Exhibit 99.1

Pennsylvania Real Estate Investment Trust

Supplemental Financial and Operating Information

Quarter Ended September 30, 2006

www.preit.com

NYSE common shares (PEI)

NYSE preferred shares (PEIPRA)

Pennsylvania Real Estate Investment Trust

Supplemental Financial and Operating Information

Table of Contents

Introduction
Company Information	3
Recent Developments	4
Market Capitalization and Capital Resources	5
Operating Results
Income Statement-Proportionate Consolidation Method-Three Months Ended September 30, 2006 and September 30, 2005	6
Income Statement-Proportionate Consolidation Method-Nine Months Ended September 30, 2006 and September 30, 2005	7
Net Operating Income-Three Months Ended September 30, 2006 and September 30, 2005	8
Net Operating Income-Nine Months Ended September 30, 2006 and September 30, 2005	9
Computation of Earnings per Share	10
Funds From Operations and Funds Available for Distribution	11
Operating Statistics
Summary of Executed Leases	12
Summarized Rent Per Square Foot and Occupancy Percentages	13
Mall Sales and Rents Per Square Foot	14
Mall Occupancy	15
Power Center and Strip Center Rents Per Square Foot and Occupancy Percentages	16
Top Twenty Tenants	17
Lease Expirations	18
Gross Leasable Area Summary	19
Property Information	20
Balance Sheet
Balance Sheet-Proportionate Consolidation Method	23
Balance Sheet-Property Type	24
Investment in Real Estate	25
Property Redevelopment and Repositioning Summary	27
Development Property Summary	28
Capital Expenditures	29
Debt Analysis	30
Debt Schedule	31
Shareholder Information	32
Definitions	33

FORWARD-LOOKING STATEMENTS

This Quarterly Supplemental Financial and Operating Information contains certain “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. 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 PREIT’s current views about future events 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. More specifically, PREIT’s business might be affected by uncertainties affecting real estate businesses generally as well as the following, among other factors: general economic, financial and political conditions, including changes in interest rates or the possibility of war or terrorist attacks; changes in local market conditions or other competitive or retail industry factors in the regions where our properties are concentrated; PREIT’s ability to maintain and increase property occupancy and rental rates, and risks relating to development or redevelopment activities, including construction, obtaining entitlements and managing multiple projects simultaneously. In particular, the successful development or redevelopment of any property is subject to a number of risks, including, among others, that PREIT’s development or redevelopment plans might change, its development or redevelopment activities might be delayed and anticipated project costs might increase. Unanticipated expenses or delays would also adversely affect PREIT’s investment returns on a development or redevelopment project. Additionally, there can be no assurance that PREIT’s actual results will not differ significantly from the estimates set forth above, or that PREIT’s returns on its developments, redevelopments or acquisitions will be consistent with the estimates outlined in the related press releases or other disclosures. Investors are also directed to consider the risks and uncertainties discussed in documents PREIT has filed with the Securities and Exchange Commission and, in particular, PREIT's Annual Report on Form 10-K for the year ended December 31, 2005. PREIT does not intend to update or revise any forward-looking statements to reflect new information, future events or otherwise.

Pennsylvania Real Estate Investment Trust

Company Information

Background

Pennsylvania Real Estate Investment Trust (“PREIT”), founded in 1960 and one of the first equity REITs in the U.S., has a primary investment focus on retail shopping malls and power centers located in the Mid-Atlantic region and eastern United States. As of September 30, 2006, PREIT’s portfolio consists of 50 retail properties (approximately 34.6 million square feet) in 13 states, including 39 shopping malls, and 11 power and strip centers and 1 office property.

Investors Relations

If you would like to participate in our quarterly conference call or would like additional information about PREIT, please contact:

Nurit Yaron, Vice President - Investor Relations

200 South Broad Street

Philadelphia, PA 19102

Telephone: (215) 875-0735

Fax: (215) 546-7311

Email: yaronn@preit.com

Credit Ratings

Preferred stock

Moody’s	B1	(Stable)
Fitch	B+	(Positive)

Reporting Calendar

Results for the next quarter will be announced as follows (tentative date):

Fourth Quarter 2006 March 1, 2007

Research Coverage

Company	Analyst	Phone Number
Green Street Advisors	Jim Sullivan	(949) 640-8780
	Ben Yang	(949) 640-8780
JP Morgan	Michael W. Mueller	(212) 622-6689
	Anthony Paolone	(212) 622-6682
Lehman Brothers	David Harris	(212) 526-1790
Stifel Nicolaus	David M. Fick	(410) 539-0000
	Nathan Isbee	(410) 454-4143
UBS Securities	Scott Crowe	(212) 713-1419
	Jeffrey Spector	(212) 713-6144

Page 3

Pennsylvania Real Estate Investment Trust

Recent Developments

Dividends and Distributions:

October 30, 2006 PREIT announced the Board of Trustees of the Company declared a quarterly cash dividend of $0.57 per common share and a regular dividend of $1.375 per share on its 11.00% senior preferred shares.

September 15, 2006 Dividends were paid per the July 31, 2006 declaration to all shareholders of record as of September 1, 2006.

July 31, 2006 PREIT announced the Board of Trustees of the Company declared a quarterly cash dividend of $0.57 per common share and a regular dividend of $1.375 per share on its 11% senior preferred shares.

Acquisitions, dispositions, development and redevelopment activities:

October 25, 2006 PREIT and Simon Property Group, Inc, announced an addition of an approximately 110,000 square foot lifestyle expansion to Lehigh Valley Mall in Whitehall, Pennsylvania.

September 13, 2006 PREIT announced the details of a major redevelopment for Cherry Hill Mall in Cherry Hill, NJ, including the scheduled opening of a new Nordstrom store in spring 2009.

Financing activities:

July 8, 2006 The operating partnership which owns Lehigh Valley Mall in Whitehall, Pennsylvania, entered into a $150.0 million mortgage secured by Lehigh Valley Mall. The interest rate is the one month LIBOR rate, reset monthly, plus a spread of 56 basis points. The loan has an initial term of 12 months, during which interest only payments are required.

Reporting activities:

October 17, 2006 PREIT scheduled its Third Quarter conference call of Thursday, November 2, 2006.

July 27, 2006 PREIT reported its Second Quarter 2006 financial results.

NOTE: These press releases are available on the Company’s website at www.preit.com.

Page 4

Pennsylvania Real Estate Investment Trust

Market Capitalization and Capital Resources

	Quarter Ended September 30,						Year Ended December 31,
	2006			2005			2005			2004			2003
TRADING INFORMATION (NYSE)
High Price	$	43.41		$	50.20		$	50.20		$	43.70		$	36.30
Low Price	$	37.30		$	39.60		$	35.24		$	30.25		$	24.70
Average Daily Trading Volume		171,849			165,764			209,537			161,659			109,892
MARKET CAPITALIZATION (in thousands, except per share amounts)
EQUITY CAPITALIZATION
Common Shares Outstanding		36,865			36,714			36,521			36,272			35,544
OP Units Outstanding		3,959			4,500			4,156			4,414			3,692
TOTAL Shares and OP Units		40,824			41,214			40,677			40,686			39,236
Market Price (closing price at end of period)	$	42.57		$	42.18		$	37.36		$	42.80		$	36.30
Equity Market Capitalization - Shares and OP Units	$	1,736,920		$	1,738,418		$	1,519,679		$	1,741,349		$	1,424,259
Preferred Shares, Nominal Value		123,750			123,750			123,750			123,750			123,750
Total Equity Market Capitalization		1,860,670			1,862,168			1,643,429			1,865,099			1,548,009
DEBT CAPITALIZATION
Unsecured Debt Balance (1)		277,000			276,000			436,900			271,000			170,000
Secured Debt Balance		1,798,976			1,442,536			1,523,745			1,326,127			1,396,263
Debt Capitalization		2,075,976			1,718,536			1,960,645			1,597,127			1,566,263
TOTAL MARKET CAPITALIZATION	$	3,936,646		$	3,580,704		$	3,604,074		$	3,462,226		$	3,114,272
Preferred Shares/Total Market Capitalization		3.1	%		3.5	%		3.4	%		3.6	%		4.0	%
Shares and OP Units/Total Market Capitalization		44.1	%		48.5	%		42.2	%		50.3	%		45.7	%
Debt Capitalization/Total Market Capitalization		52.7	%		48.0	%		54.4	%		46.1	%		50.3	%
Equity Capitalization/Total Market Capitalization		47.3	%		52.0	%		45.6	%		53.9	%		49.7	%
Unsecured Debt Balance/Total Debt		13.3	%		16.1	%		22.3	%		17.0	%		10.9	%
DISTRIBUTIONS PER COMMON SHARE
Ordinary Income		(2	)	$	0.526		$	2.075		$	1.617		$	1.196
Capital Gain Pre-May 6		(2	)		—			—			—			0.096
Capital Gain Post-May 5		(2	)		—			—			—			0.213
Section 1250 Gain		(2	)		—			—			0.026			0.480
Return of Capital/Non-Taxable		(2	)		0.044			0.175			0.517			0.085
Distributions per share	$	0.570		$	0.570		$	2.250		$	2.160		$	2.070
Annualized Dividend Yield (3)		5.4	%		5.4	%		6.0	%		5.0	%		5.7	%
CAPITAL RESOURCES
Cash on Hand	$	21,457		$	32,013		$	25,828		$	45,949		$	46,883
Credit Facility (4)		500,000			500,000			500,000			500,000			500,000
Amount outstanding		(277,000	)		(276,000	)		(342,500	)		(271,000	)		(170,000	)
Letters of Credit		(24,083	)		(13,335	)		(10,485	)		(8,055	)		(500	)
Available Credit Facility (5)		198,917			210,665			147,015			220,945			329,500
Shelf Registration		1,000,000			1,000,000			1,000,000			1,000,000			1,000,000
Amount Used		(344,146	)		(344,146	)		(344,146	)		(344,146	)		(344,146	)
Available Shelf		655,854			655,854			655,854			655,854			655,854
TOTAL CAPITAL RESOURCES	$	876,228		$	898,532		$	828,697		$	922,748		$	1,032,237

⁽¹⁾ The unsecured debt balance as of December 31, 2005 includes $94,400 of corporate notes payable.

⁽²⁾ Tax status of 2006 dividend payments will be available in January 2007.

⁽³⁾ Based on closing share price at the end of the period.

⁽⁴⁾ The unsecured Credit Facility may be increased to $650,000 under prescribed conditions.

⁽⁵⁾ The available Credit Facility is subject to covenants that may restrict amounts that can be borrowed.

Page 5

Pennsylvania Real Estate Investment Trust

Income Statement - Three Months Ended September 30, 2006

Proportionate Consolidation Method ⁽¹⁾

(in thousands)

	Three months ended September 30, 2006												Three months ended September 30, 2005
	GAAP			Share of unconsolidated partnerships (1)			Discontinued operations			Total			GAAP			Share of unconsolidated partnerships(1)			Discontinued operations			Total
Real estate revenues:
Base rent	$	71,353		$	5,926		$	200		$	77,479		$	67,729		$	4,831		$	566		$	73,126
Expense reimbursements		34,394			1,934			66			36,394			32,299			1,421			122			33,842
Percentage rent		1,438			52			—			1,490			1,455			35			(36	)		1,454
Lease termination revenue		439			145			—			584			176			376			—			552
Other real estate revenues		4,503			207			—			4,710			3,275			163			—			3,438
TOTAL REAL ESTATE REVENUES		112,127			8,264			266			120,657			104,934			6,826			652			112,412
Property operating expenses:
CAM and real estate taxes		(31,842	)		(1,562	)		(62	)		(33,466	)		(28,734	)		(1,431	)		(176	)		(30,341	)
Utilities		(7,137	)		(225	)		(1	)		(7,363	)		(6,897	)		(102	)		(14	)		(7,013	)
Other property operating expenses		(6,748	)		(506	)		(69	)		(7,323	)		(5,898	)		(424	)		(12	)		(6,334	)
TOTAL PROPERTY OPERATING EXPENSES		(45,727	)		(2,293	)		(132	)		(48,152	)		(41,529	)		(1,957	)		(202	)		(43,688	)
NET OPERATING INCOME		66,400			5,971			134			72,505			63,405			4,869			450			68,724
Management company revenue		666			—			—			666			521			—			—			521
Interest and other income		566			—			—			566			293			—			—			293
Other:
General and administrative expenses		(9,668	)		—			—			(9,668	)		(8,412	)		—			—			(8,412	)
Income taxes		(142	)		—			—			(142	)		(78	)		—			—			(78	)
Interest expense (2)		(24,341	)		(3,248	)		—			(27,589	)		(21,056	)		(1,958	)		—			(23,014	)
Prepayment penalty		—			—			—			—			(803	)		—			—			(803	)
Depreciation and amortization		(31,118	)		(1,679	)		(41	)		(32,838	)		(27,550	)		(1,103	)		(178	)		(28,831	)
Subtotal		2,363			1,044			93			3,500			6,320			1,808			272			8,400
Equity in income of partnerships		1,044			(1,044	)		—			—			1,808			(1,808	)		—			—
Gains on sales of interests in real estate		—			—			—			—			5,024			—			—			5,024
Gains on sales of non-operating real estate		166			—			—			166			3,000			—			—			3,000
Minority interest		(384	)		—			—			(384	)		(1,818	)		—			—			(1,818	)
TOTAL CONTINUING OPERATIONS		3,189			—			93			3,282			14,334			—			272			14,606
Discontinued Operations:
Operating results from discontinued operations		93			—			(93	)		—			272			—			(272	)		—
Gains on sales of discontinued operations		1,414			—			—			1,414			3,736			—			—			3,736
Minority interest		(152	)		—			—			(152	)		(447	)		—			—			(447	)
TOTAL DISCONTINUED OPERATIONS		1,355			—			(93	)		1,262			3,561			—			(272	)		3,289
NET INCOME		4,544			—			—			4,544			17,895			—			—			17,895
Dividends on preferred shares		(3,403	)		—			—			(3,403	)		(3,403	)		—			—			(3,403	)
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS	$	1,141		$	—		$	—		$	1,141		$	14,492		$	—		$	—		$	14,492

⁽¹⁾ Totals include PREIT’s proportionate share of partnership operations in order to reflect the Company’s share of the total revenues and expenses of the underlying properties.

