SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
Form 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarter Ended: June 30, 2000
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Commission File No. 17533
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FEDERAL REALTY INVESTMENT TRUST
-------------------------------
(Exact name of registrant as specified in its charter)
Maryland 52-0782497
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1626 East Jefferson Street, Rockville, Maryland 20852-4041
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(Address of principal executive offices) (Zip Code)
(301) 998-8100
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(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X . No_____.
-----
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.
Class Outstanding at July 26, 2000
- ------------------------------ ----------------------------
Common Shares of Beneficial Interest 39,436,269
This report contains 39 pages.
FEDERAL REALTY INVESTMENT TRUST
S.E.C. FORM 10-Q
June 30, 2000
I N D E X
PART I. FINANCIAL INFORMATION PAGE NO.
Consolidated Balance Sheets
June 30, 2000 (unaudited) and
December 31, 1999 (audited) 4
Consolidated Statements of Operations (unaudited)
Six months ended June 30, 2000 and 1999 5
Consolidated Statements of Operations (unaudited)
Three months ended June 30, 2000 and 1999 6
Consolidated Statements
of Shareholders' Equity (unaudited)
Six months ended June 30, 2000 and 1999 7
Consolidated Statements of Cash Flows (unaudited)
Six months ended June 30, 2000 and 1999 8
Notes to Financial Statements 9-14
Management's Discussion and Analysis of 15-25
Financial Condition and Results of Operations
PART II. OTHER INFORMATION 26
2
FEDERAL REALTY INVESTMENT TRUST
S.E.C. FORM 10-Q
June 30, 2000
PART I. FINANCIAL INFORMATION
The following financial information is submitted in response to
the requirements of Form 10-Q and does not purport to be financial
statements prepared in accordance with generally accepted accounting
principles since they do not include all disclosures which might be
associated with such statements. In the opinion of management, such
information includes all adjustments, consisting only of normal
recurring accruals, necessary to a fair statement of the results for
the interim periods presented.
3
Federal Realty Investment Trust
CONSOLIDATED BALANCE SHEETS
June 30, December 31,
2000 1999
(unaudited)
------------- -----------
ASSETS (in thousands)
Investments
Real estate, at cost $1,761,045 $1,721,459
Less accumulated depreciation and amortization (337,603) (317,921)
---------- ----------
1,423,442 1,403,538
Mortgage notes receivable 45,936 53,495
---------- ----------
1,469,378 1,457,033
Other Assets
Cash 18,686 11,738
Accounts and notes receivable 18,807 23,130
Prepaid expenses and other assets, principally
property taxes and lease commissions 31,324 36,807
Debt issue costs 6,288 5,340
---------- ----------
$1,544,483 $1,534,048
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Obligations under capital leases $ 121,824 $ 122,026
Mortgages payable 50,262 50,547
Notes payable 298,730 162,768
Accounts payable and accrued expenses 31,540 34,974
Dividends payable 19,036 19,431
Security deposits 5,146 5,068
Prepaid rents 8,039 6,788
Senior notes and debentures 410,000 510,000
5 1/4% Convertible subordinated debentures 75,289 75,289
Investors' interest in consolidated assets 46,240 45,330
Commitments and contingencies
Shareholders' equity
Preferred stock, authorized 15,000,000 shares, $.01 par
7.95% Series A Cumulative Redeemable Preferred Shares,
(stated at liquidation preference $25 per share),
4,000,000 shares issued in 1997 100,000 100,000
Common shares of beneficial interest, $.01 par, 100,000,000 shares
authorized, 40,777,851 and 40,418,766 issued, respectively 407 404
Additional paid in capital 720,350 713,354
Accumulated dividends in excess of Trust net income (293,518) (286,348)
---------- ----------
527,239 527,410
Less: 1,419,428 and 217,644 common shares in treasury - at cost,
respectively (27,315) (4,334)
Deferred compensation on restricted shares (16,854) (15,219)
Notes receivable from employee stock plans (4,693) (6,030)
---------- ----------
478,377 501,827
---------- ----------
$1,544,483 $1,534,048
========== ==========
The accompanying notes are an integral part of these consolidated statements.
4
Federal Realty Investment Trust
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
Six months ended June 30,
2000 1999
---------- --------
(In thousands, except per share data)
Revenue
Rental income $128,483 $119,107
Other property income 5,465 4,827
Interest income 3,962 3,844
-------- --------
137,910 127,778
Expenses
Rental 28,042 26,104
Real estate taxes 12,979 11,867
Interest 33,529 30,518
Administrative 5,790 5,414
Depreciation and amortization 25,993 24,932
-------- --------
106,333 98,835
-------- --------
Operating income before investors' share
of operations and gain (loss) on sale of real estate 31,577 28,943
Investors' share of operations (3,045) (1,524)
-------- --------
Income before gain (loss) on sale of
real estate 28,532 27,419
Gain (loss) on sale of real estate 3,681 (7,050)
-------- --------
Net income 32,213 20,369
Dividends on preferred stock (3,975) (3,975)
-------- --------
Net income available for common
shareholders $ 28,238 $ 16,394
======== ========
Earnings per common share, basic
Income before gain (loss) on sale of real estate $ 0.63 $ 0.59
Gain (loss) on sale of real estate 0.10 (0.18)
-------- --------
$ 0.73 $ 0.41
======== ========
Weighted average number of common shares, basic 38,871 39,489
======== ========
Earnings per common share, diluted
Income before gain (loss) on sale of real estate $ 0.63 $ 0.58
Gain (loss) on sale of real estate 0.09 (0.17)
-------- --------
$ 0.72 $ 0.41
======== ========
Weighted average number of common shares, diluted 40,037 40,613
======== ========
The accompanying notes are an integral part of these consolidated statements.
