2. Forward Looking Statement
This presentation contains certain "forward-looking statements" within the meaning of the federal securities laws. 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 uncertainties affecting real estate
businesses generally as well as the following, among other factors: our substantial debt, stated value of preferred shares and our high
leverage ratio; constraining leverage, interest and tangible net worth covenants under our 2013 Revolving Facility, our 2014 Term Loans and
our 2015 Term Loan; potential losses on impairment of certain long-lived assets, such as real estate, or of intangible assets, such as goodwill,
including such losses that we might be required to record in connection with any dispositions of assets; changes to our corporate management
team and any resulting modifications to our business strategies; our ability to refinance our existing indebtedness when it matures, on
favorable terms or at all; our ability to raise capital, including through the issuance of equity or equity-related securities if market conditions are
favorable, through joint ventures or other partnerships, through sales of properties or interests in properties, or through other actions; our
ability to identify and execute on suitable acquisition opportunities and to integrate acquired properties into our portfolio; our partnerships and
joint ventures with third parties to acquire or develop properties; our short- and long-term liquidity position; current economic conditions and
their effect on employment, consumer confidence and spending and the corresponding effects on tenant business performance, prospects,
solvency and leasing decisions and on our cash flows, and the value and potential impairment of our properties; general economic, financial
and political conditions, including credit market conditions, changes in interest rates or unemployment; changes in the retail industry, including
consolidation and store closings, particularly among anchor tenants; the effects of online shopping and other uses of technology on our retail
tenants; our ability to sell properties that we seek to dispose of or our ability to obtain estimated sale prices; our ability to maintain and
increase property occupancy, sales and rental rates, in light of the relatively high number of leases that have expired or are expiring in the
next two years; acts of violence at malls, including our properties, or at other similar spaces, and the potential effect on traffic and sales;
increases in operating costs that cannot be passed on to tenants; risks relating to development and redevelopment activities which could be
subject to delays or other risks and might not yield the returns we anticipate; concentration of our properties in the Mid-Atlantic region;
changes in local market conditions, such as the supply of or demand for retail space, or other competitive factors; and potential dilution from
any capital raising transactions. 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 in our most recent Annual Report on Form 10-K and in any
subsequent Quarterly Report on Form 10-Q 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.
2
3. ITINERARY
3
Q&A
Travel to Fashion Outlets of Philadelphia
Management Presentation 8:30-11:00 AM
12:30 – 1:15 PM
11:00 AM – noon
On Site Fashion Outlets of Philadelphia Presentation 1:30 – 2:30 PM
5. 5
BREAKING NEWS
Non refundable deposit received for Palmer Park Mall
Non refundable deposit received for three mall package
6. 6
KEY CATALYSTSOur future is bright
Move to QUALITY is pronounced and accelerating
RESULTS achieved are demonstrable and sustainable
Experiencing a dramatic increase in new retail DEMAND
REDEVELOPMENT opportunities are realizable and impactful
Balance sheet is STRONG and improving
8. A VISION REALIZEDA sustainable, growing platform
Balance Sheet
Improvement
Operational
Excellence
Elevating Portfolio
Quality
Positioning for
Growth
In 2012 we outlined a strategy focused on 4 key objectives to drive
NAV and shareholder value:
We have created a sustainable, stable platform with a flexible balance sheet
with realizable growth opportunities.
8
9. NEXT STAGEA sustainable, growing platform
9
$500 psf in sales
More than 50% of NOI generated from top 10 MSAs
Sustained NOI growth greater than 3%
Leverage below 48%
10. WHERE WE AREGoals Per 2012 Investor Day
10
Enhanced Portfolio Quality Strengthened the Balance Sheet
Measure of Success 9/30/12 2015 Goal
12/31/15
Estimate (1)
Leverage 62% < 55% <50%
Debt/EBITDA 8.8 < 7.5 8.0
SS NOI Growth 1–2% > 3%
Upper end of
guidance range of
2-2.7%
Total Mall Occupancy 92.6% 95.0% 95.4%
Occupancy Cost 11.4% 12.5% 12.7%
Sales PSF $379 > $400 $428
(1) Sales figure is from 9/30/15
11. STRONG, FLEXIBLE BALANCE SHEET
11
Ample Liquidity
Laddered maturities
Minimal exposure to floating rate debt
Plan to reduce leverage below 47% by end of 2018
12. SALES OUTPACING OCCUPANCY COSTSOpportunity to drive rents to correlate with sales growth
12(1) Excludes 6 malls currently marketed for sale, Fashion Outlets of Philadelphia and Springfield Town Center
(1)
16. 16
KEY TAKEAWAYSOur future is bright
Our move to QUALITY is pronounced and accelerating
RESULTS achieved demonstrate our success
We are experiencing a dramatic increase in new retail DEMAND
REDEVELOPMENT opportunities are realizable and impactful
Our balance sheet is STRONG and improving
17. SELECT ANCHOR PROFILEReduced exposure to select anchors
29 16 12
29 19 19
12 3 3
Tenant
# of locations
2012
# of locations
post-disposition
# of locations
post-recapture
17
18. A UNIQUE PLATFORMRealizing a Transformed PREIT
18
Concentration in densely populated, high barrier-to-entry markets
High quality assets in two Top 10 MSAs is attracting productive retailers
Opportunities to improve asset quality through remerchandising &
redevelopment
Significantly reduced risk profile through dispositions
Well-positioned portfolio with high-quality assets
Mitigated anchor exposure through asset sales & replacement initiative