⁽²⁾ Net of capitalized interest expense of $2,799 and $795 for the three months ended September 30, 2006 and September 30, 2005, respectively.

Page 6

Pennsylvania Real Estate Investment Trust

Income Statement - Nine Months Ended September 30, 2006

Proportionate Consolidation Method ⁽¹⁾

(in thousands)

	Nine months ended September 30, 2006												Nine months ended September 30, 2005
	GAAP			Share of unconsolidated partnerships (1)			Discontinued operations			Total			GAAP			Share of unconsolidated partnerships(1)			Discontinued operations			Total
Real estate revenues:
Base rent	$	213,064		$	17,634		$	625		$	231,323		$	200,717		$	15,250		$	1,925		$	217,892
Expense reimbursements		100,973			5,852			139			106,964			93,614			4,725			445			98,784
Percentage rent		5,202			121			—			5,323			5,959			96			14			6,069
Lease termination revenue		2,583			263			152			2,998			1,265			548			933			2,746
Other real estate revenues		12,491			617			—			13,108			9,393			401			1			9,795
TOTAL REAL ESTATE REVENUES		334,313			24,487			916			359,716			310,948			21,020			3,318			335,286
Property operating expenses:
CAM and real estate taxes		(93,753	)		(4,781	)		(181	)		(98,715	)		(85,094	)		(4,513	)		(587	)		(90,194	)
Utilities		(18,734	)		(658	)		(4	)		(19,396	)		(18,093	)		(317	)		(31	)		(18,441	)
Other property operating expenses		(19,200	)		(1,635	)		(60	)		(20,895	)		(16,286	)		(1,441	)		(89	)		(17,816	)
TOTAL PROPERTY OPERATING EXPENSES		(131,687	)		(7,074	)		(245	)		(139,006	)		(119,473	)		(6,271	)		(707	)		(126,451	)
NET OPERATING INCOME		202,626			17,413			671			220,710			191,475			14,749			2,611			208,835
Management company revenue		2,324			—			—			2,324			2,043			—			—			2,043
Interest and other income		1,452			—			—			1,452			738			—			—			738
Other:
General and administrative expenses		(30,187	)		—			—			(30,187	)		(27,833	)		—			—			(27,833	)
Executive separation		(3,985	)		—			—			(3,985	)		—			—			—			—
Income taxes		(383	)		—			—			(383	)		(519	)		—			—			(519	)
Interest expense (2)		(73,234	)		(8,083	)		—			(81,317	)		(61,118	)		(6,036	)		—			(67,154	)
Prepayment penalty		—			—			—			—			(803	)		—			—			(803	)
Depreciation and amortization		(94,839	)		(5,255	)		(144	)		(100,238	)		(80,801	)		(3,287	)		(523	)		(84,611	)
Subtotal		3,774			4,075			527			8,376			23,182			5,426			2,088			30,696
Equity in income of partnerships		4,075			(4,075	)		—			—			5,426			(5,426	)		—			—
Gains on sales of interests in real estate		—			—			—			—			5,661			—			—			5,661
Gains on sales of non-operating real estate		381			—			—			381			3,060			—			—			3,060
Minority interest		(927	)		—			—			(927	)		(4,308	)		—			—			(4,308	)
TOTAL CONTINUING OPERATIONS		7,303			—			527			7,830			33,021			—			2,088			35,109
Discontinued Operations:
Operating results from discontinued operations		527			—			(527	)		—			2,088			—			(2,088	)		—
Gains on sales of discontinued operations		1,414			—			—			1,414			3,736			—			—			3,736
Minority interest		(196	)		—			—			(196	)		(655	)		—			—			(655	)
TOTAL DISCONTINUED OPERATIONS		1,745			—			(527	)		1,218			5,169			—			(2,088	)		3,081
NET INCOME		9,048			—			—			9,048			38,190			—			—			38,190
Dividends on preferred shares		(10,209	)		—			—			(10,209	)		(10,209	)		—			—			(10,209	)
NET INCOME AVAILABLE (LOSS ALLOCABLE) TO COMMON SHAREHOLDERS	$	(1,161	)	$	—		$	—		$	(1,161	)	$	27,981		$	—		$	—		$	27,981

⁽¹⁾ Totals include PREIT’s proportionate share of partnership operations in order to reflect the Company’s share of the total revenues and expenses of the underlying properties.

⁽²⁾ Net of capitalized interest expense of $6,154 and $1,690 for the nine months ended September 30, 2006 and September 30, 2005, respectively.

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Pennsylvania Real Estate Investment Trust

Net Operating Income⁽¹⁾ - Three Months Ended September 30, 2006

(in thousands)

	Three months ended September 30, 2006												Three months ended September 30, 2005
SAME PROPERTY/NEW/OTHER	Same			New			Other			Total			Same			New			Other			Total
Real estate revenues:
Base rent	$	72,963		$	4,471		$	45		$	77,479		$	72,473		$	571		$	82		$	73,126
Expense reimbursements		33,472			2,922			—			36,394			33,724			116			2			33,842
Percentage rent		1,487			3			—			1,490			1,499			(45	)		—			1,454
Lease termination revenue		440			144			—			584			552			—			—			552
Other real estate revenues		4,440			269			1			4,710			3,436			2			—			3,438
TOTAL REAL ESTATE REVENUES		112,802			7,809			46			120,657			111,684			644			84			112,412
Property operating expenses:
CAM and real estate taxes		(31,055	)		(2,405	)		(6	)		(33,466	)		(30,123	)		(210	)		(8	)		(30,341	)
Utilities		(7,034	)		(330	)		1			(7,363	)		(6,999	)		(14	)		—			(7,013	)
Other property operating expenses		(6,800	)		(522	)		(1	)		(7,323	)		(6,336	)		4			(2	)		(6,334	)
TOTAL PROPERTY OPERATING EXPENSES		(44,889	)		(3,257	)		(6	)		(48,152	)		(43,458	)		(220	)		(10	)		(43,688	)
NET OPERATING INCOME	$	67,913		$	4,552		$	40		$	72,505		$	68,226		$	424		$	74		$	68,724

	Three months ended September 30, 2006									Three months ended September 30, 2005
RETAIL SAME PROPERTY COMPARISON	Malls			Power and Strip Centers			Total			Malls			Power and Strip Centers			Total
Real estate revenues:
Base rent	$	65,465		$	7,498		$	72,963		$	65,106		$	7,367		$	72,473
Expense reimbursements		31,879			1,593			33,472			32,189			1,535			33,724
Percentage rent		1,442			45			1,487			1,451			48			1,499
Lease termination revenue		440			—			440			177			375			552
Other real estate revenues		4,385			55			4,440			3,367			69			3,436
TOTAL REAL ESTATE REVENUES		103,611			9,191			112,802			102,290			9,394			111,684
Property operating expenses:
CAM and real estate taxes		(29,513	)		(1,542	)		(31,055	)		(28,447	)		(1,676	)		(30,123	)
Utilities		(6,987	)		(47	)		(7,034	)		(6,960	)		(39	)		(6,999	)
Other property operating expenses		(6,695	)		(105	)		(6,800	)		(6,159	)		(177	)		(6,336	)
TOTAL PROPERTY OPERATING EXPENSES		(43,195	)		(1,694	)		(44,889	)		(41,566	)		(1,892	)		(43,458	)
NET OPERATING INCOME	$	60,416		$	7,497		$	67,913		$	60,724		$	7,502		$	68,226

⁽¹⁾ Totals include PREIT’s proportionate share of partnership operations in order to reflect the Company’s share of the total revenues and expenses of the underlying properties.

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Pennsylvania Real Estate Investment Trust

Net Operating Income⁽¹⁾ - Nine Months Ended September 30, 2006

(in thousands)

	Nine months ended September 30, 2006												Nine months ended September 30, 2005
SAME PROPERTY/NEW/OTHER	Same			New			Other			Total			Same			New			Other			Total
Real estate revenues:
Base rent	$	209,278		$	21,907		$	138		$	231,323		$	208,185		$	9,364		$	343		$	217,892
Expense reimbursements		94,567			12,397			—			106,964			94,737			4,020			27			98,784
Percentage rent		5,006			317			—			5,323			5,817			253			(1	)		6,069
Lease termination revenue		2,620			379			(1	)		2,998			1,801			945			—			2,746
Other real estate revenues		12,169			939			—			13,108			9,472			323			—			9,795
TOTAL REAL ESTATE REVENUES		323,640			35,939			137			359,716			320,012			14,905			369			335,286
Property operating expenses:
CAM and real estate taxes		(87,889	)		(10,812	)		(14	)		(98,715	)		(86,004	)		(4,153	)		(37	)		(90,194	)
Utilities		(17,715	)		(1,681	)		—			(19,396	)		(17,849	)		(592	)		—			(18,441	)
Other property operating expenses		(19,078	)		(1,815	)		(2	)		(20,895	)		(16,981	)		(828	)		(7	)		(17,816	)
TOTAL PROPERTY OPERATING EXPENSES		(124,682	)		(14,308	)		(16	)		(139,006	)		(120,834	)		(5,573	)		(44	)		(126,451	)
NET OPERATING INCOME	$	198,958		$	21,631		$	121		$	220,710		$	199,178		$	9,332		$	325		$	208,835

	Nine months ended September 30, 2006									Nine months ended September 30, 2005
RETAIL SAME PROPERTY COMPARISON	Malls			Power and Strip Centers			Total			Malls			Power and Strip Centers			Total
Real estate revenues:
Base rent	$	186,971		$	22,307		$	209,278		$	185,859		$	22,326		$	208,185
Expense reimbursements		89,769			4,798			94,567			89,915			4,822			94,737
Percentage rent		4,916			90			5,006			5,703			114			5,817
Lease termination revenue		2,863			2			2,865			1,248			553			1,801
Other real estate revenues		11,762			162			11,924			9,306			166			9,472
TOTAL REAL ESTATE REVENUES		296,281			27,359			323,640			292,031			27,981			320,012
Property operating expenses:
CAM and real estate taxes		(83,150	)		(4,739	)		(87,889	)		(81,068	)		(4,936	)		(86,004	)
Utilities		(17,589	)		(127	)		(17,716	)		(17,731	)		(118	)		(17,849	)
Other property operating expenses		(18,589	)		(488	)		(19,077	)		(16,332	)		(649	)		(16,981	)
TOTAL PROPERTY OPERATING EXPENSES		(119,328	)		(5,354	)		(124,682	)		(115,131	)		(5,703	)		(120,834	)
NET OPERATING INCOME	$	176,953		$	22,005		$	198,958		$	176,900		$	22,278		$	199,178

⁽¹⁾ Totals include PREIT’s proportionate share of partnership operations in order to reflect the Company’s share of the total revenues and expenses of the underlying properties.

Page 9

Pennsylvania Real Estate Investment Trust

Computation of

Earnings (Loss) Per Share

(in thousands, except per share amounts)

	Three months ended September 30,						Nine months ended September 30,
	2006			2005			2006			2005
Income from continuing operations	$	3,189		$	14,334		$	7,303		$	33,021
Dividends on preferred shares		(3,403	)		(3,403	)		(10,209	)		(10,209	)
Income (loss allocable) from continuing operations available to common shareholders		(214	)		10,931			(2,906	)		22,812
Dividends on unvested restricted shares		(247	)		(265	)		(796	)		(770	)
Income/(loss) from continuing operations used to calculate earnings per share - basic		(461	)		10,666			(3,702	)		22,042
Minority interest in properties-continuing operations		—			42			—			127
Income/(loss) from continuing operations used to calculate earnings per share - diluted	$	(461	)	$	10,708		$	(3,702	)	$	22,169
Income from discontinued operations	$	1,355		$	3,561		$	1,745		$	5,169
Basic earnings per share:
Income/(loss) from continuing operations	$	(0.01	)	$	0.29		$	(0.10	)	$	0.61
Income from discontinued operations		0.03			0.10			0.05			0.14
	$	0.02		$	0.39		$	(0.05	)	$	0.75
Diluted earnings per share:
Income/(loss) from continuing operations	$	(0.01	)	$	0.29		$	(0.10	)	$	0.60
Income from discontinued operations		0.03			0.10			0.05			0.14
	$	0.02		$	0.39		$	(0.05	)	$	0.74
Weighted average of common shares outstanding		36,721			36,609			36,646			36,490
Weighted average of unvested restricted stock		(439	)		(460	)		(457	)		(441	)
Weighted average shares outstanding - basic		36,282			36,149			36,189			36,049
Weighted average effect of common share equivalents (1)		—			697			—			675
Total weighted average shares outstanding-diluted		36,282			36,846			36,189			36,724

⁽¹⁾ Effect of common share equivalents are anti-dilutive due to the loss from continuing operations allocable to common shareholders for the three and nine months ended September 30, 2006, and therefore the effect of common share equivalents is not included for the calculation of diluted EPS.