5
Federal Realty Investment Trust
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
Three months ended June 30,
2000 1999
------------ --------
(In thousands, except per share data)
Revenue
Rental income $64,251 $59,674
Other property income 2,700 2,555
Interest and other income 1,855 1,966
------- -------
68,806 64,195
Expenses
Rental 13,422 12,456
Real estate taxes 6,522 5,855
Interest 17,036 15,385
Administrative 2,868 3,160
Depreciation and amortization 13,338 12,651
------- -------
53,186 49,507
------- -------
Operating income before investors' share
of operations and gain (loss) on sale of real estate 15,620 14,688
Investors' share of operations (1,227) (823)
------- -------
Income before gain (loss) on sale of real estate 14,393 13,865
Gain (loss) on sale of real estate 3,681 (7,050)
------- -------
Net income 18,074 6,815
Dividends on preferred stock (1,987) (1,987)
------- -------
Net income available for common shareholders $16,087 $ 4,828
======= =======
Earnings per common share, basic
Income before gain (loss) on sale of real estate $ 0.32 $ 0.30
Gain (loss) on sale of real estate 0.10 (0.18)
------- -------
$ 0.42 $ 0.12
======= =======
Weighted average number of common shares, basic 38,601 39,543
======= =======
Earnings per common share, diluted
Income before gain (loss) on sale of real estate $ 0.32 $ 0.29
Gain (loss) on sale of real estate 0.09 (0.17)
------- -------
$ 0.41 $ 0.12
======= =======
Weighted average number of common shares, diluted 39,782 40,682
======= =======
The accompanying notes are an integral part of these consolidated statements.
6
Federal Realty Investment Trust
CONSOLIDATED STATEMENTS OF COMMON SHAREHOLDERS' EQUITY
(Unaudited)
Six months ended June 30,
2000
----------- ----------- ---------------
(In thousands, except share data) Shares Amount Additional
Paid-in-Capital
Common Shares of Beneficial Interest
Balance, beginning of period 40,418,766 $404 $713,354
Exercise of stock options 42,322 871
Shares issued under dividend reinvestment plan 77,954 1 1,585
Performance and Restricted Shares granted, net
of Restricted Shares retired 238,809 2 4,540
----------- ----------- ---------
Balance, end of period 40,777,851 $407 $720,350
=========== =========== =========
Accumulated Dividends in Excess of Trust Net Income
Balance, beginning of period ($286,348)
Net income 32,213
Dividends declared to common shareholders (35,408)
Dividends declared to preferred shareholders (3,975)
-----------
Balance, end of period ($293,518)
===========
Common Shares of Beneficial Interest in Treasury
Balance, beginning of period (217,644) ($4,334)
Performance and Restricted Shares (forfeited) retired (16,384) (349)
Purchase of treasury shares (1,185,400) (22,632)
----------- -----------
Balance, end of period (1,419,428) ($27,315)
=========== ===========
Deferred Compensation on Restricted Shares
Balance, beginning of period (599,427) ($15,219)
Performance and Restricted Shares issued,
net of Forfeitures (199,271) (3,751)
Vesting of Performance and Restricted Shares 82,323 2,116
----------- -----------
Balance, end of period (716,375) ($16,854)
=========== ===========
Subscriptions receivable from employee stock plans
Balance, beginning of period (317,606) ($6,030)
Subscription loans issued (5,500) (115)
Subscription loans paid 70,680 1,452
----------- -----------
Balance, end of period (252,426) ($4,693)
=========== ===========
Six months ended June 30,
1999
----------- ----------- ---------------
(In thousands, except share data) Shares Amount Additional
Paid-in-Capital
Common Shares of Beneficial Interest
Balance, beginning of period 40,139,675 $707,724 -
Exercise of stock options 49,917 1,044 -
Shares issued under dividend reinvestment plan 77,151 1,735 -
Performance and Restricted Shares granted, net
of Restricted Shares retired 60,654 1,374 -
----------- ----------- ---------
Balance, end of period 40,327,397 $711,877 $0
=========== =========== =========
Accumulated Dividends in Excess of Trust Net Income
Balance, beginning of period ($255,211)
Net income 20,369
Dividends declared to common shareholders (35,384)
Dividends declared to preferred shareholders (3,975)
-----------
Balance, end of period ($274,201)
===========
Common Shares of Beneficial Interest in Treasury
Balance, beginning of period (59,425) ($1,376)
Performance and Restricted Shares (forfeited) retired 1,006 21
Purchase of treasury shares - -
----------- -----------
Balance, end of period (58,419) ($1,355)
=========== ===========
Deferred Compensation on Restricted Shares
Balance, beginning of period (582,910) ($14,892)
Performance and Restricted Shares issued,
net of Forfeitures (41,327) (910)
Vesting of Performance and Restricted Shares 3,905 101
----------- -----------
Balance, end of period (620,332) ($15,701)
=========== ===========
Subscriptions receivable from employee stock plans
Balance, beginning of period (337,111) ($6,298)
Subscription loans issued (9,083) (190)
Subscription loans paid 28,588 458
----------- -----------
Balance, end of period (317,606) ($6,030)
=========== ===========
The accompanying notes are an integral part of these consolidated statements.
7
Federal Realty Investment Trust
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
Six months ended June 30,
2000 1999
--------- --------
(In thousands)
OPERATING ACTIVITIES
Net income $ 32,213 $ 20,369
Items not requiring cash outlays
Depreciation and amortization 25,993 24,932
(Gain) loss on sale of real estate (3,681) 7,050
Other, net 624 1,419
Changes in assets and liabilities
Decrease in accounts receivable 4,323 2,950
Decrease in prepaid expenses and other
assets before depreciation and amortization 2,032 895
Increase (decrease) in operating accounts payable,
security deposits and prepaid rent 1,912 (2,850)
(Decrease) increase in accrued expenses (4,455) 761
--------- --------
Net cash provided by operating activities 58,961 55,526
INVESTING ACTIVITIES
Acquisition of real estate (19,573) (22,736)
Capital expenditures (59,669) (40,239)
Proceeds from sale of real estate 47,157 -
Repayment (Issuance) of mortgage notes receivable, net 2,340 (5,297)
--------- --------
Net cash used in investing activities (29,745) (68,272)
FINANCING ACTIVITIES
Borrowing of short-term debt, net 129,000 45,853
Borrowing on construction loans 8,048 -
Repayment of senior notes (100,000) -
Issuance of common shares 2,629 1,743
Common shares repurchased (22,632) -
Payments on mortgages, capital leases and notes
payable, including prepayment fees (1,573) (614)
Dividends paid (38,491) (38,031)
Increase (decrease) in minority interest, net 751 (1,582)
--------- --------
Net cash (used in) provided by financing activities (22,268) 7,369
--------- --------
Increase (decrease) in cash 6,948 (5,377)
Cash at beginning of period 11,738 17,230
--------- --------
Cash at end of period $ 18,686 $ 11,853
========= ========
The accompanying notes are an integral part of these consolidated statements.
