8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of report (Date of earliest event reported) October 30, 2007

Pennsylvania Real Estate Investment Trust

(Exact Name of Registrant as Specified in its Charter)

Pennsylvania	1-6300	23-6216339
(State or Other Jurisdiction of Incorporation or Organization)	(Commission File Number)	(IRS Employer Identification No.)

The Bellevue, 200 S. Broad Street, Philadelphia, Pennsylvania	19102
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code: (215) 875-0700

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition.

On October 30, 2007, Pennsylvania Real Estate Investment Trust provided on its web site at www.preit.com its Quarterly Supplemental Disclosure dated September 30, 2007. A copy of the Quarterly Supplemental Disclosure is attached as an exhibit to this report.

The information furnished under this “Item 2.02. Results of Operations and Financial Condition” shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such a filing.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

99.1 Quarterly Supplemental Disclosure dated September 30, 2007.

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	PENNSYLVANIA REAL ESTATE INVESTMENT TRUST
Date: November 5, 2007	By:	/s/ Bruce Goldman
		Bruce Goldman
		Executive Vice President and General Counsel

Exhibit Index

99.1 Quarterly Supplemental Disclosure dated September 30, 2007

- 2 -

EX-99.1

Exhibit 99.1

Pennsylvania Real Estate Investment Trust

Supplemental Financial and Operating Information

Quarter Ended September 30, 2007

www.preit.com

NYSE: (PEI)

Pennsylvania Real Estate Investment Trust

Supplemental Financial and Operating Information

September 30, 2007

Table of Contents

Introduction
Company Information	1
Press Release Announcements	2
Market Capitalization and Capital Resources	3
Operating Results
Income Statement-Proportionate Consolidation Method - Three Months Ended September 30, 2007 and 2006	4
Income Statement-Proportionate Consolidation Method - Nine Months Ended September 30, 2007 and 2006	5
Net Operating Income - Three Months Ended September 30, 2007 and 2006	6
Net Operating Income - Nine Months Ended September 30, 2007 and 2006	7
Computation of Earnings per Share	8
Funds From Operations and Funds Available for Distribution	9
Operating Statistics
Leasing Activity Summary	10
Summarized Rent Per Square Foot and Occupancy Percentages	11
Mall Sales and Rents Per Square Foot	12
Mall Occupancy - Owned GLA	13
Power Center and Strip Center Rents Per Square Foot and Occupancy Percentages	14
Top Twenty Tenants	15
Lease Expirations	16
Gross Leasable Area Summary	17
Property Information	18
Balance Sheet
Balance Sheet - Proportionate Consolidation Method	21
Balance Sheet - Property Type	22
Investment in Real Estate	23
Property Redevelopment and Repositioning Summary	25
Development Property Summary	27
Capital Expenditures	28
Debt Analysis	29
Debt Schedule	30
Shareholder Information	31
Definitions	32

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 herein, 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, 2006. 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” or “the Company”), 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. As of September 30, 2007, the Company’s retail portfolio, of approximately 33.7 million square feet, consisted of 55 properties including 38 shopping malls, 11 strip and power centers, and six properties under development. The Company’s properties are located in 13 states in the eastern half of the United States, primarily in the Mid-Atlantic region.

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) 546-2504

Email: yaronn@preit.com

Reporting Calendar

Results for 2007 will be announced as follows (tentative dates):

Fourth Quarter 2007 February 26, 2008

Research Coverage

Company	Analyst	Phone Number
Citi Investment Research	Jonathan Litt	(212) 816-0231
	Ambika Goel	(212) 816-6981
Green Street Advisors	Jim Sullivan	(949) 640-8780
	Ben Yang	(949) 640-8780
JP Morgan	Michael W. Mueller	(212) 622-6689
	Sarah E. King	(212) 622-5670
Lehman Brothers	David Harris	(212) 526-1790
Merrill Lynch	Craig Schmidt	(212) 449-1944
	Steve Sakwa	(212) 449-0335
	David Wiggington	(212) 449-2729
Morgan Stanley	Matthew Ostrower	(212) 761-6284
	Mick Chiang	(212) 761-6385
Stifel Nicolaus	Nathan Isbee	(443) 224-1346
	David M. Fick	(443) 224-1308
UBS Securities	Jeffrey Spector	(212) 713-6144

1

Pennsylvania Real Estate Investment Trust

Press Release Announcements

Dividends and Distributions:

October 29, 2007 PREIT announced the Board of Trustees of the Company declared a quarterly cash dividend of $0.57 per common share.

July 31, 2007 PREIT announced the Board of Trustees of the Company declared a quarterly cash dividend of $0.57 per common share.

Acquisitions, dispositions, development and redevelopment activities:

September 17, 2007 PREIT announced the grand opening of The Cheesecake Factory at Willow Grove Park in Willow Grove, Pennsylvania.

August 28, 2007 PREIT and Simon Property Group announced details regarding the Grand Opening of the Lifestyle expansion at Lehigh Valley Mall in Whitehall, Pennsylvania.

August 1, 2007 PREIT announced it will begin the development of Monroe Marketplace in Monroe Township, Pennsylvania, with a groundbreaking ceremony on August 2, 2007.

Financing activities:

August 1, 2007 PREIT redeemed all of its 2.475 million outstanding 11% Non-Convertible Senior Preferred Shares on July 31, 2007.

Other activities:

October 16, 2007 PREIT, Bank of America and Tasty Baking announced they are sponsoring the creation of a nine story mural to be known as the Jefferson Gateway Mural in Philadelphia, Pennsylvania.

October 11, 2007 PREIT scheduled its Third Quarter 2007 earnings call for Tuesday, October 30, 2007.

July 31, 2007 PREIT reported its results for the Second Quarter 2007.

July 10, 2007 PREIT scheduled its Second Quarter 2007 earnings call for Tuesday, July 31, 2007.

NOTE: The press release announcements are available on the Company’s website at www.preit.com.

2

Pennsylvania Real Estate Investment Trust

Market Capitalization and Capital Resources

	Quarter Ended September 30,						Year Ended December 31,
	2007			2006			2006			2005			2004
TRADING INFORMATION
High Price	$	45.38		$	43.41		$	44.53		$	50.20		$	43.70
Low Price	$	34.37		$	37.30		$	36.75		$	35.24		$	30.25
Average Daily Trading Volume		356,078			171,849			223,686			209,537			161,659
MARKET CAPITALIZATION (in thousands, except per share amounts)
EQUITY CAPITALIZATION
Common Shares Outstanding		38,664			36,865			36,947			36,521			36,272
O.P. Units Outstanding		2,682			3,959			4,297			4,156			4,414
Total Shares and O.P. Units		41,346			40,824			41,244			40,677			40,686
Market Price (closing price at end of period)	$	38.94		$	42.57		$	39.38		$	37.36		$	42.80
Equity Market Capitalization - Shares and O.P. Units	$	1,610,005		$	1,736,920		$	1,606,325		$	1,519,679		$	1,741,349
Preferred Shares, Nominal Value		—			123,750			123,750			123,750			123,750
Total Equity Market Capitalization		1,610,005			1,860,670			1,730,075			1,643,429			1,865,099
DEBT CAPITALIZATION
Unsecured Debt Balance (1) (2)		533,648			277,000			333,148			436,900			271,000
Secured Debt Balance		1,837,860			1,798,976			1,789,511			1,523,745			1,326,127
Debt Capitalization		2,371,508			2,075,976			2,122,659			1,960,645			1,597,127
TOTAL MARKET CAPITALIZATION	$	3,981,513		$	3,936,646		$	3,852,734		$	3,604,074		$	3,462,226
Preferred Shares/Total Market Capitalization		0.0%			3.1%			3.2%			3.4%			3.6%
Shares and O.P. Units/Total Market Capitalization		40.4%			44.1%			41.7%			42.2%			50.3%
Debt Capitalization/Total Market Capitalization		59.6%			52.7%			55.1%			54.4%			46.1%
Equity Capitalization/Total Market Capitalization		40.4%			47.3%			44.9%			45.6%			53.9%
Unsecured Debt Balance/Total Debt		22.5%			13.3%			15.7%			22.3%			17.0%
DISTRIBUTIONS PER COMMON SHARE
Ordinary Income		(3	)	$	0.493		$	1.935		$	2.075		$	1.617
Section 1250 Gain		(3	)		—			0.037			—			0.026
Return of Capital/Non-Taxable		(3	)		0.077			0.308			0.175			0.517
Distributions per share	$	0.570		$	0.570		$	2.280		$	2.250		$	2.160
Annualized Dividend Yield(4)		5.9%			5.4%			5.8%			6.0%			5.0%
CAPITAL RESOURCES
Cash on Hand	$	23,861		$	21,457		$	18,727		$	25,828		$	45,949
Credit Facility (5)		500,000			500,000			500,000			500,000			500,000
Amount Outstanding		(245,000	)		(277,000	)		(332,000	)		(342,500	)		(271,000	)
Letters of Credit		(16,686	)		(24,083	)		(24,803	)		(10,485	)		(8,055	)
Credit Facility Available(6)		238,314			198,917			143,197			147,015			220,945
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	$	918,029		$	876,228		$	817,778		$	828,697		$	922,748

(1) The unsecured debt balance includes $1,148, $1,148 and $94,400 of corporate notes payable as of September 30, 2007, December 31, 2006 and December 31, 2005, respectively.

(2) The unsecured debt balance includes $287,500 in exchangeable senior notes as of September 30, 2007.

(3) Tax status of 2007 dividend payments will be available in January 2008.

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

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

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

3

Pennsylvania Real Estate Investment Trust

Income Statement - Three Months Ended September 30, 2007 and 2006

Proportionate Consolidation Method ⁽¹⁾

(in thousands)

	Three months ended September 30, 2007												Three months ended September 30, 2006
	GAAP			Share of unconsolidated partnerships(1)			Discontinued operations			Total			GAAP			Share of unconsolidated partnerships(1)			Discontinued operations			Total
Real estate revenue:
Base rents	$	71,547		$	6,020		$	—		$	77,567		$	70,644		$	5,926		$	909		$	77,479
Expense reimbursements		33,369			2,234			—			35,603			33,951			1,934			509			36,394
Percentage rent		1,289			38			—			1,327			1,432			52			5			1,489
Lease termination revenue		690			5			—			695			440			145			—			585
Other real estate revenue		3,985			192			19			4,196			4,519			207			104			4,830
TOTAL REAL ESTATE REVENUE		110,880			8,489			19			119,388			110,986			8,264			1,527			120,777
Property operating expenses:
CAM and real estate taxes		(31,620	)		(1,712	)		—			(33,332	)		(31,408	)		(1,562	)		(496	)		(33,466	)
Utilities		(6,886	)		(252	)		—			(7,138	)		(6,886	)		(225	)		(252	)		(7,363	)
Other property operating expenses		(5,968	)		(635	)		—			(6,603	)		(6,759	)		(507	)		(158	)		(7,424	)
TOTAL PROPERTY OPERATING EXPENSES		(44,474	)		(2,599	)		—			(47,073	)		(45,053	)		(2,294	)		(906	)		(48,253	)
NET OPERATING INCOME		66,406			5,890			19			72,315			65,933			5,970			621			72,524
Management company revenue		854			—			—			854			546			—			—			546
Interest and other income		535			—			—			535			566			—			—			566
Other expenses:
General and administrative expenses		(9,888	)		—			—			(9,888	)		(9,567	)		—			—			(9,567	)
Income taxes and other		(109	)		—			—			(109	)		(142	)		—			—			(142	)
Interest expense(2)		(24,866	)		(3,028	)		—			(27,894	)		(24,041	)		(3,247	)		(300	)		(27,588	)
Depreciation and amortization		(32,743	)		(1,714	)		—			(34,457	)		(30,808	)		(1,679	)		(352	)		(32,839	)
Subtotal		189			1,148			19			1,356			2,487			1,044			(31	)		3,500
Equity in income of partnerships		1,148			(1,148	)		—			—			1,044			(1,044	)		—			—
Gains on sales of non-operating real estate		247			—			—			247			166			—			—			166
Minority interest		(103	)		—			—			(103	)		(395	)		—			—			(395	)
TOTAL CONTINUING OPERATIONS		1,481			—			19			1,500			3,302			—			(31	)		3,271
Discontinued Operations:
Operating results from discontinued operations		19			—			(19	)		—			(31	)		—			31			—
Gain on sale of discontinued operations		—			—			—			—			1,414			—			—			1,414
Minority interest		(1	)		—			—			(1	)		(141	)		—			—			(141	)
TOTAL DISCONTINUED OPERATIONS		18			—			(19	)		(1	)		1,242			—			31			1,273
NET INCOME		1,499			—			—			1,499			4,544			—			—			4,544
Dividends on preferred shares		(1,134	)		—			—			(1,134	)		(3,403	)		—			—			(3,403	)
Redemption of preferred shares		13,347			—			—			13,347			—			—			—			—
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS	$	13,712		$	—		$	—		$	13,712		$	1,141		$	—		$	—		$	1,141

⁽¹⁾ Total includes PREIT’s proportionate share of partnership operations “grossed up” to reflect the Company’s share of the total revenue and expenses of the underlying properties.

