Item 8. and Item 15(a)(1) and (2)

Index to Consolidated Financial Statements and Schedules

Consolidated Financial Statements	Page No.
Management Assessment Report on Internal Control over Financial Reporting	F-2
Report of Independent Registered Public Accounting Firm	F-3
Report of Independent Registered Public Accounting Firm	F-4
Consolidated Balance Sheets	F-5
Consolidated Statements of Comprehensive Income	F-6
Consolidated Statement of Shareholders’ Equity	F-7
Consolidated Statements of Cash Flows	F-8
Notes to Consolidated Financial Statements	F-9
Financial Statement Schedules
Schedule III—Summary of Real Estate and Accumulated Depreciation	F-31
Schedule IV—Mortgage Loans on Real Estate	F-38

All other schedules have been omitted either because the information is not applicable, not material, or is disclosed in our consolidated financial statements and related notes.

F-1

Management Assessment Report on Internal Control over Financial Reporting

The management of Federal Realty is responsible for establishing and maintaining adequate internal control over financial reporting. Establishing and maintaining internal control over financial reporting is a process designed by, or under the supervision of, our President and Chief Executive Officer and Executive Vice President - Chief Financial Officer, as appropriate, and effected by our employees, including management and our Board of Trustees, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. This process includes policies and procedures that:

•	pertain to the maintenance of records that accurately and fairly reflect the transactions and dispositions of our assets in reasonable detail;

•	provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are made only in accordance with the authorization procedures we have established; and

•	provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of any of our assets in circumstances that could have a material adverse effect on our financial statements.

Management, including our Chief Executive Officer and Chief Financial Officer, do not expect that our internal control over financial reporting will prevent all errors and fraud. In designing and evaluating our control system, management recognized that any control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance of achieving the desired control objectives. Further, the design of a control system must reflect the fact that there are resource constraints, and management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, that may affect our operation have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management’s override of the control. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.

Management conducted an assessment of the effectiveness of the Trust’s internal control over financial reporting as of December 31, 2012. In making this assessment, it used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control—Integrated Framework. Based on this assessment, management concluded that our internal control over financial reporting is effective, based on those criteria, as of December 31, 2012.

Grant Thornton LLP, the independent registered public accounting firm that audited the Trust’s consolidated financial statements included in this Annual Report on Form 10-K, has issued an attestation report on the Trust’s internal control over financial reporting, which appears on page F-3 of this Annual Report on Form 10-K.

F-2

Report of Independent Registered Public Accounting Firm

Trustees and Shareholders of Federal Realty Investment Trust

We have audited the internal control over financial reporting of Federal Realty Investment Trust (a Maryland real estate investment trust) and subsidiaries (collectively, the "Trust") as of December 31, 2012, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Federal Realty Investment Trust’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management Assessment Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on Federal Realty Investment Trust’s internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, the Trust maintained, in all material respects, effective internal control over financial reporting as of December 31, 2012, based on criteria established in Internal Control—Integrated Framework issued by COSO.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of the Trust as of December 31, 2012 and 2011, and the related consolidated statements of comprehensive income, shareholders’ equity, and cash flows for each of the three years in the period ended December 31, 2012 and our report dated February 12, 2013 expressed an unqualified opinion.

/s/ GRANT THORNTON LLP

McLean, Virginia

February 12, 2013

F-3

Report of Independent Registered Public Accounting Firm

Trustees and Shareholders of Federal Realty Investment Trust

We have audited the accompanying consolidated balance sheets of Federal Realty Investment Trust (a Maryland real estate investment trust) and subsidiaries (collectively, the "Trust") as of December 31, 2012 and 2011, and the related consolidated statements of comprehensive income, shareholders’ equity, and cash flows for each of the three years in the period ended December 31, 2012. Our audits of the basic financial statements included the financial statement schedules listed in the index appearing under Item 15(a) (1) and (2). These financial statements and financial statement schedules are the responsibility of the Trust’s management. Our responsibility is to express an opinion on these financial statements and financial statement schedules based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Trust and subsidiaries as of December 31, 2012 and 2011, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2012, in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the related financial statement schedules, when considered in relation to the basic financial statements taken as a whole, present fairly, in all material respects, the information set forth therein.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the Trust’s internal control over financial reporting as of December 31, 2012, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) and our report dated February 12, 2013 expressed an unqualified opinion.