8
Federal Realty Investment Trust
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2000
(unaudited)
NOTE A - ACCOUNTING POLICIES AND OTHER DATA
Reference should be made to the notes to financial statements included in
the Annual Report to shareholders for the year ended December 31, 1999 which
contain the accounting policies and other data of Federal Realty Investment
Trust (the "Trust").
The following table sets forth the reconciliation between basic and diluted
EPS:
Six months ending Three months ending
June 30, June 30,
Numerator 2000 1999 2000 1999
Net income available for common
shareholders - basic $28,238 $16,394 $16,087 $ 4,828
Income attributable to operating
partnership units 744 361 131 97
Net income available for common ------- ------- ------- -------
shareholders - diluted $28,982 $16,755 $16,218 $ 4,925
======= ======= ======= =======
Denominator
Denominator for basic EPS-
weighted average shares 38,871 39,489 38,601 39,543
Effect of dilutive securities
Stock options and awards 161 244 176 259
Operating partnership units 1,005 880 1,005 880
------- ------- ------- -------
Denominator for diluted EPS 40,037 40,613 39,782 40,682
======= ======= ======= =======
NOTE B - REAL ESTATE ASSETS AND ENCUMBRANCES
On January 5, 2000 the Trust purchased the 75,000 square foot Greenlawn
Plaza in Greenlawn, New York for $6.2 million, with plans to renovate and expand
the center by 35,000 square feet. On February 16, 2000 control of a parcel of
land for future development in Hillsboro, Oregon was acquired for $11.7 million.
An additional $1.6 million will be owed if certain cash flow criteria are met
during the first ten years of operations.
On January 1, 2000 the Trust issued 190,000 partnership units valued at
$3.6 million in exchange for the minority partner's interest in Loehmann's
Plaza.
On April 6, 2000 the Trust converted a note receivable of $5.8 million to a
90% interest in a partnership owning a 30,000 square foot street retail property
in Santa Monica, California valued at
9
$6.3 million. The property is currently under construction. The Trust has
contributed an additional $488,000 towards the construction of the property as
of June 30, 2000.
On June 30, 2000 the Trust sold the 296,000 square foot Peninsula Shopping
Center located in Palos Verdes, California for $48.6 million resulting in a gain
$3.7 million.
In addition, during the first six months of 2000 the Trust invested $3.6
million in mortgage notes receivable with an average weighted interest rate of
9.7%. A mortgage note receivable of $5.9 million, which earned interest at 10%,
was paid off June 23, 2000.
NOTE C - MORTGAGES AND NOTES PAYABLE
At June 30, 2000 there was $159.6 million borrowed under the Trust's
syndicated credit facility. The maximum drawn during the first six months of
2000 was $218.1 million. The weighted average interest rate on borrowings for
the six months ended June 30, 2000 was 6.8%. The facility requires fees and has
various covenants including the maintenance of a minimum shareholders' equity
and a maximum ratio of debt to net worth.
In June 2000 the Trust modified certain covenants and extended its
syndicated credit facility and its $125 million term loan for an additional year
to December 19, 2003. Fees paid for this extension totaled $1.0 million.
On January 17, 2000 the Trust's $100 million of 8.875% Notes matured and
were paid with borrowings on the Trust's revolving credit facilities. On
February 29, 2000 the Trust obtained a construction loan for up to $24.5 million
in connection with the Trust's Woodmont East development in Bethesda, Maryland.
The loan, which has a floating interest rate of LIBOR plus 1.2% to 1.5%,
depending on occupancy levels, matures August 29, 2002 with two, one-year
extension options. At June 30, 2000 the outstanding balance on the loan is $8.0
million. The property secures the construction loan facility. In connection with
the land for future development in Hillsboro, Oregon the Trust issued a $3.4
million note due on August 14, 2000. The loan bears interest at LIBOR plus
1.25%. The property secures the loan facility.
In anticipation of a mortgage placement in the third quarter of 2000 the
Trust purchased a Treasury Yield Hedge (notional amount of $140 million) to
minimize the risk of changes in interest rates. The hedge was terminated on June
30, 2000 at a gain of $165,000 which will be recognized as a reduction of
interest expense over the term of the mortgage.
In July 2000, citing the Trust's pursuit of development and the resultant
capital requirements, Standard and Poor's lowered the rating on the Trust's
senior notes from BBB+ to BBB. Standard and Poor's noted that the outlook is
stable with the rating
10
"supported by a very solid portfolio of seasoned in-fill retail properties".
Under the terms of the syndicated credit facility, this lowered rating results
in an increase in the Trust's borrowing rate from LIBOR plus 65 basis points to
LIBOR plus 80 basis points. The interest rate on the term loan increases from
LIBOR plus 75 basis points to LIBOR plus 95 basis points.
NOTE D - SHAREHOLDERS' EQUITY
During the first six months of 2000, options for 277,500 shares at prices
ranging from $18 to $22 1/16 per share, fair value at the dates of award, were
awarded to certain employees and Trustees of the Trust. The options vest over
three and four year terms.
In December 1999 the Trustees authorized a share repurchase program of up
to an aggregate of four million of the Trust's common shares. The repurchase
program will end upon the earlier of December 31, 2000 or the date when the
repurchase limit has been met. During the first six months of 2000, 1,185,400
common shares at a cost of $22.6 million were repurchased bringing the total
purchased under the program as of June 30,2000 to 1,325,900 common shares at a
cost of $25.2 million.
NOTE E - INTEREST EXPENSE
The Trust incurred interest expense totaling $38.7 million during the first
six months of 2000 and $33.3 million during the first six months of 1999 of
which $5.2 million and $2.8 million, respectively, was capitalized in connection
with development projects. Interest paid was $41.5 million in the first six
months of 2000 and $33.2 million in the first six months of 1999.
NOTE F - COMMITMENTS AND CONTINGENCIES
The Trust is involved in various lawsuits and environmental matters arising
in the normal course of business. Management believes that such matters will not
have a material effect on the financial condition or results of operations of
the Trust.