Scale allows for intensive focus by senior management on priority endeavors
Improved portfolio has provided ability to attract and retain top talent
19. 19
TCO MAC SPG GGP PEI CBL WPG RSE
Sales per square foot $805 $630 $616 $593 $424 $371 $352 $345
TTM sales growth 1.9% 7.0% 0.5% 3.7% 9.6% 4.2% 5.6% 7.1%
SS NOI (2015E) 3.1% 5.8% 4.0% 4.0% 2.5% -0.6% -1.2% 3.3%
Occupancy 91.7% 95.7% 95.9% 95.2% 91.9% 90.8% 90.2% 89.5%
Occupancy cost ratio 13.8% 13.2% 12.1% 13.3% 12.7% 13.0% 12.7% 11.1%
Releasing spreads 15% 15% 18% 10% 6% 7% 0% 7%
Average HHI $68k $63k $64k $59k $57k $54k $56k $53k
Source: Green Street Advisors, Mall Sector Update, November 11, 2015 (All operating data as of September 30, 2015)
SHIFTING PEER GROUPImproving position
20. 20
TCO MAC SPG GGP PEI CBL WPG RSE
G&A/Asset value(bps) 36 33 14 50 60 53 60 105
Total leverage ratio 28% 28% 30% 39% 48% 56% 51% 62%
Debt/EBITDA 7.7x 6.6x 6.1x 8.9x 7.8x 7.0x 6.8x 8.8x
Floating rate exposure 25% 18% 10% 19% 11% 24% 25% 26%
Credit Line Maturity 2020 2018 2019 2020 2020 2020 2019 2018
Net Asset Value/Share $116 $93 $227 $35 $33 $26 $18 $17
Source: Green Street Advisors, Mall Sector Update, November 11, 2015 (All operating data as of September 30, 2015)
SHIFTING PEER GROUPImproving position
20
21. IMPROVED LINEUPBringing shoppers more of what they want
4 13
1 3
4 8
3 4
2 11
Tenant
# of locations
2012
# of locations
2015 (1)
(1) Includes executed leases not yet open
21
22. NEW-TO-PORTFOLIO TENANCYSince 2012, PREIT has added x new tenants to the portfolio
Marquee first-to-portfolio tenants
22
Century 21 opened their first store
outside of NY Metro in Philadelphia.
Legoland Discovery Center will join
Plymouth Meeting in 2017; one of only
9 in the US.
24. 24
KEY TAKEAWAYSOur future is bright
Our move to QUALITY is pronounced and accelerating
RESULTS achieved demonstrate our success
We are experiencing a dramatic increase in new retail DEMAND
REDEVELOPMENT opportunities are realizable and impactful
Our balance sheet is STRONG and improving
25. OUR TEAM
Robert McCadden
Executive Vice President &
Chief Financial Officer
Joseph Aristone
Senior Vice President
Leasing
Bruce Goldman
Executive Vice President
General Counsel & Secretary
Daniel Herman
Senior Vice President
Redevelopment
Andrew Ioannou
Executive Vice President
Finance & Acquisitions
Mario Ventresca, Jr.
Executive Vice President
Operations
Heather Crowell
Vice President
Investor Relations & Corporate
Communications
25
26. CULTURAL EVOLUTIONNew Production Talent
26
VP,
Development
Leasing
VP,
Retail Leasing
Director,
Retail Leasing
Director,
Retail Leasing
Director,
Retail Leasing
Director,
Partnership
Marketing
Sr Director,
Partnership
Marketing
31 years
experience
31 years
experience
25 years
experience
18 years
experience
30 years
experience
10 years
experience
13 years
experience
Previous
developer:
Vornado,
Federal, GGP
Previous
developer:
Simon, GGP
Previous
developer:
Westfield,
Forest City,
Prime Retail
Previous
developer:
Simon
Previous
developer:
CBL
Previous
developer:
Westfield
Previous
developer:
Westfield
Michael
Khouri
Jeffrey
Sneddon
Donna
DiPeso
Sean
Linehan
Lori
McCommons
Heidi
Kempf
Scott
Degraffenreid
27. TALENT EVOLUTIONAttracting & Maintaining Key Production Personnel
Quality Portfolio
Quality People
Quality Tenants
EXCEPTIONAL
RESULTS
27
28. POST-TRANSFORMATIONA higher quality mall company
28
25Quality malls
• 55% NOI generated from top 10 MSAs
$450 psf
• With clear path to $500 psf
$90k• Average HHI from metro portfolio
3%SS NOI growth
+
+
30. PHILADELPHIA MARKET PRESENCEPREIT is the Dominant Enclosed Mall Landlord in the 6th largest MSA
Own 41% of the enclosed mall GLA
in the Philadelphia Metro Area
Serve 6+ Million residents and 40
million visitors in the Philadelphia
Metro Area
Exton Square Mall
Springfield Mall
Cumberland Mall
Moorestown Mall
Cherry Hill Mall
Gloucester Premium Outlets
Willow Grove Park
Plymouth Meeting Mall
Fashion Outlets
30
31. PHILADELPHIA MARKET STRENGTHHow the region compares
• 2nd Highest Urban Population Density
• 4th Largest Media Market
• 6th Largest Personal Income
• 6th Largest Employment Market
• 7th in Academic R&D Expenditures
31
32. PHILADELPHIA MARKET STRENGTHPeople want to be here
Over 25 Fortune 1,000 companies call the Philadelphia Region home
32
Diverse & stable economy bolstered by healthcare, pharma and education
Lowest rental rate for Class A office and industrial space compared to New
York, Boston, Washington DC and Atlanta
Lowest Cost of Living of Northeast US metros
Largest percentage growth in millenials among the nation’s 30 largest
cities
Home to over 100 degree granting institutions educating nearly 500,000
students
33. WASHINGTON DC MARKET PRESENCEPREIT has established a strong presence in the 7th largest MSA
• Own 4 of 19 enclosed malls
serving unique and growing
markets
• Serve 3+ million residents
and tens of millions of
visitors in the Washington DC
Metro Area
Valley Mall
Francis Scott Key Mall
Mall at Prince Georges
Springfield Town Center
33
34. WASHINGTON DC MARKET INSIGHTS3rd Wealthiest MSA in the country
Fairfax County Prince Georges County
Frederick County Washington County
• 3rd wealthiest county in the US
• Gross County Product is nearly $100 billion
• 18% Population Growth since 2000
• DC Suburb just to the northeast of
downtown DC
• $1 billion in nearby developments continue
to create density and attract educated,
young residents to the area
• Interstates 70 and 270 offer direct access to
Washington DC & Baltimore
• Upscale community with benefits of
proximity to urban areas mixed with quieter
country living
• 42% of households earn $100k+
• One of the fastest growing counties on the
east coast
• 25% Population Growth since 2000
• Residents lured by lower cost of living and
convenience of living on I-81 corridor
34
35. VALUE CREATION FRAMEWORKPathway to Driving Shareholder Value
Portfolio Optimization
Executing Growth
Initiatives
Performance Priority
Measured Capital
Allocation
Continue to evaluate all properties
and divest when necessary or
invest when the opportunity
presents itself.