/s/ GRANT THORNTON LLP

McLean, Virginia

February 12, 2013

F-4

Federal Realty Investment Trust

Consolidated Balance Sheets

	December 31,
	2012				2011
	(In thousands, except share data)
ASSETS
Real estate, at cost
Operating (including $278,826 and $263,570 of consolidated variable interest entities, respectively)	$	4,490,960			$	4,232,608
Construction-in-progress	288,714				193,836
	4,779,674				4,426,444
Less accumulated depreciation and amortization (including $12,024 and $4,991 of consolidated variable interest entities, respectively)	(1,224,295		)		(1,127,588		)
Net real estate	3,555,379				3,298,856
Cash and cash equivalents	36,988				67,806
Accounts and notes receivable, net	73,861				75,921
Mortgage notes receivable, net	55,648				55,967
Investment in real estate partnership	33,169				34,352
Prepaid expenses and other assets	132,659				121,492
Debt issuance costs, net of accumulated amortization of $10,140 and $9,098, respectively	10,861				11,816
TOTAL ASSETS	$	3,898,565			$	3,666,210
LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities
Mortgages payable (including $205,299 and $207,683 of consolidated variable interest entities, respectively)	$	760,789			$	747,523
Capital lease obligations	71,693				63,093
Notes payable	299,575				295,159
Senior notes and debentures	1,076,545				1,004,635
Accounts payable and accrued expenses	120,929				104,660
Dividends payable	47,685				44,229
Security deposits payable	12,957				12,221
Other liabilities and deferred credits	103,379				68,761
Total liabilities	2,493,552				2,340,281
Commitments and contingencies (Note 9)
Redeemable noncontrolling interests	94,420				85,325
Shareholders’ equity
Preferred shares, authorized 15,000,000 shares, $.01 par: 5.417% Series 1 Cumulative Convertible Preferred Shares, (stated at liquidation preference $25 per share), 399,896 shares issued and outstanding	9,997				9,997
Common shares of beneficial interest, $.01 par, 100,000,000 shares authorized, 64,815,446 and 63,544,150 shares issued and outstanding, respectively	648				636
Additional paid-in capital	1,875,525				1,764,940
Accumulated dividends in excess of net income	(586,970		)		(555,541		)
Accumulated other comprehensive loss	(12,388		)		(3,940		)
Total shareholders’ equity of the Trust	1,286,812				1,216,092
Noncontrolling interests	23,781				24,512
Total shareholders’ equity	1,310,593				1,240,604
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	3,898,565			$	3,666,210

The accompanying notes are an integral part of these consolidated statements.

