7.0	%		5.43
2024	5			702,674		14.2	%		3,226		3,226		11.9	%		4.59
2025	5			731,526		14.8	%		2,659		2,659		9.8	%		3.63
2026	1			58,371		1.2	%		861		861		3.2	%		14.75
2027		-		-		0.0	%		-		-		0.0	%		-
2028	9			982,424		19.9	%		6,696		6,696		24.7	%		6.82
2029	1			65,155		1.3	%		2,210		2,210		8.1	%		33.92
Thereafter	3			198,048		4.0	%		2,697		2,697		9.9	%		13.62
Total/Average		43		4,943,338		100	%	$	28,706	$	27,133		100	%	$	5.81

⁽¹⁾	Only includes owned space. Excludes tenants from Fashion District Philadelphia.

⁽²⁾	Does not include tenants occupying space under license agreements with initial terms of less than one year. The aggregate GLA of these tenants is 606,677 square feet.

⁽³⁾	Includes our share of tenant rent from partnership properties based on PREIT’s ownership percentage in the respective equity method investments.

Pennsylvania Real Estate Investment Trust

Property Information as of December 31, 2019

		Landlord Owned Anchors/ Large Format Non Anchor				Anchor Stores Not Owned			Non-anchor occupied GLA
Properties	Location	Tenant	Expiration Year	GLA		Tenant	GLA		Large Format		Small Shop		Vacant		Total GLA

Core Malls
Capital City Mall	Camp Hill, PA	JCPenney	2028		102,825	Macy's		120,000		104,806		174,815		2,325		616,750
		Dick's Sporting Goods	2028		61,677
		Field & Stream	2031							50,302
Cherry Hill Mall	Cherry Hill, NJ	Nordstrom	2025		138,000	JCPenney		174,285		242,732		426,629		14,072		1,300,318
						Macy's		304,600
Cumberland Mall	Vineland, NJ	Burlington	2021		80,983	BJ's Wholesale Club		117,889		137,493		157,384		75,439		950,987
		The Home Depot	2024		132,013	Boscov's		155,341
		Dick's Sporting Goods	2028		50,000
		Regal Cinemas	2024							44,445
Dartmouth Mall	Dartmouth, MA	JCPenney	2024		100,020	Macy's		140,000		129,427		147,996		1,840		564,271
		AMC Theaters	2026							44,988
Francis Scott Key Mall	Frederick, MD	JCPenney	2021		101,293	Macy's		139,333		139,863		156,652		46,093		754,267
		Sears	2023		120,883
		Dick's Sporting Goods	2025							50,150
Jacksonville Mall	Jacksonville, NC	Belk	2021		72,510					123,079		124,717		5,034		494,945
		JCPenney	2025		51,812
		Sears	2021		117,793
Lehigh Valley Mall	Allentown, PA	Boscov's	2022		164,694	JCPenney		207,292		141,510		343,026		91,286		1,159,808
		Macy's	2022		212,000
Magnolia Mall	Florence, SC	Belk	2028		115,793					96,175		160,693		2,078		601,589
		Best Buy	2023		32,054
		JCPenney	2022		104,107
		Dick's Sporting Goods	2023							45,000
		Burlington	2028							45,689
Moorestown Mall	Moorestown, NJ	Boscov's	2028		202,765					63,039		194,852		58,195		931,971
		Lord & Taylor	2020		121,200
		Sears	2022		205,591
		Regal Cinemas	2028							57,843
		HomeSense	2028		28,486
Patrick Henry Mall	Newport News, VA	Dick's Sporting Goods	2022		50,250	Dillard's		144,157		60,095		224,289		13,661		717,664
		JCPenney	2020		85,212	Macy's		140,000
Plymouth Meeting Mall	Plymouth Meeting, PA	Boscov's	2028		188,429					152,381		181,617		109,524		877,798
		Whole Foods	2029		65,155
		Burlington	2030		41,883
		AMC Theaters	2027							48,000
		Dick's Sporting Goods	2031							57,588
		LEGOLAND Discovery Center	2032							33,221
Springfield Mall	Springfield, PA					Macy's		192,000		20,577		183,410		18,833		610,719
						Target		195,899
Springfield Town Center	Springfield, VA	Macy's	2025		252,245	JCPenney		209,144		178,772		330,286		56,665		1,374,177
						Target		180,841
		Dick's Sporting Goods	2025							53,891
		Nordstrom Rack	2025							33,107
		Regal Cinemas	2029							49,788
		Saks OFF 5th	2026							29,438
The Mall at Prince Georges	Hyattsville, MD	JCPenney	2021		148,778					177,988		257,262		8,837		923,706
		Macy's	2023		195,655
		Target	2024		135,186