Pursuant to the provisions of the partnership agreement, in the event of
the exercise of put options by another partner, the Trust would be required to
purchase a 37.5% interest of Congressional Plaza at its then fair market value.
Based on management's current estimate of fair market value, the Trust's
estimated liability upon exercise of the put option is approximately $27
million.
Under the terms of certain other partnerships, if certain leasing and
revenue levels are obtained for the properties owned by the partnerships, the
limited partners may require the Trust to purchase their partnership interests
at a formula price based upon net operating income. The purchase price may be
paid in cash or
11
common stock of the Trust at the election of the limited partners. In
certain of the partnerships, if the limited partners do not redeem their
interest, the Trust may choose to purchase the limited partnership interests
upon the same terms.
Under the terms of other partnerships, the partners may exchange their
1,004,589 operating units into cash or the same number of common shares of the
Trust, at the option of the Trust. On July 17, 2000 the Trust redeemed 100,000
operating units for cash of $2.1 million.
In connection with a mortgage application the Trust issued a $3.0 million
Letter of Credit.
NOTE G - COMPONENTS OF RENTAL INCOME
The components of rental income for the periods ended June 30 are as
follows (in thousands):
Six months Three months
2000 1999 2000 1999
---- ---- ---- ----
Retail properties
Minimum rents $104,047 $ 96,718 $52,324 $48,584
Cost reimbursements 19,963 18,534 9,705 9,335
Percentage rents 3,097 2,526 1,541 1,100
Apartments 1,376 1,329 681 655
-------- -------- ------- -------
$128,483 $119,107 $64,251 $59,674
======== ======== ======= =======
12
NOTE H - SEGMENT INFORMATION
The Trust operates its portfolio of properties in three geographic
operating regions: Northeast, Mid-Atlantic and West.
A summary of the Trust's operations by geographic region is presented below
(in thousands):
Six months ended North Mid
June 30, 2000 East Atlantic West Other Total
- --------------------------------------------------------------------------------------------------
Rental income $ 55,054 $ 55,811 $ 17,618 $ 128,483
Other income 1,993 2,109 1,363 5,465
Rental expense (11,762) (12,129) (4,151) (28,042)
Real estate tax (7,032) (4,352) (1,595) (12,979)
-------- -------- ------------- ----------
Net operating income 38,253 41,439 13,235 92,927
Interest income $ 3,962 3,962
Interest expense (33,529) (33,529)
Administrative expense (5,790) (5,790)
Depreciation and
amortization (12,262) (10,656) (2,589) ( 486) (25,993)
-------- -------- ------------- ----------- ----------
Income before investors'
share of operations $ 25,991 $ 30,783 $ 10,646 $ (35,843) $ 31,577
======== ======== ============= ----------- ----------
Capital expenditures $ 24,984 $ 21,659 $ 40,978 $ 87,621
======== ======== ============= ==========
Real estate assets $740,670 $681,911 $ 338,464 $1,761,045
======== ======== ============= ==========
Six months ended North Mid
June 30, 1999 East Atlantic West Other Total
- -------------------------------------------------------------------------------------------------
Rental income $ 49,910 $ 54,513 $ 14,684 $ 119,107
Other income 2,550 1,564 713 4,827
Rental expense (10,676) (11,838) (3,590) (26,104)
Real estate tax (6,014) (4,395) (1,458) (11,867)
-------- -------- ------------- ----------
Net operating income 35,770 39,844 10,349 85,963
Interest income $ 3,844 3,844
Interest expense (30,518) (30,518)
Administrative expense (5,414) (5,414)
Depreciation and
amortization (11,074) (11,523) (1,886) (449) (24,932)
-------- -------- ------------- ----------- ----------
Income before investors'
share of operations $ 24,696 $ 28,321 $ 8,463 $ (32,537) $ 28,943
======== ======== ============= =========== ==========
Capital expenditures $ 13,167 $ 11,600 $ 42,932 $ 67,699
======== ======== ============= ==========
Real estate assets $696,786 $681,344 $ 323,851 $1,701,981
======== ======== ============= ==========
13
Three months ended North Mid
June 30, 2000 East Atlantic West Other Total
- -------------------------------------------------------------------------------------------
Rental income $ 27,769 $ 27,688 $ 8,794 $ 64,251
Other income 945 1,178 577 2,700
Rental expense (5,417) (5,845) (2,160) (13,422)
Real estate tax (3,515) (2,248) (759) (6,522)
-------- -------- ------------- --------
Net operating income 19,782 20,773 6,452 47,007
Interest income $ 1,855 1,855
Interest expense (17,036) (17,036)
Administrative expense (2,868) (2,868)
Depreciation and
amortization (6,389) (5,392) (1,317) ( 240) (13,338)
-------- -------- ------------- -------- ----------
Income before investors'
share of operations $ 13,393 $ 15,381 $ 5,135 $(18,289) $ 15,620
======== ======== ============= ======== ==========
Capital expenditures $ 10,650 $ 13,889 $ 22,068 $ 46,607
======== ======== ============= ==========
Real estate assets $740,670 $681,911 $ 338,464 $1,761,045
======== ======== ============= ==========
Three months ended North Mid
June 30, 1999 East Atlantic West Other Total
- ------------------------------------------------------------------------------------------
Rental income $ 25,052 $ 27,051 $ 7,571 $ 59,674
Other income 1,381 753 421 2,555
Rental expense (4,863) (5,904) (1,689) (12,456)
Real estate tax (2,927) (2,226) (702) (5,855)
-------- -------- ------------- ----------
Net operating income 18,643 19,674 5,601 43,918
Interest income $ 1,966 1,966
Interest expense (15,385) (15,385)
Administrative expense (3,160) (3,160)
Depreciation and
amortization (5,636) (5,829) (968) (218) (12,651)
-------- -------- ------------- -------- ---------
Income before investors'
share of operations $ 13,007 $ 13,845 $ 4,633 $(16,797) $ 14,688
======== ======== ============= ======== ==========
Capital expenditures $ 11,072 $ 4,163 $ 17,912 $ 33,147
======== ======== ============= ==========
Real estate assets $696,786 $681,344 $ 323,851 $1,701,981
======== ======== ============= ==========
There are no transactions between geographic areas.