F-5

Federal Realty Investment Trust

Consolidated Statements of Comprehensive Income

	Year Ended December 31,
	2012				2011				2010
	(In thousands, except per share data)
REVENUE
Rental income	$	582,335			$	538,701			$	522,651
Other property income	20,217				9,260				14,545
Mortgage interest income	5,466				5,098				4,601
Total revenue	608,018				553,059				541,797
EXPENSES
Rental expenses	112,760				109,549				110,519
Real estate taxes	66,799				60,620				58,663
General and administrative	31,158				28,985				24,189
Litigation provision	—				—				330
Depreciation and amortization	142,039				126,208				118,878
Total operating expenses	352,756				325,362				312,579
OPERATING INCOME	255,262				227,697				229,218
Other interest income	689				218				256
Interest expense	(113,336		)		(98,465		)		(101,882		)
Early extinguishment of debt	—				296				(2,801		)
Income from real estate partnerships	1,757				1,808				1,060
INCOME FROM CONTINUING OPERATIONS	144,372				131,554				125,851
DISCONTINUED OPERATIONS
Discontinued operations - income	—				957				976
Discontinued operations - gain on deconsolidation of VIE	—				2,026				—
Discontinued operations - gain on sale of real estate	—				15,075				1,000
Results from discontinued operations	—				18,058				1,976
INCOME BEFORE GAIN ON SALE OF REAL ESTATE	144,372				149,612				127,827
Gain on sale of real estate	11,860				—				410
NET INCOME	156,232				149,612				128,237
Net income attributable to noncontrolling interests	(4,307		)		(5,695		)		(5,447		)
NET INCOME ATTRIBUTABLE TO THE TRUST	151,925				143,917				122,790
Dividends on preferred shares	(541		)		(541		)		(541		)
NET INCOME AVAILABLE FOR COMMON SHAREHOLDERS	$	151,384			$	143,376			$	122,249
EARNINGS PER COMMON SHARE, BASIC
Continuing operations	$	2.17			$	2.00			$	1.95
Discontinued operations	—				0.29				0.03
Gain on sale of real estate	0.19				—				0.01
	$	2.36			$	2.29			$	1.99
Weighted average number of common shares, basic	63,881				62,438				61,182
EARNINGS PER COMMON SHARE, DILUTED
Continuing operations	$	2.16			$	1.99			$	1.94
Discontinued operations	—				0.29				0.03
Gain on sale of real estate	0.19				—				0.01
	$	2.35			$	2.28			$	1.98
Weighted average number of common shares, diluted	64,056				62,603				61,324
NET INCOME	$	156,232			$	149,612			$	128,237
Other comprehensive loss - change in value of interest rate swaps	(8,448		)		(3,940		)		—
COMPREHENSIVE INCOME	147,784				145,672				128,237
Comprehensive income attributable to noncontrolling interests	(4,307		)		(5,695		)		(5,447		)
COMPREHENSIVE INCOME ATTRIBUTABLE TO THE TRUST	$	143,477			$	139,977			$	122,790

The accompanying notes are an integral part of these consolidated statements.

F-6

Federal Realty Investment Trust

Consolidated Statement of Shareholders’ Equity

	Shareholders’ Equity of the Trust
	Preferred Shares							Common Shares							Additional Paid-in Capital				Accumulated Dividends in Excess of Net Income				Accumulated Other Comprehensive Loss				Noncontrolling Interests				Total Shareholders' Equity
	Shares			Amount				Shares			Amount
	(In thousands, except share data)
BALANCE AT DECEMBER 31, 2009	399,896			$	9,997			61,242,050			$	612			$	1,606,115			$	(486,449	)		$	—			$	21,463			$	1,151,738
Net income, excluding $2,986 attributable to redeemable noncontrolling interests	—			—				—			—				—				122,790				—				2,461				125,251
Dividends declared to common shareholders	—			—				—			—				—				(163,382		)		—				—				(163,382		)
Dividends declared to preferred shareholders	—			—				—			—				—				(541		)		—				—				(541		)
Distributions declared to noncontrolling interests	—			—				—			—				—				—				—				(2,223		)		(2,223		)
Common shares issued	—			—				190			—				14				—				—				—				14
Exercise of stock options	—			—				107,493			1				4,051				—				—				—				4,052
Shares issued under dividend reinvestment plan	—			—				34,401			—				2,544				—				—				—				2,544
Share-based compensation expense, net	—			—				135,338			2				6,485				—				—				—				6,487
Conversion and redemption of OP units	—			—				6,946			—				532				—				—				(669		)		(137		)
Adjustment to redeemable noncontrolling interests	—			—				—			—				(8,035		)		—				—				—				(8,035		)
BALANCE AT DECEMBER 31, 2010	399,896			9,997				61,526,418			615				1,611,706				(527,582		)		—				21,032				1,115,768
Net income, excluding $3,492 attributable to redeemable noncontrolling interests	—			—				—			—				—				143,917				—				2,203				146,120
Other comprehensive loss - change in value of interest rate swaps	—			—				—			—				—				—				(3,940		)		—				(3,940		)
Dividends declared to common shareholders	—			—				—			—				—				(171,335		)		—				—				(171,335		)
Dividends declared to preferred shareholders	—			—				—			—				—				(541		)		—				—				(541		)
Distributions declared to noncontrolling interests	—			—				—			—				—				—				—				(2,320		)		(2,320		)
Common shares issued	—			—				1,662,230			17				139,281				—				—				—				139,298
Exercise of stock options	—			—				237,271			3				15,187				—				—				—				15,190
Shares issued under dividend reinvestment plan	—			—				28,823			—				2,374				—				—				—				2,374
Share-based compensation expense, net	—			—				89,408			1				8,246				—				—				—				8,247
Conversion and redemption of OP units	—			—				—			—				(96		)		—				—				(55		)		(151		)
Purchase of noncontrolling interest	—			—				—			—				(2,331		)		—				—				(207		)		(2,538		)
Deconsolidation of VIE	—			—				—			—				—				—				—				(420		)		(420		)
Contributions from noncontrolling interests	—			—				—			—				—				—				—				4,279				4,279
Adjustment to redeemable noncontrolling interests	—			—				—			—				(9,427		)		—				—				—				(9,427		)
BALANCE AT DECEMBER 31, 2011	399,896			9,997				63,544,150			636				1,764,940				(555,541		)		(3,940		)		24,512				1,240,604
Net income, excluding $2,592 attributable to redeemable noncontrolling interests	—			—				—			—				—				151,925				—				1,715				153,640
Other comprehensive loss - change in value of interest rate swaps	—			—				—			—				—				—				(8,448		)		—				(8,448		)
Dividends declared to common shareholders	—			—				—			—				—				(182,813		)		—				—				(182,813		)
Dividends declared to preferred shareholders	—			—				—			—				—				(541		)		—				—				(541		)
Distributions declared to noncontrolling interests	—			—				—			—				—				—				—				(2,232		)		(2,232		)
Common shares issued	—			—				1,039,405			10				106,209				—				—				—				106,219
Exercise of stock options	—			—				97,430			1				5,666				—				—				—				5,667
Shares issued under dividend reinvestment plan	—			—				22,814			—				2,248				—				—				—				2,248
Share-based compensation expense, net	—			—				111,647			1				10,370				—				—				—				10,371
Conversion and redemption of OP units	—			—				—			—				(439		)		—				—				(389		)		(828		)
Contributions from noncontrolling interests	—			—				—			—				—				—				—				175				175
Adjustment to redeemable noncontrolling interests	—			—				—			—				(13,469		)		—				—				—				(13,469		)
BALANCE AT DECEMBER 31, 2012	399,896			$	9,997			64,815,446			$	648			$	1,875,525			$	(586,970	)		$	(12,388	)		$	23,781			$	1,310,593