Pennsylvania Real Estate Investment Trust

Property Information as of December 31, 2019

			Landlord Owned Anchors/ Large Format Non Anchor				Anchor Stores Not Owned			Non-anchor occupied GLA
Properties		Location	Tenant	Expiration Year	GLA		Tenant	GLA		Large Format		Small Shop		Vacant		Total GLA

Valley Mall		Hagerstown, MD	JCPenney	2024		157,455					95,023		243,764		4,558		794,794
			Belk	2028		123,094
			Regal Cinemas	2029							53,059
			Onelife Fitness	2033		70,000
			Tilt Studio	2028		47,841
Viewmont Mall		Scranton, PA	JCPenney	2025		193,112	Macy's		139,801		76,053		165,985		1,698		689,226
			Dick's Sporting Goods/Field & Stream	2028		90,000
			HomeGoods	2027							22,577
Willow Grove Park		Willow Grove, PA	Macy's	2022		225,000	Bloomingdale's		237,537		78,219		260,653		17,875		1,035,200
			Nordstrom Rack	2022		40,332	Sears⁽¹⁾		175,584
Woodland Mall		Grand Rapids, MI	Von Maur	2119		86,165	JCPenney		254,905		210,651		259,745		7,510		976,292
							Macy's		157,316
Total Core Malls						4,512,291			3,385,924		2,946,969		3,993,775		535,523		15,374,482

Other Malls and Retail Properties
Exton Square Mall		Exton, PA	Boscov's	2024		178,000	Macy's		181,200		41,884		201,543		330,344		991,342
			Round 1	2026		58,371
Fashion District Philadelphia		Philadelphia, PA	Burlington Coat Factory	2032		85,162					70,312		127,114		282,832		823,648
			Century 21	2026		95,157
			AMC	2034							36,535
			Round 1	2029							58,080
			City Winery	2037							29,762
			H&M	2030							38,694
Gloucester Premium Outlets		Blackwood, NJ									37,303		270,712		60,133		368,148
Metroplex Shopping Center		Plymouth Meeting, PA	Giant Food Store	2021		67,185	Lowe's		163,215		287,711		43,387		12,905		778,190
							Target		137,514
			Dick's Sporting Goods	2020							41,593
			Saks OFF 5th	2026							24,680
The Court at Oxford Valley		Fairless Hills, PA	Best Buy	2021		59,620	BJ's Wholesale Club		116,872		249,597		54,141		44,164		704,526
							The Home Depot		130,751
			Dick's Sporting Goods	2021							49,381
Valley View Mall	⁽²⁾	La Crosse, WI	JCPenney	2025		96,357					41,667		148,576		231,982		518,582
Valley View Center		La Crosse, WI											15,272				60,272
			Dick's Sporting Goods	2025							45,000
Red Rose Commons		Lancaster, PA					The Home Depot		134,558		248,086		15,207		-		462,883
							Weis Market		65,032
Total Other Malls and Retail Properties						639,852			929,142		1,300,285		875,952		962,360		4,707,591
Total Portfolio						5,152,143			4,315,066		4,247,254		4,869,727		1,497,883		20,082,073

(1) Approximately 69,000 square feet of this space has been subleased to Primark.

(2) Vacant GLA includes 100,000 square feet from former Herberger's store which closed in the third quarter of 2018.

Pennsylvania Real Estate Investment Trust

Investment in Real Estate - Consolidated Properties

(in thousands)

	December 31, 2019
	Operating Properties and Land Held for Development		Construction in Progress		Accumulated Depreciation		Net Real Estate		Debt⁽¹⁾
Core Malls
Capital City Mall		134,897	$	1,859	$	51,408	$	85,348	$	-
Cherry Hill Mall		479,060		1,784		261,070		219,774		268,753
Cumberland Mall		83,994		-		31,239		52,755		42,247
Dartmouth Mall		83,336		4,879		44,318		43,897		58,288
Francis Scott Key Mall		97,956		-		43,141		54,815		68,469
Jacksonville Mall		93,998		-		40,556		53,442		-
Magnolia Mall		108,004		4		50,497		57,511		-
Moorestown Mall		175,891		10,653		72,684		113,860		-
Patrick Henry Mall		156,458		-		73,125		83,333		88,910
Plymouth Meeting Mall		222,354		15,172		99,496		138,030		-
The Mall at Prince Georges		143,338		1,918		63,944		81,312		-
Springfield Town Center		496,199		-		67,343		428,856		-
Valley Mall		127,061		18,295		49,460		95,896		-
Viewmont Mall		121,744		-		49,593		72,151		67,185
Willow Grove Park		232,927		27,888		105,214		155,601		156,444
Woodland Mall		258,152		23,576		78,710		203,018		123,840
Total Core Malls		3,015,369		106,028		1,181,798		1,939,599		874,136