⁽²⁾ Capitalized interest expense of $4,455 and $2,799 is not included for the three months ended September 30, 2007 and September 30, 2006, respectively.

4

Pennsylvania Real Estate Investment Trust

Income Statement - Nine Months Ended September 30, 2007 and 2006

Proportionate Consolidation Method⁽¹⁾

(in thousands)

	Nine months ended September 30, 2007												Nine months ended September 30, 2006
	GAAP			Share of unconsolidated partnerships(1)			Discontinued operations			Total			GAAP			Share of unconsolidated partnerships (1)			Discontinued operations			Total
Real estate revenue:
Base rent	$	213,300		$	17,843		$	530		$	231,673		$	210,909		$	17,634		$	2,780		$	231,323
Expense reimbursements		101,028			6,708			436			108,172			99,544			5,852			1,568			106,964
Percentage rent		4,922			76			—			4,998			5,196			121			6			5,323
Lease termination revenue		1,408			6			—			1,414			2,583			263			152			2,998
Other real estate revenue		11,638			639			91			12,368			12,704			617			278			13,599
TOTAL REAL ESTATE REVENUE		332,296			25,272			1,057			358,625			330,936			24,487			4,784			360,207
Property operating expenses:
CAM and real estate taxes		(95,116	)		(5,235	)		(473	)		(100,824	)		(92,429	)		(4,782	)		(1,504	)		(98,715	)
Utilities		(19,055	)		(697	)		(259	)		(20,011	)		(17,965	)		(658	)		(773	)		(19,396	)
Other property operating expenses		(17,263	)		(1,733	)		(92	)		(19,088	)		(19,214	)		(1,635	)		(416	)		(21,265	)
TOTAL PROPERTY OPERATING EXPENSES		(131,434	)		(7,665	)		(824	)		(139,923	)		(129,608	)		(7,075	)		(2,693	)		(139,376	)
NET OPERATING INCOME		200,862			17,607			233			218,702			201,328			17,412			2,091			220,831
Management company revenue		1,827			—			—			1,827			1,832			—			—			1,832
Interest and other income		2,323			—			—			2,323			1,452			—			—			1,452
Other expenses:
General and administrative expenses		(31,314	)		—			—			(31,314	)		(29,817	)		—			—			(29,817	)
Executive separation		—			—			—			—			(3,985	)		—			—			(3,985	)
Income taxes and other		(520	)		—			—			(520	)		(383	)		—			—			(383	)
Interest expense (2)		(72,338	)		(9,208	)		(136	)		(81,682	)		(72,319	)		(8,082	)		(915	)		(81,316	)
Depreciation and amortization		(96,970	)		(5,127	)		(215	)		(102,312	)		(91,421	)		(5,255	)		(3,562	)		(100,238	)
Subtotal		3,870			3,272			(118	)		7,024			6,687			4,075			(2,386	)		8,376
Equity in income of partnerships		3,272			(3,272	)		—			—			4,075			(4,075	)		—			—
Gains on sales of interests in real estate		579			—			—			579			—			—			—			—
Gains on sales of non-operating real estate		1,731			—			—			1,731			381			—			—			381
Minority interest		(884	)		—			—			(884	)		(1,221	)		—			—			(1,221	)
TOTAL CONTINUING OPERATIONS		8,568			—			(118	)		8,450			9,922			—			(2,386	)		7,536
Discontinued Operations:
Operating results from discontinued operations		(118	)		—			118			—			(2,386	)		—			2,386			—
Gain on sale of discontinued operations		6,699			—			—			6,699			1,414			—			—			1,414
Minority interest		(691	)		—			—			(691	)		98			—			—			98
TOTAL DISCONTINUED OPERATIONS		5,890			—			118			6,008			(874	)		—			2,386			1,512
NET INCOME		14,458			—			—			14,458			9,048			—			—			9,048
Dividends on preferred shares		(7,941	)		—			—			(7,941	)		(10,209	)		—			—			(10,209	)
Redemption of preferred shares		13,347			—			—			13,347			—			—			—			—
NET INCOME AVAILABLE (LOSS ALLOCABLE) TO COMMON SHAREHOLDERS	$	19,864		$	—		$	—		$	19,864		$	(1,161	)	$	—		$	—		$	(1,161	)

⁽¹⁾ Total includes PREIT’s proportionate share of partnership operations “grossed up” to reflect the Company’s share of the total revenue and expenses of the underlying properties.

⁽²⁾ Capitalized interest expense of $11,883 and $6,154 is not included for the nine months ended September 30, 2007 and September 30, 2006, respectively.

5

Pennsylvania Real Estate Investment Trust

Net Operating Income⁽¹⁾ - Three Months Ended September 30, 2007 and 2006

(in thousands)

	Three months ended September 30, 2007									Three months ended September 30, 2006
SAME STORE RETAIL/OTHER	Same			Other			Total			Same			Other			Total
Real estate revenue:
Base rent	$	77,518		$	49		$	77,567		$	76,524		$	955		$	77,479
Expense reimbursements		35,603			—			35,603			35,886			508			36,394
Percentage rent		1,327			—			1,327			1,484			5			1,489
Lease termination revenue		695			—			695			585			—			585
Other real estate revenue		4,177			19			4,196			4,725			105			4,830
TOTAL REAL ESTATE REVENUE		119,320			68			119,388			119,204			1,573			120,777
Property operating expenses:
CAM and real estate taxes		(33,325	)		(7	)		(33,332	)		(32,964	)		(502	)		(33,466	)
Utilities		(7,138	)		—			(7,138	)		(7,111	)		(252	)		(7,363	)
Other property operating expenses		(6,602	)		(1	)		(6,603	)		(7,265	)		(159	)		(7,424	)
TOTAL PROPERTY OPERATING EXPENSES		(47,065	)		(8	)		(47,073	)		(47,340	)		(913	)		(48,253	)
NET OPERATING INCOME	$	72,255		$	60		$	72,315		$	71,864		$	660		$	72,524
	Three months ended September 30, 2007									Three months ended September 30, 2006
SAME STORE COMPARISON	Malls			Power and Strip Centers			Total			Malls			Power and Strip Centers			Total
Real estate revenue:
Base rent	$	70,072		$	7,446		$	77,518		$	69,027		$	7,497		$	76,524
Expense reimbursements		33,956			1,647			35,603			34,293			1,593			35,886
Percentage rent		1,290			37			1,327			1,439			45			1,484
Lease termination revenue		690			5			695			584			1			585
Other real estate revenue		4,129			48			4,177			4,670			55			4,725
TOTAL REAL ESTATE REVENUE		110,137			9,183			119,320			110,013			9,191			119,204
Property operating expenses:
CAM and real estate taxes		(31,678	)		(1,647	)		(33,325	)		(31,423	)		(1,541	)		(32,964	)
Utilities		(7,088	)		(50	)		(7,138	)		(7,064	)		(47	)		(7,111	)
Other property operating expenses		(6,415	)		(187	)		(6,602	)		(7,159	)		(106	)		(7,265	)
TOTAL PROPERTY OPERATING EXPENSES		(45,181	)		(1,884	)		(47,065	)		(45,646	)		(1,694	)		(47,340	)
NET OPERATING INCOME	$	64,956		$	7,299		$	72,255		$	64,367		$	7,497		$	71,864

⁽¹⁾ Includes PREIT’s proportionate share of partnership operations “grossed up” to reflect the Company’s share of the total revenues and expenses of the underlying properties.

6

Pennsylvania Real Estate Investment Trust

Net Operating Income⁽¹⁾ - Nine Months Ended September 30, 2007 and 2006

(in thousands)

	Nine months ended September 30, 2007									Nine months ended September 30, 2006
SAME STORE RETAIL/OTHER	Same			Other			Total			Same			Other			Total
Real estate revenue:
Base rent	$	230,993		$	680		$	231,673		$	228,405		$	2,918		$	231,323
Expense reimbursements		107,736			436			108,172			105,396			1,568			106,964
Percentage rent		4,998			—			4,998			5,316			7			5,323
Lease termination revenue		1,414			—			1,414			2,847			151			2,998
Other real estate revenue		12,277			91			12,368			13,321			278			13,599
TOTAL REAL ESTATE REVENUE		357,418			1,207			358,625			355,285			4,922			360,207
Property operating expenses:
CAM and real estate taxes		(100,329	)		(495	)		(100,824	)		(97,197	)		(1,518	)		(98,715	)
Utilities		(19,752	)		(259	)		(20,011	)		(18,623	)		(773	)		(19,396	)
Other property operating expenses		(18,992	)		(96	)		(19,088	)		(20,847	)		(418	)		(21,265	)
TOTAL PROPERTY OPERATING EXPENSES		(139,073	)		(850	)		(139,923	)		(136,667	)		(2,709	)		(139,376	)
NET OPERATING INCOME	$	218,345		$	357		$	218,702		$	218,618		$	2,213		$	220,831
	Nine months ended September 30, 2007									Nine months ended September 30, 2006
SAME STORE COMPARISON	Malls			Power and Strip Centers			Total			Malls			Power and Strip Centers			Total
Real estate revenue:
Base rent	$	208,591		$	22,402		$	230,993		$	206,099		$	22,306		$	228,405
Expense reimbursements		102,705			5,031			107,736			100,598			4,798			105,396
Percentage rent		4,917			81			4,998			5,226			90			5,316
Lease termination revenue		1,408			6			1,414			2,845			2			2,847
Other real estate revenue		12,112			165			12,277			13,158			163			13,321
TOTAL REAL ESTATE REVENUE		329,733			27,685			357,418			327,926			27,359			355,285
Property operating expenses:
CAM and real estate taxes		(95,193	)		(5,136	)		(100,329	)		(92,458	)		(4,739	)		(97,197	)
Utilities		(19,616	)		(136	)		(19,752	)		(18,496	)		(127	)		(18,623	)
Other property operating expenses		(18,334	)		(658	)		(18,992	)		(20,359	)		(488	)		(20,847	)
TOTAL PROPERTY OPERATING EXPENSES		(133,143	)		(5,930	)		(139,073	)		(131,313	)		(5,354	)		(136,667	)
NET OPERATING INCOME	$	196,590		$	21,755		$	218,345		$	196,613		$	22,005		$	218,618

⁽¹⁾ Includes PREIT’s proportionate share of partnership operations “grossed up” to reflect the Company’s share of the total revenues and expenses of the underlying properties.

7

Pennsylvania Real Estate Investment Trust

Computation of

Earnings Per Share

(in thousands, except per share amounts)

	Three months ended September 30,						Nine months ended September 30,
	2007			2006 (1)			2007			2006 (1)
Income from continuing operations	$	1,481		$	3,302		$	8,568		$	9,922
Redemption of preferred shares		13,347			—			13,347			—
Dividends on preferred shares		(1,134	)		(3,403	)		(7,941	)		(10,209	)
Income (loss) from continuing operations allocable to common shareholders		13,694			(101	)		13,974			(287	)
Dividends on unvested restricted shares		(272	)		(247	)		(815	)		(797	)
Income (loss) from continuing operations used to calculate earnings per share - basic		13,422			(348	)		13,159			(1,084	)
Minority interest in properties-continuing operations		—			—			—			—
Income (loss) from continuing operations used to calculate earnings per share - diluted	$	13,422		$	(348	)	$	13,159		$	(1,084	)
Income (loss) from discontinued operations used to calculate earnings per share - basic	$	18		$	1,242		$	5,890		$	(874	)
Minority interest in properties-discontinued operations		—			—			—			—
Income (loss) from discontinued operations used to calculate earnings per share - diluted	$	18		$	1,242		$	5,890		$	(874	)
Basic earnings (loss) per share:
Income (loss) from continuing operations	$	0.35		$	(0.01	)	$	0.35		$	(0.03	)
Income (loss) from discontinued operations		—			0.03			0.16			(0.02	)
Income (loss) per share - basic	$	0.35		$	0.02		$	0.51		$	(0.05	)
Diluted earnings (loss) per share:
Income (loss) from continuing operations	$	0.35		$	(0.01	)	$	0.35		$	(0.03	)
Income (loss) from discontinued operations		—			0.03			0.16			(0.02	)
Income (loss) per share - diluted	$	0.35		$	0.02		$	0.51		$	(0.05	)
Weighted average of common shares outstanding		38,659			36,721			37,744			36,646
Weighted average of unvested restricted shares		(477	)		(439	)		(524	)		(457	)
Weighted average shares outstanding - basic		38,182			36,282			37,220			36,189
Weighted average effect of common share equivalents (2)		294			—			362			—
Total weighted average shares outstanding - diluted		38,476			36,282			37,582			36,189

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

⁽²⁾ Effect of common share equivalents are anti-dilutive due to the loss from continuing operations allocable to common shareholders, therefore the effect of common share equivalents is not included for the three and nine months ended September 30, 2006.