14
FEDERAL REALTY INVESTMENT TRUST
FORM 10-Q
June 30, 2000
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion should be read in conjunction with the Consolidated
Financial Statements and Notes thereto. Certain statements made in this report
contain forward-looking statements, within the meaning of the Private Securities
Litigation Reform Act of 1995. Such forward-looking statements involve known
and unknown risks, uncertainties and other factors which may cause actual
results, performance or achievements of the Trust to be materially different
from the results of operations or plans expressed or implied by such forward-
looking statements. Such factors include, among others, general economic and
business conditions which will affect credit-worthiness of tenants, financing
availability and cost, retailing trends and rental rates; risks of real estate
development and acquisitions; governmental and environmental regulations; and
competition with other real estate companies and technology. Portions of this
discussion include certain forward-looking statements about the Trust's and
management's intentions and expectations. Although these intentions and
expectations are based upon reasonable assumptions, many factors, such as
general economic conditions, local and national real estate conditions,
increases in interest rates and operating costs, may cause actual results to
differ materially from current expectations.
LIQUIDITY AND CAPITAL RESOURCES
Federal Realty meets its liquidity requirements through net cash provided
by operating activities, along with traditional debt and equity funding
alternatives available to it. A significant portion of cash provided by
operating activities is distributed to common and preferred shareholders in the
form of dividends. Accordingly, capital outlays for property acquisitions, major
renovation and development projects and balloon debt repayments require debt or
equity funding. The Trust also expects proceeds from the sale of selected assets
to provide an additional source of capital in 2000 and 2001.
Net cash provided by operating activities was $59.0 million in the first
half of 2000 and $55.5 million in the first half of 1999 of which $38.5 million
and $38.0 million, respectively, was distributed to shareholders. Contributions
from retenanted and redeveloped properties, as more fully described below, were
the primary sources of these increases.
15
Net cash used in investing activities was $29.7 million during the first
half of 2000 and $68.3 million during the first half of 1999. The Trust
purchased real estate totaling $24.8 million in the first half of 2000 and $25.2
million in the first half of 1999, requiring cash outlays of $19.6 million and
$22.7 million, respectively. During these two periods, the Trust expended an
additional $59.7 million and $40.2 million, respectively, in capital
improvements to its properties. The Trust invested $3.6 million during the first
half of 2000 and $5.3 million during the first half of 1999 in mortgage notes
receivable with an average weighted interest rate of 9.7% and 10%, respectively.
One mortgage note receivable of $5.9 million was paid off June 23, 2000. Cash of
$47.2 million was received in June 2000 from the sale of a property.
On January 5, 2000 the Trust purchased the 75,000 square foot Greenlawn
Plaza in Greenlawn, New York for $6.2 million, with plans to renovate and expand
the center by 35,000 square feet. On February 16, 2000 control of a parcel of
land for future development in Hillsboro, Oregon was acquired for $11.7 million.
An additional $1.6 million will be owed if certain cash flow criteria are met
during the first ten years of operations.
On January 1, 2000 the Trust issued 190,000 partnership units valued at
$3.6 million in exchange for the minority partner's interest in Loehmann's
Plaza.
On April 6, 2000 the Trust converted a note receivable of $5.8 million to a
90% interest in a partnership owning a 30,000 square foot street retail property
in Santa Monica, California valued at $6.3 million. The property is currently
under construction. The Trust has contributed an additional $488,000 towards the
construction of the property as of June 30, 2000.
On June 30, 2000 the Trust sold the 296,000 square foot Peninsula Shopping
Center located in Palos Verdes, California for $48.6 million resulting in a gain
of $3.7 million.
Of the $59.7 million spent in the first six months of 2000 on the Trust's
existing real estate portfolio, approximately $28.4 million was invested in
predevelopment and development projects in Bethesda, Maryland; San Jose,
California; and Arlington, Virginia. The remaining $31.3 million of capital
expenditures relates to improvements to common areas, tenant work and various
redevelopments, including the renovation of Greenlawn Plaza.
Net cash provided by financing activities, before dividend payments, was
$16.2 million in the first half of 2000 and $45.4 million in the first half of
1999. The Trust utilized the proceeds from the sale of Peninsula Shopping
Center, two unsecured borrowings and its unsecured line of credit to fund
acquisitions, capital expenditures and share repurchases in 2000.
On February 29, 2000 the Trust obtained a construction loan for up to $24.5
million in connection with the Trust's Woodmont East
16
development in Bethesda, Maryland. The loan, which has a floating interest rate
of LIBOR plus 1.2% to 1.5%, depending on occupancy levels, matures August 29,
2002 with two one year extension options. At June 30, 2000 the outstanding
balance on the loan is $8.0 million. The property secures the construction loan
facility. In connection with the land for future development in Hillsboro,
Oregon the Trust issued a $3.4 million note due on August 14, 2000. The loan
bears interest at LIBOR plus 1.25%. The property secures the loan facility.
At June 30, 2000 there was $159.6 million borrowed under the syndicated
credit facility. The maximum drawn during the first six months of 2000 was
$218.1 million. The weighted average interest rate on borrowings for the six
months ended June 30, 2000 was 6.8%. The facility requires fees and has various
covenants including the maintenance of a minimum shareholders' equity and a
maximum ratio of debt to net worth. In June 2000, the Trust modified certain
covenants and extended its syndicated credit facility and its $125 million term
loan for an additional year to December 19, 2003. Fees paid for this extension
totaled $1.0 million.
In July 2000, citing the Trust's pursuit of development and the resultant
capital requirements, Standard and Poor's lowered the rating on the Trust's
senior notes from BBB+ to BBB. Standard and Poor's noted that the outlook is
stable with the rating "supported by a very solid portfolio of seasoned in-fill
retail properties". Under the terms of the syndicated credit facility, this
lowered rating results in an increase in the Trust's borrowing rate from LIBOR
plus 65 basis points to LIBOR plus 80 basis points. The interest rate on the
term loan increases from LIBOR plus 75 basis points to LIBOR plus 95 basis
points.
Capital requirements for the remainder of 2000 will depend on new
development efforts, acquisition opportunities, the level of improvements and
redevelopments on existing properties and the level of common shares that the
Trust can repurchase.