Page 10

Pennsylvania Real Estate Investment Trust

Funds From Operations and Funds Available for Distribution

(in thousands, except per share amounts)

	Three months ended September 30,						Nine months ended September 30,						Year Ended December 31,
	2006			2005(1)			2006			2005(1)			2005(1)
FUNDS FROM OPERATIONS (FFO)
Net income	$	4,544		$	17,895		$	9,048		$	38,190		$	57,629
Dividends on preferred shares		(3,403	)		(3,403	)		(10,209	)		(10,209	)		(13,612	)
Net income available (loss allocable) to common shareholders		1,141			14,492			(1,161	)		27,981			44,017
Minority interest		536			2,265			1,123			4,963			7,404
Gains on sales of interests in real estate		—			(5,024	)		—			(5,661	)		(5,586	)
Gains on sales of discontinued operations		(1,414	)		(3,736	)		(1,414	)		(3,736	)		(6,158	)
Depreciation and amortization: (2)
Wholly owned and consolidated partnerships		30,552			27,062			93,165			79,449			108,145
Unconsolidated partnerships		1,679			1,103			5,255			3,287			4,582
Discontinued operations		41			178			144			523			433
FFO	$	32,535		$	36,340		$	97,112		$	106,806		$	152,837
FUNDS AVAILABLE FOR DISTRIBUTION (FAD)
FFO	$	32,535		$	36,340		$	97,112		$	106,806		$	152,837
Adjustments:
Straight line rent		(818	)		(1,175	)		(2,179	)		(3,206	)		(4,374	)
Recurring capital expenditures		(8,116	)		(5,390	)		(12,016	)		(10,231	)		(15,357	)
Tenant allowances		(5,460	)		(4,139	)		(12,899	)		(11,837	)		(18,201	)
Capitalized leasing costs		(1,129	)		(801	)		(3,472	)		(2,563	)		(3,574	)
Amortization of debt premium		(3,349	)		(4,851	)		(10,496	)		(14,528	)		(18,773	)
Amortization of above and below market lease intangibles		134			68			196			507			1,384
FAD	$	13,797		$	20,052		$	56,246		$	64,948		$	93,942
Weighted average of common shares outstanding		36,282			36,149			36,189			36,049			36,090
Weighted average of OP Units outstanding		4,081			4,593			4,125			4,621			4,580
Weighted average shares and OP Units outstanding-basic		40,363			40,742			40,314			40,670			40,670
Weighted average effect of common share equivalents		560			697			590			675			673
Total weighted average shares outstanding, including OP Units		40,923			41,439			40,904			41,345			41,343
Net income/(loss) per share (diluted)	$	0.02		$	0.39		$	(0.05	)	$	0.74		$	1.17
FFO per diluted share	$	0.80		$	0.88		$	2.37		$	2.58		$	3.70
FAD per diluted share	$	0.34		$	0.49		$	1.38		$	1.57		$	2.27
Dividend per Common Share	$	0.57		$	0.57		$	1.71		$	1.68		$	2.25
PAYOUT RATIOS
Payout Ratio of FFO		65.3	%(3)											60.9	%
Payout Ratio of FAD		111.0	%(3)											99.0	%

⁽¹⁾ Certain prior period amounts have been reclassified to conform with the current presentation.

⁽²⁾ Excludes depreciation of non-real estate assets and amortization of deferred financing costs.

⁽³⁾ Twelve months ended September 30, 2006.

Page 11

Pennsylvania Real Estate Investment Trust

Summary of Executed Leases

	Number	GLA	Average Previous Base Rent psf		Average New Base Rent psf		Increase/Decrease in Base Rent psf			%Increase/ Decrease in Base Rent psf		Annualized Tenant Improvements psf (1)
Previously Leased Space:
1st Quarter	22	119,428	$	17.84	$	19.98	$	2.14		12	%	$	1.54
2nd Quarter	40	92,261		27.18		31.58		4.40		16	%		1.72
3rd Quarter (2)	33	88,803		29.74		28.67		(1.07	)	-4	%		1.11
Total/Weighted Average	95	300,492	$	24.23	$	26.11	$	1.88		8	%	$	1.47
Previously Vacant Space:
1st Quarter	36	147,378	$	—	$	21.13	$	21.13		N/A		$	2.91
2nd Quarter	42	117,101		—		23.56		23.56		N/A			1.63
3rd Quarter	30	119,513		—		21.35		21.35		N/A			1.64
Total/Weighted Average	108	383,992	$	—	$	21.94	$	21.94		N/A		$	2.12
Non-Anchor Renewal: (3)
1st Quarter	139	710,798	$	14.85	$	15.45	$	0.60		4	%	$	0.10
2nd Quarter	119	312,399		24.16		26.04		1.88		8	%		0.20
3rd Quarter	95	310,527		22.50		25.76		3.26		14	%		3.26
Total/Weighted Average	353	1,333,724	$	19.99	$	21.56	$	1.57		8	%	$	0.66
Anchor Renewal: (3)
1st Quarter	2	244,805	$	1.93	$	1.93	$	—		0	%	$	—
2nd Quarter	3	243,596		3.31		3.35		0.04		1	%		—
3rd Quarter	1	96,268		3.02		3.02		—		0	%		—
Total/Weighted Average	6	584,669	$	2.68	$	2.70	$	0.02		1	%	$	—

⁽¹⁾ These leasing costs are presented as annualized costs per square foot and are spread uniformly over the life of the lease.

⁽²⁾ The leasing spreads for transactions completed in the 3rd quarter were impacted by the restructuring of seven Sam Goody’s and Suncoast leases. Excluding these transactions, new rent on previously owned space averaged $33.41 per square foot, an increase of $5.27 per square foot, or 19%, over an average expiring rent of $28.14 per square foot.

⁽³⁾ This category includes expansions, relocations and lease extensions.

Page 12

Pennsylvania Real Estate Investment Trust

Summarized Rent Per Square Foot and Occupancy Percentages

	September 30, 2006						September 30, 2005						Change
	Avg Base Rent		Occupancy				Avg Base Rent		Occupancy				Avg Base Rent		Occupancy
			Total		Non-Anchor				Total		Non-Anchor				Total		Non-Anchor
Enclosed Malls weighted average	$	24.18	88.7	%	85.7	%	$	23.27	90.9	%	85.9	%	3.9	%	-2.2	%	-0.2	%
Power Centers and Strip Centers weighted average	$	15.67	97.6	%	96.2	%	$	15.46	97.3	%	95.8	%	1.4	%	0.3	%	0.4	%
Retail Portfolio weighted average	$	22.77	89.8	%	87.3	%	$	22.09	91.8	%	87.5	%	3.1	%	-1.9	%	-0.2	%
Consolidated Properties	$	23.09	89.0	%	86.0	%	$	22.72	91.1	%	84.1	%	1.6	%	-2.1	%	1.9	%
Unconsolidated Properties	$	21.01	97.0	%	95.8	%	$	18.99	97.6	%	96.4	%	10.6	%	-0.5	%	-0.6	%
Same Properties	$	22.19	89.9	%	87.3	%	$	21.93	91.8	%	87.5	%	1.2	%	-1.9	%	-0.2	%
New	$	35.17	88.1	%	86.8	%		N/A	N/A		N/A		N/A		N/A		N/A

Page 13

Pennsylvania Real Estate Investment Trust

Mall Sales and Rents Per Square Foot

			September 30, 2006						September 30, 2005						Change
	% of Current Quarter Mall NOI		Avg Base Rent(1)		Avg Comp Sales(2)		Occup. Cost Ratio(3)		Avg Base Rent(1)		Avg Comp Sales(2)		Occup. Cost Ratio(3)		Avg Base Rent(1)		Avg Comp Sales(2)		Occup. Cost Ratio(3)
Sales per square foot over $400	36.2	%
Lehigh Valley Mall			$	31.47	$	491	8.5	%	$	29.72	$	470	8.7	%	5.9	%	4.4	%	-0.3	%
Cherry Hill Mall				37.72		475	13.0	%		36.20		450	13.7	%	4.2	%	5.6	%	-0.7	%
The Mall at Prince Georges				25.53		455	11.6	%		25.70		435	11.4	%	-0.7	%	4.6	%	0.2	%
Patrick Henry Mall				31.89		451	10.5	%		32.21		450	9.9	%	-1.0	%	0.1	%	0.6	%
Willow Grove Park				39.88		441	14.0	%		38.87		416	14.3	%	2.6	%	6.1	%	-0.3	%
Jacksonville Mall				24.22		439	9.6	%		23.51		401	9.3	%	3.0	%	9.4	%	0.3	%
Dartmouth Mall				20.95		436	10.6	%		19.90		427	10.9	%	5.3	%	2.1	%	-0.3	%
Moorestown Mall				27.43		419	13.9	%		25.54		382	14.7	%	7.4	%	9.8	%	-0.8	%
The Gallery at Market East				31.95		410	11.9	%		32.30		390	11.9	%	-1.1	%	5.1	%	0.0	%
Sales per square foot between $350 - $400	19.4	%
Springfield Mall				32.55		393	13.3	%		N/A		N/A	N/A		N/A		N/A		N/A
Exton Square Mall				33.54		385	14.7	%		33.55		365	15.4	%	0.0	%	5.3	%	-0.7	%
Viewmont Mall				24.34		378	11.2	%		23.43		365	11.1	%	3.9	%	3.6	%	0.1	%
Woodland Mall				36.59		372	20.1	%		N/A		N/A	N/A		N/A		N/A		N/A
Valley Mall				18.97		353	9.7	%		17.99		339	9.9	%	5.5	%	3.9	%	-0.2	%
Capital City Mall				25.89		351	11.4	%		23.32		347	10.6	%	11.0	%	1.3	%	0.8	%
Sales per square foot between $300 - $349	23.1	%
Valley View Mall				24.44		349	12.0	%		23.33		325	12.2	%	4.8	%	7.3	%	-0.2	%
Wyoming Valley Mall				25.61		347	12.3	%		22.98		344	11.6	%	11.4	%	1.0	%	0.7	%
Cumberland Mall				16.47		341	11.3	%		16.15		347	11.2	%	2.0	%	-1.7	%	0.0	%
Orlando Fashion Square				25.99		334	13.9	%		25.92		332	13.8	%	0.3	%	0.7	%	0.1	%
Francis Scott Key Mall				22.81		333	9.9	%		22.62		296	10.2	%	0.8	%	12.6	%	-0.3	%
South Mall				16.14		312	9.8	%		15.51		302	9.5	%	4.1	%	3.4	%	0.2	%
Wiregrass Mall				22.65		310	10.0	%		21.50		283	10.6	%	5.3	%	9.6	%	-0.6	%
Palmer Park Mall				22.46		306	11.0	%		21.72		309	11.1	%	3.4	%	-0.9	%	-0.1	%
Magnolia Mall				27.74		303	13.1	%		24.36		303	12.8	%	13.8	%	-0.1	%	0.4	%
Logan Valley Mall				21.17		301	11.4	%		21.41		298	11.5	%	-1.1	%	0.9	%	-0.1	%
Sales per square foot under $300	21.3	%
Phillipsburg Mall				23.28		296	12.1	%		23.66		313	11.8	%	-1.6	%	-5.4	%	0.4	%
Washington Crown Center				15.84		294	11.7	%		16.70		301	11.1	%	-5.1	%	-2.2	%	0.6	%
North Hanover Mall				20.56		290	9.8	%		20.08		282	9.5	%	2.4	%	3.1	%	0.3	%
New River Valley Mall				15.83		287	11.1	%		19.04		293	10.4	%	-16.9	%	-1.9	%	0.7	%
Gadsden Mall				18.25		278	11.1	%		19.35		288	10.6	%	-5.7	%	-3.4	%	0.6	%
Plymouth Meeting				18.37		275	13.0	%		19.35		263	14.6	%	-5.1	%	4.8	%	-1.6	%
Uniontown Mall				15.28		272	10.1	%		15.52		287	10.4	%	-1.6	%	-5.3	%	-0.2	%
Nittany Mall				20.05		264	11.1	%		20.72		263	11.3	%	-3.2	%	0.2	%	-0.3	%
Beaver Valley Mall				15.64		262	14.7	%		16.40		252	14.9	%	-4.6	%	4.1	%	-0.2	%
Crossroads Mall				16.88		262	9.3	%		16.35		275	9.0	%	3.3	%	-4.9	%	0.3	%
Chambersburg Mall				17.63		249	10.6	%		20.90		246	11.7	%	-15.7	%	1.1	%	-1.1	%
Lycoming Mall				14.22		236	11.1	%		15.40		229	11.4	%	-7.7	%	3.2	%	-0.3	%
Echelon Mall				18.58		206	14.6	%		21.03		217	15.7	%	-11.6	%	-4.9	%	-1.1	%
Schuylkill Mall				11.27		178	9.3	%		11.50		193	9.4	%	-1.9	%	-7.9	%	-0.1	%
Enclosed Malls weighted average			$	24.18	$	351	12.0	%	$	23.27	$	338	11.8	%	3.9	%	3.8	%	0.2	%
Consolidated Properties			$	23.69	$	343	12.2	%	$	22.96	$	332	12.0	%	3.2	%	3.4	%	0.2	%
Unconsolidated Properties			$	31.81	$	452	10.1	%	$	29.72	$	470	8.7	%	7.0	%	-3.9	%	1.4	%
Same Properties			$	23.56	$	349	11.6	%	$	23.27	$	338	11.8	%	1.2	%	3.2	%	-0.2	%
New			$	35.17	$	381	17.0	%		N/A		N/A	N/A		N/A		N/A		N/A

⁽¹⁾ Base rent includes all non-anchor space owned by the Company.

⁽²⁾ Based on reported sales by tenants that lease individual spaces of 10,000 square feet or less and have occupied the space for at least 24 months.

⁽³⁾ Based on all comparable non-anchor tenants that have occupied their space for at least 24 months.