Myopic focus on delivering results
that rival the high quality peer set,
namely 3%+ SS NOI growth.
The scale of our portfolio provides
an opportunity to impact the
platform through well - executed
repositioning projects
Attention to balance sheet is a
must with a focus on timing of
spend and risk-adjusted returns.
35
36. 36
KEY CATALYSTSOur future is bright
Move to QUALITY is pronounced and accelerating
RESULTS achieved are demonstrable and sustainable
Experiencing a dramatic increase in new retail DEMAND
REDEVELOPMENT opportunities are realizable and impactful
Balance sheet is STRONG and improving
39. INVESTOR PERSPECTIVE
39
Top 5 active shareholders were not or were nominal holders 3 yrs ago
Activated shareholder relations program
Goal to increase sell side coverage
Dramatic increase in institutional ownership to 81%
40. GOVERNANCE PRIORITY
40
Five board changes in three years; reduced average tenure and
increased independent director percentage
Eliminated Executive Chairman role
Significant share ownership requirements for CEO and Board
ISS Quickscore of 3 demonstrates low governance risk
• Strong pay for performance alignment
59. NEW BUSINESS DEVELOPMENT
59
Cultivating a robust pipeline of new relationships including 200
qualified leads and 31 “hot” prospects
Mission to source new-to-portfolio tenants
Top Prospects
60. EXPANDING RETAILERS
60
Department Stores
Nordstrom
Dillard’s
Belk
Primark
Ross Stores
Kohl’s
Burlington
TJ Maxx
Men’s & Women
Buckle
Zumiez
Express
Lululemon
Urban Outfitters
Women’s Stores
Chico/Soma
Anthropologie
Christopher & Banks
Lane Bryant
Victoria Secret
White House/Black Market
Fast Casual Concept
Zara
H&M (major expansion)
Men’s Apparel
DXL
Men’s Wearhouse
Build A Bear
GNC
Container Store
White Barn Candle Co
Dicks Sporting Goods
Hibbett’s
Academy Sports
Field & Stream
Cosmetic Personal Services
Bath & Body Works
ULTA
Sephora
LUSH
Jewelry
Kay Jewelers
Zales
Electronics
Apple
Gamestop
Home Furnishings
Restoration Hardware
Home Goods
La Z Boy
Accessories
Fossil
Francesca’s Collection
Michael Kors
Vera Bradley
Shoes
DSW
Famous Footwear
Footlocker
Johnson & Murphy
Journey’s
Shoe Dept Encore
Department Stores & Boxes
Men’s & Women’s
Women’s Apparel
Fast Fashion
Men’s Apparel
Specialty Retail
Accessories
Shoes
Jewelry
Electronics
Home Furnishings
Sporting Goods
Cosmetics
61. REMERCHANDISING: Viewmont MallScranton, PA
• Capture underserved customer and expand dominant
position in the trade area by bringing in several first-to-
market tenants
• Solidify value through re-negotiated long term leases
with high quality tenants
Vision
• Capitalize on lease expirations to right-size existing
tenants
• Add catalyst tenants that would open only store in market
Strategy
• CVS Lease expiration [9,000sf]
• Limited Superstore renegotiation [30,000sf]
• Secured new tenants
• New store prototype build-out for existing tenants
Execution
61
64. REMERCHANDISING: Viewmont MallScranton, PA
64
RESULTS
Sales
Non Anchor
Occupancy
Est. NOI Growth
$442 psf (as of 11/30/15)
- Up 20% since Q1 ‘13
98.2%
- Up 450 bps over 12/31/14
+20%
- measured from 2014-2015
65. REMERCHANDISING: Moorestown MallMoorestown, NJ
65
Marketing research uncovered enormous unmet demand for quality
restaurant offerings which prompted successful 2011 liquor
referendum and paved way for evolution of the mall
Located 5 miles from Cherry Hill Mall in a distinct, affluent immediate
trade area
Multi-phase remerchandising effort centered around curated dining
experiences, high-end boutique row offerings, flagship salon & spa and
first-to-market entertainment experiences
Excellent real estate, serviced by NJ Route 38 and easily accessed by
NJ Turnpike and Interstate 295
67. • Differentiate mall offerings by creating a dining and
entertainment focus with best-of-breed local retailers
• Attract affluent customer base
Vision
• Introduce high quality dining and entertainment
• Add high-end boutiques offering brand name products in
boutique atmosphere
Strategy
• Attracted best-of-breed, destination dining options
• Secured only RPX theater in Philadelphia market
• Relocated award-winning salon to add to lifestyle
atmosphere
• Successfully leased Boutique Row
Execution
REMERCHANDISING: Moorestown MallMoorestown, NJ
67
71. REMERCHANDISING: Moorestown MallMoorestown, NJ
71
RESULTS
Sales
Occupancy
Est. NOI Growth
$355 psf
- with expectations to exceed
$400 psf upon stabilization
87.4% Non-Anchor
- Up 9% since 2011 Referendum
+40%
- measured from 2011-2016 (e)
72. REMERCHANDISING: IN PROGRESS
72
Patrick Henry Mall
Valley Mall
Capital City Mall