The Trust will need additional capital in order to fund these acquisitions,
expansions, developments and its share repurchase program. Sources of this
funding may be additional debt, both secured and unsecured; additional equity;
proceeds from the sale of properties; and joint venture relationships. The
timing and choice of capital sources will depend on the cost and availability of
that capital, among other things. The Trust believes, based on past experience,
that access to the capital needed to execute its business plan will be available
to it.
CONTINGENCIES
The Trust is involved in various lawsuits and environmental matters arising
in the normal course of business. Management believes that such matters will not
have a material effect on the financial condition or results of operations of
the Trust.
17
Pursuant to the provisions of the partnership agreement, in the event of
the exercise of put options by another partner, the Trust would be required to
purchase a 37.5% interest of Congressional Plaza at its then fair market value.
Based on management's current estimate of fair market value, the Trust's
estimated liability upon exercise of the put option is approximately $27
million.
Under the terms of certain other partnerships, if certain leasing and
revenue levels are obtained for the properties owned by the partnerships, the
limited partners may require the Trust to purchase their partnership interests
at a formula price based upon net operating income. The purchase price may be
paid in cash or common stock of the Trust at the election of the limited
partners. In certain of the partnerships, if the limited partners do not redeem
their interest, the Trust may choose to purchase the limited partnership
interests upon the same terms.
Under the terms of other partnerships, the partners may exchange their
1,004,589 operating units into cash or the same number of common shares of the
Trust, at the option of the Trust. On July 17, 2000 the Trust redeemed 100,000
operating units for cash of $2.1 million.
RESULTS OF OPERATIONS
Net income and funds from operations have been affected by the Trust's
recent redevelopment and financing activities. The Trust has historically
reported its funds from operations in addition to its net income and net cash
provided by operating activities. Funds from operations is a supplemental
measure of real estate companies' operating performance. As of January 1, 2000
the National Association of Real Estate Investment Trusts ("NAREIT") defines
funds from operations as follows: income available for common shareholders
before depreciation and amortization of real estate assets and before
extraordinary items less gains on sale of real estate. Prior to January 1, 2000
funds from operations also excluded significant nonrecurring events. Funds from
operations does not replace net income as a measure of performance or net cash
provided by operating activities as a measure of liquidity. Rather, funds from
operations has been adopted by real estate investment trusts to provide a
consistent measure of operating performance in the industry. Nevertheless, funds
from operations, as presented by the Trust, may not be comparable to funds from
operations as presented by other real estate investment trusts.
18
The reconciliation of net income to funds from operations is as follows:
Six months ending Three months ending
June 30, June 30,
2000 1999 2000 1999
Net income available for common
shareholders - basic $28,238 $16,394 $16,087 $ 4,828
(Gain) loss on sale of real
estate (3,681) 7,050 (3,681) 7,050
Depreciation and amortization of
real estate assets 23,623 22,617 12,136 11,489
Amortization of initial direct
costs of leases 1,700 1,460 870 742
Income attributable to operating
partnership units 744 361 131 97
Funds from operations for common ------- ------- ------- -------
shareholders $50,624 $47,882 $25,543 $24,206
======= ======= ======= =======
SIX MONTHS ENDED JUNE 30, 2000 and 1999
Consolidated Results
- --------------------
Rental income, which consists of minimum rent, percentage rent and cost
recoveries, increased 7.9% from $119.1 million in the first half of 1999 to
$128.5 million in the first half of 2000. If properties acquired, sold and
developed in 2000 and 1999 are excluded, rental income increased 7.3%, due
primarily to the favorable impact of redeveloped and retenanted centers.
Other property income includes items such as utility reimbursements,
telephone income, merchant association dues, late fees and temporary tenant
income. Other property income increased 13.2% from $4.8 million in the first six
months of 1999 to $5.5 million in the first six months of 2000 due primarily to
increases in lease termination fees and temporary tenant income, an area
identified by the Trust as one with additional growth opportunity.
Rental expenses increased 7.4% from $26.1 million in the first half of 1999
to $28.0 million in the first half of 2000. If rental expenses are adjusted for
properties acquired, sold and developed in 2000 and 1999, rental expenses
increased 6.6% from $25.4 million in 1999 to $27.0 million in 2000, primarily
due to increased snow removal and other operating costs in 2000. Rental expense
as a percentage of property income remained constant in both periods at 21%.
Real estate taxes increased 9.4% from $11.9 million in the first half of
1999 to $13.0 million in the first half of 2000. If real estate taxes are
adjusted for properties acquired, sold and developed in 2000 and 1999, real
estate taxes increased 8.4% due primarily to
19
increased taxes on recently redeveloped properties.
Depreciation and amortization expenses increased 4.3% from $24.9 million in
the first half of 1999 to $26.0 million in the first half of 2000 reflecting the
impact of recent tenant work and property improvements.
During the first six months of 2000 the Trust incurred interest expense of
$38.7 million, of which $5.2 million was capitalized, as compared to 1999's
$33.3 million, of which $2.8 million was capitalized. The increase in interest
expense reflects the additional debt issued to fund the Trust's share repurchase
and capital improvement programs. The ratio of earnings to combined fixed
charges and preferred dividends was 1.45x and 1.54x for the first half of 2000
and 1999, respectively. The ratio of earnings to fixed charges was 1.6x and 1.7x
during the first half of 2000 and 1999, respectively. The ratio of funds from
operations to combined fixed charges and preferred dividends was 2.0x for the
first half of 2000 and 2.1x for the first half of 1999.
Administrative expenses increased from $5.4 million in the first six months
of 1999 to $5.8 million in the first six months of 2000, 4.2% of revenue in both
years. A decrease in costs related to abandoned acquisition and development
projects were offset by increased personnel costs. The tight labor market in the
Trust's operating regions resulted in higher salaries both to existing and new
employees.
On June 30, 2000 the Trust sold the 296,000 square foot Peninsula Shopping
Center located in Palos Verdes, California for $48.6 million resulting in a gain
of $3.7 million. During the second quarter of 1999, the Trust recorded a $7.1
million charge, representing the estimated loss on a potential sale of certain
assets, principally Northeast Plaza in Atlanta, Georgia, thereby valuing the
assets at their estimated fair value less estimated costs to sell. On October
18, 1999 the Trust sold Northeast Plaza for $19.6 million, realizing a loss of
$6.3 million.