8

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,
	2007			2006(1)			2007			2006(1)			2006(1)
FUNDS FROM OPERATIONS (FFO)
Net income	$	1,499		$	4,544		$	14,458		$	9,048		$	28,021
Redemption of preferred shares		13,347			—			13,347			—			—
Dividends on preferred shares		(1,134	)		(3,403	)		(7,941	)		(10,209	)		(13,613	)
Minority interest		104			536			1,575			1,123			3,288
Gains on sales of interests in real estate		—			—			(560	)		—			—
Gains on sales of interests in discontinued operations		—			(1,414	)		(6,699	)		(1,414	)		(1,414	)
Depreciation and amortization: (2)
Wholly owned and consolidated partnerships		32,178			30,241			95,275			89,747			121,090
Unconsolidated partnerships		1,714			1,679			5,127			5,255			7,017
Discontinued operations		—			352			215			3,562			3,871
FFO	$	47,708		$	32,535		$	114,797		$	97,112		$	148,260
FUNDS AVAILABLE FOR DISTRIBUTION (FAD)
FFO	$	47,708		$	32,535		$	114,797		$	97,112		$	148,260
Adjustments:
Straight line rent		(599	)		(818	)		(1,554	)		(2,179	)		(2,918	)
Recurring capital expenditures		(6,005	)		(5,181	)		(9,633	)		(8,408	)		(15,172	)
Tenant allowances		(4,485	)		(5,460	)		(9,783	)		(12,899	)		(18,521	)
Capitalized leasing costs		(1,011	)		(1,115	)		(3,502	)		(3,458	)		(4,613	)
Amortization of debt premium		(3,135	)		(3,349	)		(9,733	)		(10,496	)		(13,821	)
Amortization of above- and below- market lease intangibles		(34	)		134			(115	)		196			101
Redemption of preferred shares		(13,347	)		—			(13,347	)		—			—
FAD	$	19,092		$	16,746		$	67,130		$	59,868		$	93,316
Weighted average of common shares outstanding		38,181			36,282			37,219			36,189			36,256
Weighted average of O.P. Units outstanding		2,694			4,081			3,610			4,125			4,083
Weighted average effect of common share equivalents		295			560			363			590			599
Total weighted average shares outstanding, including O.P. Units		41,170			40,923			41,192			40,904			40,938
Net income (loss) per diluted share	$	0.35		$	0.02		$	0.51		$	(0.05	)	$	0.37
FFO per diluted share	$	1.16		$	0.80		$	2.79		$	2.37		$	3.62
FAD per diluted share	$	0.46		$	0.41		$	1.63		$	1.46		$	2.28
Dividend per Common Share	$	0.57		$	0.57		$	1.71		$	1.71		$	2.28
PAYOUT RATIOS
Payout Ratio of FFO		56.5%	(3)
Payout Ratio of FAD		93.2%	(3)

⁽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, 2007.

9

Pennsylvania Real Estate Investment Trust

2007 Leasing Activity Summary

	Number	GLA	Average Previous Base Rent psf		Average New Base Rent psf		$ Change in Base Rent psf		% Change in Base Rent psf		Annualized Tenant Improvements psf (1)
Previously Leased Space:
1st Quarter	19	60,893	$	29.86	$	32.15	$	2.30	7.7	%	$	0.54
2nd Quarter	29	72,929		25.61		30.94		5.33	20.8	%		2.34
3rd Quarter	29	87,409		36.26		39.09		2.83	7.8	%		2.61
Total/Average	77	221,231	$	30.99	$	34.49	$	3.51	12.1	%	$	1.95
Previously Vacant Space:
1st Quarter	37	235,070	$	—	$	23.54	$	23.54	N/A		$	6.83
2nd Quarter	48	169,889		—		26.05		26.05	N/A			4.49
3rd Quarter	29	134,218		—		24.71		24.71	N/A			7.48
Total/Average	114	539,177	$	—	$	24.62	$	24.62	N/A		$	6.26
Renewal (2):
1st Quarter	93	386,965	$	18.42	$	21.02	$	2.60	14.1	%	$	0.11
2nd Quarter	107	223,891		26.93		29.45		2.52	9.4	%		0.02
3rd Quarter	79	230,501		20.11		20.52		0.40	2.0	%		0.12
Total/Average	279	841,357	$	21.15	$	23.13	$	1.98	9.5	%	$	0.09
Anchor Renewal:
1st Quarter	1	100,115	$	2.98	$	2.98	$	—	0.0	%	$	—
2nd Quarter	3	247,882		2.03		2.03		—	0.0	%		—
3rd Quarter	1	130,178		2.91		2.91		—	0.0	%		—
Total/Average	5	478,175	$	2.31	$	2.47	$	—	0.0	%	$	—

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

⁽²⁾ This category includes expansions, downsizings and lease extensions.

10

Pennsylvania Real Estate Investment Trust

Summarized Rent Per Square Foot and Occupancy Percentages

	September 30, 2007				September 30, 2006				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(1)	$	30.32	90.0%	87.3%	$	29.88	89.2%	86.4%	1.5%	0.8%	0.9%
Power and Strip Centers weighted average	$	16.04	96.2%	94.1%	$	15.67	97.6%	96.2%	2.4%	-1.4%	-2.1%
Retail Portfolio weighted average	$	27.07	90.8%	88.4%	$	26.62	90.3%	87.9%	1.7%	0.5%	0.5%
Consolidated Properties	$	28.24	90.2%	87.5%	$	27.90	89.4%	86.6%	1.2%	0.8%	0.9%
Unconsolidated Properties	$	22.22	95.6%	93.7%	$	21.31	97.0%	95.8%	4.2%	-1.6%	-2.1%
Same Properties	$	27.07	90.8%	88.4%	$	26.62	90.3%	87.9%	1.7%	0.5%	0.5%

⁽¹⁾ Average base rent for tenants that lease individual spaces of 10,000 square feet or less and pay fixed rent. Average base rent for tenants greater than 10,000 square feet was $12.98/sq ft as of September 30, 2007, and $12.93/sq ft as of September 30, 2006.

11

Pennsylvania Real Estate Investment Trust

Mall Sales and Rents Per Square Foot

		September 30, 2007						September 30, 2006						Change
	% of Current Quarter Mall NOI	Avg Base Rent(1)		Avg Comp Sales(2)		Occup. Cost Ratio(2)		Avg Base Rent(1)		Avg Comp Sales(2)		Occup. Cost Ratio(2)		Avg Base Rent(1)		Avg Comp Sales(2)		Occup. Cost Ratio(2)
Sales per square foot over $400	41.8%
Lehigh Valley Mall		$	39.72	$	485	11.7	%	$	38.09	$	491	8.5	%	4.3	%	-1.3	%	3.3	%
Patrick Henry Mall			36.75		484	10.4	%		35.31		451	10.5	%	4.1	%	7.3	%	-0.1	%
Cherry Hill Mall			41.74		480	13.5	%		40.26		475	13.0	%	3.7	%	1.0	%	0.5	%
Woodland Mall			43.17		458	15.5	%		43.48		372	20.1	%	-0.7	%	23.3	%	-4.6	%
Jacksonville Mall			30.63		455	9.8	%		29.62		439	9.6	%	3.4	%	3.6	%	0.2	%
Willow Grove Park			41.52		437	13.9	%		40.83		441	14.0	%	1.7	%	-0.9	%	-0.1	%
The Mall at Prince Georges			32.39		433	12.1	%		31.45		455	11.6	%	3.0	%	-4.8	%	0.5	%
Moorestown Mall			36.30		430	13.9	%		36.40		419	13.9	%	-0.3	%	2.6	%	0.0	%
The Gallery at Market East			35.27		407	12.6	%		35.47		410	11.9	%	-0.6	%	-0.8	%	0.6	%
Dartmouth Mall			28.90		403	11.7	%		28.33		436	10.6	%	2.0	%	-7.5	%	1.1	%
Sales per square foot between $350 - $400	23.1%
Exton Square Mall			35.79		393	14.1	%		36.06		385	14.7	%	-0.8	%	2.1	%	-0.6	%
Springfield Mall			31.89		390	13.0	%		32.55		393	13.3	%	-2.0	%	-0.6	%	-0.3	%
Viewmont Mall			29.93		374	11.7	%		30.78		378	11.2	%	-2.7	%	-1.0	%	0.5	%
Valley View Mall			29.11		367	11.7	%		28.79		349	12.0	%	1.1	%	5.1	%	-0.3	%
Francis Scott Key Mall			25.72		366	10.1	%		25.87		333	9.9	%	-0.6	%	9.9	%	0.2	%
Capital City Mall			31.76		364	10.9	%		32.93		351	11.4	%	-3.5	%	3.7	%	-0.5	%
Valley Mall			23.96		357	10.5	%		23.73		353	9.7	%	1.0	%	1.3	%	0.8	%
Wyoming Valley Mall			29.44		350	11.8	%		28.74		347	12.3	%	2.5	%	0.9	%	-0.5	%
Sales per square foot between $300 - $349	13.6%
Cumberland Mall			25.95		323	12.0	%		23.68		341	11.3	%	9.6	%	-5.3	%	0.7	%
Palmer Park Mall			23.71		320	10.5	%		22.41		306	11.0	%	5.8	%	4.6	%	-0.5	%
Orlando Fashion Square			34.89		316	14.5	%		33.10		334	13.9	%	5.4	%	-5.5	%	0.6	%
Magnolia Mall			24.83		306	12.0	%		25.76		303	13.1	%	-3.6	%	0.9	%	-1.1	%
Wiregrass Commons			25.08		301	10.7	%		25.08		310	10.0	%	0.0	%	-3.1	%	0.7	%
Logan Valley Mall			25.22		300	11.6	%		23.68		301	11.4	%	6.5	%	-0.4	%	0.2	%
Sales per square foot under $300	21.5%
South Mall			22.82		297	10.8	%		22.63		312	9.8	%	0.8	%	-4.7	%	1.0	%
New River Valley Mall			24.42		293	9.5	%		23.62		287	11.1	%	3.4	%	1.9	%	-1.6	%
Nittany Mall			21.07		292	10.8	%		21.02		264	11.1	%	0.2	%	10.6	%	-0.3	%
Uniontown Mall			21.12		286	10.5	%		20.36		272	10.1	%	3.7	%	5.3	%	0.4	%
North Hanover Mall			23.48		285	11.9	%		21.01		290	9.8	%	11.8	%	-1.8	%	2.1	%
Gadsden Mall			23.66		283	10.3	%		23.50		278	11.1	%	0.7	%	1.8	%	-0.8	%
Washington Crown Center			20.86		279	12.3	%		23.42		294	11.7	%	-10.9	%	-5.0	%	0.6	%
Crossroads Mall			20.61		278	9.5	%		20.11		262	9.3	%	2.5	%	6.3	%	0.2	%
Plymouth Meeting Mall			30.08		273	13.4	%		28.67		275	13.0	%	4.9	%	-0.9	%	0.4	%
Phillipsburg Mall			25.15		272	13.4	%		24.67		296	12.1	%	2.0	%	-8.2	%	1.3	%
Beaver Valley Mall			23.47		266	14.8	%		23.63		262	14.7	%	-0.7	%	1.6	%	0.1	%
Lycoming Mall			19.87		258	11.4	%		20.34		236	11.1	%	-2.3	%	9.2	%	0.3	%
Chambersburg Mall			19.96		236	11.8	%		20.17		249	10.6	%	-1.0	%	-5.2	%	1.2	%
Voorhees Town Center			29.66		201	13.0	%		29.57		206	14.6	%	0.3	%	-2.8	%	-1.6	%
Enclosed Malls weighted average		$	30.32	$	362	12.2	%	$	29.88	$	354	12.0	%	1.5	%	2.1	%	0.2	%
Consolidated Properties		$	29.80	$	354	12.2	%	$	29.42	$	346	12.2	%	1.3	%	2.3	%	0.0	%
Unconsolidated Properties		$	36.74	$	448	12.2	%	$	35.88	$	452	10.1	%	2.4	%	-0.8	%	2.1	%
Same Properties		$	30.32	$	362	12.2	%	$	29.88	$	354	12.0	%	1.5	%	2.1	%	0.2	%

⁽¹⁾ Average base rent includes all non-anchor space owned by the Company and leased to tenants that lease individual spaces of 10,000 square feet or less and pay fixed rent.