Non-Core Malls
Exton Square Mall		48,971		-		11,470		37,501		-
Valley View Mall		36,190		-		12,600		23,590		27,429
Total Non-Core Malls		85,161		-		24,070		61,091		27,429

Total Malls	$	3,100,530	$	106,028	$	1,205,868	$	2,000,690	$	901,565
Other Properties
Land held for development		5,881		-		-		5,881		-
Total Other Properties	$	5,881	$	-	$	-	$	5,881	$	-
Total Investment in Real Estate	$	3,106,411	$	106,028	$	1,205,868	$	2,006,571	$	901,565

Outparcels/land parcels held for sale
Jacksonville Mall		293		-		-		-		-
Magnolia Mall		1,863		-		-		-		-
Moorestown Mall		434		-		-		-		-
Valley Mall		3,846		-		-		-		-
Woodland Mall		6,174		-		-		-		-
Total held for sale	$	12,610	$	-	$	-	$	-	$	-

⁽¹⁾	Refer to page 33 for further debt information.

Pennsylvania Real Estate Investment Trust

Investment in Real Estate – Equity Method Investments at Ownership Share

(in thousands)

	December 31, 2019
	Operating Properties and Land Held for Development		Construction in Progress		Accumulated Depreciation			Net Real Estate		Debt⁽²⁾
Unconsolidated Malls
Fashion District Philadelphia⁽¹⁾	$	204,876	$	120,165	$	(10,384	)	$	314,657	$	150,500
Lehigh Valley Mall		49,811		4,653		(28,768	)		25,696		96,400
Springfield Mall		58,726		60		(23,996	)		34,790		30,226
Total Unconsolidated Malls	$	313,413	$	124,878	$	(63,148	)	$	375,143	$	277,126

Unconsolidated Other Retail Properties
Gloucester Premium Outlets		27,510		498		(4,774	)		23,234		21,500
Metroplex Shopping Center		43,031		36		(26,010	)		17,057		37,404
The Court at Oxford Valley		29,138		5		(13,369	)		15,774		26,647
Red Rose Commons		14,216		8		(4,295	)		9,929		12,858
Total Unconsolidated Other Retail Properties	$	113,895	$	547	$	(48,448	)	$	65,994	$	98,409
Unconsolidated Property Under Development
Pavilion at Market East		6,346		785		(2,390	)		4,741		3,109
Total Investment in Real Estate	$	433,654	$	126,210	$	(113,986	)	$	445,878	$	378,644

⁽¹⁾	CIP includes $37.6 million of existing building shell that was reclassified from operating properties.

⁽²⁾	Refer to page 33 for further debt information.

Pennsylvania Real Estate Investment Trust

Anchor Replacement Summary

December 31, 2019

Property	Former Anchors	GLA (in '000's)	Date Closed	Decommission Date	Replacement Tenant(s)	GLA (in '000's)	Actual/Targeted Occupancy Date
Completed:
Magnolia Mall	Sears	91	Q1 17	Q2 17	Burlington	46	Q3 17
					HomeGoods	22	Q2 18
					Five Below	8	Q2 18
Moorestown Mall	Macy's	200	Q1 17	Q2 17	HomeSense	28	Q3 18
					Five Below	9	Q4 18
					Sierra Trading Post	19	Q1 19
Valley Mall	Macy's	120	Q1 16	Q4 17	Tilt Studio	48	Q3 18
					One Life Fitness	70	Q3 18
	Bon-Ton	123	Q1 18	Q1 18	Belk	123	Q4 18
Woodland Mall	Sears	313	Q2 17	Q2 17	REI	20	Q2 19
					Black Rock Bar & Grill	9	Q3 19
					Von Maur	86	Q4 19
					Urban Outfitters	8	Q4 19
					Small shops	13	Q4 19
Plymouth Meeting Mall	Macy's⁽¹⁾	215	Q1 17	Q2 17	Burlington	42	Q3 19
					Dick's Sporting Goods	58	Q3 19
					Miller's Ale House	8	Q3 19
					Edge Fitness	38	Q4 19
Willow Grove Park	JC Penney	125	Q3 17	Q1 18	Yard House	8	Q4 19