Page 14

Pennsylvania Real Estate Investment Trust

Mall Occupancy

	September 30, 2006				September 30, 2005				Change
	Total		Non-Anchor		Total		Non-Anchor		Total		Non-Anchor
Beaver Valley Mall	91.5	%	81.5	%	90.7	%	79.8	%	0.8	%	1.6	%
Capital City Mall	93.3	%	88.5	%	95.8	%	92.4	%	-2.5	%	-3.9	%
Chambersburg Mall	91.4	%	81.7	%	91.1	%	80.9	%	0.4	%	0.8	%
Cherry Hill Mall	63.4	%	95.3	%	95.0	%	95.0	%	-31.6	%	0.3	%
Crossroads Mall	94.5	%	87.2	%	96.2	%	91.0	%	-1.7	%	-3.8	%
Cumberland Mall	97.9	%	96.4	%	98.8	%	97.8	%	-0.8	%	-1.4	%
Dartmouth Mall	96.3	%	93.9	%	95.9	%	93.2	%	0.4	%	0.7	%
Echelon Mall	29.2	%	48.2	%	32.0	%	53.0	%	-2.8	%	-4.7	%
Exton Square Mall	93.7	%	86.1	%	92.1	%	82.8	%	1.5	%	3.3	%
Francis Scott Key Mall (1)	97.1	%	93.8	%	94.8	%	89.2	%	2.4	%	4.6	%
Gadsden Mall	94.7	%	87.5	%	95.0	%	88.2	%	-0.3	%	-0.7	%
The Gallery at Market East	86.9	%	82.7	%	81.9	%	76.2	%	5.0	%	6.6	%
Jacksonville Mall	95.8	%	91.5	%	97.3	%	94.5	%	-1.5	%	-3.0	%
Lehigh Valley Mall	96.1	%	94.3	%	95.3	%	93.2	%	0.8	%	1.1	%
Logan Valley Mall	97.5	%	93.9	%	96.5	%	91.8	%	0.9	%	2.2	%
Lycoming Mall (1)	93.8	%	88.4	%	89.1	%	78.9	%	4.7	%	9.5	%
Magnolia Mall	92.7	%	81.8	%	94.8	%	86.6	%	-2.0	%	-4.9	%
The Mall at Prince Georges	96.1	%	91.4	%	97.2	%	93.4	%	-1.1	%	-2.0	%
Moorestown Mall	91.5	%	80.6	%	92.8	%	83.4	%	-1.2	%	-2.8	%
New River Valley Mall (1)	97.4	%	95.4	%	78.2	%	85.0	%	19.2	%	10.4	%
Nittany Mall	94.5	%	88.8	%	93.2	%	86.2	%	1.3	%	2.5	%
North Hanover Mall	75.7	%	74.6	%	92.4	%	79.1	%	-16.7	%	-4.6	%
Orlando Fashion Square	91.7	%	82.4	%	90.2	%	79.1	%	1.5	%	3.3	%
Palmer Park Mall	100.0	%	100.0	%	99.8	%	99.5	%	0.2	%	0.5	%
Patrick Henry Mall	95.1	%	90.5	%	96.2	%	92.5	%	-1.1	%	-2.0	%
Phillipsburg Mall	92.3	%	82.1	%	91.8	%	81.1	%	0.5	%	1.0	%
Plymouth Meeting	86.0	%	79.8	%	90.0	%	85.6	%	-4.0	%	-5.8	%
Schuylkill Mall	73.4	%	62.7	%	74.3	%	64.7	%	-1.0	%	-2.0	%
South Mall	93.1	%	87.1	%	92.2	%	85.3	%	0.9	%	1.8	%
Springfield Mall	87.5	%	87.5	%	N/A		N/A		N/A		N/A
Uniontown Mall	94.6	%	86.4	%	95.2	%	87.9	%	-0.6	%	-1.4	%
Valley Mall	98.5	%	97.2	%	99.1	%	98.4	%	-0.6	%	-1.1	%
Valley View Mall (1)	87.0	%	81.7	%	92.0	%	88.7	%	-4.9	%	-7.0	%
Viewmont Mall	99.2	%	98.0	%	99.3	%	98.3	%	-0.1	%	-0.3	%
Washington Crown Center	90.2	%	81.9	%	91.8	%	84.9	%	-1.7	%	-3.0	%
Willow Grove Park	66.3	%	88.8	%	93.6	%	89.3	%	-27.3	%	-0.6	%
Wiregrass Mall	80.6	%	80.6	%	83.8	%	83.8	%	-3.1	%	-3.1	%
Woodland Mall	88.4	%	86.4	%	N/A		N/A		N/A		N/A
Wyoming Valley Mall	92.4	%	78.5	%	96.0	%	88.7	%	-3.6	%	-10.2	%
Enclosed Malls weighted average	88.7	%	85.7	%	90.9	%	85.9	%	-2.2	%	-0.2	%
Consolidated Properties	88.5	%	85.3	%	90.8	%	85.6	%	-2.3	%	-0.3	%
Unconsolidated Properties	93.9	%	92.0	%	95.3	%	93.2	%	-1.4	%	-1.2	%
Same Properties	88.7	%	85.7	%	90.9	%	85.9	%	-2.2	%	-0.3	%
New	88.1	%	86.8	%	N/A		N/A		N/A		N/A

⁽¹⁾ Reflects the decommissioning of space related to redevelopment activity. A space is decommissioned once tenant relocations have been completed and demolition/reconfiguration of the former space has commenced. Space is recommissioned once the first tenant in the new/reconfigured wing or area is open and the remaining space is in leaseable condition.

Page 15

Pennsylvania Real Estate Investment Trust

Power Center and Strip Center Rents Per Square Foot and Occupancy Percentages

	September 30, 2006						September 30, 2005						Change
	Avg Base Rent		Occupancy				Avg Base Rent		Occupancy				Avg Base Rent		Occupancy
			Total		Non-Anchor				Total		Non-Anchor				Total		Non-Anchor
Power and Strip Centers
Christiana Power Center	$	20.83	100.0	%	100.0	%	$	20.83	100.0	%	100.0	%	0.0	%	0.0	%	0.0	%
The Commons at Magnolia		13.52	93.0	%	87.8	%		13.26	100.0	%	100.0	%	2.0	%	-7.0	%	-12.2	%
The Court at Oxford Valley		16.16	100.0	%	100.0	%		15.37	100.0	%	100.0	%	5.1	%	0.0	%	0.0	%
Creekview Shopping Center		14.64	100.0	%	100.0	%		14.47	100.0	%	100.0	%	1.2	%	0.0	%	0.0	%
Crest Plaza		16.89	96.6	%	93.6	%		16.39	98.1	%	96.4	%	3.0	%	-1.5	%	-2.8	%
Metroplex Shopping Center		19.09	100.0	%	100.0	%		18.23	100.0	%	100.0	%	4.7	%	0.0	%	0.0	%
Northeast Tower Center		14.83	96.6	%	94.4	%		14.63	96.6	%	94.4	%	1.3	%	0.0	%	0.0	%
Paxton Towne Centre		15.27	93.5	%	90.3	%		15.99	90.0	%	84.9	%	-4.5	%	3.5	%	5.4	%
Red Rose Commons		13.86	99.2	%	99.2	%		13.86	99.2	%	99.2	%	0.0	%	0.0	%	0.0	%
Springfield Park		20.31	87.8	%	64.3	%		19.65	84.2	%	53.7	%	3.3	%	3.6	%	10.6	%
Whitehall Mall		10.46	98.1	%	96.0	%		10.17	98.5	%	96.6	%	2.9	%	-0.4	%	-0.6	%
Weighted Average	$	15.67	97.6	%	96.2	%	$	15.46	97.3	%	95.8	%	1.4	%	0.3	%	0.4	%
Consolidated Properties	$	15.83	96.4	%	94.0	%	$	15.96	96.0	%	93.2	%	-0.9	%	0.4	%	0.8	%
Unconsolidated Properties	$	15.58	98.5	%	97.8	%	$	15.13	98.4	%	97.5	%	2.9	%	0.1	%	0.2	%
Same Properties	$	15.67	97.6	%	96.2	%	$	15.46	97.3	%	95.8	%	1.4	%	0.3	%	0.4	%

Page 16

Pennsylvania Real Estate Investment Trust

Top Twenty Tenants (by share of PREIT’s Annualized Base Rent)

(dollars in thousands)

	Number of Stores			GLA of Stores			Base Rent
Tenant (1)	Minimum Rent	% Rent In Lieu of Minimum Rent or Common Area Costs (2)	Total	Minimum Rent	% Rent In Lieu of Minimum Rent or Common Area Costs (2)	Total	Annualized Base Rent		PREIT’s share of Annualized Minimum Rent (3)			Percent of PREIT’s Total Retail Minimum Rent
Gap, Inc.	54	3	57	685,221	24,606	709,827	$	13,769	$	12,770		4.12	%
Limited Brands, Inc.	85	18	103	521,572	77,264	598,836		13,175		12,467		4.02	%
Foot Locker, Inc.	81	5	86	422,588	10,415	433,003		8,886		8,442		2.72	%
JC Penney Company, Inc.	24	5	29	2,295,459	824,327	3,119,786		7,099		7,099		2.29	%
Zale Corporation	91	0	91	76,314	—	76,314		6,325		6,041		1.95	%
Sears Holding Corporation	26	5	31	2,999,421	726,263	3,725,684		6,180		6,036		1.95	%
Luxottica Group S.p.A.	86	3	89	156,491	1,340	157,831		5,404		5,031		1.62	%
American Eagle Outfitters, Inc.	32	2	34	178,796	8,813	187,609		4,837		4,626		1.49	%
Sterling Jewelers, Inc.	45	0	45	64,942	—	64,942		4,622		4,434		1.43	%
Hallmark Cards, Inc.	53	6	59	182,894	26,854	209,748		4,296		4,148		1.34	%
Transworld Entertainment Corp.	39	6	45	173,340	25,208	198,548		4,158		3,926		1.27	%
Borders Group Inc.	32	2	34	207,360	7,976	215,336		4,055		3,788		1.22	%
The Finish Line, Inc.	32	4	36	156,680	17,627	174,307		3,428		3,376		1.09	%
Regis Corporation	93	0	93	112,810	—	112,810		3,473		3,344		1.08	%
Pacific Sunwear of California	35	5	40	120,896	17,828	138,724		3,202		3,052		0.98	%
Dick’s Sporting Goods	6	0	6	294,958	—	294,958		3,870		2,993		0.97	%
Aeropostale, Inc.	34	0	34	115,732	—	115,732		2,977		2,826		0.91	%
GameStop Corp.	56	0	56	69,299	—	69,299		2,875		2,773		0.89	%
The Bon Ton Dept Stores, Inc	12	1	13	1,008,613	60,916	1,069,529		2,768		2,768		0.89	%
Genesco, Inc.	58	0	58	66,542	—	66,542		2,802		2,766		0.89	%
Total Top 20 Tenants	974	65	1,039	9,909,928	1,829,437	11,739,365	$	108,201	$	102,706		33.14	%
Total Retail Leases			3,610			23,888,463	$	330,452	$	309,916	(4)	100.00	%

⁽¹⁾ Tenant includes all brands and concepts of the tenant.

⁽²⁾ Income from lease(s) in which tenant pays percentage rent in lieu of fixed rent or common area costs are not included in annualized base rent.

⁽³⁾ Includes PREIT’s proportionate share of tenant rents from partnership properties based on PREIT’s ownership percentage in the respective partnerships.

⁽⁴⁾ PREIT’s share of annualized base rent is derived by annualizing 3rd quarter base rent. Straight line rent is not included in the base rent figures.

Page 17

Pennsylvania Real Estate Investment Trust

Lease Expirations

(dollars in thousands except psf amounts)

Non-Anchors⁽¹⁾

		Gross Leasable Area			Annualized Base Rent
Lease Expiration Year	Number of Leases Expiring	Expiring GLA	Percent of Total		Rent in Expiring Year		PREIT’s Share of Rent in Expiring Year (3)		Percent of PREIT’s Total		Average Expiring Base Rent psf
Holdovers (2)	137	343,496	2.8	%	$	7,570	$	6,837	2.5	%	$	22.04
2006	98	235,363	1.9	%		5,478		5,117	1.9	%		23.27
2007	489	1,249,652	10.2	%		28,742		27,437	10.1	%		23.00
2008	434	1,246,105	10.2	%		31,007		29,943	11.0	%		24.88
2009	429	1,167,809	9.5	%		30,090		29,081	10.7	%		25.77
2010	440	1,454,850	11.9	%		34,840		33,296	12.3	%		23.95
2011	346	1,481,180	12.1	%		34,917		31,044	11.4	%		23.57
2012	233	1,000,678	8.2	%		25,365		23,106	8.5	%		25.35
2013	189	640,284	5.2	%		16,060		14,813	5.4	%		25.08
2014	156	565,841	4.6	%		15,551		13,646	5.0	%		27.48
2015	183	788,747	6.4	%		20,363		18,088	6.6	%		25.82
Thereafter	353	2,092,479	17.0	%		42,246		39,627	14.6	%		20.19
Total/Average	3,487	12,266,484	100.0	%	$	292,229	$	272,035	100.0	%	$	23.82

Anchors⁽¹⁾

		Gross Leasable Area			Annualized Base Rent
Lease Expiration Year	Number of Leases Expiring	Expiring GLA	Percent of Total		Rent in Expiring Year		PREIT’s Share of Rent in Expiring Year (3)		Percent of PREIT’s Total		Average Expiring Base Rent psf
Holdovers (2)	1	85,483	0.7	%	$	—	$	—	0.0	%	$	—
2006	—	—	0.0	%		—		—	0.0	%		—
2007	7	570,912	4.9	%		1,550		1,540	4.4	%		2.71
2008	15	1,152,226	9.9	%		3,075		3,075	8.7	%		2.67
2009	12	929,598	8.0	%		2,714		2,322	6.6	%		2.92
2010	22	2,089,444	18.0	%		6,144		6,144	17.4	%		2.94
2011	23	1,885,550	16.3	%		6,471		5,348	15.1	%		3.43
2012	5	554,129	4.8	%		1,027		990	2.8	%		1.85
2013	6	452,530	3.9	%		2,729		2,729	7.7	%		6.03
2014	6	662,582	5.7	%		2,081		2,081	5.9	%		3.14
2015	1	85,212	0.7	%		469		469	1.3	%		5.50
Thereafter	25	3,154,313	27.1	%		11,963		10,632	30.1	%		3.79
Total/Average	123	11,621,979	100.0	%	$	38,223	$	35,330	100.0	%	$	3.29

⁽¹⁾ Only includes owned space.