The accompanying notes are an integral part of these consolidated statements.

F-7

Federal Realty Investment Trust

Consolidated Statements of Cash Flows

	Year Ended December 31,
	2012				2011				2010
	(In thousands)
OPERATING ACTIVITIES
Net income	$	156,232			$	149,612			$	128,237
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization, including discontinued operations	142,039				126,568				119,817
Litigation provision	—				—				(250		)
Gain on sale of real estate	(11,860		)		(15,075		)		(1,410		)
Gain on deconsolidation of VIE	—				(2,026		)		—
Early extinguishment of debt	—				(296		)		2,801
Income from real estate partnerships	(1,757		)		(1,808		)		(1,060		)
Other, net	4,348				3,871				4,099
Changes in assets and liabilities, net of effects of acquisitions and dispositions
Increase in accounts receivable	7,332				1,888				7,461
(Increase) decrease in prepaid expenses and other assets	(7,793		)		2,613				(2,824		)
Increase (decrease) in accounts payable and accrued expenses	3,259				(14,994		)		(879		)
Increase (decrease) in security deposits and other liabilities	4,833				(5,642		)		743
Net cash provided by operating activities	296,633				244,711				256,735
INVESTING ACTIVITIES
Acquisition of real estate	(80,865		)		(103,557		)		(57,133		)
Capital expenditures - development and redevelopment	(129,346		)		(91,922		)		(50,414		)
Capital expenditures - other	(51,325		)		(50,540		)		(38,681		)
Proceeds from sale of real estate	—				23,695				—
Investment in real estate partnerships	—				(6,947		)		(16,930		)
Distribution from real estate partnership in excess of earnings	1,116				1,070				237
Distribution from sale of real estate partnership properties	—				34,617				—
Leasing costs	(14,233		)		(12,415		)		(10,272		)
Repayment of mortgage and other notes receivable, net	1,095				9,630				(13,895		)
Net cash used in investing activities	(273,558		)		(196,369		)		(187,088		)
FINANCING ACTIVITIES
Net (repayments) borrowings under revolving credit facility, net of costs	—				(81,159		)		76,550
Issuance of senior notes, net of costs	244,807				—				148,457
Purchase and retirement of senior notes/debentures	(175,000		)		(75,000		)		—
Issuance of mortgages, capital leases and notes payable, net of costs	5,399				272,193				9,950
Repayment of mortgages, capital leases and notes payable	(53,414		)		(91,952		)		(262,340		)
Issuance of common shares	114,134				156,862				6,610
Dividends paid to common and preferred shareholders	(179,884		)		(169,254		)		(163,120		)
Distributions to and redemptions of noncontrolling interests	(9,935		)		(8,023		)		(5,346		)
Net cash (used in) provided by financing activities	(53,893		)		3,667				(189,239		)
(Decrease) increase in cash and cash equivalents	(30,818		)		52,009				(119,592		)
Cash and cash equivalents at beginning of year	67,806				15,797				135,389
Cash and cash equivalents at end of year	$	36,988			$	67,806			$	15,797