In progress:
Plymouth Meeting Mall	Macy's⁽¹⁾	see above			Michael's	26	Q1 20
Valley Mall	Sears	see above			Dick's Sporting Goods	57	Q1 20
Moorestown Mall	Macy's	see above			Michael's	25	Q1 20
Dartmouth Mall	Sears	108	Q3 19	Q3 19	Burlington	44	Q1 20
Willow Grove Park	JC Penney	see above			Studio Movie Grill	49	Q1 20

⁽¹⁾	Property is subject to a ground lease.

Pennsylvania Real Estate Investment Trust

Property Redevelopment Table as of December 31, 2019

Name of Project and Location	Total Project Cost ⁽¹⁾ (in millions)	PREIT's Investment to Date (in millions)	Targeted Return on Incremental Investment	Construction Start Date	Expected Construction Completion	Stabilization Year	Percentage Leased or Negotiating

Woodland Mall
Grand Rapids, MI	$94-95	$90.9	5.0-6.0%	2017	2019	2021	89%
Upgrade of existing tenant mix including: 90,000 square foot Von Maur, new-to-market tenants: Urban Outfitters, The Cheesecake Factory and Black Rock Bar & Grill along with additional high quality retail, replacing a former Sears store. REI opened May 2019 while Black Rock Bar & Grill opened Q3 2019.

Anchor replacements:
Dartmouth Mall
Dartmouth, MA	$12-13	$4.8⁽²⁾	4.0-8.0%⁽³⁾	2019	2020	2021	49%
Includes Burlington as lead replacement for Sears as well as several outparcel opportunities.

Valley Mall
Hagerstown, MD	$23-24	$17.1	6.0-7.0%	2019	2020	2020	68%
Includes DICK'S Sporting Goods as replacement for Sears as well as other tenant opportunities.

Willow Grove Park Mall
Willow Grove, PA	$27-28	$31.4	7.5-8.0%	2018	2020	2021	82%
Addition of Studio Movie Grill, offering movies and in-theater dining, with other dining and entertainment tenants planned in former JC Penney box.

⁽¹⁾	Excludes $5.0 million of initial direct costs included in deferred costs and other assets in the consolidated balance sheet. Total project costs include a pro rata share of such initial direct costs.

⁽²⁾	High end of targeted return on incremental investment includes revenues from additional inline stores and outparcel opportunities. Additional capital expenditures will be required to achieve these returns.

Pennsylvania Real Estate Investment Trust

Capital Expenditures

Three Months and Year Ended December 31, 2019

(in thousands)

	Three Months Ended December 31, 2019						Year Ended December 31, 2019
	Consolidated		PREIT's Share of Equity Method Investments		Total		Consolidated		PREIT's Share of Equity Method Investments		Total
Redevelopment projects with incremental GLA and/or anchor replacement ⁽¹⁾	$	32,864	$	16,449	$	49,313	$	106,151	$	76,989	$	183,140
Tenant allowances		5,853		188		6,041		11,702		420		12,122
Recurring capital expenditures:
CAM expenditures		3,917		131		4,048		15,121		590		15,711
Non-CAM expenditures		152		94		246		1,570		309		1,879
Total recurring capital expenditures		4,069		225		4,295		16,691		899		17,590
Total	$	42,786	$	16,862	$	59,648	$	134,544	$	78,308	$	212,852

⁽¹⁾	Net of any tenant reimbursements, parcel sales, tax credits or other incentives.

Pennsylvania Real Estate Investment Trust

Debt Analysis as of December 31, 2019

(in thousands)

	Outstanding Debt
	Fixed Rate ⁽¹⁾			% of Total Indebtedness			Variable Rate			% of Total Indebtedness			Total			% of Total Indebtedness
Consolidated mortgage loans payable ⁽²⁾	$	887,711			42.6	%	$	13,854			0.7	%	$	901,565			43.3	%
Unconsolidated mortgage loans payable ⁽³⁾		203,534			9.7	%		24,609			1.2	%		228,143			10.9	%
Consolidated Term Loans ⁽⁴⁾		550,000			26.4	%		-			0.0	%		550,000			26.4	%
Unconsolidated Term Loan ⁽⁵⁾		-			0.0	%		150,500			7.2	%		150,500			7.2	%
2018 Revolving Facility		-			0.0	%		255,000			12.2	%		255,000			12.2	%
Total Outstanding Debt	$	1,641,245			78.7	%	$	443,963			21.3	%	$	2,085,208			100.0	%
Average Stated Interest Rate		3.96	%					3.49	%					3.84	%

⁽¹⁾	Includes variable rate debt swapped to fixed rate debt.