Francis Scott Key Mall
Francis Scott Key Mall
Valley Mall
Capital City Mall
Patrick Henry Mall
73. REMERCHANDISING: Patrick Henry MallNewport News, VA
73
THE MARKET:
Population
Average HHI
Daytime Population
THE STORY: Located on the Hampton Roads peninsula, Patrick Henry Mall is the only enclosed
mall between Richmond and Norfolk. Completely renovated in 2006 as other shopping
centers opened in market, the property withstood the competition and remains the strongest
retail destination in the trade area. Two area Macy’s closings will serve to strengthen the
property’s market position.
With several key in-demand, fashion-oriented retailers opened or opening soon, the mall is
poised to capitalize on the leasing momentum as more hot national, retailers look to join.
625,655
$75,026
635,740
THE PROPERTY
Sales
Non-Anchor Occupancy
$420
93.6%
74. REMERCHANDISING: Patrick Henry MallNewport News, VA
• Further property’s position in the market as the
dominant, established retail shopping destination in the
Hampton Roads market
Vision
• Attract key tenants looking to exit competitive project
• Upgrade merchandising mix with catalyst tenants that
would enhance shopping experience & attract other key
tenants
• Upgrade restaurant offerings
Strategy
• Backfilled former Borders store with Forever 21 at main
mall entrance
• H&M – opening Q2 2016
Current
Accomplishments
74
75. REMERCHANDISING: Patrick Henry MallNewport News, VA
75
Targeted Retailers Newly Opened / Fully Executed
Opportunity for Remerchandising
76. REMERCHANDISING: Valley MallHagerstown. MD
76
THE MARKET:
Population
Average HHI
Daytime Population
THE STORY: Located at the western edge of the Washington Metro area, Valley Mall is the
dominant regional enclosed mall within 30 miles. The trade area has seen immense growth
over the past twenty years due to improved highway accessibility to Washington DC and
Baltimore coupled with lower cost of living compared to other metro suburbs. The mall also
benefits from its location along the I-81 corridor, a vital north-south route.
Due to the growth , the mall has evolved with an impressive lineup of restaurants and an ever
improving roster of in-demand national retailers.
474,158
$68,277
$66,555
THE PROPERTY
Sales
Non-Anchor Occupancy
$392
96.0%
77. REMERCHANDISING: Valley MallHagerstown, MD
• Capture underserved customer and expand dominant
position in the trade area by bringing in several first-to-
market tenants
Vision
• Add catalyst tenants that would open only store in market
• Secure replacement for underperforming anchor tenant
with new department store that better serves trade area
Strategy
• Upgrade front of mall facing Halfway Boulevard with
destination restaurants
• H&M – opening Q2 2016
• Secured additional new impact tenants
Current
Accomplishments
77
79. REMERCHANDISING: Capital City MallCamp Hill, PA
79
THE MARKET:
Population
Average HHI
Daytime Population
THE STORY: Located just eight miles from downtown Harrisburg, PA – the state capital, Capital
City Mall is the dominant retail center in the region, featuring a wide array of first-to-market
and exclusive retailers including DSW , The Buckle and Forever 21.
A strong regional economy and location in the more desirable West Shore section of trade
area puts the mall in the perfect position to capitalize on shopper demand for better brands
and a differentiated experience.
531,839
$76,283
620,502
THE PROPERTY
Sales
Non-Anchor Occupancy
$392
97.6%
80. REMERCHANDISING: Capital City MallCamp Hill, PA
• Continue to elevate the merchandising mix to provide
shoppers better fashion-oriented brandsVision
• Capitalize on available outparcel with prime visibility to
major regional highway
• Build off success of DSW and Forever 21 to add catalyst
tenants that would open only store in market
Strategy
• Field & Stream – Opened in Q4 2015
• H&M – Opening Q2 2016
• Discussions with several other better fashion retailers
• Discussions with restaurants for pad locations
Current
Accomplishments
80
81. REMERCHANDISING: Capital City MallCamp Hill, PA
81
Targeted Retailers
Newly Opened / Fully Executed
Opportunity for Remerchandising
82. REMERCHANDISING: Francis Scott Key MallFrederick. MD
82
THE MARKET:
Population
Average HHI
Daytime Population
THE STORY: Strategically located Washington DC bedroom community at the intersection of I-
70 and I-270, Francis Scott Key Mall is perfectly situated in the expanding, upscale suburban
communities of Frederick County. Along with rising populations, home values and household
incomes, the trade area’s demand for better retail has grown.