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

12

Pennsylvania Real Estate Investment Trust

Mall Occupancy - Owned GLA

	September 30, 2007		September 30, 2006		Change
	Total	Non-Anchor	Total	Non-Anchor	Total	Non-Anchor
Beaver Valley Mall	93.2%	85.4%	91.5%	81.5%	1.7%	3.9%
Capital City Mall	96.8%	94.5%	93.3%	88.5%	3.5%	6.0%
Chambersburg Mall	88.9%	76.4%	91.4%	81.7%	-2.5%	-5.3%
Cherry Hill Mall (1) (2)	89.0%	89.0%	63.4%	95.3%	25.6%	-6.3%
Crossroads Mall	92.1%	81.8%	94.5%	87.2%	-2.4%	-5.4%
Cumberland Mall	97.8%	96.1%	97.9%	96.4%	-0.1%	-0.3%
Dartmouth Mall	95.8%	93.1%	96.3%	93.9%	-0.5%	-0.8%
Exton Square Mall	93.1%	84.8%	93.7%	86.1%	-0.6%	-1.3%
Francis Scott Key Mall (2)	95.8%	91.4%	97.1%	93.8%	-1.3%	-2.4%
Gadsden Mall	91.7%	80.5%	94.7%	87.5%	-3.0%	-7.0%
The Gallery at Market East (3)	42.0%	81.0%	86.9%	82.7%	-44.9%	-1.9%
Jacksonville Mall	94.6%	89.1%	95.8%	91.5%	-1.2%	-2.4%
Lehigh Valley Mall	97.6%	96.5%	96.1%	94.3%	1.5%	2.2%
Logan Valley Mall	96.9%	92.5%	97.5%	93.9%	-0.6%	-1.4%
Lycoming Mall (2)	96.5%	93.6%	93.8%	88.4%	2.7%	5.2%
Magnolia Mall	97.5%	94.4%	92.7%	81.8%	4.8%	12.6%
Moorestown Mall	89.2%	75.0%	91.5%	80.6%	-2.3%	-5.6%
New River Valley Mall (2)	96.9%	94.8%	97.4%	95.4%	-0.5%	-0.6%
Nittany Mall	93.5%	86.9%	94.5%	88.8%	-1.0%	-1.9%
North Hanover Mall (2)	90.8%	81.5%	75.7%	74.6%	15.1%	6.8%
Orlando Fashion Square	91.1%	81.1%	91.7%	82.4%	-0.6%	-1.3%
Palmer Park Mall	97.3%	91.3%	100.0%	100.0%	-2.7%	-8.7%
Patrick Henry Mall	98.4%	97.0%	95.1%	90.5%	3.3%	6.5%
Phillipsburg Mall	92.4%	82.6%	92.3%	82.1%	0.1%	0.5%
Plymouth Meeting Mall	80.3%	71.2%	86.0%	79.8%	-5.7%	-8.6%
The Mall at Prince Georges	97.1%	93.9%	96.1%	91.4%	1.0%	2.5%
South Mall	90.8%	82.7%	93.1%	87.1%	-2.3%	-4.4%
Springfield Mall	86.9%	86.9%	87.5%	87.5%	-0.6%	-0.6%
Uniontown Mall	94.2%	85.3%	94.6%	86.4%	-0.4%	-1.1%
Valley Mall	97.8%	96.1%	98.5%	97.2%	-0.7%	-1.1%
Valley View Mall (2)	93.2%	90.5%	87.0%	81.7%	6.2%	8.8%
Viewmont Mall	98.5%	96.1%	99.2%	98.0%	-0.7%	-1.9%
Voorhees Town Center (2)	62.0%	61.3%	29.2%	48.2%	32.8%	13.1%
Washington Crown Center	92.2%	85.7%	90.2%	81.9%	2.0%	3.8%
Willow Grove Park (1)	70.7%	96.3%	66.3%	88.8%	4.4%	7.5%
Wiregrass Mall	83.3%	83.3%	80.6%	80.6%	2.7%	2.7%
Woodland Mall	86.9%	84.6%	88.4%	86.4%	-1.5%	-1.8%
Wyoming Valley Mall	92.4%	78.3%	92.4%	78.5%	0.0%	-0.2%
Enclosed Malls weighted average	90.0%	87.3%	89.2%	86.4%	0.8%	0.9%
Consolidated Properties	89.8%	86.9%	89.0%	86.0%	0.8%	0.9%
Unconsolidated Properties	95.0%	93.4%	93.9%	92.0%	1.1%	1.4%
Same Properties	90.0%	87.3%	89.2%	86.4%	0.8%	0.9%

⁽¹⁾ The total occupancy percentages in 2006 for Cherry Hill Mall and 2006 and 2007 for Willow Grove Park include the former Strawbridge’s stores that are currently vacant, pending redevelopment. These vacant department stores represent 33.5% and 29.0% of the owned mall GLA for Cherry Hill Mall and Willow Grove Park, respectively.

⁽²⁾ Reflects the decommissioning of space related to redevelopment activity. 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 leasable condition.

⁽³⁾ The total occupancy percentages in 2007 for The Gallery at Market East include the former Strawbridge’s store that is currently vacant, pending redevelopment. This vacant department store represents 51.5% of the owned mall GLA for The Gallery at Market East.

13

Pennsylvania Real Estate Investment Trust

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

	September 30, 2007						September 30, 2006						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 Center	$	20.83	100.0	%	100.0	%	$	20.83	100.0	%	100.0	%	0.0	%	0.0	%	0.0	%
Creekview		15.15	100.0	%	100.0	%		14.64	100.0	%	100.0	%	3.5	%	0.0	%	0.0	%
Crest Plaza		16.94	96.6	%	93.6	%		16.89	96.6	%	93.6	%	0.3	%	0.0	%	0.0	%
The Commons at Magnolia		13.23	97.4	%	94.9	%		13.52	93.0	%	87.8	%	-2.1	%	4.4	%	7.1	%
Metroplex Shopping Center		19.10	100.0	%	100.0	%		19.09	100.0	%	100.0	%	0.0	%	0.0	%	0.0	%
Northeast Tower Center		15.28	96.6	%	94.4	%		14.83	96.6	%	94.4	%	3.0	%	0.0	%	0.0	%
The Court at Oxford Valley		16.07	97.1	%	95.3	%		16.16	100.0	%	100.0	%	-0.6	%	-2.9	%	-4.7	%
Paxton Towne Centre		15.57	93.5	%	90.3	%		15.27	93.5	%	90.3	%	1.9	%	0.0	%	0.0	%
Red Rose Commons		13.86	99.2	%	99.2	%		13.86	99.2	%	99.2	%	0.0	%	0.0	%	0.0	%
Springfield Park		21.73	90.9	%	73.5	%		20.31	87.8	%	64.3	%	7.0	%	3.2	%	9.2	%
Whitehall Mall		11.63	90.9	%	80.6	%		10.46	98.1	%	96.0	%	11.2	%	-7.3	%	-15.4	%
Weighted Average	$	16.04	96.2	%	94.1	%	$	15.67	97.6	%	96.2	%	2.4	%	-1.4	%	-2.1	%
Consolidated Properties	$	16.12	96.7	%	94.6	%	$	15.83	96.4	%	94.0	%	1.9	%	0.3	%	0.6	%
Unconsolidated Properties	$	15.99	95.9	%	93.8	%	$	15.58	98.5	%	97.8	%	2.7	%	-2.6	%	-4.0	%
Same Properties	$	16.04	96.2	%	94.1	%	$	15.67	97.6	%	96.2	%	2.4	%	-1.4	%	-2.1	%

14

Pennsylvania Real Estate Investment Trust

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

(dollars in thousands)

	Paying Minimum Rent		Paying Percentage of Sales in lieu of Minimum Rent (2)		Total		Minimum Rent
Tenant (1)	Number of Stores	GLA	Number of Stores	GLA	Total Number of Stores	Total GLA	Annualized Minimum Rent		PREIT’s share of Annualized Minimum Rent (3)		Percent of PREIT’s Total Retail Minimum Rent
Gap, Inc.	51	649,076	4	33,106	55	682,182	$	13,435	$	12,518	4.07	%
Foot Locker, Inc.	76	398,064	6	19,389	82	417,453		8,683		8,201	2.67	%
JC Penney Company, Inc.	23	2,281,660	6	824,327	29	3,105,987		6,999		6,999	2.28	%
Limited Brands, Inc.	58	269,510	14	43,935	72	313,445		7,022		6,589	2.14	%
Zale Corporation	88	74,013	1	289	89	74,302		6,501		6,177	2.01	%
Sears Holding Corporation	24	2,796,396	6	881,839	30	3,678,235		5,445		5,302	1.73	%
American Eagle Outfitters, Inc.	35	192,940	1	5,013	36	197,953		5,378		5,167	1.68	%
Sterling Jewelers, Inc.	44	65,768	0	—	44	65,768		4,795		4,608	1.50	%
Transworld Entertainment Corp.	39	166,052	4	16,208	43	182,260		4,165		3,933	1.28	%
Luxottica Group S.p.A.	54	129,300	1	548	55	129,848		4,244		3,910	1.27	%
Regis Corporation	101	125,483	0	—	101	125,483		3,819		3,676	1.20	%
Dick’s Sporting Goods	7	340,409	1	45,000	8	385,409		4,536		3,659	1.19	%
Borders Group, Inc.	27	204,216	3	15,476	30	219,692		3,638		3,372	1.10	%
The Finish Line, Inc.	33	152,344	4	21,963	37	174,307		3,352		3,301	1.07	%
Golden Gate Private Equity (4)	14	128,746	4	30,311	18	159,057		3,512		3,274	1.07	%
Pacific Sunwear of California	36	128,121	2	7,246	38	135,367		3,359		3,208	1.04	%
Hallmark Cards, Inc.	38	151,966	4	18,198	42	170,164		3,300		3,193	1.04	%
Genesco Inc.	59	71,227	0	—	59	71,227		2,974		2,908	0.95	%
RadioShack	47	96,578	0	—	47	96,578		2,861		2,818	0.92	%
The Bon-Ton Dept. Stores, Inc.	13	1,008,613	0	—	13	1,008,613		2,768		2,768	0.90	%
Total Top 20 Tenants	867	9,430,482	61	1,962,848	928	11,393,330	$	100,786	$	95,581	31.11	%
Total Retail Leases					3,383				$	307,281	100.00	%

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

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

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

⁽⁴⁾ Owns and operates Express clothing stores.

15

Pennsylvania Real Estate Investment Trust

Lease Expirations

(dollars in thousands except psf amounts)

Non-Anchors⁽¹⁾

		Gross Leasable Area			Annualized Minimum Rent
Lease Expiration Year	Number of Leases Expiring	Expiring GLA	Percent of Total		Min Rent in Expiring Year		PREIT’s Share of Min Rent in Expiring Year (2)		Percent of PREIT’s Total		Average Expiring Minimum Rent psf
Holdover	123	296,131	2.5	%		6,426		6,091	2.2	%		21.70
2007	101	221,525	1.8	%		5,742		5,172	1.9	%		25.92
2008	476	1,278,873	10.5	%		31,908		30,628	11.2	%		24.95
2009	462	1,242,761	10.2	%		31,060		30,118	11.0	%		24.99
2010	453	1,503,340	12.4	%		36,081		34,544	12.6	%		24.00
2011	379	1,521,682	12.5	%		36,342		32,628	12.0	%		23.88
2012	279	1,091,098	9.0	%		29,202		26,903	9.9	%		26.76
2013	191	674,251	5.6	%		15,904		14,688	5.4	%		23.59
2014	154	569,046	4.7	%		15,299		13,537	5.0	%		26.89
2015	180	790,911	6.5	%		20,338		17,988	6.6	%		25.71
Thereafter	470	2,945,680	24.3	%		65,218		60,696	22.2	%		22.14
Total/Average	3,268	12,135,298	100.0	%	$	293,519	$	272,994	100.0	%	$	24.19
Anchors(1)
		Gross Leasable Area			Annualized Minimum Rent
Lease Expiration Year	Number of Leases Expiring(3)	Expiring GLA	Percent of Total		Min Rent in Expiring Year		PREIT’s Share of Min Rent in Expiring Year (2)		Percent of PREIT’s Total		Average Expiring Minimum Rent psf
Holdover	2	153,630	1.4	%	$	404	$	404	1.2	%	$	2.63
2008	6	375,917	3.3	%		1,127		1,127	3.3	%		3.00
2009	9	915,799	8.1	%		2,614		2,222	6.5	%		2.85
2010	20	1,886,419	16.8	%		5,410		5,410	15.8	%		2.87
2011	24	1,953,860	17.3	%		6,693		5,570	16.2	%		3.43
2012	9	889,626	7.9	%		2,178		2,141	6.2	%		2.45
2013	11	960,470	8.5	%		4,116		4,116	12.0	%		4.29
2014	6	662,582	5.9	%		2,081		2,081	6.1	%		3.14
2015	1	85,212	0.8	%		469		469	1.4	%		5.50
Thereafter	27	3,377,086	30.0	%		12,088		10,748	31.3	%		3.58
Total/Average	115	11,260,601	100.0	%	$	37,178	$	34,286	100.0	%	$	3.30

⁽¹⁾ Only includes owned space.