⁽²⁾	Excludes deferred financing costs of $1,812.

⁽³⁾	Reflects our share of mortgage debt of equity method investees. Excludes our share of deferred financing costs of $738.

⁽⁴⁾	Excludes deferred financing costs of $1,975.

⁽⁵⁾	Reflects our share of Term Loan debt of equity method investee. Excludes our share of deferred financing costs of $1,641.

		Average Debt Balance
		Mortgage Debt			Revolving Facility			Term Loans		Total
Beginning Balance	9/30/2019	$	1,135,889		$	213,000		$	700,500	$	2,049,389
2018 Revolving Facility Borrowing	10/29/2019		-			17,000			-		17,000
2018 Revolving Facility Borrowing	11/26/2019		-			5,000			-		5,000
2018 Revolving Facility Borrowing	12/13/2019		-			18,000			-		18,000
2018 Revolving Facility Borrowing	12/24/2019		-			8,000			-		8,000
2018 Revolving Facility Pay Down	12/31/2019		-			(6,000	)		-		(6,000	)
Mortgage loan amortization, including our share of debt of equity method investees	12/31/2019		(6,181	)		-			-		(6,181	)
Ending Balance	12/31/2019	$	1,129,708		$	255,000		$	700,500	$	2,085,208
Weighted Average Balance		$	1,134,092		$	230,674		$	700,500	$	2,065,266

(continued on next page)

Pennsylvania Real Estate Investment Trust

Debt Analysis as of December 31, 2019

(in thousands)

Debt Maturities⁽¹⁾
Year	Scheduled Amortization		Deferred Financing Cost Amortization - Mortgages			Mortgage Balance at Initial Maturity Date		2018 Revolving Facility		Term Loans		Deferred Financing Cost Amortization - Term Loans			Total Debt
2020	$	20,644	$	(1,025	)	$	27,161	$	-	$	-	$	(1,143	)	$	45,637
2021		21,910		(625	)		229,955		-		-		(1,137	)		250,103
2022		17,201		(301	)		377,489		-		250,000		(726	)		643,663
2023		10,204		(195	)		86,801		-		-		(209	)		96,601
2024		9,291		(184	)		-		255,000		450,500		(75	)		714,532
Thereafter		11,619		(221	)		317,434		-		-		(326	)		328,506
	$	90,869	$	(2,551	)	$	1,038,840	$	255,000	$	700,500	$	(3,616	)	$	2,079,042

⁽¹⁾	The weighted average period to total debt maturity is 3.38 years, excluding extension options. Includes 100% of revolver, term loan and mortgage loan debt from consolidated properties and our share of term loan and mortgage loan debt of equity method investees.

Weighted Average Mortgage Interest Rates
Year	Balance ⁽¹⁾		Interest Rate
2020	$	27,429		5.95	%
2021		233,639		3.65	%
2022		400,968		4.12	%
2023		95,692		4.37	%
2024		-		0.00	%
Thereafter		371,980		4.08	%
Total	$	1,129,708		4.08	%

⁽¹⁾	Includes our share of debt of equity method investees.

Pennsylvania Real Estate Investment Trust

Debt Schedule as of December 31, 2019

(in thousands)

	Debt			Interest Rate			Annual Debt Service		Balance at Maturity		Initial Maturity Date	Fully Extended Maturity Date
Fixed Rate Mortgage Loans
Valley View Mall	$	27,429			5.95	%	$	2,290	$	27,161	July 2020	July 2020
Viewmont Mall ⁽¹⁾		57,000			3.73	%		2,126		-	March 2021	March 2021
Woodland Mall ⁽¹⁾		123,840			3.02	%		5,414		121,600	April 2021	April 2021
Red Rose Commons ⁽²⁾		12,858			5.14	%		978		12,379	July 2021	July 2021
The Court at Oxford Valley ⁽²⁾		26,647			5.56	%		2,058		25,782	July 2021	July 2021
Cumberland Mall		42,247			4.40	%		3,433		38,157	August 2022	August 2022
Cherry Hill Mall		268,753			3.90	%		16,980		251,120	September 2022	September 2022
Francis Scott Key Mall ⁽¹⁾		64,800			5.01	%		3,244		-	January 2022	January 2023
Dartmouth Mall		58,288			3.97	%		3,825		53,299	April 2023	April 2023
Metroplex Shopping Center ⁽²⁾		37,404			5.00	%		2,818		33,502	October 2023	October 2023
Patrick Henry Mall		88,910			4.35	%		5,748		77,591	July 2025	July 2025
Springfield Mall ⁽²⁾		30,226			4.45	%		1,964		26,299	October 2025	October 2025
Willow Grove Park		156,444			3.88	%		9,599		133,754	October 2025	October 2025
Lehigh Valley Mall ⁽²⁾		96,400			4.06	%		5,768		79,789	November 2027	November 2027
Total Fixed Rate Mortgage Loans	$	1,091,246			4.09	%	$	66,245	$	880,433