As a result of the foregoing items, net income before gain (loss) on the
sale of real estate increased from $27.4 million in the first half of 1999 to
$28.5 million in the first half of 2000, while net income increased from $20.4
million during the first half of 1999 to $32.2 million during the first half of
2000 and net income available for common shareholders increased from $16.4
million to $28.2 million.
While the Trust expects growth in net income and funds from operations
during the remainder of 2000, the growth rate will be less than in 1999. Growth
in 1999 was fueled by contributions from 1998 acquisitions, by higher leverage
combined with low interest rates, by savings from the 1998 restructuring and by
growth from the core portfolio. There are no significant income producing
acquisitions in 1999 to fuel 2000 growth; there will be no significant
contribution in 2000 from the Trust's development projects and the savings from
20
the 1998 restructuring have already been realized. Consequently, the growth in
2000 is primarily dependent on contributions from the core portfolio. Growth of
net income from the core portfolio is, in part, dependent on controlling
expenses, some of which are beyond the complete control of the Trust, such as
snow removal and trends in the retailing environment, such as the evolution of
the Internet and demand for retail space. The Trust currently expects that
demand for its retail space should remain at levels similar to those in 1999. A
weakening of the retail environment could, however, adversely impact the Trust
by increasing vacancies and decreasing rents. In past weak retail and real
estate environments, the Trust has been able to replace weak and bankrupt
tenants with stronger tenants; management believes that due to the quality of
the Trust's properties there will continue to be demand for its space.
Growth in net income is also dependent on the amount of leverage and
interest rates. The Trust's leverage is increasing as it finances its
development pipeline. In addition, the Trust will continue to have exposure to
changes in market interest rates. As interest rates increase, net income and
funds from operations, as well as the ultimate cost of the Trust's development
projects will be negatively impacted due to the variable interest rates on the
Trust's revolving credit facilities.
Segment Results
- ---------------
The Trust operates its portfolio of properties in three geographic
operating regions: Northeast, Mid-Atlantic and West.
Historical operating results for the three regions are as follows (in
thousands):
For the six months ended June 30,
2000 1999
- ----------------------------------------------------------------------------
Rental income
Northeast $ 55,054 $ 49,910
Mid-Atlantic 55,811 54,513
West 17,618 14,684
-------- --------
Total $128,483 $119,107
======== ========
Net operating income
Northeast $ 38,253 $ 35,770
Mid-Atlantic 41,439 39,844
West 13,235 10,349
-------- --------
Total $ 92,927 $ 85,963
======== ========
The Northeast
- --------------
The Northeast region is comprised of fifty-four assets, extending from
suburban Philadelphia north through New York and its suburbs into New England
and west to Illinois and Michigan.
21
When comparing the first half of 2000 with 1999, rental income increased
10.3% from $49.9 million in 1999 to $55.1 million in 2000. Excluding properties
acquired since January 1, 1999, rental income increased 10.0%, primarily due to
increases at recently redeveloped and retenanted shopping centers, such as Bala
Cynwyd, Lawrence Park, Gratiot, Langhorne Square, and Wynnewood.
Net operating income increased 6.9% from $35.8 million in 1999 to $38.3
million in 2000. Excluding properties acquired since January 1, 1999, net
operating income increased 6.8%, primarily due to increases at the recently
redeveloped and retenanted shopping centers.
The Mid-Atlantic
- ----------------
The Mid-Atlantic region is comprised of thirty-one assets, located from
Baltimore south to metropolitan Washington, D.C. and further south through
Virginia, North Carolina, and Florida.
When comparing the first half of 2000 with 1999, rental income increased
2.4% from $54.5 million in 1999 to $55.8 million in 2000. On a same center
basis, excluding Northeast Plaza in Atlanta, Georgia which was sold in 1999 and
the recently developed Phase 3 of the Bethesda Row project in Bethesda, Maryland
rental income increased 4.1%, due in part to new anchor leases at several
centers.
When comparing the first half of 2000 with 1999, net operating income
increased 4.0% from $39.8 million in 1999 to $41.4 million in 2000. On the same
center basis as above net operating income increased 5.6%, due primarily to the
new anchor leases and lease termination fees.
The West
- --------
The Western region is comprised of thirty-nine assets, located from Texas
to the West Coast.
When comparing the first half of 2000 with 1999, rental income increased
20.0% from $14.7 million in 1999 to $17.6 million in 2000. Excluding newly
developed properties and properties acquired since January 1, 1999, rental
income increased 9.9%; increases from recently redeveloped and retenanted
properties in the Los Angeles and San Francisco, California areas were offset by
a decrease at Town & Country Plaza in San Jose, California the majority of which
was vacated in May 2000 in preparation for its razing and subsequent new
development.
When comparing the first half of 2000 with 1999, net operating income
increased 27.9% from $10.3 million in 1999 to $13.2 million in 2000. Excluding
newly developed properties and properties acquired since January 1, 1999, net
operating income increased 16.4%, due to increases from other income and from
the recently redeveloped and retenanted properties, offset by Town & Country
Plaza as mentioned above.
22
RESULTS OF OPERATIONS - THREE MONTHS ENDED JUNE 30, 2000 and 1999
Consolidated Results
- --------------------
Rental income, which consists of minimum rent, percentage rent and cost
recoveries, increased 7.7% from $59.7 million in the second quarter of 1999 to
$64.3 million in the second quarter of 2000. If properties acquired, sold and
developed in 2000 and 1999 are excluded, rental income increased 7.3%, due
primarily to the favorable impact of redeveloped and retenanted centers.
Other property income includes items such as utility reimbursements,
telephone income, merchant association dues, late fees and temporary tenant
income. Other property income increased 5.7% from $2.6 million in the second
quarter of 1999 to $2.7 million in the second quarter of 2000 due primarily to
increases in lease termination fees.
Rental expenses increased 7.8% from $12.5 million in the second quarter of
1999 to $13.4 million in the second quarter of 2000. If rental expenses are
adjusted for properties acquired, sold and developed in 2000 and 1999, rental
expenses increased 7.2% from $12.0 million in 1999 to $12.9 million in 2000.
There was a decrease in write off of tenant work and lease costs which resulted
from a 1999 bankruptcy, but this decrease was outweighed by increases in
environmental costs and other operating costs. Rental expense as a percentage of
property income remained constant in both periods at 20%.