⁽²⁾ Includes all tenant leases which have already expired and are on a month-to-month basis.

⁽³⁾ Includes PREIT’s proportionate share of tenant rents from partnership properties based on PREIT’s ownership percentage in the respective partnerships.

Page 18

Pennsylvania Real Estate Investment Trust

Gross Leasable Area Summary as of September 30, 2006

	Owned GLA			GLA Not Owned	Total GLA
	Anchors	Non-anchors	Total
Malls (1)
Beaver Valley Mall	511,267	430,312	941,579	204,770	1,146,349
Capital City Mall	204,301	286,713	491,014	120,000	611,014
Chambersburg Mall	241,690	212,308	453,998	—	453,998
Cherry Hill Mall	261,885	519,712	781,597	478,885	1,260,482
Crossroads Mall	256,248	195,528	451,776	—	451,776
Cumberland Mall	283,365	385,384	668,749	273,230	941,979
Dartmouth Mall	208,460	322,520	530,980	140,000	670,980
Echelon Mall	297,323	432,137	729,460	396,783	1,126,243
Exton Square Mall	440,301	369,989	810,290	277,468	1,087,758
Francis Scott Key Mall	291,620	253,480	545,100	139,333	684,433
Gadsden Mall	274,060	203,241	477,301	—	477,301
The Gallery at Market East	127,271	397,928	525,199	—	525,199
Jacksonville Mall	242,115	233,605	475,720	—	475,720
Lehigh Valley Mall	212,000	451,314	663,314	371,986	1,035,300
Logan Valley Mall	454,387	327,348	781,735	—	781,735
Lycoming Mall	321,441	370,113	691,554	120,000	811,554
Magnolia Mall	343,118	228,597	571,715	—	571,715
The Mall at Prince Georges	479,619	396,291	875,910	—	875,910
Moorestown Mall	408,356	315,878	724,234	321,200	1,045,434
New River Valley Mall	175,306	220,413	395,719	—	395,719
Nittany Mall	221,462	215,654	437,116	95,000	532,116
North Hanover Mall	286,277	164,903	451,180	—	451,180
Orlando Fashion Square	491,999	436,895	928,894	155,576	1,084,470
Palmer Park Mall	314,235	143,474	457,709	—	457,709
Patrick Henry Mall	279,619	296,229	575,848	140,000	715,848
Phillipsburg Mall	326,170	246,380	572,550	—	572,550
Plymouth Meeting Mall	185,000	413,744	598,744	214,635	813,379
Schuylkill Mall	346,990	318,756	665,746	60,916	726,662
South Mall	188,858	216,355	405,213	—	405,213
Springfield Mall	—	221,519	221,519	367,176	588,695
Uniontown Mall	421,378	276,816	698,194	—	698,194
Valley Mall	294,348	364,983	659,331	243,400	902,731
Valley View Mall	96,357	235,445	331,802	254,596	586,398
Viewmont Mall	386,262	238,383	624,645	120,000	744,645
Washington Crown Center	245,401	290,539	535,940	140,095	676,035
Willow Grove Park	453,740	336,629	790,369	413,121	1,203,490
Wiregrass Commons	—	229,826	229,826	403,163	632,989
Woodland Mall	71,000	413,304	484,304	725,186	1,209,490
Wyoming Valley Mall	592,110	321,802	913,912	—	913,912
Total Malls (39 properties)	11,235,339	11,934,447	23,169,786	6,176,519	29,346,305
Power and Strip Centers
Christiana Power Center	190,814	111,595	302,409	—	302,409
The Court at Oxford Valley	176,831	280,032	456,863	247,623	704,486
Creekview Shopping Center	—	136,086	136,086	288,916	425,002
Crest Plaza Shopping Center	53,445	60,826	114,271	143,130	257,401
The Commons at Magnolia	51,574	67,615	119,189	126,200	245,389
Metroplex Shopping Center	67,185	410,276	477,461	300,729	778,190
Northeast Tower Center	119,388	182,521	301,909	175,311	477,220
Paxton Towne Centre	151,627	297,836	449,463	273,058	722,521
Red Rose Commons	—	263,452	263,452	199,590	463,042
Springfield Park	83,539	43,432	126,971	145,669	272,640
Whitehall Mall	294,635	262,384	557,019	—	557,019
Total Power and Strip Centers (11 properties)	1,189,038	2,116,055	3,305,093	1,900,226	5,205,319
CONSOLIDATED PROPERTIES	11,590,187	12,118,093	23,708,280	6,443,972	30,152,252
UNCONSOLIDATED PROPERTIES	834,190	1,932,409	2,766,599	1,632,773	4,399,372
TOTAL PROPERTIES	12,424,377	14,050,502	26,474,879	8,076,745	34,551,624

⁽¹⁾ Does not include 108,100 sf at Westgate anchor pad in Bethlehem, PA leased to Bon-Ton with expiration date of 11/23/2010.

Page 19

Pennsylvania Real Estate Investment Trust

Property Information as of September 30, 2006

Properties (1)	Same Store/New	Ownership Interest	Date Acquired	Year Built/Last Renovated	Years Since Renovation	Anchors / Majors Tenants	Lease Expiration
MALLS
Beaver Valley Mall Monaca, PA	Same Store Redevelopment	100%	2002	1970/1991	15	Boscov’s JC Penney Sears Macy’s	9/30/18 9/30/17 8/15/11 (4)
Capital City Mall Camp Hill, PA	Same Store Redevelopment	100%	2003	1974/2005	1	JC Penney Macy’s Sears	11/30/10 (4) 7/28/09
Chambersburg Mall (2) Chambersburg, PA	Same Store	89%	2003	1982	24	Bon-Ton JC Penney Sears Value City	1/28/11 3/31/12 2/9/10 2/28/07
Cherry Hill Mall Cherry Hill, NJ	Same Store Redevelopment	100%	2003	1961/1990	16	JC Penney Macy’s	(4) (4)
Crossroads Mall Beckley, WV	Same Store	100%	2003	1981	25	Sears JC Penney Belk	3/31/11 12/31/11 11/4/08
Cumberland Mall Vineland, NJ	Same Store Redevelopment	100%	2005	1973/2003	3	Boscov’s BJ’s Home Depot JC Penney Value City	(4) (4) 10/31/19 11/30/08 7/31/08
Dartmouth Mall Dartmouth, MA	Same Store	100%	1997	1971/2000	6	JC Penney Sears Macy’s	7/31/09 4/12/16 (4)
Echelon Mall Voorhees, NJ	Same Store Redevelopment	100%	2003	1970/1998	8	Boscov’s Macy’s	(4) (4)
Exton Square Mall Exton, PA	Same Store	100%	2003	1973/2000	6	Boscov’s JC Penney K-Mart Sears Macy’s	10/31/19 5/31/20 (4) 1/31/20 (4)
Francis Scott Key Mall (2) Frederick, MD	Same Store Redevelopment	89%	2003	1978/1991	15	Macy’s Sears JC Penney Value City	(4) 7/31/08 9/30/11 6/30/10
Gadsden Mall Gadsden, AL	Same Store	100%	2005	1974/1990	16	Belk McRae’s Sears	2/19/11 7/31/14 3/5/09
The Gallery at Market East (3) Philadelphia, PA	Same Store	100%	2003	1977/1990	16	Burlington Coat Factory	2/28/32
Jacksonville Mall Jacksonville, NC	Same Store	100%	2003	1981/1998	8	Belk JC Penney Sears	8/21/11 8/31/10 8/4/11
Lehigh Valley Mall (4) Allentown, PA	Same Store Redevelopment	50%	1973	1977/1996	10	Macy’s JC Penney Boscov’s	7/31/12 (4) (4)
Logan Valley Mall Altoona, PA	Same Store	100%	2003	1960/1997	9	JC Penney Macy’s Sears	6/30/17 1/31/10 10/31/16
Lycoming Mall (2) Pennsdale, PA	Same Store Redevelopment	89%	2003	1978/1990	16	Bon-Ton JC Penney Macy’s Sears Value City	7/31/11 10/31/10 (4) 7/31/08 7/31/08
Magnolia Mall Florence, SC	Same Store Redevelopment	100%	1997	1979/1992	14	Belk Best Buy JC Penney Sears	1/31/11 1/31/13 3/31/07 10/16/09
The Mall at Prince Georges Hyattsville, MD	Same Store	100%	1998	1959/2004	2	JC Penney Macy’s Target	7/31/11 10/31/08 1/31/10
Moorestown Mall Moorestown, NJ	Same Store	100%	2003	1963/2000	6	Boscov’s Lord & Taylor Sears Macy’s	10/31/10 (4) 10/5/22 (4)
New River Valley Mall (2) Christiansburg, VA	Same Store Redevelopment	89%	2003	1988	18	Belk JC Penney Sears	4/19/08 3/31/08 8/2/08

Page 20

Pennsylvania Real Estate Investment Trust

Property Information as of September 30, 2006 (continued)

Properties (1)	Same Store/New	Ownership Interest	Date Acquired	Year Built/Last Renovated	Years Since Renovation	Anchors / Majors Tenants	Lease Expiration
Nittany Mall (2) State College, PA	Same Store	89%	2003	1968/1990	16	Bon-Ton JC Penney Macy’s Sears	1/31/08 7/31/10 (4) 8/31/10
North Hanover Mall (2) Hanover, PA	Same Store	89%	2003	1967/1999	7	JC Penney Black Rose Antiques Sears	1/31/11 N/A 11/30/09
Orlando Fashion Square Orlando, FL	Same Store	100%	2004	1973/2003	3	Macy’s Dillard’s JC Penney Sears	10/31/71 1/31/14 4/30/13 (4)
Palmer Park Mall Easton, PA	Same Store	100%	1972/2003	1972/1998	8	Bon-Ton Boscov’s	7/25/14 10/31/18
Patrick Henry Mall(2) Newport News, VA	Same Store Redevelopment	89%	2003	1988/2005	1	Dillard’s Dick’s Sporting Goods JC Penney Macy’s	9/22/13 1/31/22 10/31/15 (4)
Phillipsburg Mall(2) Phillipsburg, NJ	Same Store	89%	2003	1989/2003	3	Bon-Ton JC Penney Sears Kohl’s	1/31/10 3/31/10 4/30/09 1/31/25
Plymouth Meeting Mall Plymouth Meeting, PA	Same Store Redevelopment	100%	2003	1966/1999	7	AMC Theater Boscov’s Macy’s	12/31/18 10/31/16 (4)
Schuylkill Mall Frackville, PA	Same Store	100%	2003	1980/1991	15	K-Mart Sears Bon-Ton Black Diamond Antiques	10/31/10 10/31/10 (4) N/A
South Mall (2) Allentown, PA	Same Store	89%	2003	1975/1992	14	Bon-Ton Stein Mart Steve & Barry’s	1/28/11 10/31/11 1/31/11
Springfield Mall Springfield, PA	New	50%	2005	1974/1997	9	Macy’s TBD	(4) (4)
Uniontown Mall (2) Uniontown, PA	Same Store	89%	2003	1972/1990	16	Bon-Ton JC Penney Roomful Express Furn. Sears Teletech Customer Care Value City	1/31/11 10/31/10 3/26/10 2/25/08 6/28/08 7/31/07
Valley Mall Hagerstown, MD	Same Store	100%	2003	1974/1999	7	Sears JC Penney Bon-Ton Macy’s	(4) 10/3/09 1/31/14 (4)
Valley View Mall La Crosse, WI	Same Store Redevelopment	100%	2003	1980/2001	5	JC Penney Herberger’s Macy’s Sears	7/31/10 (4) (4) (4)
Viewmont Mall (2) Scranton, PA	Same Store	89%	2003	1968/1996	10	JC Penney Sears Macy’s	10/31/10 12/31/10 (4)
Washington Crown Center (2) Washington, PA	Same Store	89%	2003	1969/1999	7	Sears Bon-Ton Gander Macy’s	8/17/09 1/31/10 7/24/13 (4)
Willow Grove Park Willow Grove, PA	Same Store Redevelopment	100%	2000/2003	1982/2001	5	Sears Bloomingdale’s Macy’s	(4) (4) 1/31/22
Wiregrass Commons Dothan, AL	Same Store	100%	2003	1986/1999	7	Dillard’s JC Penney McRaes Parisian	(4) (4) (4) (4)

Page 21

Pennsylvania Real Estate Investment Trust

Property Information as of September 30, 2006 (continued)

Properties (1)	Same Store/New	Ownership Interest	Date Acquired	Year Built/Last Renovated	Years Since Renovation	Anchors / Majors Tenants	Lease Expiration
Woodland Mall Grand Rapids, MI	New	100%	2005	1968/1998	8	JCPenney Sears Macy’s Kohl’s	(4) (4) (4) 1/31/09
Wyoming Valley Mall Wilkes-Barre, PA	Same Store	100%	2003	1974/1995	11	Bon-Ton JC Penney Sears Macy’s	1/31/12 1/31/07 8/1/11 1/31/07
POWER CENTERS
Christiana Power Center Newark, DE	Same Store	100%	1998	1998	8	Costco Dick’s Sporting Goods	9/30/18 11/30/13
Creekview Shopping Center Warrington, PA	Same Store	100%	1999	2001	5	Target Lowe’s Genuardi’s	(4) (4) 12/31/21
Metroplex Shopping Center (3) Plymouth Meeting, PA	Same Store	50%	1999	2001	5	Target Lowe’s Giant	(4) (4) 2/28/21
Northeast Tower Center Philadelphia, PA	Same Store	100%	1998/1999	1997/1998	8	Home Depot Raymour & Flanigan Wal-Mart	(4) (4) 1/31/14
Paxton Towne Centre Harrisburg, PA	Same Store	100%	1999	2001	5	Target Kohl’s Weis Markets Costco	(4) 1/25/21 11/30/20 (4)
Red Rose Commons (3) Lancaster, PA	Same Store	50%	1998	1998	8	Weis Markets Home Depot	(4) (4)
The Court at Oxford Valley (3) Langhorne, PA	Same Store	50%	1997	1996	10	Best Buy BJ’s Dick’s Sporting Goods Home Depot Linens N Things	12/31/11 (4) 4/15/11 (4) 2/14/17
Whitehall Mall (3)Allentown, PA	Same Store	50%	1964	1964/1998	8	Kohl’s Sears Bed, Bath & Beyond	3/9/07 9/18/11 1/31/10
STRIP CENTERS
Crest Plaza Shopping Center Allentown, PA	Same Store	100%	1964	1959/2003	3	Weis Market Target	10/31/14 (4)
Springfield Park I & II Springfield, PA	Same Store	50%	1997/1998	1997/1998	8	Target Bed, Bath & Beyond LA Fitness	(4) 1/31/09 3/31/17
The Commons at Magnolia Florence, SC	Same Store	100%	1999	1991/2002	4	Goody’s Target	5/31/12 (4)

⁽¹⁾ Does not include 108,100 sf at Westgate Anchor pad in Bethlehem, PA leased to Bon-Ton with expiration date of 11/23/2010.