An upgraded merchandising mix and better restaurant offerings will keep consumers from
traveling south and east to find the brands and cuisine they desire.
328,328
$103,109
289,304
THE PROPERTY
Sales
Non-Anchor Occupancy
$363
97.8%
83. REMERCHANDISING: Francis Scott Key MallFrederick, MD
• Capture underserved customer and expand dominant
position in the trade area by bringing in several first-to-
market tenants
Vision
• Add catalyst tenants that would open only store in market
• Expand strong performing tenants looking for more GLA
• Create restaurant cluster
Strategy
• H&M – opening in Q2 2016
• Discussions with several better fashion retailers
• Discussions with restaurants for exterior box location
Current
Accomplishments
83
84. REMERCHANDISING: Francis Scott Key MallFrederick, MD
84
Targeted Retailers
Newly Opened / Fully Executed
Opportunity for Remerchandising
Value City
Furniture
Dick’s
Sporting
Goods
85. 85
KEY CATALYSTSOur future is bright
Our move to QUALITY is pronounced and accelerating
RESULTS achieved demonstrate our success
We are experiencing a dramatic increase in new retail DEMAND
REDEVELOPMENT opportunities are realizable and impactful
Our balance sheet is STRONG and improving
87. Property Date Sold
Sales Price
(millions)
Sales
psf
Gross Rent
psf
Non-anchor
occupancy
Cap Rate
Phillipsburg Mall Jan ’13 $ 11.5 $ 229 $26.24 66.5% 9.8%
Orlando Fashion Square Feb ’13 35.0 233 $30.78 80.7% 9.8%
Chambersburg Mall Nov ‘13 8.5 235 $19.46 76.2% n/a
South Mall Jun ‘14 23.6 227 $25.10 90.6% 10.1%
Nittany Mall Sep ‘14 32.3 243 $28.99 70.0% 16.2%
North Hanover Mall Sep ‘14 (included w/Nittany) 275 $36.06 72.8% 11.0%
Uniontown Mall Aug ‘15 23.0 282 $26.71 84.5% 17.5%
Voorhees Town Center Sep ‘15 13.4 261 $26.33 74.3% 10.3%
Total Malls $147.3
Paxton Town Centre Jan ’13 76.8 6.9%
Commons at Magnolia Sep ’13 12.3 8.9%
Christiana Center Sep ’13 75.0 6.5%
The Gallery (50% interest) Jul ’14 106.8 5.1%
Whitehall Mall Dec ’14 20.0 7.0%
Springfield Park Jul ‘15 20.2 7.0%
Other properties Various 25.3
Grand total $483.7
DISPOSITION REVIEWOptimally timed program yields results
87
88. DISPOSITION UPDATEFinalizing transactions underway solidifies mall platform
Mall Property Status Estimated Closing
Package –Gadsden, Wiregrass, New River Valley Under Contract 1H 2016
Palmer Park Mall Non refundable deposit 1H 2016
Lycoming Mall Marketing 2H 2016
Washington Crown Center Marketing 2H 2016
88
Non-Mall Property Status Estimated Closing
1520-22 Chestnut & 1501-05 Walnut St Negotiating Contract 1H 2016
Gainesville, FL Land Parcel Under Contract 1H 2017
Estimated Gross Proceeds: $200 - $225 million
89. PROGRAM IMPLEMENTATION & SUMMARYKeys to Success
89
Assets are accessible to the buyer pool; many within a few hours from
New York City
Developed relationships with well-capitalized entrepreneurial buyers
Realistic approach to trading cap rates
90. 90
KEY CATALYSTSOur future is bright
Our move to QUALITY is pronounced and accelerating
RESULTS achieved demonstrate our success
We are experiencing a dramatic increase in new retail DEMAND
REDEVELOPMENT opportunities are realizable and impactful
Our balance sheet is STRONG and improving
92. 92
•Sales as of 9.30.14$384
•Impact of dispositions+$7 (2%)
•Store closings resulting from bankruptcy+$11 (3%)
•Organic improvement in sales performance through concerted
remerchandising efforts+$26 (7%)
•Sales psf as of 9.30.15$428
•Impact of anticipated additional asset sales [Avg Sales psf = $297]+$20 (5%)
•Sales post Dispositions$448
•Springfield Town Center [at $525 psf]
•Fashion Outlets of Philadelphia [at $650 psf]+$29 (7%)
•Projected Portfolio Sales psf upon stabilization$477
STC and Fashion Outlets of Philadelphia are assumed to stabilize in 2018 and 2019 respectively.
Assumes balance of portfolioremains static.
PATHWAY TO NOI GROWTHSales growth drives opportunity to drive rents
93. ORGANIC GROWTH LEVERSRenewal Spreads
93
12/31/15
Avg Rent
2016
Expirations
2017
Expirations
2018
Expirations
Premier $67.60 $53.69 $52.97 $57.17
Core Growth – Major
Market
$45.79 $40.05 $44.49 $42.36
Core Growth – Market
Dominant
$44.13 $43.64 $49.40 $43.38
3.8 million sf of leases expiring 2016 – 2018 represent opportunity to drive $5.0-10.0 million in
incremental revenue at estimated average 7% spread
94. ORGANIC GROWTH LEVERSConversion to Fixed CAM provides an opportunity for margin expansion
$1.5 to $2.0 million of additional contribution from tenants with Fixed CAM leases
94
95. ORGANIC GROWTH LEVERSOpportunity to grow operating margin through Fixed CAM greater in post-disposition portfolio
95
(1) Calculated as CAM revenues divided by CAM Operating Expenses excluding non-cash CAM depreciation
(2) Includes all malls owned during the periods presented excluding The Gallery and Springfield Town Center
(3) Excludes 6 malls currently marketed for sale, Fashion Outlets of Philadelphia and Springfield Town Center
96. ORGANIC GROWTH LEVERSImprove Common Area Margin
$1.0 million per annum through increased revenue and expense control.