Real estate taxes increased 11.4% from $5.9 million in the second quarter
of 1999 to $6.5 million in the second quarter of 2000. If real estate taxes are
adjusted for properties acquired, sold and developed in 2000 and 1999, real
estate taxes increased 9.3% due primarily to increased taxes on recently
redeveloped properties.
Depreciation and amortization expenses increased 5.4% from $12.7 million in
the second quarter of 1999 to $13.3 million in the second quarter of 2000
reflecting the impact of recent tenant work and property improvements.
During the second quarter of 2000 the Trust incurred interest expense of
$20.0 million, of which $3.0 million was capitalized, as compared to 1999's
$17.0 million, of which $1.6 million was capitalized. The increase in interest
expense reflects the additional debt issued to fund the Trust's share repurchase
and capital improvement programs.
On June 30, 2000 the Trust sold the 296,000 square foot Peninsula Shopping
Center in Palos Verdes, California for $48.6 million resulting in a gain of $3.7
million. During the second quarter of 1999, the Trust recorded a $7.1 million
charge, representing the estimated loss on a potential sale of certain assets,
principally Northeast Plaza in Atlanta, Georgia, thereby
23
valuing the assets at their estimated fair value less estimated costs to sell.
On October 18, 1999 the Trust sold Northeast Plaza for $19.6 million, realizing
a loss of $6.3 million.
Administrative expenses decreased from $3.2 million, or 4.9% of revenue in
the second quarter of 1999 to $2.9 million, or 4.2% of revenue in the second
quarter of 2000 due primarily to a decrease in costs related to the abandonment
of acquisition and development projects which was offset by increased personnel
costs. The tight labor market in the Trust's operating regions resulted in
higher salaries both to existing and new employees.
As a result of the foregoing items, net income before gain (loss) on sale
of real estate increased from $13.9 million in the second quarter of 1999 to
$14.4 million in the second quarter of 2000, while net income increased from
$6.8 million during the second quarter of 1999 to $18.1 million during the
second quarter of 2000 and net income available for common shareholders
increased from $4.8 million to $16.1 million.
Segment Results
- ---------------
The Trust operates its portfolio of properties in three geographic
operating regions: Northeast, Mid-Atlantic and West.
Historical operating results for the three regions are as follows (in
thousands):
For the three months ended June 30,
2000 1999
- --------------------------------------------------------------------------------
Rental income
Northeast $27,769 $25,052
Mid-Atlantic 27,688 27,051
West 8,794 7,571
------- -------
Total $64,251 $59,674
======= =======
Net operating income
Northeast $19,782 $18,643
Mid-Atlantic 20,773 19,674
West 6,452 5,601
------- -------
Total $47,007 $43,918
======= =======
The Northeast
- --------------
The Northeast region is comprised of fifty-four assets, extending from
suburban Philadelphia north through New York and its suburbs into New England
and west to Illinois and Michigan.
When comparing the second quarter of 2000 with 1999, rental income increased
10.8% from $25.1 million in 1999 to $27.8 million
24
in 2000. Excluding properties acquired since January 1, 1999, rental income
increased 10.4%, primarily due to increases at recently redeveloped and
retenanted shopping centers, such as Bala Cynwyd, Lawrence Park, Gratiot,
Langhorne Square, and Wynnewood.
Net operating income increased 6.1% from $18.6 million in 1999 to $19.8
million in 2000. Excluding properties acquired since January 1, 1999, net
operating income increased 6.0%, primarily due to increases at the recently
redeveloped and retenanted shopping centers.
The Mid-Atlantic
- ----------------
The Mid-Atlantic region is comprised of thirty-one assets, located from
Baltimore south to metropolitan Washington, D.C. and further south through
Virginia, North Carolina, and Florida.
When comparing the second quarter of 2000 with 1999, rental income
increased 2.4% from $27.1 million in 1999 to $27.7 million in 2000. On a same
center basis, excluding Northeast Plaza in Atlanta, Georgia which was sold in
1999 and the recently developed Phase 3 of the Bethesda Row project in Bethesda,
Maryland, rental income increased 4.0%, due in part to new anchor leases at
several centers.
When comparing the second quarter of 2000 with 1999, net operating income
increased 5.6% from $19.7 million in 1999 to $20.8 million in 2000. On a same
center basis as above, net operating income increased 7.3%, due primarily to the
new anchor leases and lease termination fees.
The West
- --------
The Western region is comprised of thirty-nine assets, located from Texas
to the West Coast.
When comparing the second quarter of 2000 with 1999, rental income
increased 16.2% from $7.6 million in 1999 to $8.8 million in 2000. Excluding
newly developed properties and properties acquired since January 1, 1999, rental
income increased 8.7%; increases from recently redeveloped and retenanted
properties in the Los Angeles and San Francisco, California areas were offset by
a decrease at Town & Country Plaza in San Jose, California, the majority of
which was vacated in May 2000 in preparation for its razing and subsequent new
development.
When comparing the second quarter of 2000 with 1999, net operating income
increased 15.2% from $5.6 million in 1999 to $6.5 million in 2000. Excluding
newly developed properties and properties acquired since January 1, 1999, net
operating income increased 7.3%, due to increases from other income and from the
recently redeveloped and retenanted properties, offset by Town & Country Plaza
as mentioned above.
25
PART II - OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Shareholders
At the 2000 Annual Meeting of Shareholders on May 3, 2000 the Shareholders
elected two trustees to serve for the ensuing three years. Holders of 32.1
million shares voted for and holders of 260,000 and 277,000 shares voted against
each trustee, respectively.
Item 6. Exhibits and Reports on Form 8-K
(A) Exhibits pp. 27-39
(10) (i) Amended and Restated Term Loan Agreement
(10) (ii) Amended and Restated Credit Agreement
(27) Financial Data Schedules Edgar filing only
(B) Reports on Form 8-K
A Form 8-K, dated March 31, 2000, was filed on May 5, 2000 in response to
Item 5.
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
FEDERAL REALTY INVESTMENT TRUST
--------------------------------
(Registrant)
July 26, 2000 Steven J. Guttman
-----------------
Steven J. Guttman, President
(Chief Executive Officer)
July 26, 2000 Cecily A. Ward
--------------
Cecily A. Ward, Chief Financial Officer
(Principal Accounting Officer)
26