⁽²⁾ Includes PREIT’s proportionate share of tenant rents from partnership properties based on PREIT’s ownership percentage in the respective partnerships.

⁽³⁾ Accounts for all contiguous anchor space as one lease.

16

Pennsylvania Real Estate Investment Trust

Retail Gross Leasable Area Summary as of September 30, 2007

	Owned GLA
Malls (1)	Anchors	Non-anchors	Total	GLA Not Owned	Total GLA
Beaver Valley Mall	511,267	446,011	957,278	204,770	1,162,048
Capital City Mall	204,301	285,575	489,876	120,000	609,876
Chambersburg Mall	241,690	212,666	454,356	—	454,356
Cherry Hill Mall	—	520,257	520,257	478,885	999,142
Crossroads Mall	256,248	195,528	451,776	—	451,776
Cumberland Mall	283,365	385,395	668,760	273,230	941,990
Dartmouth Mall	208,460	322,620	531,080	140,000	671,080
Exton Square Mall	440,301	369,954	810,255	277,468	1,087,723
Francis Scott Key Mall	291,620	280,904	572,524	139,333	711,857
Gadsden Mall	274,060	203,242	477,302	—	477,302
The Gallery at Market East (2)	683,471	396,813	1,080,284	—	1,080,284
Jacksonville Mall	242,115	233,691	475,806	—	475,806
Lehigh Valley Mall	212,000	457,277	669,277	371,986	1,041,263
Logan Valley Mall	454,387	324,484	778,871	—	778,871
Lycoming Mall	321,441	380,954	702,395	120,000	822,395
Magnolia Mall	343,118	277,860	620,978	—	620,978
Moorestown Mall	408,356	311,563	719,919	321,200	1,041,119
New River Valley Mall	175,306	260,410	435,716	—	435,716
Nittany Mall	221,462	215,654	437,116	95,000	532,116
North Hanover Mall	156,308	154,455	310,763	—	310,763
Orlando Fashion Square	491,999	434,054	926,053	155,576	1,081,629
Palmer Park Mall	314,235	143,459	457,694	—	457,694
Patrick Henry Mall	279,619	294,988	574,607	140,000	714,607
Phillipsburg Mall	326,170	252,377	578,547	—	578,547
Plymouth Meeting Mall	188,429	410,463	598,892	214,635	813,527
The Mall at Prince Georges	479,619	434,849	914,468	—	914,468
South Mall	188,858	216,347	405,205	—	405,205
Springfield Mall	—	221,653	221,653	367,176	588,829
Uniontown Mall	421,378	276,816	698,194	—	698,194
Valley Mall	280,549	373,359	653,908	243,400	897,308
Valley View Mall	96,357	247,105	343,462	254,596	598,058
Viewmont Mall	386,262	238,383	624,645	120,000	744,645
Voorhees Town Center	4,404	230,091	234,495	396,783	631,278
Washington Crown Center	245,401	290,468	535,869	140,095	675,964
Willow Grove Park (3)	443,430	345,891	789,321	413,121	1,202,442
Wiregrass Commons	—	229,988	229,988	403,163	633,151
Woodland Mall	71,000	413,455	484,455	725,186	1,209,641
Wyoming Valley Mall	592,110	322,029	914,139	—	914,139
Total Malls (38 properties)	10,739,096	11,611,088	22,350,184	6,115,603	28,465,787
Power and Strip Centers
Christiana Center	190,814	111,595	302,409	—	302,409
Creekview	—	136,086	136,086	288,916	425,002
Crest Plaza	53,445	60,826	114,271	143,130	257,401
The Commons at Magnolia	50,571	53,006	103,577	126,200	229,777
Metroplex Shopping Center	67,185	410,276	477,461	300,729	778,190
Northeast Tower Center	119,388	182,536	301,924	175,311	477,235
The Court at Oxford Valley	176,831	280,032	456,863	247,623	704,486
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)	1,188,035	2,101,461	3,289,496	1,900,226	5,189,722
CONSOLIDATED PROPERTIES	11,092,941	11,774,043	22,866,984	6,383,056	29,250,040
UNCONSOLIDATED PROPERTIES	834,190	1,938,506	2,772,696	1,632,773	4,405,469
TOTAL PROPERTIES	11,927,131	13,712,549	25,639,680	8,015,829	33,655,509

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

⁽²⁾ Includes 556,200 square feet of anchor space subject to redevelopment plans.

⁽³⁾ Includes 228,740 square feet of anchor space under redevelopment.

17

Pennsylvania Real Estate Investment Trust

Property Information as of September 30, 2007

Properties (1)	Ownership Interest	Date Acquired	Year Built/Last Renovated	Years Since Renovation	Anchors / Majors Tenants	Lease Expiration
MALLS
Beaver Valley Mall Monaca, PA	100%	2002	1970/1991	16	Boscov’s JC Penney Macy’s Sears	9/30/18 9/30/17 (2) 8/15/11
Capital City Mall Camp Hill, PA	100%	2003	1974/2005	2	JC Penney Macy’s Sears	11/30/10 (2) 7/28/09
Chambersburg Mall Chambersburg, PA	100%	2003	1982	25	Bon-Ton JC Penney Sears Value City	1/28/11 3/31/12 2/9/10 8/31/07
Cherry Hill Mall Cherry Hill, NJ	100%	2003	1961/1990	17	JC Penney Macy’s	(2) (2)
Crossroads Mall (3) Beckley, WV	100%	2003	1981	26	Belk JC Penney Sears	11/4/08 12/31/11 3/31/11
Cumberland Mall Vineland, NJ	100%	2005	1973/2003	4	Boscov’s BJ’s Home Depot JC Penney Value City	(2) (2) 10/31/19 11/30/08 7/31/13
Dartmouth Mall Dartmouth, MA	100%	1997	1971/2000	7	JC Penney Macy’s Sears	7/31/09 (2) 4/12/16
Exton Square Mall (3) Exton, PA	100%	2003	1973/2000	7	Boscov’s JC Penney K-Mart Macy’s Sears	10/31/19 5/31/20 (2) (2) 1/31/20
Francis Scott Key Mall Frederick, MD	100%	2003	1978/1991	16	JC Penney Macy’s Sears Value City	9/30/11 (2) 7/31/13 6/30/10
Gadsden Mall Gadsden, AL	100%	2005	1974/1990	17	Belk Parisian Sears	2/19/11 7/31/14 3/5/09
The Gallery at Market East (3) (4) Philadelphia, PA	100%	2003	1977/1990	17	Burlington Coat Factory	2/28/32
Jacksonville Mall Jacksonville, NC	100%	2003	1981/1998	9	Belk JC Penney Sears	8/21/11 8/31/10 8/4/11
Lehigh Valley Mall (5) Allentown, PA	50%	1973	1977/1996	11	Boscov’s JC Penney Macy’s Sears	(2) (2) 7/31/12
Logan Valley Mall Altoona, PA	100%	2003	1960/1997	10	JC Penney Macy’s Sears	6/30/17 1/31/10 10/31/16
Lycoming Mall Pennsdale, PA	100%	2003	1978/1990	17	Bon-Ton JC Penney Macy’s Sears Value City	7/31/11 10/31/10 (2) 7/31/13 7/31/08
Magnolia Mall Florence, SC	100%	1997	1979/1992	15	Belk Best Buy JC Penney Sears	1/31/11 1/31/13 3/31/12 10/16/09
Moorestown Mall Moorestown, NJ	100%	2003	1963/2000	7	Boscov’s Lord & Taylor Macy’s Sears	10/31/10 (2) (2) 10/5/22
New River Valley Mall Christiansburg, VA	100%	2003	1988/2007	0	Belk JC Penney Sears	4/19/11 3/31/08 8/2/13
Nittany Mall State College, PA	100%	2003	1968/1990	17	Bon-Ton JC Penney Macy’s Sears	1/31/08 7/31/10 (2) 8/31/10
North Hanover Mall Hanover, PA	100%	2003	1967/1999	8	JC Penney Sears	1/31/11 11/30/09

18

Pennsylvania Real Estate Investment Trust

Property Information as of September 30, 2007 (continued)

Properties (1)	Ownership Interest	Date Acquired	Year Built/Last Renovated	Years Since Renovation	Anchors /Majors Tenants	Lease Expiration
Orlando Fashion Square (3) Orlando, FL	100%	2004	1973/2003	4	Dillard’s JC Penney Macy’s Sears	1/31/14 4/30/13 10/31/71 (2)
Palmer Park Mall Easton, PA	100%	1972/2003	1972/1998	9	Bon-Ton Boscov’s	7/25/14 10/31/18
Patrick Henry Mall Newport News, VA	100%	2003	1988/2005	2	Dick's Sporting Goods Dillard’s JC Penney Macy’s	1/31/22 9/22/13 10/31/15 (2)
Phillipsburg Mall Phillipsburg, NJ	100%	2003	1989/2003	4	Bon-Ton JC Penney Kohl’s Sears	1/31/10 3/31/10 1/31/25 4/30/09
Plymouth Meeting Mall (3) Plymouth Meeting, PA	100%	2003	1966/1999	8	AMC Theater Boscov’s Macy’s	12/31/18 10/31/16 (2)
The Mall at Prince Georges Hyattsville, MD	100%	1998	1959/2004	3	JC Penney Macy’s Target	7/31/11 10/31/18 1/31/10
South Mall Allentown, PA	100%	2003	1975/1992	15	Bon-Ton Stein Mart Steve & Barry’s	1/28/11 10/31/11 1/31/11
Springfield Mall Springfield, PA	50%	2005	1974/1997	10	Macy’s TBD	(2) (2)
Uniontown Mall (3) Uniontown, PA	100%	2003	1972/1990	17	Bon-Ton JC Penney Roomful Express Furn. Sears Teletech Customer Care Value City	1/31/11 10/31/10 3/26/10 2/25/13 6/28/08 7/31/07
Valley Mall Hagerstown, MD	100%	2003	1974/1999	8	Bon-Ton JC Penney Macy’s Sears	1/31/14 10/3/09 (2) (2)
Valley View Mall La Crosse, WI	100%	2003	1980/2001	6	Herberger’s JC Penney Macy’s Sears	(2) 7/31/10 (2) (2)
Viewmont Mall Scranton, PA	100%	2003	1968/2006	1	JC Penney Macy’s Sears	10/31/10 (2) 12/31/10
Voorhees Town Center (3) Voorhees, NJ	100%	2003	1970/1998	9	Boscov’s Macy’s	(2) (2)
Washington Crown Center Washington, PA	100%	2003	1969/1999	8	Bon-Ton Gander Mountain Sports Macy’s Sears	1/31/10 7/24/13 (2) 8/17/09
Willow Grove Park Willow Grove, PA	100%	2000/2003	1982/2001	6	Bloomingdale’s Macy's Sears	(2) 1/31/22 (2)
Wiregrass Commons (3) Dothan, AL	100%	2003	1986/1999	8	Dillard’s JC Penney McRae’s Parisian	(2) (2) (2) (2)
Woodland Mall Grand Rapids, MI	100%	2005	1968/1998	9	JC Penney Kohl’s Macy’s Sears	(2) 1/31/19 (2) (2)
Wyoming Valley Mall Wilkes-Barre, PA	100%	2003	1974/2006	1	Bon-Ton JC Penney Macy’s Sears	1/31/12 4/30/12 1/31/12 8/1/11

19

Pennsylvania Real Estate Investment Trust

Property Information as of September 30, 2007 (continued)

Properties (1)	Ownership Interest	Date Acquired	Year Built/Last Renovated	Years Since Renovation	Anchors /Majors Tenants	Lease Expiration
POWER CENTERS
Christiana Center Newark, DE	100%	1998	1998	9	Costco Dick’s Sporting Goods	9/30/18 11/30/13
Creekview Warrington, PA	100%	1999	2001	6	Genuardi’s Lowe’s Target	12/31/21 (2) (2)
Metroplex Shopping Center (5) Plymouth Meeting, PA	50%	1999	2001	6	Giant Food Store Lowe’s Target	2/28/21 (2) (2)
Northeast Tower Center Philadelphia, PA	100%	1998	1997	10	Home Depot Raymour & Flanigan Wal-Mart	(2) (2) 1/31/14
The Court at Oxford Valley (5) Langhorne, PA	50%	1997	1996	11	Best Buy BJ’s Dick’s Sporting Goods Home Depot Linens N Things	12/31/11 (2) 4/15/11 (2) 2/14/17
Paxton Towne Centre Harrisburg, PA	100%	1999	2001	6	Costco Kohl’s Target Weis Markets	(2) 1/25/21 (2) 11/30/20
Red Rose Commons (5) Lancaster, PA	50%	1998	1998	9	Home Depot Weis Markets	(2) (2)
Whitehall Mall (5) Allentown, PA	50%	1964	1964/1998	9	Bed, Bath & Beyond Kohl's Sears	1/31/10 3/9/17 9/18/11
STRIP CENTERS
Crest Plaza Allentown, PA	100%	1964	1959/2003	4	Target Weis Markets	(2) 10/31/14
The Commons at Magnolia Florence, SC	100%	1999	1991/2002	5	Bed, Bath & Beyond Goody’s Target	1/31/13 5/31/12 (2)
Springfield Park Springfield, PA	50%	1997/1998	1997/1998	9	Bed, Bath & Beyond LA Fitness Target	1/31/09 3/31/17 (2)

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

⁽²⁾ Space is not owned by PREIT.