96
Increased Revenue Opportunities
• Solar Panels
• Electric Vehicle Charging
• Vending
Improved Expense Control
• Block & Index Energy Purchasing
• Housekeeping & Maintenance
• Security
97. ORGANIC GROWTH LEVERSImprove Common Area Margin
$1.0 million per annum increases through increased revenue and expense control.
97
99. ORGANIC GROWTH LEVERSTemp-to-Perm Conversion
99
Conversion of 25% of temporary tenants generates $1.3 million in annual revenue uplift
100. ORGANIC GROWTH LEVERSNew GLA Opportunities
100
Every 50,000 sf of additional exterior GLA can add $1.5 million with typically strong
return prospects and credit tenants.
101. ORGANIC GROWTH LEVERSLease Quality – managing the details allows us to control our destiny
101
Qualitative lease terms:
-Co-tenancy Provisions
-Sales Kickout thresholds
-Tenant Credit
New Business Development
Merchandising Plans
Account management & scrutiny
-Review of opportunities
-Portfolio view of transactions
Transaction Approval
Committee
102. ORGANIC GROWTH OPPORTUNITIESSummary
102
Improved common area margin: $1 Million
Migration to fixed CAM: $1.5 – 2 Million
Occupancy gains: $1.7 – 5.1 Million
Temp-to-perm conversion: $1.25 Million
Improved renewal spreads: $5 – 10 Million
New buildable area: $1.5 Million
Quantified opportunity to drive 3%+ annual increases in Same Store NOI= $16.4 Million
103. 103
KEY CATALYSTSOur future is bright
Our move to QUALITY is pronounced and accelerating
RESULTS achieved demonstrate our success
We are experiencing a dramatic increase in new retail DEMAND
REDEVELOPMENT opportunities are realizable and impactful
Our balance sheet is STRONG and improving
107. ACTIVE REDEVELOPMENTStabilizing Springfield Town Center - Springfield, VA
94.4%
$9-10M
Total space leased committed
Incremental NOI anticipated in 2016
40,000 sf new leases being negotiated
$6M renovation currently underway at Macy’s
$505 1st Year Sales PSF
107
71% of 2016 incremental leasing revenue secured
Recently opened Dave & Buster’s in 32,000 square feet. Strong sales indicate
strength of location.
94.4%
$9-10M
40,000 sf
71%
109. ACTIVE REDEVELOPMENTFashion Outlets of Philadelphia – Philadelphia, PA
(1) JV Cost
(2) Net of Grants
109
THE MARKET:
Population
Average HHI
Average Home Value
Daytime Population
THE STORY: Spanning three city blocks, the Fashion Outlets of Philadelphia will offer a fusion
of outlet retail taking the form of luxury and moderate brands, traditional mall retail, popular
flagship retail, destination dining experiences and entertainment offerings. Opening in 2018
with bright, contemporary spaces that will welcome shoppers and reconnect to Market Street
with accessible storefronts, sidewalk cafés, a new streetscape, digital signage and graphics, all
complementing the existing office space.
PROJECT DETAILS
Cost $320- $380 million (1)
Net Cost $275-$335 million (2)
Targeted Return 8%-9%
Stabilized Year 2020
6,302,012
$86,507
$288,340
6,693,353
111. ACTIVE REDEVELOPMENTFashion Outlets of Philadelphia – Philadelphia, PA
111
Public Financing Sources & Amounts
$55 million
$58 million
$13 million
$30 million
$1.5 million
$1.0 million
Commonwealth (2)
Redevelopment Assistance Capital Program
(RACP)
Committed RACP
Pending RACP
Infrastructure Facilities Improvement
Program (IFIP)
Multimodal Transportation Fund (MTF)
Local (1)
Public Access Easement Agreement
Tax Increment Financing
TIF
TOTAL:
$158.5 million
(1) Paid over time
(2) Paid upon meeting grant requirements
112. ACTIVE REDEVELOPMENTExton Square – Phase I
112
THE MARKET:
Population
Average HHI
Average Home Value
Daytime Population
THE STORY : Located in Chester County, the wealthiest and fastest growing in PA, Exton
Square Mall sits at the heart of the area’s retail hub. Noted for its strong line-up of national
retailers in a convenient, easy-to-shop setting, the property will see an increase in traffic with
the addition of a Whole Foods Market, opening in 2017.
Additional synergy will be created on-mall with the potential addition of a first-to-market
bowling and entertainment concept in the former JCPenney anchor box.
522,688
$109,631
$369,499
544,048
PROJECT DETAILS
Cost $30-$33 million
Targeted Return 9%-10%
Stabilized Year 2018
115. ACTIVE REDEVELOPMENTPlymouth Meeting Mall – Plymouth Meeting, PA
115
THE MARKET:
Population
Average HHI
Daytime Population
THE STORY: Capitalizing on the over 90 million cars passing the center every year and
expanding the mall’s trade area to a 2-hour drive time, Plymouth Meeting will become a true
destination for visitors.
The the addition of Legoland Discovery Center will complement an already unique experience
that combines great shopping with destination entertainment, high quality dining and a
gourmet grocer. This addition is expected to act as a catalyst for an interior mall
remerchandising.