The accompanying notes are an integral part of these consolidated statements.

F-8

Federal Realty Investment Trust

Notes to Consolidated Financial Statements

December 31, 2012, 2011 and 2010

NOTE 1—BUSINESS AND ORGANIZATION

Federal Realty Investment Trust (the “Trust”) is an equity real estate investment trust (“REIT”) specializing in the ownership, management, and redevelopment of retail and mixed-use properties. Our properties are located primarily in densely populated and affluent communities in strategically selected metropolitan markets in the Mid-Atlantic and Northeast regions of the United States, as well as in California. As of December 31, 2012, we owned or had a majority interest in community and neighborhood shopping centers and mixed-use properties which are operated as 88 predominantly retail real estate projects.

We operate in a manner intended to enable us to qualify as a REIT for federal income tax purposes. A REIT that distributes at least 90% of its taxable income to its shareholders each year and meets certain other conditions is not taxed on that portion of its taxable income which is distributed to its shareholders.

NOTE 2—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation

Our consolidated financial statements include the accounts of the Trust, its corporate subsidiaries, and all entities in which the Trust has a controlling interest or has been determined to be the primary beneficiary of a variable interest entity (“VIE”). The equity interests of other investors are reflected as noncontrolling interests or redeemable noncontrolling interests. All significant intercompany transactions and balances are eliminated in consolidation. We account for our interests in joint ventures, which we do not control, using the equity method of accounting. Certain 2011 and 2010 amounts have been reclassified to conform to current period presentation.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America, referred to as “GAAP,” requires management to make estimates and assumptions that in certain circumstances affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities, and revenues and expenses. These estimates are prepared using management’s best judgment, after considering past, current and expected events and economic conditions. Actual results could differ from these estimates.

Revenue Recognition and Accounts Receivable

Our leases with tenants are classified as operating leases. Substantially all such leases contain fixed escalations which occur at specified times during the term of the lease. Base rents are recognized on a straight-line basis from when the tenant controls the space through the term of the related lease, net of valuation adjustments, based on management’s assessment of credit, collection and other business risk. Percentage rents, which represent additional rents based upon the level of sales achieved by certain tenants, are recognized at the end of the lease year or earlier if we have determined the required sales level is achieved and the percentage rents are collectible. Real estate tax and other cost reimbursements are recognized on an accrual basis over the periods in which the related expenditures are incurred. For a tenant to terminate its lease agreement prior to the end of the agreed term, we may require that they pay a fee to cancel the lease agreement. Lease termination fees for which the tenant has relinquished control of the space are generally recognized on the termination date. When a lease is terminated early but the tenant continues to control the space under a modified lease agreement, the lease termination fee is generally recognized evenly over the remaining term of the modified lease agreement.

We make estimates of the collectability of our accounts receivable related to minimum rents, straight-line rents, expense reimbursements and other revenue. Accounts receivable is carried net of this allowance for doubtful accounts. Our determination as to the collectability of accounts receivable and correspondingly, the adequacy of this allowance, is based primarily upon evaluations of individual receivables, current economic conditions, historical experience and other relevant factors. The allowance for doubtful accounts is increased or decreased through bad debt expense. Accounts receivable are written-off when they are deemed to be uncollectible and we are no longer actively pursuing collection. At December 31, 2012 and 2011, our allowance for doubtful accounts was $15.9 million and $17.6 million, respectively.