⁽²⁾ PREIT has an 89% ownership interest and a 99% economic interest in these properties. These properties are consolidated for financial reporting purposes.

⁽³⁾ Property is managed by a third party.

⁽⁴⁾ Space is not owned by PREIT.

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Pennsylvania Real Estate Investment Trust

Balance Sheet

Proportionate Consolidation Method ⁽¹⁾

(in thousands, except per share amounts)

	September 30, 2006												December 31, 2005
	GAAP			Share of Unconsolidated Partnerships			Assets Held for Sale			Total			GAAP			Share of Unconsolidated Partnerships			Assets Held for Sale			Total
ASSETS
Investments in real estate, at cost
Operating properties	$	2,860,761		$	182,214		$	—		$	3,042,975		$	2,807,575		$	169,301		$	8,268		$	2,985,144
Construction in progress		192,190			2,819			—			195,009			55,368			2,220			—			57,588
Land held for development		5,616			—			—			5,616			5,616			—			—			5,616
Other properties		—			—			1,489			1,489			—			—			1,504			1,504
TOTAL INVESTMENTS IN REAL ESTATE		3,058,567			185,033			1,489			3,245,089			2,868,559			171,521			9,772			3,049,852
Accumulated depreciation		(283,321	)		(37,738	)		—			(321,059	)		(220,788	)		(32,459	)		—			(253,247	)
Net investments in real estate		2,775,246			147,295			1,489			2,924,030			2,647,771			139,062			9,772			2,796,605
Investments in partnerships, at equity		39,447			(39,447	)		—			—			41,536			(41,536	)		—			—
Other assets:
Cash and cash equivalents		17,134			4,323			—			21,457			21,642			4,186			—			25,828
Rents and other receivables		41,285			9,651			—			50,936			46,492			11,407			—			57,899
Assets held for sale		1,551			—			(1,489	)		62			17,720			—			(9,772	)		7,948
Intangible assets		145,969			—			—			145,969			173,594			—			—			173,594
Deferred costs and other assets, net of accumulated amortization		77,383			8,837			—			86,220			69,792			12,151			—			81,943
TOTAL OTHER ASSETS		322,769			(16,636	)		(1,489	)		304,644			370,776			(13,792	)		(9,772	)		347,212
TOTAL ASSETS	$	3,098,015		$	130,659		$	—		$	3,228,674		$	3,018,547		$	125,270		$	—		$	3,143,817
LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities:
Mortgage notes payable	$	1,578,598		$	190,389		$	—		$	1,768,987		$	1,332,066		$	134,500		$	17,114		$	1,483,680
Debt premium on mortgage notes payable		29,988			—			—			29,988			40,066			—			—			40,066
Credit Facility		277,000			—			—			277,000			342,500			—			—			342,500
Corporate notes payable		—			—			—			—			94,400			—			—			94,400
Distributions in excess of partnership investments		64,971			(64,971	)		—			—			13,353			(13,353	)		—			—
Liabilities related to assets held for sale		48			—			—			48			18,233			—			(17,114	)		1,119
Other liabilities		112,954			5,241			—			118,195			82,733			4,123			—			86,856
TOTAL LIABILITIES		2,063,559			130,659			—			2,194,218			1,923,351			125,270			—			2,048,621
Minority interest		103,671			—			—			103,671			118,320			—			—			118,320
Shareholders’ equity:
Shares of beneficial interest at $1 par		36,865			—			—			36,865			36,521			—			—			36,521
Preferred shares at $0.01 par		25			—			—			25			25			—			—			25
Capital contributed in excess of par		913,185			—			—			913,185			899,439			—			—			899,439
Accumulated other comprehensive income		8,145			—			—			8,145			4,377			—			—			4,377
(Distributions in excess of net income) retained earnings		(27,435	)		—			—			(27,435	)		36,514			—			—			36,514
TOTAL SHAREHOLDERS’ EQUITY		930,785			—			—			930,785			976,876			—			—			976,876
TOTAL LIABILITIES, MINORITY INTERESTS AND SHAREHOLDERS’ EQUITY	$	3,098,015		$	130,659		$	—		$	3,228,674		$	3,018,547		$	125,270		$	—		$	3,143,817

⁽¹⁾ Total includes PREIT’s proportionate share of partnership assets and liabilities in order to reflect the Company’s share of the total assets and liabilities of the underlying properties. The consolidated financial statements, which are presented in accordance with GAAP, reflect only the Company’s equity in these properties.

Page 23

Pennsylvania Real Estate Investment Trust

Balance Sheet

Property Type ⁽¹⁾

(in thousands, except per share amounts)

	September 30, 2006												December 31, 2005
	Malls			Power and Strip Centers			Corporate and Other Properties			Total			Malls			Power and Strip Centers			Corporate and Other Properties			Total
ASSETS
Investments in real estate:
Investments in real estate, at cost	$	2,851,816		$	278,051		$	115,222		$	3,245,089		$	2,720,316		$	287,219		$	42,317		$	3,049,852
Accumulated depreciation		(265,250	)		(55,809	)		—			(321,059	)		(201,176	)		(52,071	)		—			(253,247	)
Net investments in real estate		2,586,566			222,242			115,222			2,924,030			2,519,140			235,148			42,317			2,796,605
Other assets:
Cash		11,732			2,451			7,274			21,457			16,288			3,674			5,866			25,828
Rents and other receivables		33,696			13,250			3,990			50,936			35,698			14,805			7,396			57,899
Assets held for sale					—			62			62			7,861			87			—			7,948
Intangible assets		134,164			—			11,805			145,969			161,765			—			11,829			173,594
Deferred costs and other assets, net of accumulated amortization		47,292			9,073			29,855			86,220			38,910			12,002			31,031			81,943
Total other assets		226,884			24,774			52,986			304,644			260,522			30,568			56,122			347,212
TOTAL ASSETS	$	2,813,450		$	247,016		$	168,208		$	3,228,674		$	2,779,662		$	265,716		$	98,439		$	3,143,817
LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities:
Mortgage notes payable	$	1,676,037		$	92,950		$	—		$	1,768,987		$	1,393,727		$	89,953		$	—		$	1,483,680
Debt premium on mortgage notes payable		29,287			701			—			29,988			39,094			972			—			40,066
Credit Facility		—			—			277,000			277,000			—			—			342,500			342,500
Corporate notes payable		—			—			—			—			—			—			94,400			94,400
Liabilities related to assets held for sale		—			—			48			48			1,094			4			21			1,119
Other liabilities		61,707			7,203			49,285			118,195			49,531			4,014			33,311			86,856
TOTAL LIABILITIES		1,767,031			100,854			326,333			2,194,218			1,483,446			94,943			470,232			2,048,621
Minority interest		2,538			—			101,133			103,671			3,016			—			115,304			118,320
Shareholders’ equity:
Shares of beneficial interest at $1 par		—			—			36,865			36,865			—			—			36,521			36,521
Preferred shares at $0.01 par		—			—			25			25			—			—			25			25
Capital contributed in excess of par		—			—			913,185			913,185			—			—			899,439			899,439
Accumulated other comprehensive income		—			—			8,145			8,145			—			—			4,377			4,377
(Distributions in excess of net income) retained earnings		—			—			(27,435	)		(27,435	)		—			—			36,514			36,514
Net investment		1,043,881			146,162			(1,190,043	)		—			1,293,200			170,773			(1,463,973	)		—
TOTAL SHAREHOLDERS’ EQUITY		1,043,881			146,162			(259,258	)		930,785			1,293,200			170,773			(487,097	)		976,876
TOTAL LIABILITIES, MINORITY INTERESTS AND SHAREHOLDERS’ EQUITY	$	2,813,450		$	247,016		$	168,208		$	3,228,674		$	2,779,662		$	265,716		$	98,439		$	3,143,817

⁽¹⁾ Total includes PREIT’s proportionate share of partnership assets and liabilities in order to reflect the Company’s share of the total assets and liabilities of the underlying properties. The consolidated financial statements, which are presented in accordance with GAAP, reflect only the Company’s equity in these properties.

Page 24

Pennsylvania Real Estate Investment Trust

Investment in Real Estate

(in thousands)

	September 30, 2006						December 31, 2005
	Cost (1)		Accumulated Depreciation		Net Real Estate		Cost (1)		Accumulated Depreciation		Net Real Estate
Consolidated Malls
Beaver Valley Mall	$	57,965	$	7,237	$	50,728	$	56,003	$	5,844	$	50,159
Capital City Mall		91,396		6,512		84,884		88,628		4,550		84,078
Chambersburg Mall (2)		35,635		2,896		32,739		35,238		2,094		33,144
Cherry Hill Mall		229,765		17,685		212,080		209,683		13,478		196,205
Crossroads Mall		33,254		3,202		30,052		32,269		2,318		29,951
Cumberland Mall		57,177		2,051		55,126		55,236		1,082		54,154
Dartmouth Mall		60,687		15,826		44,861		60,548		13,719		46,829
Echelon Mall		19,585		3,875		15,710		18,175		3,043		15,132
Exton Square Mall		145,331		12,121		133,210		144,828		9,699		135,129
Francis Scott Key Mall (2)		65,982		5,081		60,901		62,262		3,624		58,638
Gadsden Mall		51,238		2,003		49,235		50,448		1,016		49,432
The Gallery at Market East		79,407		6,224		73,183		78,034		4,580		73,454
Jacksonville Mall		68,099		5,622		62,477		67,272		4,109		63,163
Logan Valley Mall (2)		92,539		8,771		83,768		91,916		6,449		85,467
Lycoming Mall (2)		68,808		4,441		64,367		57,216		3,207		54,009
Magnolia Mall		68,307		12,270		56,037		65,587		10,986		54,601
The Mall at Prince Georges		96,875		17,840		79,035		92,675		15,667		77,008
Moorestown Mall		76,981		10,190		66,791		76,654		8,066		68,588
New River Valley Mall (2)		41,568		2,595		38,973		31,506		1,834		29,672
Nittany Mall (2)		40,909		3,241		37,668		39,587		2,281		37,306
North Hanover Mall (2)		29,397		2,547		26,850		29,015		1,842		27,173
Orlando Fashion Square		111,325		5,447		105,878		109,718		3,125		106,593
Palmer Park Mall		33,678		8,379		25,299		33,543		7,636		25,907
Patrick Henry Mall (2)		133,954		9,589		124,365		131,103		5,976		125,127
Phillipsburg Mall (2)		49,250		3,948		45,302		49,162		2,914		46,248
Plymouth Meeting Mall		83,953		7,978		75,975		81,746		6,246		75,500
Schuylkill Mall		8,400		973		7,427		8,268		—		8,268
South Mall (2)		27,959		2,211		25,748		27,110		1,627		25,483
Uniontown Mall (2)		35,494		3,574		31,920		35,127		2,615		32,512
Valley Mall		86,774		8,063		78,711		86,301		5,930		80,371
Valley View Mall		64,736		4,637		60,099		61,167		3,399		57,768
Viewmont Mall (2)		79,533		5,553		73,980		77,311		4,069		73,242
Washington Crown Center (2)		42,857		5,379		37,478		42,538		3,984		38,554
Westgate Anchor Pad		3,450		—		3,450		3,400		—		3,400
Willow Grove Park		195,349		20,775		174,574		176,107		16,687		159,420
Wiregrass Mall		38,646		3,004		35,642		37,459		2,245		35,214
Woodland Mall		177,058		4,191		172,867		160,044		24		160,020
Wyoming Valley Mall (2)		95,366		6,650		88,716		91,736		4,860		86,876
Total Consolidated Malls		2,778,687		252,581		2,526,106		2,654,620		190,825		2,463,795
Unconsolidated Malls
Lehigh Valley Mall		19,143		10,641		8,502		17,953		10,223		7,730
Springfield Mall		53,986		2,028		51,958		47,743		127		47,616
Total Unconsolidated Malls		73,129		12,669		60,460		65,696		10,350		55,346
TOTAL MALLS	$	2,851,816	$	265,250	$	2,586,566	$	2,720,316	$	201,175	$	2,519,141

⁽¹⁾ Includes development and construction in progress costs at operating properties.