Variable Rate Mortgage Loans
Pavilion East Associates ⁽²⁾	$	3,109			4.60	%	$	243	$	3,009	February 2021	February 2021
Viewmont Mall		10,185			4.04	%		412		67,185	March 2021	March 2021
Gloucester Premium Outlets ⁽²⁾		21,500			3.19	%		686		21,500	March 2022	March 2023
Francis Scott Key Mall		3,669			4.29	%		157		66,712	January 2022	January 2023
Total Variable Rate Mortgage Loans	$	38,463			3.64	%	$	1,498	$	158,406
Total Mortgage Loans	$	1,129,709			4.07	%	$	67,743	$	1,038,839

Consolidated Mortgage Loans	$	901,565			3.98	%	$	53,228	$	836,579
Consolidated Deferred Financing Fees		(1,812	)	n/a			n/a		n/a
Unconsolidated Mortgage Loans		228,144			4.43	%		14,515		202,260
Unconsolidated Deferred Financing Fees ⁽²⁾		(739	)	n/a			n/a		n/a
2014 7 Year Term Loan ⁽¹⁾		250,000			3.72	%		8,383		250,000	December 2021	December 2021
2018 5 Year Term Loan ⁽¹⁾		300,000			4.09	%		11,377		300,000	May 2023	May 2023
Unconsolidated Term Loan		150,500		��	3.69	%		5,555		150,500	January 2023	January 2023
Term Loan Deferred Financing Fees		(3,616	)	n/a			n/a		n/a
2018 Revolving Facility		255,000			3.31	%		8,435		255,000	May 2022	May 2023
Total	$	2,079,042			3.84	%	$	101,493	$	1,994,339
Amortization of Deferred Financing Fees	—				0.16	%	—		—
Effective Interest Rate	$	2,079,042			4.00	%	$	101,493	$	1,994,339

⁽¹⁾	All or a portion of the loan has been effectively swapped to the fixed interest rate presented.

⁽²⁾	Includes our share of debt of equity method investees, based on our ownership percentage.

Pennsylvania Real Estate Investment Trust

Selected Debt Ratios ⁽¹⁾

	December 31, 2019
Consolidated Liabilities to Gross Asset Value		59.83	%
Ratio of Consolidated Liabilities to Gross Asset Value shall not exceed 60%
Secured Indebtedness to Gross Asset Value		34.92	%
Secured Indebtedness to Gross Asset Value may not exceed 60%
Adjusted EBITDA to Fixed Charges		1.50
Adjusted EBITDA may not be less than 1.50 to 1.00
Unencumbered Adjusted NOI to Unsecured Interest Expense	3.14
Unencumbered Adjusted NOI to Unsecured Interest Expense may not be less than 1.75 to 1.00
Unencumbered Debt Yield		11.35	%
Ratio of Unencumbered Adjusted NOI to Unsecured Debt may not be less than 11%

⁽¹⁾

The 2018 Revolving Facility Agreement and 2018 Term Loan Agreement dated May 24, 2018, and the 7-Year 2014 Term Loan Agreement, as amended, dated June 5, 2018 (collectively, the "Credit Facility Agreements"), contain identical affirmative and negative covenants customarily found in such agreements, including requirements that the Company, on a consolidated basis, maintain certain financial ratios. All capitalized terms used on this page have the meanings ascribed to such terms in the Credit Facility Agreements. In addition to the ratios set forth herein, there are several other ratios set forth in the covenants under the Credit Facility Agreements with which the Company must comply, which are described in the Company’s quarterly report on form 10-Q for the quarterly period ended June 30, 2018.