⁽³⁾ Properties are subject to a ground lease.

⁽⁴⁾ The Gallery at Market East is a consolidation of Gallery at Market East I and Gallery at Market East II.

⁽⁵⁾ Property is managed by a third party.

20

Pennsylvania Real Estate Investment Trust

Balance Sheet

Proportionate Consolidation Method ⁽¹⁾

(in thousands, except per share amounts)

	September 30, 2007											December 31, 2006
	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	$	2,958,684		$	183,549		$	—	$	3,142,233		$	2,909,862		$	183,552		$	—		$	3,093,414
Construction in progress		320,494			16,788			—		337,282			216,892			3,670			—			220,562
Land held for development		5,616			172			—		5,788			5,616			166			—			5,782
Other properties		1,339			—			—		1,339			—			—			1,339			1,339
TOTAL INVESTMENTS IN REAL ESTATE		3,286,133			200,509			—		3,486,642			3,132,370			187,388			1,339			3,321,097
Accumulated depreciation		(375,013	)		(43,666	)				(418,679	)		(306,893	)		(39,188	)		—			(346,081	)
Net investments in real estate		2,911,120			156,843			—		3,067,963			2,825,477			148,200			1,339			2,975,016
Investments in partnerships, at equity		36,895			(36,895	)				—			38,621			(38,621	)		—			—
Other assets:
Cash and cash equivalents		23,548			313			—		23,861			15,808			2,919			—			18,727
Rents and other receivables (2)		38,812			11,600			—		50,412			46,065			9,861			—			55,926
Assets held for sale		—			—			—		—			1,401			—			(1,339	)		62
Intangible assets, net		112,519			945			—		113,464			139,117			1,191			—			140,308
Deferred costs and other assets, net of accumulated amortization		99,916			8,864			—		108,780			79,120			8,733			—			87,853
TOTAL OTHER ASSETS		311,690			(15,173	)		—		296,517			320,132			(15,917	)		(1,339	)		302,876
TOTAL ASSETS	$	3,222,810		$	141,670		$	—	$	3,364,480		$	3,145,609		$	132,283		$	—		$	3,277,892
LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities:
Mortgage notes payable	$	1,649,278		$	188,582		$	—	$	1,837,860		$	1,572,908		$	189,940		$	—		$	1,762,848
Debt premium on mortgage notes payable		16,930			—			—		16,930			26,663			—			—			26,663
Exchangeable notes		287,500			—			—		287,500			—			—			—			—
Credit Facility		245,000			—			—		245,000			332,000			—			—			332,000
Notes payable		1,148			—			—		1,148			1,148			—			—			1,148
Distributions in excess of partnership investments		55,215			(55,215	)		—		—			63,439			(63,439	)		—			—
Liabilities related to assets held for sale		—			—			—		—			34			—			—			34
Other liabilities		126,242			8,303			—		134,545			105,754			5,782			—			111,536
TOTAL LIABILITIES		2,381,313			141,670			—		2,522,983			2,101,946			132,283			—			2,234,229
Minority interest		66,979			—			—		66,979			114,363			—			—			114,363
Shareholders’ equity:
Shares of beneficial interest at $1 par		38,664			—			—		38,664			36,947			—			—			36,947
Preferred shares at $0.01 par		—			—			—		—			25			—			—			25
Capital contributed in excess of par		805,811			—			—		805,811			917,322			—			—			917,322
Accumulated other comprehensive income		10,055			—			—		10,055			7,893			—			—			7,893
Distributions in excess of net income		(80,012	)		—			—		(80,012	)		(32,887	)		—			—			(32,887	)
TOTAL SHAREHOLDERS’ EQUITY		774,518			—			—		774,518			929,300			—			—			929,300
TOTAL LIABILITIES, MINORITY INTERESTS AND SHAREHOLDERS’ EQUITY	$	3,222,810		$	141,670		$	—	$	3,364,480		$	3,145,609		$	132,283		$	—		$	3,277,892

⁽¹⁾ Total includes PREIT’s proportionate share of partnership assets and liabilities “grossed up” 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.

⁽²⁾ Total includes straight line rent of $24.1 million ($20.9 million wholly owned, $3.2 million partnership) and $22.6 million ($19.4 million wholly owned, $3.2 million partnership) for September 30, 2007 and December 31, 2006, respectively.

21

Pennsylvania Real Estate Investment Trust

Balance Sheet

Property Type ⁽¹⁾

(in thousands, except per share amounts)

	September 30, 2007												December 31, 2006
	Malls			Power and Strip Centers			Corporate and Other Development Properties			Total			Malls			Power and Strip Centers			Corporate and Other Development Properties			Total
ASSETS
Investments in real estate:
Investments in real estate, at cost	$	2,858,035		$	278,377		$	12,948		$	3,149,360		$	2,808,939		$	278,202		$	13,394		$	3,100,535
Construction in progress		193,194			122			143,966			337,282			117,871			(8	)		102,699			220,562
Accumulated depreciation		(353,958	)		(63,666	)		(1,055	)		(418,679	)		(288,069	)		(57,323	)		(689	)		(346,081	)
Net investments in real estate		2,697,271			214,833			155,859			3,067,963			2,638,741			220,871			115,404			2,975,016
Other assets:
Cash		7,052			998			15,811			23,861			13,362			1,514			3,851			18,727
Rents and other receivables (2)		36,087			12,863			1,462			50,412			38,379			13,074			4,473			55,926
Assets held for sale		—			—			—			—			—			52			10			62
Intangible assets, net		101,660			—			11,804			113,464			128,503			—			11,805			140,308
Deferred costs and other assets, net of accumulated amortization		62,091			10,314			36,375			108,780			46,424			10,129			31,300			87,853
Total other assets		206,890			24,175			65,452			296,517			226,668			24,769			51,439			302,876
TOTAL ASSETS	$	2,904,161		$	239,008		$	221,311		$	3,364,480		$	2,865,409		$	245,640		$	166,843		$	3,277,892
LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities:
Mortgage notes payable	$	1,747,081		$	90,779		$	—		$	1,837,860		$	1,670,436		$	92,412		$	—		$	1,762,848
Debt premium on mortgage notes payable		16,584			346			—			16,930			26,052			611			—			26,663
Exchangeable notes		—			—			287,500			287,500			—			—			—			—
Credit Facility		—			—			245,000			245,000			—			—			332,000			332,000
Notes payable		1,148			—			—			1,148			1,148			—			—			1,148
Liabilities related to assets held for sale		—			—			—			—			—			15			19			34
Other liabilities		65,694			1,737			67,114			134,545			56,468			2,962			52,106			111,536
TOTAL LIABILITIES		1,830,507			92,862			599,614			2,522,983			1,754,104			96,000			384,125			2,234,229
Minority interest		—			—			66,979			66,979			—			—			114,363			114,363
Shareholders’ equity:
Shares of beneficial interest at $1 par		—			—			38,664			38,664			—			—			36,947			36,947
Preferred shares at $0.01 par		—			—			—			—			—			—			25			25
Capital contributed in excess of par		—			—			805,811			805,811			—			—			917,322			917,322
Accumulated other comprehensive income		—			—			10,055			10,055			—			—			7,893			7,893
Distributions in excess of net income		—			—			(80,012	)		(80,012	)		—			—			(32,887	)		(32,887	)
Net investment		1,073,654			146,146			(1,219,800	)		—			1,111,305			149,640			(1,260,945	)		—
TOTAL SHAREHOLDERS’ EQUITY		1,073,654			146,146			(445,282	)		774,518			1,111,305			149,640			(331,645	)		929,300
TOTAL LIABILITIES, MINORITY INTERESTS AND SHAREHOLDERS’ EQUITY	$	2,904,161		$	239,008		$	221,311		$	3,364,480		$	2,865,409		$	245,640		$	166,843		$	3,277,892

⁽¹⁾ Total includes PREIT’s proportionate share of partnership assets and liabilities “grossed up” 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.

⁽²⁾ Total includes straight line rent of $24.1 million ($20.9 million wholly owned, $3.2 million partnership) and $22.6 million ($19.4 million wholly owned, $3.2 million partnership) for September 30, 2007 and December 31, 2006, respectively.

22

Pennsylvania Real Estate Investment Trust

Investment in Real Estate ⁽¹⁾

(in thousands)

	September 30, 2007								December 31, 2006
	Operating Property and Land Held for Development		Construction in Progress		Accumulated Depreciation		Net Real Estate		Operating Property and Land Held for Development		Construction in Progress		Accumulated Depreciation		Net Real Estate
Consolidated Malls
Beaver Valley Mall	$	65,967	$	89	$	9,409	$	56,647	$	58,490	$	1,024	$	7,745	$	51,769
Capital City Mall		93,066		197		10,242		83,021		91,929		203		7,703		84,429
Chambersburg Mall		36,326		—		3,986		32,340		36,269		—		3,166		33,103
Cherry Hill Mall		210,163		42,409		23,323		229,249		210,153		21,319		19,115		212,357
Crossroads Mall		33,862		—		4,442		29,420		33,441		—		3,500		29,941
Cumberland Mall		58,141		31		3,477		54,695		56,338		1,072		2,409		55,001
Dartmouth Mall		60,953		—		18,510		42,443		60,692		70		16,487		44,275
Exton Square Mall		146,134		29		15,424		130,739		145,590		27		12,930		132,687
Francis Scott Key Mall		70,002		200		7,415		62,787		67,712		240		5,583		62,369
Gadsden Mall		52,245		59		3,346		48,958		51,636		—		2,349		49,287
The Gallery at Market East		79,506		28,875		8,413		99,968		78,426		26,243		6,768		97,901
Jacksonville Mall		68,574		2,099		7,678		62,995		68,123		77		6,128		62,072
Logan Valley Mall		93,422		—		11,981		81,441		93,042		—		9,560		83,482
Lycoming Mall		72,138		395		6,926		65,607		70,370		1,511		5,022		66,859
Magnolia Mall		81,111		1,469		14,371		68,209		67,429		4,684		12,705		59,408
Moorestown Mall		79,871		1,510		13,015		68,366		77,025		217		10,873		66,369
New River Valley Mall		54,761		1,218		4,785		51,194		40,918		9,064		2,979		47,003
Nittany Mall		41,945		—		4,740		37,205		41,708		—		3,735		37,973
North Hanover Mall		31,320		12,920		3,697		40,543		30,049		445		2,782		27,712
Orlando Fashion Square		112,807		352		8,608		104,551		112,113		204		6,232		106,085
Palmer Park Mall		33,905		—		9,333		24,572		33,847		—		8,616		25,231
Patrick Henry Mall		137,844		455		14,806		123,493		136,694		207		10,876		126,025
Phillipsburg Mall		51,665		15		5,409		46,271		50,900		430		4,296		47,034
Plymouth Meeting Mall		63,310		32,756		10,278		85,788		62,978		21,851		8,555		76,274
The Mall at Prince Georges		99,476		68		21,306		78,238		97,788		679		18,649		79,818
Schuylkill Mall		—		—		—		—		8,411		—		1,062		7,349
South Mall		28,885		—		3,052		25,833		28,589		15		2,418		26,186
Uniontown Mall		36,669		—		4,932		31,737		36,337		—		3,904		32,433
Valley Mall		88,853		1,032		11,023		78,862		86,977		268		8,792		78,453
Valley View Mall		66,564		3		6,598		59,969		65,884		28		5,177		60,735
Viewmont Mall		84,799		395		7,844		77,350		81,753		264		6,024		75,993
Voorhees Town Center		10,561		24,844		2,866		32,539		16,634		5,746		4,149		18,231
Washington Crown Center		40,088		—		7,076		33,012		41,581		—		5,843		35,738
Westgate Anchor Pad		3,450		—		—		3,450		3,450		—		—		3,450
Willow Grove Park		178,763		25,822		26,423		178,162		177,536		18,664		22,357		173,843
Wiregrass Commons		36,879		139		4,083		32,935		38,255		42		3,271		35,026
Woodland Mall		179,287		10		9,974		169,323		178,296		—		5,660		172,636
Wyoming Valley Mall		101,228		407		9,753		91,882		98,700		577		7,325		91,952
Total Consolidated Malls		2,784,540		177,798		338,544		2,623,794		2,736,063		115,171		274,745		2,576,489
Unconsolidated Malls
Lehigh Valley Mall		19,117		15,166		11,365		22,918		18,741		2,610		10,824		10,527
Springfield Mall		54,378		230		4,049		50,559		54,135		90		2,500		51,725
Total Unconsolidated Malls		73,495		15,396		15,414		73,477		72,876		2,700		13,324		62,252
TOTAL MALLS	$	2,858,035	$	193,194	$	353,958	$	2,697,271	$	2,808,939	$	117,871	$	288,069	$	2,638,741

⁽¹⁾ Total includes PREIT’s proportionate share of partnership assets and liabilities “grossed up” 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.