In some cases, primarily relating to straight-line rents, the collection of accounts receivable extends beyond one year. Our experience relative to unbilled straight-line rents is that a portion of the amounts otherwise recognizable as revenue is never billed to or collected from tenants due to early lease terminations, lease modifications, bankruptcies and other factors. Accordingly, the extended collection period for straight-line rents along with our evaluation of tenant credit risk may result in the nonrecognition of a portion of straight-line rental income until the collection of such income is reasonably assured. If our

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evaluation of tenant credit risk changes indicating more straight-line revenue is reasonably collectible than previously estimated and realized, the additional straight-line rental income is recognized as revenue. If our evaluation of tenant credit risk changes indicating a portion of realized straight-line rental income is no longer collectible, a reserve and bad debt expense is recorded. At December 31, 2012 and 2011, accounts receivable include approximately $56.1 million and $50.5 million, respectively, related to straight-line rents.

Real Estate

Land, buildings and improvements are recorded at cost. Depreciation is computed using the straight-line method. Estimated useful lives range generally from 35 years to a maximum of 50 years on buildings and major improvements. Minor improvements, furniture and equipment are capitalized and depreciated over useful lives ranging from 2 to 20 years. Maintenance and repairs that do not improve or extend the useful lives of the related assets are charged to operations as incurred. Tenant improvements are capitalized and depreciated over the life of the related lease or their estimated useful life, whichever is shorter. If a tenant vacates its space prior to contractual termination of its lease, the undepreciated balance of any tenant improvements are written off if they are replaced or have no future value. In 2012, 2011 and 2010, real estate depreciation expense was $128.7 million, $114.2 million and $108.3 million, respectively, including amounts from discontinued operations and assets under capital lease obligations.

Sales of real estate are recognized only when sufficient down payments have been obtained, possession and other attributes of ownership have been transferred to the buyer and we have no significant continuing involvement. The application of this criteria can be complex and requires us to make assumptions. We believe this criteria was met for all real estate sold during the periods presented.

Our methodology of allocating the cost of acquisitions to assets acquired and liabilities assumed is based on estimated fair values, replacement cost and/or appraised values. When we acquire operating real estate properties, the purchase price is allocated to land, building, improvements, leasing costs, intangibles such as in-place leases, and to current assets and liabilities acquired, if any. The value allocated to in-place leases is amortized over the related lease term and reflected as rental income in the statement of operations. We consider qualitative and quantitative factors in evaluating the likelihood of a tenant exercising a below market renewal option and include such renewal options in the calculation of in-place lease value when we consider these to be bargain renewal options. If the value of below market lease intangibles includes renewal option periods, we include such renewal periods in the amortization period utilized. If a tenant vacates its space prior to contractual termination of its lease, the unamortized balance of any in-place lease value is written off to rental income.

Transaction costs related to the acquisition of a business, such as broker fees, transfer taxes, legal, accounting, valuation, and other professional and consulting fees, are expensed as incurred and included in “general and administrative expenses” in our consolidated statements of comprehensive income. The acquisition of an operating shopping center typically qualifies as a business. For asset acquisitions not meeting the definition of a business, transaction costs are capitalized as part of the acquisition cost.

When applicable, as lessee, we classify our leases of land and building as operating or capital leases. We are required to use judgment and make estimates in determining the lease term, the estimated economic life of the property and the interest rate to be used in determining whether or not the lease meets the qualification of a capital lease and is recorded as an asset.

We capitalize certain costs related to the development and redevelopment of real estate including pre-construction costs, real estate taxes, insurance, construction costs and salaries and related costs of personnel directly involved. Additionally, we capitalize interest costs related to development and redevelopment activities. Capitalization of these costs begin when the activities and related expenditures commence and cease when the project is substantially complete and ready for its intended use at which time the project is placed in service and depreciation commences. Additionally, we make estimates as to the probability of certain development and redevelopment projects being completed. If we determine the development or redevelopment is no longer probable of completion, we expense all capitalized costs which are not recoverable.