1,008,315
$92,967
1,116,568
PROJECT DETAILS
Cost $6.6 - $7.3 million
Targeted Return 8%-9%
Stabilized Year 2018
118. ACTIVE REDEVELOPMENTCumberland Mall – Vineland, NJ
118
THE MARKET:
Population
Average HHI
Daytime Population
THE STORY: The spring 2015 closure of JCPenney presented the opportunity to upgrade
Cumberland Mall. The former anchor box sits at the most visible corner of the property and
immediately attracted the attention of retailers looking to relocate to mall. In December
2015, a lease was signed with Dick’s Sporting Goods who will open a 50,000 sf store in early
2017. As the only Dick’s Sporting Goods for over 20 miles, the store will drive incremental
traffic to the center and solidify its position in the market.
920,251
$79,272
881,662
PROJECT DETAILS
Cost $7.45 - $8.25 million
Targeted Return 10% - 11%
Stabilized Year 2017
120. ACTIVE REDEVELOPMENTMall at Prince Georges – Hyattsville, MD
120
THE MARKET:
Population
Average HHI
Daytime Population
THE STORY Just 2 miles from the University of Maryland and minutes from Washington DC, the
Mall at Prince Georges’ position in the market is strengthened by the sheer volume of
development immediately surrounding the property – over $1 billion in recent development
has occurred in the trade area. A remerchandising program, highlighted by the recent H&M
transaction , will attract the high-income, fashion-oriented customers that have flocked to the
area.
Additional opportunities to add fast casual restaurants along the exterior of the mall will add
to the density of the property and increase mall traffic.
1,514,259
$86,108
1,516,634
PROJECT DETAILS
Cost $22.4 - $27 million
Targeted Return 8%-9%
Stabilized Year 2018
121. ACTIVE REDEVELOPMENTMall at Prince Georges – Hyattsville, MD
121
1. Belcrest Plaza: 25 acre redevelopment, 2,675
residential units, multi family/town homes;
2. 3350 at Alterra 283 multi-family units
3. Post Park: $87M mixed use project. 396 high-end
apartment homes
4. Kiplinger Property: $73M, 452-unit with 34,200 sf of
retail space.
5. The Gateway at University Town Center: $7M addition
completed in 2015.
6. Mosaic at Metro: 260 luxury apartments
7. College Park Place: $20M, 156-room Courtyard by
Marriot, with retail and apartments
8. University of Maryland Conference Hotel: $150M
facility with 300 hotel rooms and 43,000 SF of
conference space.
9. Terrapin Row: $8M student housing complex with
1,575+ beds.
10. Landmark College Park: Student housing with 850
beds and
11. The Reserve at College Heights: Single-family luxury
homes.
12. M-Square: Largest research park in MD ($500M+
invested). 6,500+ employees.
13. Riverdale Park Station: $250M mixed-use project
including county’s first Whole Foods.
14. Arts District at Hyattsville: $213M, award-winning
mixed use
124. Cost
(in millions)
Targeted
Return
Stabilized Year
Fashion Outlets of Philadelphia $160-$190(1) 8% - 9% 2020
Exton Square Mall $30-$33 9% - 10% 2018
Plymouth Meeting Mall $6.6 - $7.3 8% - 9% 2018
Cumberland Mall $7.45 - $8.25 10% -11% 2017
Mall at Prince Georges $24.4 - $27.0 8% - 9% 2018
ACTIVE REDEVLOPMENT PROJECTSSummary
124
(1) PREIT Share of Cost
125. 125
KEY CATALYSTSOur future is bright
Our move to QUALITY is pronounced and accelerating
RESULTS achieved demonstrate our success
We are experiencing a dramatic increase in new retail DEMAND
REDEVELOPMENT opportunities are realizable and impactful
Our balance sheet is STRONG and improving
128. 128
CAPITALALLOCATION PROTOCOLCareful, measured approach
Priority given to A malls and high-quality B’s that are cap rate transformative
Limit number and scope of projects being pursued at any given point
Priority given to value enhancing (offensive) projects vs. maintaining (defensive)
Timing of outlay & balance sheet impact modeled to ensure internal targets are
achieved
Predevelopment costs capped
Targeted returns of 200-300 bps over trading cap rate
Minimum leasing thresholds required before commitment is finalized
129. 64.1% 50.4% <48% 46.5%
8.9x 8.0x <7.5x 7.1x
$267 $286 >$250 $258
129
9/30/12 12/31/15 (E)
Post-
Redevelopment
Bank Leverage
Debt/EBITDA
Liquidity (in millions)
Year End 2018
Target
BALANCE SHEET TARGETS3 Year Investment Horizon
133. IMPROVING LIQUIDITYAmended Revolving Facility
LEAD Wells Fargo Bank NA
SIZE $400 million
ACCORDIAN $200 million
PRICING 120 – 155 bps over LIBOR
MATURITY 2018; with options to 2020
AVAILABILTY 11% debt yield on unencumbered pool NOI
133
MATURITY
AVAILABILITY
LEAD
SIZE
PRICING
ACCORDIAN
136. CAPITAL PLAN3 Year Investment Horizon
136
(1) Liabilities-to-GAV per bank credit facility (after adjustment for STC valuation)
(2) Total Debt exc. Cash/Trailing 4Q EBITDA
(3) Credit facility availability less LOC plus available cash (after payoff of $79M loan on Valley Mall Q1 16)
50.4% 8.0x $286
3.0%/yr (280 bps) (.6x) $19
$200-$225M (80 bps) (.1x) $140
$145-$155M (210 bps) (.3x) $66
$250-$300M 640 bps 1.1x ($275)
~8.25% return (320 bps) (.7x) $22
$20M/yr (140 bps) (.3x) -
46.5% 7.1x $258
<48% <7.5x >$250
Bank Leverage (1) Debt/EBITDA (2) Liquidity
(in millions) (3)
12/31/15 (E)
Target
Baseline NOI Growth
Sale of JV Power Centers
Redevelopment Capital
Redevelopment NOI
Debt Amortization
Post-Redevelopment
Sale of Marketed Assets
Estimate
137. SOURCES & USES OF CAPITALPreliminary View
137
(1) Assumes that FFO is sufficient to cover dividends, recurring capital expenditures, normal tenant allowances and principal payments on debt.