23

Pennsylvania Real Estate Investment Trust

Investment in Real Estate ⁽¹⁾ (continued)

(in thousands)

	September 30, 2007								December 31, 2006
	Operating Property and Land Held for Development		Construction in Progress		Accumulated Depreciation		Net Real Estate		Operating Property and Land Held for Development		Construction in Progress			Accumulated Depreciation		Net Real Estate
Consolidated Power Centers/Strips
Christiana Center	$	40,935	$	—	$	8,511	$	32,424	$	40,935	$	—		$	7,656	$	33,279
Creekview		19,098		—		5,376		13,722		19,098		—			4,689		14,409
Crest Plaza		16,307		41		3,625		12,723		16,238		(9	)		3,139		13,090
The Commons at Magnolia		10,118		—		2,424		7,694		9,724		—			2,131		7,593
Northeast Tower Center		33,630		—		5,588		28,042		33,748		—			5,119		28,629
Paxton Towne Centre		54,056		—		10,666		43,390		54,056		1			9,414		44,643
Total Consolidated Power Centers/Strips		174,144		41		36,190		137,995		173,799		(8	)		32,148		141,643
Unconsolidated Power Centers/Strips
Metroplex Shopping Center		42,024		—		10,270		31,754		42,024		—			9,113		32,911
The Court at Oxford Valley		27,737		—		6,603		21,134		27,735		—			6,151		21,584
Red Rose Commons		11,748		1		2,527		9,222		11,934		—			2,290		9,644
Whitehall Mall		15,664		80		7,046		8,698		15,664		—			6,684		8,980
Springfield Park		7,060		—		1,030		6,030		7,046		—			937		6,109
Total Unconsolidated Power Centers/Strips		104,233		81		27,476		76,838		104,403		—			25,175		79,228
TOTAL POWERS AND STRIP CENTERS	$	278,377	$	122	$	63,666	$	214,833	$	278,202	$	(8	)	$	57,323	$	220,871
Development Properties
The Plaza at Magnolia	$	—	$	511	$	—	$	511	$	—	$	6,885		$	—	$	6,885
Monroe Marketplace		—		20,974		—		20,974		—		6,313			—		6,313
New Garden Town Center		—		37,563		—		37,563		—		34,793			—		34,793
New River Valley Center		—		24,592		—		24,592		—		5,707			—		5,707
Springhills		—		28,374		—		28,374		—		26,086			—		26,086
Sunrise Plaza (Lacey Retail Center)		—		30,641		—		30,641		—		21,945			—		21,945
Total Development Properties		—		142,655		—		142,655		—		101,729			—		101,729
Unconsolidated Development Properties
Pavilion at Market East		5,821		1,311		776		6,356		6,273		970			689		6,554
Total Unconsolidated Development Properties		5,821		1,311		776		6,356		6,273		970			689		6,554
Other Properties
P&S Building		1,339		—		279		1,060		1,339		—			—		1,339
Land held for development - consolidated		5,616		—		—		5,616		5,616		—			—		5,616
Land held for development - unconsolidated		172		—		—		172		166		—			—		166
Total Other Properties	$	7,127	$	—	$	279	$	6,848	$	7,121	$	—		$	—	$	7,121
TOTAL INVESTMENT IN REAL ESTATE	$	3,149,360	$	337,282	$	418,679	$	3,067,963	$	3,100,535	$	220,562		$	346,081	$	2,975,016
CONSOLIDATED PROPERTIES	$	2,965,639	$	320,494	$	375,013	$	2,911,120	$	2,916,817	$	216,892		$	306,893	$	2,826,816
UNCONSOLIDATED PROPERTIES		183,721		16,788		43,666		156,843		183,718		3,670			39,188		148,200
TOTAL INVESTMENT IN REAL ESTATE	$	3,149,360	$	337,282	$	418,679	$	3,067,963	$	3,100,535	$	220,562		$	346,081	$	2,975,016

⁽¹⁾ Total includes PREIT’s proportionate share of partnership assets and liabilities “grossed up” 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.

24

Pennsylvania Real Estate Investment Trust

Property Redevelopment and Repositioning Summary as of September 30, 2007

NAME OF PROJECT LOCATION	PREIT’s PROJECTED SHARE OF COST	PREIT’s INVESTMENT	RETURN ON INCREMENTAL INVESTMENT		CONSTRUCTION START DATE	EXPECTED CONSTRUCTION COMPLETION
	(in millions)	(in millions)
ENCLOSED MALL
Beaver Valley Mall Monaca, PA	$9.2	$8.1	9.4	%	2006	2007
-Opened 45,000 sf Dick’s Sporting Goods in August 2007 (17,000 sf of new GLA).
Magnolia Mall
Florence, SC	18.5	15.4	9.5	%	2006	2007
-Opened 45,000 sf Dick’s Sporting Goods in April 2007 (45,000 sf of new GLA); -Opened 28,000 sf Barnes & Noble in August 2007 (13,000 sf of new GLA); -Commenced mall renovation in third quarter of 2007; -Net increase in property GLA is approximately 58,000 sf.
New River Valley Mall Christiansburg, VA	26.0	25.1	8.1	%	2005	2007
-Relocated and expanded the Regal Cinemas to a free-standing 14-screen theater in May 2007 (27,000 sf of new GLA); -Opened 45,000 sf Dick’s Sporting Goods in a combination of small shop space and vacant anchor space (net decrease in GLA of 9,000 sf); -Opened 23,000 sf New River Valley Community College in August 2007 (23,000 sf of new GLA); -Opening 3,000 sf of food court space in early November 2007 (3,000 sf of new GLA); -Completed mall renovation; -Net increase in property GLA is approximately 44,000 sf.
Jacksonville Mall Jacksonville, NC	4.0	2.3	8.0	%	2007	2008
-Opening 28,000 sf Barnes & Noble (13,000 sf of new GLA).
Lehigh Valley Mall Allentown, PA	22.2	15.2	8.4	%	2006	2008
-Opening 140,000 sf Lifestyle component, including a 30,000 sf Barnes & Noble, shops and restaurants; -Demolished 10,000 sf outparcel as part of this project; -Expecting approximately 110,000 sf to open in 2007 and the remaining 30,000 sf to open in 2008. Ann Taylor, Ann Taylor Loft, Apple, Bravo, Chico’s, Coach, Coldwater Creek, J. Crew, Pottery Barn, Sephora, Soma and White House/Black Market opened in October 2007. Barnes & Noble is expected to open on October 30, 2007 and Bonefish Grill, Coldstone Creamery, Williams-Sonoma and Yankee Candle are expected to open by the end of 2007. -Net increase in property GLA is approximately 130,000 sf.
Moorestown Mall Moorestown, NJ	13.7	3.6	8.2	%	2007	2008

-Opened 16,000 sf Lane Furniture in September 2007 (8,000 sf of new GLA);

-Opening 15,000 sf Eastern Mountain Sports (4,000 sf of new GLA);

-Opening 6,000 sf of outparcel restaurants;

-Creating 3 spaces with exterior frontage in approximately 6,000 sf of unleasable space (new GLA);

-Updating the entrances and facades;

-Net increase in property GLA will be approximately 24,000 sf.

25

Pennsylvania Real Estate Investment Trust

Property Redevelopment and Repositioning Summary as of September 30, 2007 (continued)

NAME OF PROJECT LOCATION	PREIT’s PROJECTED SHARE OF COST	PREIT’s INVESTMENT	RETURN ON INCREMENTAL INVESTMENT		CONSTRUCTION START DATE	EXPECTED CONSTRUCTION COMPLETION
ENCLOSED MALL (continued)	(in millions)	(in millions)
North Hanover Mall Hanover, PA	$35.1	$13.8	7.8	%	2007	2008
-Opening 172,000 sf Boscov’s in the former 70,000 sf Bon-Ton anchor and absorbing 12,000 sf of existing in-line space (90,000 sf of new GLA); -Opened 50,000 sf Dick’s Sporting Goods in October 2007 in the former 63,000 sf Black Rose Antiques location (net decrease in GLA of 13,000 sf); -Relocated and downsized Black Rose Antiques to 15,000 sf of previously vacant space in adjacent strip center; -Net increase in property GLA will be approximately 77,000 sf.
Plymouth Meeting Mall Plymouth Meeting, PA	83.9	32.8	8.6	%	2007	2008
-Opening 65,000 sf Whole Foods Market; -Opening four restaurant outparcels (Benihana, California Pizza Kitchen, P.F. Chang’s China Bistro and Redstone American Grill), totaling 34,000 sf; -Opening 39,000 sf of retail space; -Opening 4,000 sf Citibank outparcel; -Net increase in property GLA will be approximately 142,000 sf.
Willow Grove Park Willow Grove, PA	39.1	25.8	6.5	%	2007	2008
-Opening 194,000 sf Boscov’s and 22,000 sf of restaurants in the former 229,000 sf Strawbridge’s. Included in the 22,000 sf of restaurants is a 10,000 sf Cheesecake Factory that opened during September 2007; -Net reduction in property GLA will be approximately 13,000 sf.
Cherry Hill Mall Cherry Hill, NJ	197.7	42.4	7.1	%	2007	2009
-Opening a two-level, 138,000 sf Nordstrom (anticipated spring of 2009) in the former 262,000 sf Strawbridge’s; -Opening 88,000 sf of new in-line retail space in the old food court and Strawbridge’s area; -Opening Crate & Barrel and The Container Store in November 2007 on two outparcels totaling 59,000 sf; -Opening 72,000 sf from a combination of a Bistro Row and parking deck restaurants; -Net increase in total property GLA will be approximately 95,000 sf.
MIXED USE
Voorhees Town Center Voorhees, NJ	60.7	24.9	9.7	%	2007	2008
-Reducing mall GLA by 470,000 sf to 654,000 sf; -Opening a mixed use town center of approximately 200,000 sf; -Opening 26,000 sf of outparcel space; -Opening 425 residential units which are expected to be constructed by our ground lessee and its affiliates; -Net reduction in property GLA will be approximately 244,000 sf.

26

Pennsylvania Real Estate Investment Trust

Development Property Summary as of September 30, 2007

NAME OF PROJECT LOCATION	TOTAL PROJECTED PROPERTY GLA (sq ft) (1)	PREIT’s PROJECTED SHARE OF COST	PREIT’s INVESTMENT	EXPECTED STABILIZED NOI CAP		CONSTRUCTION START DATE	EXPECTED DATE OF COMPLETION	% LEASED		% OCCUPIED
POWER CENTERS		(in millions)	(in millions)
Sunrise Plaza (Lacey Retail Center) Lacey Township, NJ	276,000	$39.1	$30.6	6.2	%	2006	2008	58	%	48	%
A retail shopping center anchored by a 133,000 square foot Home Depot that opened in October 2007. The balance of the center is comprised of in-line stores and outparcels, including a 20,000 square foot Staples.
New River Valley Center Christiansburg, VA	164,000	29.2	24.6	8.1	%	2006	2008	100	%	5	%
The power center adjacent to the existing New River Valley Mall is under construction. Shoe Carnival opened in October 2007. Best Buy, Bed Bath & Beyond, PetSmart, Old Navy, Staples, Olive Garden, Panera Bread and Banfield, The Pet Hospital are all expected to open by the end of 2007. Ross is expected to open during the first quarter of 2008.
Monroe Marketplace Selinsgrove, PA	717,000	61.6	21.0	8.9	%	2007	2008	30	%	0	%
A 717,000 square foot power center will be developed, including Target and Giant Food Store as anchors.
MIXED USE
New Garden Town Center New Garden Township, PA	715,000	82.1	37.6	9.4	%	2008	2009	0	%	0	%
The planned development includes retail and other uses.
Springhills Gainesville, FL	TBD	TBD	28.4	TBD		TBD	TBD	0	%	0	%
540 acres of land were acquired in 2006. Site development is subject of litigation commenced by the Company in June 2007 following action by the Alachua County Board of Supervisors refusing to authorize the Company’s development plans.
OTHER
Pavilion at Market East (2) Philadelphia, PA	TBD	TBD	1.3	TBD		TBD	TBD	N/A		0	%
TBD

Valley View Downs

South Beaver Township, PA

In October 2007, we entered into an amendment to its October 2004 agreement with Valley View Downs, LP and Centaur PA, LLC with respect to the development of a proposed racetrack and casino in western Pennsylvania. PREIT will no longer acquire the site, as we have waived and terminated our rights to purchase the property. PREIT will be repaid the $983,000 it paid to Valley View in connection with the original agreement. Valley View has obtained a racing license from the PA Horse Racing Commission. There is no assurance that Valley View will obtain an Alternative Gaming license from the Pennsylvania Gaming Control Board. PREIT will not own the property, any improvements or the assets of Valley View, including any licenses. In consideration of PREIT’s waiver and termination, Valley View, Centaur or the affiliate that receives the Alternative Gaming license will pay PREIT $57 million over nine years, payable in installments from March 2010 to February 2019 plus a final payment of $30 million payable in March 2019. In addition, Valley View has entered into a development agreement with us to provide customary management services for all aspects of the construction and development phases of the racetrack and casino. The fee for such services will be $3 million, payable in installments between October 2007 and February 2010.