Pennsylvania Real Estate Investment Trust

Forward Looking Statements

This Quarterly Supplemental and Operating Information contains certain forward-looking statements that can be identified by the use of words such as “anticipate,” “believe,” “estimate,” “expect,” “project,” “intend,” “may” or similar expressions. 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 the following:

•

changes in the retail and real estate industries, including consolidation and store closings, particularly among anchor tenants;

•

current economic conditions and the corresponding effects on tenant business performance, prospects, solvency and leasing decisions;

•

our inability to collect rent due to the bankruptcy or insolvency of tenants or otherwise;

•

our ability to maintain and increase property occupancy, sales and rental rates;

•

increases in operating costs that cannot be passed on to tenants;

•

the effects of online shopping and other uses of technology on our retail tenants;

•

risks related to our development and redevelopment activities, including delays, cost overruns and our inability to reach projected occupancy or rental rates;

•

acts of violence at malls, including our properties, or at other similar spaces, and the potential effect on traffic and sales;

•

our ability to sell properties that we seek to dispose of or our ability to obtain prices we seek;

•

our substantial debt and the liquidation preference of our preferred shares and our high leverage ratio;

•

our ability to refinance our existing indebtedness when it matures, on favorable terms or at all;

•

our ability to raise capital, including through sales of properties or interests in properties and through the issuance of equity or equity-related securities if market conditions are favorable; 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 herein and in our Annual Report on Form 10-K for the year ended December 31, 2018 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.

Pennsylvania Real Estate Investment Trust

Definitions

Funds From Operations (FFO)

The National Association of Real Estate Investment Trusts (“NAREIT”) defines FFO, which is a non-GAAP measure commonly used by REITs, as net income (computed in accordance with GAAP) excluding (i) depreciation and amortization related to real estate, (ii) gains and losses from the sale of certain real estate assets, (iii) gains and losses from change in control, and (iv) impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity. We compute FFO in accordance with standards established by NAREIT, which may not be comparable to FFO reported by other REITs that do not define the term in accordance with the current NAREIT definition, or that interpret the current NAREIT definition differently than we do. NAREIT’s established guidance provides that excluding impairment write downs of depreciable real estate is consistent with the NAREIT definition.

FFO is a commonly used measure of operating performance and profitability among REITs. We use FFO and FFO per diluted share and unit of limited partnership interest in our operating partnership (“OP Unit”) and, when applicable, related measures such as Funds From Operations, as adjusted, in measuring our performance against our peers and as one of the performance measures for determining incentive compensation amounts earned under certain of our performance-based executive compensation programs.

FFO does not include gains and losses on sales of operating real estate assets or impairment write downs of depreciable real estate, which are included in the determination of net income in accordance with GAAP. Accordingly, FFO is not a comprehensive measure of our operating cash flows. In addition, since FFO does not include depreciation on real estate assets, FFO may not be a useful performance measure when comparing our operating performance to that of other non-real estate commercial enterprises. We compensate for these limitations by using FFO in conjunction with other GAAP financial performance measures, such as net income and net cash provided by operating activities, and other non-GAAP financial performance measures, such as NOI. FFO does not represent cash generated from operating activities in accordance with GAAP and should not be considered to be an alternative to net income (determined in accordance with GAAP) as an indication of our financial performance or to be an alternative to cash flow from operating activities (determined in accordance with GAAP) as a measure of our liquidity, nor is it indicative of funds available for our cash needs, including our ability to make cash distributions. We believe that net income is the most directly comparable GAAP measurement to FFO.

When applicable, we also present Funds From Operations, as adjusted, and Funds From Operations per diluted share and OP Unit, as adjusted, which are non-GAAP measures, to show the effect of such items as gain or loss on debt extinguishment (including accelerated amortization of financing costs), impairment of assets, provision for employee separation expense and insurance recoveries or losses, net, which can have a significant effect on our results of operations, but are not, in our opinion, indicative of our operating performance. We also present FFO on a further adjusted basis to isolate the impact on FFO caused by property dispositions.

We believe that FFO is helpful to management and investors as a measure of operating performance because it excludes various items included in net income that do not relate to or are not indicative of operating performance, such as gains on sales of operating real estate and depreciation and amortization of real estate, among others. We believe that Funds From Operations, as adjusted, is helpful to management and investors as a measure of operating performance because it adjusts FFO to exclude items that management does not believe are indicative of our operating performance, such as provision for employee separation expense and accelerated amortization of financing costs.