Sources 2016 2017 2018
FFO(1)
--- --- ---
Proceeds from asset sales ($345-$380M) $ 325 $ 20 n/a
Proceeds from mortgage loans 160 190 n/a
Other loan (at ownership share) 25 25 n/a
Total sources $510 $235 $ --
Uses
Mortgage loan repayments (220) (218) ---
Mortgages repaid from sale proceeds / assumed (142) --- ---
Redevelopment CapEx ($250-$300M) (125) (110) (65)
Total uses (487) (328) (65)
Net source (use) $ 23 $(93) $(65)
138. BALANCE SHEET PILLARSFocus on continued improvement
138
We will continue to reduce leverage through asset sales and NOI growth
We have ample liquidity to complete projects underway and protect us in
the event of a downturn
Our debt maturity schedule protects us from any disruption in credit markets
We have limited exposure to variable interest rates
140. 2016 OUTLOOKFocus on continued improvement
140
• Targeted same store NOI growth of 3%
• 80 -100bps increase in same store non-anchor occupancy
• All anchor replacements accounted
• Gallery / FOP redevelopment begins
Material Operating
Assumptions
• Six malls and street retail properties sold mid-year
• Power Center portfolio sold at the end of 2016
• Land parcel sold in 2017
• Annualized dilution from assumed mall and street retail
dispositions is $0.25 per share; 2016 impact is approx.
$0.12 to $0.13 per share.
Asset Disposition
Assumptions
• Addresses upcoming mortgage maturities
• Refinance mortgage at Woodland Mall; repay Valley
loan
• Finalize EB-5 loan for FOP
• Use proceeds from asset sales & borrowings to fund
redevelopment expenditures
Capital Plan
• None PlannedAsset Acquisitions
141. 2016-2018 CAPITAL SPENDINGFocus on continued improvement
141
Redevelopment CAPEX:
$250 -$300 million over
3 years
• Fashion Outlets of Philadelphia - $150 million
• Exton Square - Whole Foods & JCPenney
replacement - $32 million
• Mall at Prince Georges - $25 million
• Other projects, anchor replacements and
catalyst tenants such as LEGOLAND and H&M -
$45 to $95
142. 2016-2018 CAPITAL OUTLAYSIncludes redevelopment and recurring capital expenditures
$250 to $300 million of redevelopment capital spending over the next three years
142
143. In millions, except per share amounts 2016 Guidance
NOI from 2016 Same Store Properties (1) $ 231-233
NOI from properties for sale (2) 20-22
NOI from Springfield Town Center and Gloucester 22-24
NOI from Fashion Outlets of Philadelphia 4
Total NOI $ 277 - $283
Other revenues/expenses, net (33-34)
Interest expense (84-85)
Preferred dividends (16)
FFO $ 143 - $149
FFO/share $1.83 - $1.91
Wtd average shares & equivalents 78
2016 EARNINGS GUIDANCEPreliminary View
143
(1) Includes 23 malls identified in premier, core growth – major markets, core growth – market dominant categories
(2) Includes 6 non-core malls, 2 street-level properties and our interest in 3 power centers
144. In millions, except per share amounts 2016 Guidance
FFO $ 143 - $149
Depreciation and amortization (139 – 142)
Non-controlling interest (2-3)
Net income allocable to common shareholders $ 2 - $4
Net income per share $0.03 - $0.06
Weighted average shares and equivalents 69
RECONCILIATION TO GAAP EARNINGSPreliminary View
144
147. FUTURE GROWTH OPPORTUNITIESCherry Hill Mall - Fashion Anchor Addition
147
Remerchandising of existing
anchor with fashion department
store
Addition of new upscale fashion anchors along with the repurposing of One Cherry
Hill office building
148. FUTURE GROWTH OPPORTUNITIESExton Square Mall Phase II
148
Additional retail and restaurant development and interior remerchandising
149. FUTURE GROWTH OPPORTUNITIESSpringfield Town Center Peripheral Land
149
Development of 3 million sf of entitled peripheral land with office, multi-family, hotel
and additional retail
150. FUTURE GROWTH OPPORTUNITIESFashion Outlets of Philadelphia Overbuild
150
Vertical development at site with the addition of hotel, multi-family and/or office
151. FUTURE GROWTH OPPORTUNITIESWoodland Mall Redevelopment
151
Fashion anchor addition along with new GLA for restaurants and exterior facing retail
152. FUTURE GROWTH OPPORTUNITIESPlymouth Meeting Mall Master Plan
152
Development of PA Turnpike and former office parcel into hotel and potential flagship
office space
153. 153
KEY CATALYSTSOur future is bright
Our move to QUALITY is pronounced and accelerating
RESULTS achieved demonstrate our success
We are experiencing a dramatic increase in new retail DEMAND
REDEVELOPMENT opportunities are realizable and impactful
Our balance sheet is STRONG and improving