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

⁽²⁾ 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, 2007						Nine months ended September 30, 2007
	Consolidated		Unconsolidated		Total		Consolidated		Unconsolidated		Total
Redevelopment projects with incremental	$	44,847	$	2,904	$	47,751	$	104,380	$	12,795	$	117,175
GLA and/or anchor replacement
New development projects		22,649		37		22,686		50,735		41		50,776
Renovation with no incremental GLA		1,027		—		1,027		3,465		—		3,465
Tenant allowances		4,454		31		4,485		9,738		45		9,783
Recurring capital expenditures:
CAM expenditures		4,242		158		4,400		6,592		201		6,793
Non-CAM expenditures		1,570		35		1,605		2,656		184		2,840
Total recurring capital expenditures		5,812		193		6,005		9,248		385		9,633
Total	$	78,789	$	3,165	$	81,954	$	177,566	$	13,266	$	190,832

28

Pennsylvania Real Estate Investment Trust

Debt Analysis as of September 30, 2007

(in thousands)

Outstanding Debt ⁽¹⁾

	Fixed Rate			% of Total Indebtedness		Floating Rate			% of Total Indebtedness		Total			% of Total Indebtedness
Consolidated Mortgage Notes Payable	$	1,666,208		69.8	%	$	—		0.0	%	$	1,666,208		69.8	%
Unconsolidated Mortgage Notes Payable		71,010		3.0	%		117,572		4.8	%		188,582		7.8	%
Corporate Notes Payable		1,148		0.0	%		—		0.0	%		1,148		0.0	%
Exchangeable Notes		287,500		12.1	%		—		0.0	%		287,500		12.1	%
Credit Facility		—		0.0	%		245,000		10.3	%		245,000		10.3	%
TOTAL OUTSTANDING DEBT	$	2,025,866		84.9	%	$	362,572		15.1	%	$	2,388,438		100.0	%
AVERAGE INTEREST RATE		5.94	%				6.48	%				6.02	%

⁽¹⁾ Includes debt premium

Average Debt Balance

		Mortgage Debt (1)			REMIC (2)			Total Mortgages			Credit Facility		Exchangeable Notes		Corporate Notes Payable		TOTAL
Beginning Balance	6/30/2007	$	1,439,419		$	424,394		$	1,863,813		$	35,000	$	287,500	$	1,148	$	2,187,461
Credit Facility Borrowing, net			—			—			—			210,000		—		—		210,000
Debt Amortization (3)			(4,266	)		(4,757	)		(9,023	)		—		—		—		(9,023	)
Ending Balance	9/30/2007	$	1,435,153		$	419,637		$	1,854,790		$	245,000	$	287,500	$	1,148	$	2,388,438
Weighted Average Balance		$	1,438,227		$	423,087		$	1,861,314		$	152,826	$	287,500	$	1,148	$	2,014,140

⁽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 ⁽¹⁾

Year	Scheduled Amortization		Debt Premium Amortization		Mortgage Balance at Maturity		Credit Facility		Exchangeable Notes		Corporate Notes Payable		Total Debt
2007	$	6,739	$	3,116	$	38,250	$	—	$	—	$	1,148	$	49,253
2008		24,153		9,789		586,693		—		—		—		620,635
2009		16,171		1,283		62,434		245,000		—		—		324,888
2010		17,178		1,174		1,412		—		—		—		19,764
2011		17,588		1,152		44,788		—		—		—		63,528
2012		14,782		416		310,342		—		287,500		—		613,040
2013		9,863		—		110,457		—		—		—		120,320
Thereafter		19,178		—		557,832		—		—		—		577,010
	$	125,652	$	16,930	$	1,712,208	$	245,000	$	287,500	$	1,148	$	2,388,438

⁽¹⁾ The weighted average period to mortgage maturity is 4.64 years. Excludes debt premium.

Interest Rate Hedging Instruments

Type	Notional Amount		Blended Rate		Latest Settlement Date
10 Year Forward Starting Swaps	$	250,000	4.80	%	12/10/2008
10 Year Forward Starting Swaps	$	150,000	5.36	%	12/10/2008
	$	400,000	5.01	%

29

Pennsylvania Real Estate Investment Trust

Debt Schedule as of September 30, 2007

(in thousands)

	Proportionate Share(1)								Marked to
	Mortgage Debt		Debt Premium		Total		Stated Interest Rate		Market Interest Rate (GAAP)		Annual Debt Service		Balance at Maturity		Maturity Date
Fixed Rate Mortgage Debt
Beaver Valley Mall	$	45,426	$	—	$	45,426	7.36	%	7.36	%	$	3,972	$	42,266	2012
Capital City Mall		51,159		3,699		54,858	7.61	%	5.50	%		4,603		47,843	2012
Chambersburg Mall (2)		17,653		396		18,049	7.43	%	4.99	%		1,763		17,200	2008
Cherry Hill Mall		194,629		—		194,629	5.42	%	5.42	%		13,510		177,689	2012
Crossroads Mall		12,823		144		12,967	7.39	%	5.75	%		1,191		12,647	2008
Cumberland Mall - 1st Mortgage		42,467		1,766		44,233	6.50	%	5.40	%		3,413		38,782	2012
Cumberland Mall - 2nd Mortgage		3,303		—		3,303	5.00	%	5.00	%		206		—	2017
Dartmouth Mall		65,432		—		65,432	4.95	%	4.95	%		4,484		57,594	2013
Exton Square Mall		94,863		1,885		96,748	6.95	%	5.00	%		8,102		93,034	2008
Francis Scott Key Mall (2)		30,893		692		31,585	7.43	%	4.99	%		3,085		30,099	2008
Jacksonville Mall (2)		23,832		534		24,366	7.43	%	4.99	%		2,380		23,219	2008
Logan Valley Mall (2)		50,312		1,129		51,441	7.43	%	4.99	%		5,024		49,018	2008
Lycoming Mall (2)		30,893		692		31,585	7.43	%	4.99	%		3,084		30,099	2008
Magnolia Mall		64,072		—		64,072	5.33	%	5.33	%		4,413		54,965	2015
Metroplex Shopping Center		30,769		—		30,769	7.25	%	7.25	%		2,681		28,785	2011
Moorestown Mall		60,057		—		60,057	4.95	%	4.95	%		4,115		52,863	2013
New River Valley Mall (2)		15,005		336		15,341	7.43	%	4.99	%		1,498		14,619	2008
Nittany Mall (2)		26,480		593		27,073	7.43	%	4.99	%		2,644		25,799	2008
North Hanover Mall (2)		17,653		396		18,049	7.43	%	4.99	%		1,763		17,199	2008
Northeast Tower Center (2)		15,447		346		15,793	7.43	%	4.99	%		1,542		15,049	2008
The Court at Oxford Valley		19,349		—		19,349	8.02	%	8.02	%		2,319		16,003	2011
Palmer Park Mall		16,392		—		16,392	6.77	%	6.77	%		1,661		15,674	2009
Patrick Henry Mall (2)		44,574		1,000		45,574	7.43	%	4.99	%		4,451		43,428	2008
Phillipsburg Mall (2)		26,480		593		27,073	7.43	%	4.99	%		2,644		25,799	2008
The Mall at Prince Georges		150,000		—		150,000	5.51	%	5.51	%		8,270		150,000	2017
Red Rose Commons		12,907		—		12,907	7.66	%	7.66	%		1,220		12,425	2009
Springfield Park		1,601		—		1,601	7.79	%	7.79	%		203		1,412	2010
South Mall (2)		13,240		297		13,537	7.43	%	4.99	%		1,322		12,899	2008
Uniontown Mall (2)		21,184		475		21,659	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		35,466		237		35,703	6.15	%	5.75	%		2,773		34,335	2009
Viewmont Mall (2)		26,480		593		27,073	7.43	%	4.99	%		2,644		25,799	2008
Whitehall Mall		6,384		—		6,384	6.77	%	6.77	%		641		6,129	2008
Willow Grove Park		156,251		—		156,251	5.65	%	5.65	%		11,083		133,548	2015
Woodland Mall		156,500		—		156,500	5.58	%	5.58	%		8,397		140,484	2016
Wyoming Valley Mall (2)		50,312		1,127		51,439	7.43	%	4.99	%		5,024		49,018	2008
Total Fixed Rate Mortgage Debt		1,720,288		16,930		1,737,218	6.26	%	5.46	%		133,254		1,595,196
Variable Rate Mortgage Debt
Lehigh Valley Mall		75,000		—		75,000	5.75	%	5.75	%		4,314		75,000	2008
Pavilion East Associates		4,322		—		4,322	8.47	%	8.47	%		366		3,826	2012
Springfield Mall		38,250		—		38,250	6.23	%	6.23	%		2,380		38,250	2007
Total Variable Rate Mortgage Debt		117,572		—		117,572	6.01	%	6.01	%		7,060		117,076
Total Mortgage Debt	$	1,837,860	$	16,930	$	1,854,790	6.25	%	5.50	%	$	140,314	$	1,712,272
CONSOLIDATED MORTGAGES	$	1,649,278	$	16,930	$	1,666,208	6.21	%	5.38	%	$	126,190	$	1,530,442
UNCONSOLIDATED MORTGAGES		188,582		—		188,582	6.57	%	6.57	%		14,124		181,830
CORPORATE NOTES		1,148		—		1,148	0.00	%	0.00	%		—		—
EXCHANGEABLE NOTES		287,500		—		287,500	4.00	%	4.00	%		11,500		287,500
CREDIT FACILITY		245,000		—		245,000	6.70	%	6.70	%		16,425		—
Total	$	2,371,508	$	16,930	$	2,388,438	6.02	%	5.44	%	$	156,738	$	1,999,772

⁽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.

30

Pennsylvania Real Estate Investment Trust

Shareholder Information

Ten Largest Institutional Shareholders:	Common Shares Held (1)
Goldman Sachs Asset Management (US)	3,881,739
ING Clarion Real Estate Securities, L.P.	2,557,853
Vanguard Group, Inc.	2,535,153
Barclays Global Investors, N.A.	1,938,422
Nomura Asset Management Co., Ltd.	1,395,900
RREEF Real Estate Securities Advisors, L.P.	1,201,538
Perkins, Wolf, McDonnell & Company, LLC	1,168,572
State Street Global Advisors (US)	948,252
J.P. Morgan Investment Management Inc. (New York)	730,201
Neuberger Berman, LLC	602,799
TOTAL of Ten Largest Institutional:	16,960,429
TOTAL of all Institutional Holders:	31,101,937
Ten Largest as % of Total Institutional:	54.5	%

⁽¹⁾ Based on 13F and 13G filings as of 6/30/2007 or most recent filings.

Breakdown of Share & Unit Ownership:	Most Recent	% of Outstanding		December 31, 2006
Shares Held
Institutional (1)	31,101,937	75.2	%	27,237,603
Retail (2)	5,278,350	12.8	%	9,195,771
Insiders (3)	4,965,503	12.0	%	4,811,556
TOTAL	41,345,790	100.0	%	41,244,930

⁽¹⁾ Based on 13F and 13G filings as of 6/30/2007 or most recent filings.

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

⁽³⁾ Insider holdings as of March 31, 2007 (Shares and O.P. Units only). Excludes 330,000 exercisable options. See proxy statement dated April 20, 2007 for more details.

31

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 properties 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 includes the effect of the Company’s redemption of all of its 11% non-convertible Senior Preferred Shares in July 2007.

Funds From Operations 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 Funds From Operations 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 or losses on sale of 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 operating 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.

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