Net Operating Income (NOI)

NOI (a non-GAAP measure) is derived from real estate revenue (determined in accordance with GAAP, including lease termination revenue), minus property operating expenses (determined in accordance with GAAP), plus our pro rata share of revenue and property operating expenses of our unconsolidated partnership investments. NOI excludes other income, general and administrative expenses, employee separation expenses, interest expense, depreciation and amortization, impairment of assets, gains/ adjustment to gains on sale of interest in non operating real estate, gain on sale of interest in real estate by equity method investee, gains/ losses on sales of interests in real estate, net, and project costs and other expenses. We believe that net income is the most directly comparable GAAP measure to NOI.

NOI excludes other income, general and administrative expenses, provision for employee separation expenses, interest expense, depreciation and amortization, impairment of assets, gains/adjustments to gains on sale of interest in non operating real estate, gain/adjustments to gains on sale of interest in real estate by equity method investee, gains/losses on sales of interest in real estate, net, project costs, gain or loss on debt extinguishment, insurance recoveries or losses, net and other expenses.

We believe that NOI is helpful to management and investors as a measure of operating performance because it is an indicator of the return on property investment and provides a method of comparing property performance over time. We use NOI and related terms, like Same Store NOI, as performance measures for determining incentive compensation amounts under certain of our performance-based incentive compensation programs.

Same Store NOI

Same Store NOI is calculated using retail properties owned for the full periods presented and excludes properties acquired, disposed, under redevelopment or designated as non-core during the periods presented. In 2018, Wyoming Valley Mall was designated as non-core and subsequently conveyed to the lender in September 2019. In 2019, Exton Square and Valley View Malls, as well as power centers and Gloucester Premium Outlets, were designated as non-core and will be excluded from Same Store NOI. Non Same Store NOI is calculated using the retail properties excluded from the calculation of Same Store NOI.

Funds Available for Distribution (FAD)

FAD is a measure of a real estate company’s cash flows generated by operations and capacity to pay dividends. The Company calculates FAD by starting with FFO as adjusted and subtracting (1) straight-line rent, (2) normalized recurring capital expenditures that are capitalized but necessary to maintain our properties, (3) operational tenant allowances, (4) capitalized leasing costs, (5) non-cash compensation charges, and (6) amortization of above- and below-market lease intangibles.

We believe that net income is the most directly comparable GAAP measurement to FAD. We believe FAD provides a meaningful indicator of our ability to fund cash needs and to make cash distributions to equity owners. In addition, we believe that to further understand our liquidity, FAD should be compared with our cash flow from operating activities determined in accordance with GAAP, as presented in our consolidated financial statements. The computation of FAD may not be comparable to FAD reported by other REITs or real estate companies and FAD does not represent cash generated from operating activities determined in accordance with GAAP, and should not be considered as an alternative to net income (determined in accordance with GAAP) as an indication of our performance, or as an alternative to net cash flow from operating activities (determined in accordance with GAAP), as a measure of our liquidity.

Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate (EBITDAre)

NAREIT defines Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate (“EBITDAre”), which is a non-GAAP measure, as net income (computed in accordance with GAAP) plus interest expense, income tax expense, depreciation and amortization; plus or minus losses and gains on the disposition of depreciated property, including losses/ gains on change in control; plus impairment write downs of depreciated property and of investments in unconsolidated affiliates caused by a decrease in value of depreciated property in the affiliate; plus or minus adjustments to reflect the entity’s share of EBITDAre of unconsolidated affiliates. We compute EBITDAre in accordance with the standards established by NAREIT, which may not be comparable to EBITDAre reported by other REITs that do not define the term in accordance with the current NAREIT definition, or that interpret the current NAREIT definition differently than we do.

EBITDAre does not include interest expense, income tax expense, gains or losses on sales of operating real estate or impairment writedowns of depreciable real estate, which are included in the determination of net income in accordance with GAAP. Accordingly, EBITDAre is not a comprehensive measure of our operating cash flows. EBITDAre does not represent cash generated from operating activities in accordance with GAAP and should not be considered to be an alternative to net income (determined in accordance with GAAP) as an indication of our financial performance or to be an alternative to cash flow from operating activities (determined in accordance with GAAP) as a measure of our liquidity, nor is it indicative of funds available for our cash needs, including our ability to make cash distributions. We believe that net income is the most directly comparable GAAP measurement to EBITDAre.

We believe that EBITDAre is helpful to management and investors as a measure of operating performance because it provides an additional performance measure to management and investors to facilitate the evaluation and comparison of the Company to other REITs and to other non-real estate commercial enterprises.

Pennsylvania Real Estate Investment Trust (PRET) 8-KResults of Operations and Financial Condition