⁽²⁾ PREIT has an 89% ownership interest and a 99% economic interest in these properties. These properties are consolidated for financial reporting purposes.

Page 25

Pennsylvania Real Estate Investment Trust

Investment in Real Estate (continued)

(in thousands)

	September 30, 2006						December 31, 2005
	Cost (1)		Accumulated Depreciation		Net Real Estate		Cost (1)		Accumulated Depreciation		Net Real Estate
Consolidated Power Centers/Strips
Christiana Power Center	$	40,910	$	7,371	$	33,539	$	40,705	$	6,527	$	34,178
Creekview Shopping Center		19,098		4,460		14,638		19,095		3,772		15,323
Northeast Tower Center		33,661		4,897		28,764		33,661		4,240		29,421
Paxton Towne Centre		54,057		8,996		45,061		53,893		7,622		46,271
Crest Plaza		16,228		2,978		13,250		16,261		2,476		13,785
South Blanding Village		—		—		—		9,505		3,594		5,911
The Commons at Magnolia		9,724		2,038		7,686		9,784		1,732		8,052
Total Consolidated Power Centers/Strips		173,678		30,740		142,938		182,904		29,963		152,941
Unconsolidated Power Centers/Strips
The Court at Oxford Valley		27,735		5,997		21,738		27,702		5,551		22,151
Metroplex Shopping Center		42,024		8,727		33,297		42,024		7,568		34,456
Red Rose Commons		11,942		2,211		9,731		11,942		1,974		9,968
Whitehall Mall		15,639		6,563		9,076		15,627		6,204		9,423
Springfield Park		7,033		905		6,128		7,020		812		6,208
Total Unconsolidated Power Centers/Strips		104,373		24,403		79,970		104,315		22,109		82,206
TOTAL POWERS AND STRIP CENTERS		278,051		55,143		222,908		287,219		52,072		235,147
Development Properties
Lacey Retail Center, Lacey Twp, NJ		19,012		—		19,012		16,041		—		16,041
New Garden Town Center, New Garden Twp, PA		38,736		—		38,736		8,683		—		8,683
New River Valley Retail Center, Christianburg, VA		4,921		—		4,921		4,500		—		4,500
Springhills, Gainesville, FL		25,546		—		25,546		—		—		—
Monroe Marketplace, Selinsgrove, PA		5,542		—		5,542		—		—		—
The Plaza at Magnolia, Florence, SC		6,829		—		6,829		4,463		—		4,463
Total Development Properties		100,586		—		100,586		33,687		—		33,687
Unconsolidated Development Properties
Pavilion at Market East, Philadelphia, PA		7,531		666		6,865		1,510		—		1,510
Total Unconsolidated Development Properties		7,531		666		6,865		1,510		—		1,510
Other Properties
P&S Building		1,489		—		1,489		1,504		—		1,504
Land held for development		5,616		—		5,616		5,616		—		5,616
Total Other Properties		7,105		—		7,105		7,120		—		7,120
TOTAL INVESTMENT IN REAL ESTATE	$	3,245,089	$	321,059	$	2,924,030	$	3,049,852	$	253,247	$	2,796,605
CONSOLIDATED PROPERTIES	$	3,060,056	$	283,321	$	2,776,735	$	2,878,331	$	220,788	$	2,657,543
UNCONSOLIDATED PROPERTIES		185,033		37,738		147,295		171,521		32,459		139,062
TOTAL INVESTMENT IN REAL ESTATE	$	3,245,089	$	321,059	$	2,924,030	$	3,049,852	$	253,247	$	2,796,605

⁽¹⁾ Includes development and construction in progress costs at operating properties.

Page 26

Pennsylvania Real Estate Investment Trust

Property Redevelopment and Repositioning Summary as of September 30, 2006

NAME OF PROJECT LOCATION	TOTAL PROJECTED PROPERTY GLA (sq ft) (1)	PREIT’s PROJECTED SHARE OF COST		PREIT’s SHARE OF INVESTMENT TO DATE		RETURN ON INCREMENTAL INVESTMENT		CONSTRUCTION START DATE	EXPECTED DATE OF INITIAL OCCUPANCY	EXPECTED DATE OF COMPLETION	% OF EXPECTED SPENDING COMPLETED
		(in millions)		(in millions)
ENCLOSED MALL
Capital City Mall Camp Hill, PA	640,000	$	12.8	$	9.7	9.7	%	1Q05	4Q05	1Q07	76	%
The existing food court was redeveloped into new specialty retail space; a new eight-bay food court and two family-themed restaurants added.
Patrick Henry Mall Newport News, VA	710,000		29.3		24.8	10.0	%	1Q05	4Q05	1Q07	85	%
Dillard’s Men’s store was merged with Dillard’s; addition of Dick’s Sporting Goods, Borders, Red Robin restaurant, and new mall shops.
Cumberland Mall Vineland, NJ	950,000		5.3		4.0	10.6	%	2Q05	1Q06	1Q07	75	%
A Best Buy was added on land adjacent to the Cumberland Mall. An additional 10,000 square feet of outparcel space will also be added.
New River Valley Mall Christiansburg, VA	440,000		25.7		10.7	8.0	%	4Q05	1Q06	3Q07	42	%
Regal Cinemas will be relocated and expanded into a free-standing 14 screen theater; addition of Dick’s Sporting Goods and Red Robin restaurant.
Valley View Mall LaCrosse, WI	600,000		4.7		3.4	10.8	%	4Q05	4Q06	4Q06	72	%
An in-line 31,000 square foot Barnes & Noble opened at the mall.
Francis Scott Key Mall Frederick, MD	720,000		4.8		3.0	8.1	%	1Q06	3Q06	1Q07	63	%
An in-line 27,000 square foot Barnes & Noble is currently under construction.
Lycoming Mall Pennsdale, PA	830,000		18.1		12.3	10.6	%	1Q06	2Q06	4Q06	68	%
Dick’s Sporting Goods, Borders and Old Navy will occupy in-line space; Best Buy has opened an outparcel location. Also includes a cosmetic renovation.
Magnolia Mall Florence, SC	630,000		16.8		1.7	9.6	%	2Q06	2Q07	2Q07	10	%
A 28,000 square foot Barnes & Noble will be added to the mall as in-line space next to Belk. Dick’s Sporting Goods plans to open a 45,000 square foot store between JC Penney and Sears.
Lehigh Valley Mall Allentown, PA	1,180,000		20.3		0.4	8.5	%	3Q06	3Q07	1Q08	2	%
A Lifestyle Center will be added with shops and restaurants; a 28,000 square foot Barnes & Noble will be added as well.
Beaver Valley Mall Monaca, PA	1,160,000		9.2		1.3	9.5	%	3Q06	3Q07	3Q07	14	%
A 45,000 square foot Dick’s Sporting Goods will be added to the mall.
Plymouth Meeting Mall Plymouth Meeting, PA	TBD		83.9		21.0	8.6	%	4Q06	4Q07	1Q08	25	%
A 200,000 square foot lifestyle addition will include a 70,000 square foot Whole Foods market and 4 to 5 themed restaurants.
Cherry Hill Mall (2) Cherry Hill, NJ	TBD		TBD		19.6	TBD		TBD	TBD	TBD	TBD
Includes the addition of Bistro Row and new leasable area. Nordstrom has signed a letter of intent to open a 144,000 square foot space in the old Strawbridge’s location and is scheduled to open in the spring of 2009.
Willow Grove Park Willow Grove, PA	1,250,000		54.4		18.2	7.8	%	1Q07	1Q08	1Q08	33	%
Boscov’s will occupy a portion of the former Strawbridge’s space; balance to be reconfigured as a lifestyle/entertainment component
MIXED USE
Echelon Mall (Voorhees Town Center) Voorhees, NJ	TBD		60.7		2.8	9.7	%	1Q07	TBD	TBD	5	%
Redevelopment plans for the Echelon Mall include reducing the mall size to allow development of a mixed-use town center with 425 residential units, street-level retail and a new grocery store at the eastern half of the property, together with renaming the property as Voorhees Town Center.
Total Redevelopment Activity	9,110,000	$	346.0	$	132.9	9.0	%

⁽¹⁾ GLA includes tenants that purchased their respective land.

⁽²⁾ The previously issued detail for this project did not contemplate the addition of Nordstrom or the expansion and renovation of the mall. We are in the process of evaluating the scope of the project and will release the information in a future disclosure.

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Pennsylvania Real Estate Investment Trust

Development Property Summary as of September 30, 2006

NAME OF PROJECT LOCATION	TOTAL PROJECTED PROPERTY GLA (sq ft) (1)	PREIT’s PROJECTED SHARE OF COST		PREIT’s SHARE OF INVESTMENT TO DATE		EXPECTED STABILIZED NOI CAP		CONSTRUCTION START DATE	DATE OF INITIAL OCCUPANCY	EXPECTED DATE OF COMPLETION	% OF SPENDING COMPLETED		% LEASED		% OCCUPIED
		(in millions)		(in millions)
POWER CENTERS
The Plaza at Magnolia Florence, SC	252,000	$	11.3	$	6.8	8.9	%	1Q06	3Q06	3Q07	60	%	95	%	59	%
A 252,000 square foot power center is under construction across the street from Magnolia Mall with Home Depot as anchor. Home Depot, Longhorn Steakhouse and Olive Garden opened 3Q06. Kohl’s anticipated opening is 2Q07.
Lacey Retail Center (2) Lacey Township, NJ	261,000		49.5		19.0	6.4	%	3Q06	3Q07	1Q08	38	%	59	%	0	%
A retail shopping center will be anchored by Home Depot. The balance of the center is comprised of in-line stores and outparcels.
New River Valley Retail Center Christiansburg, VA	163,000		27.9		4.9	8.3	%	4Q06	4Q07	4Q07	18	%	18	%	0	%
A power center is planned adjacent to the existing New River Valley Mall. Best Buy lease executed July 2006.
Monroe Marketplace Selinsgrove, PA	696,000		57.0		5.5	8.7	%	2Q07	3Q08	3Q08	10	%	0	%	0	%
A 696,000 square foot power center is planned. PREIT purchased nine of the proposed 125 acres in July 2006.
MIXED USE
Springhills Gainesville, FL	TBD		TBD		25.5	TBD		TBD	TBD	TBD	N/A		0	%	0	%
PREIT has purchased 540 acres of land for $21.5 million. The Company’s plans include a mixed-use development program.
New Garden Town Center New Garden Township, PA	715,000		82.1		34.0	9.4	%	1Q08	3Q09	4Q09	41	%	0	%	0	%
Retail and mixed use components.
OTHER
Valley View Downs(3) South Beaver Township, PA	300,000		10.0		1.3	(3	)	TBD	TBD	TBD	13	%	N/A		0	%
PREIT will manage the development of a harness racetrack and a casino accommodating up to 3,000 slot machines on an approximately 208 acre property.
Pavilion at Market East (4) Philadelphia, PA	TBD		TBD		1.9	TBD		TBD	TBD	TBD	N/A		N/A		0	%
TBD
Total Development Activity	2,387,000	$	237.8	$	98.9	8.4	%

⁽¹⁾ GLA includes tenants that purchased their respective land; therefore, the % leased and occupied will also include these tenants.

⁽²⁾ Home Depot is expected to open in 3Q07 with the balance of Phase I open in 1Q08.

⁽³⁾ Our acquisition of the site and the construction of the racetrack require the issuance to Valley View Downs (an unaffiliated entity) (“Valley View”) of the sole remaining unissued harness racetrack license in Pennsylvania. The construction of the casino requires the issuance of a gaming license to Valley View. Valley View had been one of two applicants for the racing license. In November 2005, the Harness Racing Commission issued an order denying award of the racing license to both of the applicants. In December 2005, Valley View filed a motion for reconsideration with the Commission. In addition, Valley View filed an appeal of the ruling in the Pennsylvania Commonwealth Court. In June 2006, the Commonwealth Court affirmed the denial of the license to Valley View. In June and July 2006, Valley View and the Commission filed appeals with the Supreme Court of Pennsylvania. The parties are awaiting action by the Court with respect to these appeals. We are unable to predict whether Valley View will be issued the racing license or the gaming license.

⁽⁴⁾ The Partnership’s development plans for the Pavilion at Market East are under review. The company retains a 40% interest in the partnership.

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Pennsylvania Real Estate Investment Trust

Capital Expenditures

(in thousands)

	Three months ended September 30, 2006						Nine months ended September 30, 2006
	Consolidated		Unconsolidated		Total		Consolidated		Unconsolidated		Total
New development projects	$	14,061	$	—	$	14,061	$	66,800	$	—	$	66,800
Redevelopment projects with incremental GLA and/or anchor replacement		25,762		595		26,357		87,936		595		88,531
Tenant allowances		5,301		159		5,460		12,609		290		12,899
Recurring capital expenditures:
CAM expenditures		3,513		154		3,667		5,768		171		5,939
Non-CAM expenditures		1,484		29		1,513		2,068		401		2,469
Renovation with no incremental GLA		2,936		—		2,936		3,608		—		3,608
Total recurring capital expenditures		7,933		183		8,116		11,444		572		12,016
Total	$	53,057	$	937	$	53,994	$	178,789	$	1,457	$	180,246

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Pennsylvania Real Estate Investment Trust

Debt Analysis as of September 30, 2006

(in thousands)

	Outstanding Debt (1)
	Fixed Rate			% of Total Indebtedness		Floating Rate			% of Total Indebtedness		Total			% of Total Indebtedness
Consolidated mortgage notes payable	$	1,608,587		77.5	%	$	—		0.0	%	$	1,608,587		77.5	%
Unconsolidated mortgage notes payable		73,234		3.5	%		117,155		5.5	%		190,389		9.2	%
Credit Facility		—		0.0	%		277,000		13.3	%		277,000		13.3	%
TOTAL OUTSTANDING DEBT	$	1,681,821		81.0	%	$	394,155		19.0	%	$	2,075,976		100.0	%
AVERAGE INTEREST RATE		6.41	%				6.29	%				6.39	%

⁽¹⁾ Includes debt premium

		Average Debt Balance
		Mortgage Debt (1)			REMIC (2)			Total Mortgages			Credit Facility			TOTAL
Beginning Balance	6/30/2006	$	1,311,854		$	443,355		$	1,755,209		$	300,000		$	2,055,209
Lehigh Valley Refinance	7/11/2006		75,000						75,000						75,000
Credit Facility Repayment	7/11/2006		(21,750	)					(21,750	)		(52,000	)		(73,750	)
Credit Facility Borrowing	8/21/2006											10,000			10,000
Credit Facility Repayment	8/25/2006											(9,000	)		(9,000	)
Credit Facility Borrowing	9/15/2006											28,000			28,000
Debt Amortization (3)	9/30/2006		(4,855	)		(4,628	)		(9,483	)		—			(9,483	)
Ending Balance	9/30/2006	$	1,360,249		$	438,727		$	1,798,976		$	277,000		$	2,075,976
Weighted Average Balance		$	1,358,737		$	443,355		$	1,802,092		$	259,609		$	2,061,701

⁽¹⁾ Includes debt premium.

⁽²⁾ The REMIC is a first mortgage loan that has a final maturity date of September 10, 2008 and is secured by a portfolio of 15 properties at an interest rate of 7.43% per annum.

⁽³⁾ Includes the amortization of debt premium and balloon payments.

	Debt Maturities
Year	Scheduled Amortization		Debt Premium Amortization		Mortgage Balance at Maturity		Credit Facility		Total Debt
2006	$	6,215	$	3,326	$	—	$	—	$	9,541
2007		25,192		12,848		157,063		—		195,103
2008		40,772		9,789		511,693		—		562,254
2009		16,239		1,283		62,381		277,000		356,903
2010		17,137		1,174		1,412		—		19,723
2011		17,825		1,152		44,451		—		63,428
2012		14,876		416		306,580		—		321,872
2013		9,816		—		110,458		—		120,274
Thereafter		20,097		—		406,781		—		426,878
	$	168,169	$	29,988	$	1,600,819	$	277,000	$	2,075,976

⁽¹⁾ The weighted average period to mortgage maturity is 4.98 years.

Interest Rate Hedging Instruments
Type	Notional Amount		Blended Rate		Latest Settlement Date
10 Year Forward Starting Swaps	$	120,000	4.69	%	10/31/2007
10 Year Forward Starting Swaps	$	250,000	4.80	%	12/10/2008
10 Year Forward Starting Swaps	$	150,000	5.36	%	12/10/2008

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Pennsylvania Real Estate Investment Trust

Debt Schedule as of September 30, 2006

(in thousands)

	Proportionate Share(1)						Stated Interest Rate		Marked to Market Interest Rate (GAAP)		Annual Debt Service		Balance at Maturity		Maturity Date
	Mortgage Debt		Debt Premium		Total
Beaver Valley Mall	$	45,986	$	—	$	45,986	7.36	%	7.36	%	$	3,972	$	42,266	2012
Capital City Mall		51,788		4,573		56,361	7.61	%	5.50	%		4,603		47,843	2012
Chambersburg Mall (2)		18,069		801		18,870	7.43	%	4.99	%		1,763		17,200	2008
Cherry Hill Mall		197,500		—		197,500	5.42	%	5.42	%		13,510		177,689	2012
The Court at Oxford Valley		20,084		—		20,084	8.02	%	8.02	%		2,319		15,667	2011
Crossroads Mall		13,044		340		13,384	7.39	%	5.75	%		1,191		12,647	2008
Cumberland Mall - 1st Mortgage		43,010		2,128		45,138	6.50	%	5.40	%		3,413		38,782	2012
Cumberland Mall - 2nd Mortgage		3,505		—		3,505	5.00	%	5.00	%		206		—	2017
Dartmouth Mall		66,600		—		66,600	4.95	%	4.95	%		4,484		57,594	2013
Exton Square Mall		96,209		3,528		99,737	6.95	%	5.00	%		8,102		93,034	2008
Francis Scott Key Mall (2)		31,621		1,402		33,023	7.43	%	4.99	%		3,085		30,099	2008
Jacksonville Mall (2)		24,393		1,081		25,474	7.43	%	4.99	%		2,380		23,219	2008
Logan Valley Mall (2)		51,497		2,282		53,779	7.43	%	4.99	%		5,024		49,018	2008
Lycoming Mall (2)		31,621		1,402		33,023	7.43	%	4.99	%		3,084		30,099	2008
Magnolia Mall		64,995		—		64,995	5.33	%	5.33	%		4,413		54,212	2015
The Mall at Prince Georges		40,433		441		40,874	8.70	%	6.80	%		4,135		39,987	2007
Metroplex Shopping Center		31,173		—		31,173	7.25	%	7.25	%		2,681		28,785	2011
Moorestown Mall		61,129		—		61,129	4.95	%	4.99	%		4,115		52,863	2013
New River Valley Mall (2)		15,359		681		16,040	7.43	%	4.99	%		1,498		14,619	2008
Nittany Mall (2)		27,104		1,201		28,305	7.43	%	4.99	%		2,644		25,799	2008
North Hanover Mall (2)		18,069		801		18,870	7.43	%	4.99	%		1,763		17,199	2008
Northeast Tower Center (2)		15,810		701		16,511	7.43	%	7.43	%		1,542		15,049	2008
Palmer Park Mall		16,881		—		16,881	6.77	%	6.77	%		1,661		15,674	2009
Patrick Henry Mall (2)		45,624		2,022		47,646	7.43	%	4.99	%		4,451		43,428	2008
Pavilion East Associates		532		—		532	6.00	%	6.00	%		62		—	2018
Phillipsburg Mall (2)		27,104		1,201		28,305	7.43	%	4.99	%		2,644		25,799	2008
Red Rose Commons		13,188		—		13,188	7.66	%	7.66	%		1,220		12,425	2009
Schuylkill Mall (3)		16,462		—		16,462	7.25	%	7.25	%		—		—	2008
Springfield Park		1,671		—		1,671	7.79	%	7.79	%		203		1,412	2010
South Mall (2)		13,552		601		14,153	7.43	%	4.99	%		1,322		12,899	2008
Uniontown Mall (2)		21,683		961		22,644	7.43	%	4.99	%		2,115		20,639	2008
Valley Mall		90,000		—		90,000	5.49	%	5.49	%		5,014		78,835	2016
Valley View Mall		36,010		358		36,368	6.15	%	5.75	%		2,773		34,281	2009
Viewmont Mall (2)		27,104		1,201		28,305	7.43	%	4.99	%		2,644		25,799	2008
Whitehall Mall		6,586		—		6,586	6.77	%	6.77	%		641		6,129	2008
Willow Grove Park		158,440		—		158,440	5.65	%	5.65	%		11,083		133,249	2015
Woodland Mall		156,500		—		156,500	5.58	%	5.58	%		8,397		140,484	2016
Wyoming Valley Mall (2)		51,497		2,282		53,779	7.43	%	4.99	%		5,024		49,018	2008
Total Fixed Rate Debt		1,651,833		29,988		1,681,821	6.41	%	5.53	%		129,181		1,483,741
Variable Rate Debt
Lehigh Valley Mall		75,000		—		75,000	5.89	%	5.89	%		4,418		75,000	2007
Pavilion East Associates		3,905		—		3,905	8.25	%	8.25	%		430		3,828	2007
Springfield Mall		38,250		—		38,250	6.45	%	6.45	%		2,467		38,250	2007
Total Variable Rate Debt		117,155		—		117,155	6.15	%	6.15	%		7,315		117,078
Total Mortgage Debt	$	1,768,988	$	29,988	$	1,798,976	6.39	%	5.58	%	$	136,496	$	1,600,819
CONSOLIDATED MORTGAGES	$	1,578,599	$	29,988	$	1,608,587	6.36	%	5.53	%	$	122,055	$	1,419,323
UNCONSOLIDATED MORTGAGES		190,389		—		190,389	6.66	%	6.66	%		14,441		181,496
CREDIT FACILITY		277,000		—		277,000	6.40	%				—		—
Total	$	2,045,988	$	29,988	$	2,075,976	6.39	%	5.66	%	$	136,496	$	1,600,819

⁽¹⁾ Includes 100% of debt from consolidated properties and our share of debt from unconsolidated properties, based on our ownership percentage.

⁽²⁾ Mortgage Debt represents the properties’ allocated portion of the REMIC.

⁽³⁾ In December 2004, the Company completed a modification of the mortgage on Schuylkill Mall. The modification limits the monthly payments to interest plus the excess cash flow from the property. Due to the modification, the timing of future principal payment amounts cannot be determined. In October 2006, this mortgage was further modified to reduce the interest rate from 7.25% to 4.50%.

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Pennsylvania Real Estate Investment Trust

Shareholder Information

Ten Largest Institutional Shareholders: Common Shares Held (1)	September 30, 2006
Barclays Global Investors	3,943,941
Fidelity Management & Research	2,825,800
J.P. Morgan Investment Management Inc. (NY)	2,713,876
ING Clarion Real Estate Securities	2,096,353
Vanguard Group, Inc.	1,954,445
Cohen & Steers Capital Management, Inc.	1,658,700
State Street Global Advisors	895,831
Nomura Asset Management Co, Ltd.	853,200
RREEF Real Estate Securities Advisers, L.P.	825,996
Wesley Capital Management, LLC	740,467
TOTAL of Ten Largest Institutional:	18,508,609
TOTAL of all Institutional Holders:	28,425,529
Ten Largest as % of Total Institutional:	65.1	%

⁽¹⁾ Based on 13F filings as of 9/30/06 or most recent filings.

Breakdown of Share & Unit Ownership: Shares Held	September 30, 2006	December 31, 2005	% of September 30, 2006 total
Institutional (1)	28,425,529	25,620,533	69.6	%
Retail (2)	7,586,800	9,480,453	18.6	%
Insiders (3)	4,811,556	5,575,650	11.8	%
TOTAL	40,823,885	40,676,636	100.0	%

⁽¹⁾ Based on 13F filings as of 9/30/06 or most recent filings.

⁽²⁾ Retail ownership equals total shares outstanding minus institutional and insider ownership.

⁽³⁾ Insider holdings as of April 7, 2006 (Shares and OP Units only). Excludes 357,405 exercisable options.

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Pennsylvania Real Estate Investment Trust

Definitions

Funds From Operations (FFO)

The National Association of Real Estate Investment Trusts (“NAREIT”) defines Funds From Operations, which is a non-GAAP measure, as income before gains (losses) on sales of operating property and extraordinary items (computed in accordance with GAAP); plus real estate depreciation; plus or minus adjustments for unconsolidated partnerships to reflect funds from operations on the same basis. We compute Funds From Operations by taking the amount determined pursuant to the NAREIT definition and subtracting dividends on preferred shares (“FFO”). FFO is a commonly used measure of operating performance and profitability in the REIT industry, and we use FFO as a supplemental non-GAAP measure to compare our company’s performance to that of our industry peers. In addition, we use FFO as a performance measure for determining bonus amounts earned under certain of our performance-based executive compensation programs. The Company computes FFO in accordance with standards established by NAREIT, less dividends on preferred shares, which may not be comparable to FFO reported by other REITs that do not define the term in accordance with the current NAREIT definition, or that interpret the current NAREIT definition differently than the Company.

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

The Company believes that net income is the most directly comparable GAAP measurement to FFO. The Company believes that FFO is helpful to management and investors as a measure of operating performance because it excludes various items included in net income that do not relate to or are not indicative of operating performance, such as various non-recurring items that are considered extraordinary under GAAP, gains on sales of real estate and depreciation and amortization of real estate.

Net Operating Income (NOI)

Net operating income (“NOI”), which is a non-GAAP measure, is derived from revenues (determined in accordance with GAAP) minus property operating expenses (determined in accordance with GAAP). Net operating income is a non-GAAP measure. It does not represent cash generated from operating activities in accordance with GAAP and should not be considered to be an alternative to net income (determined in accordance with GAAP) as an indication of the Company’s financial performance or to be an alternative to cash flow from operating activities (determined in accordance with GAAP) as a measure of the Company’s liquidity; nor is it indicative of funds available for the Company’s cash needs, including its ability to make cash distributions. The Company believes that net income is the most directly comparable GAAP measurement to net operating income.

The Company believes that net operating income is helpful to management and investors as a measure of operating performance because it is an indicator of the return on property investment, and provides a method of comparing property performance over time. Net operating income excludes general and administrative expenses, management company revenues, interest income, interest expense, depreciation and amortization, income from discontinued operations and gains on sales of interests in real estate.

Funds Available for Distribution (FAD)

FAD, which some companies refer to as Cash Available for Distributions (CAD) or Adjusted FFO (AFFO), is a measure of a real estate company’s cash flows generated by operations and capacity to pay dividends. The Company calculates FAD by starting with FFO and subtracting (1) straight-line rents, (2) normalized recurring capital expenditures that are capitalized but necessary to maintain our properties, (3) operational tenant allowances, (4) capitalized leasing costs, (5) amortization of debt premium, and (6) amortization of above and below market lease intangibles.

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

Page 33