We review for impairment on a property by property basis. Impairment is recognized on properties held for use when the expected undiscounted cash flows for a property are less than its carrying amount at which time the property is written-down to fair value. Properties held for sale are recorded at the lower of the carrying amount or the expected sales price less costs to sell. The sale or disposal of a “component of an entity” is treated as discontinued operations. The operating properties sold by us typically meet the definition of a component of an entity and as such the revenues and expenses associated with sold properties are reclassified to discontinued operations for all periods presented.

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Cash and Cash Equivalents

We define cash and cash equivalents as cash on hand, demand deposits with financial institutions and short term liquid investments with an initial maturity, when purchased, under three months. Cash balances in individual banks may exceed the federally insured limit by the Federal Deposit Insurance Corporation (the “FDIC”). At December 31, 2012, we had $33.6 million in excess of the FDIC insured limit.

Prepaid Expenses and Other Assets

Prepaid expenses and other assets consist primarily of lease costs, prepaid property taxes and acquired above market leases. Capitalized lease costs are direct costs incurred which were essential to originate a lease and would not have been incurred had the leasing transaction not taken place and include third party commissions and salaries and related costs of personnel directly related to time spent obtaining a lease. Capitalized lease costs are amortized over the life of the related lease. If a tenant vacates its space prior to the contractual termination of its lease, the unamortized balance of any previously capitalized lease costs are written off. Other assets also include the premiums paid for split dollar life insurance for one current officer and several former officers which were approximately $4.6 million at December 31, 2012 and 2011.

Debt Issuance Costs

Costs related to the issuance of debt instruments are capitalized and are amortized as interest expense over the estimated life of the related issue using the straight-line method which approximates the effective interest method. If a debt instrument is paid off prior to its original maturity date, the unamortized balance of debt issuance costs are written off to interest expense or, if significant, included in “early extinguishment of debt.”

Derivative Instruments

At times, we may use derivative instruments to manage exposure to variable interest rate risk. We generally enter into interest rate swaps to manage our exposure to variable interest rate risk and treasury locks to manage the risk of interest rates rising prior to the issuance of debt. We enter into derivative instruments that qualify as cash flow hedges and do not enter into derivative instruments for speculative purposes.

The interest rate swaps associated with our cash flow hedges are recorded at fair value on a recurring basis. We assess effectiveness of our cash flow hedges both at inception and on an ongoing basis. The effective portion of changes in fair value of the interest rate swaps associated with our cash flow hedges is recorded in accumulated other comprehensive loss and is subsequently reclassified into interest expense as interest is incurred on the related variable rate debt. Within the next 12 months, we expect to reclassify $4.2 million as an increase to interest expense. Our cash flow hedges become ineffective if critical terms of the hedging instrument and the debt instrument do not perfectly match such as notional amounts, settlement dates, reset dates, calculation period and LIBOR rate. In addition, we evaluate the default risk of the counterparty by monitoring the credit worthiness of the counterparty. When ineffectiveness exists, the ineffective portion of changes in fair value of the interest rate swaps associated with our cash flow hedges is recognized in earnings in the period affected. Hedge ineffectiveness did not impact earnings in 2012 and 2011, and we do not anticipate it will have a significant effect in the future. We had no hedging instruments outstanding during 2010.

Mortgage Notes Receivable

We have made certain mortgage loans that, because of their nature, qualify as loan receivables. At the time the loans were made, we did not intend for the arrangement to be anything other than a financing and did not contemplate a real estate investment. We evaluate each investment to determine whether the loan arrangement qualifies as a loan, joint venture or real estate investment and the appropriate accounting thereon. Such determination affects our balance sheet classification of these investments and the recognition of interest income derived therefrom. On some of the loans we receive additional interest, however, we never receive in excess of 50% of the residual profit in the project, and because the borrower has either a substantial investment in the project or has guaranteed all or a portion of our loan (or a combination thereof), the loans qualify for loan accounting. The amounts under these arrangements are presented as mortgage notes receivable at December 31, 2012 and 2011.

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Mortgage notes receivable are recorded at cost, net of any valuation adjustments. Interest income is accrued as earned. Mortgage notes receivable are considered past due based on the contractual terms of the note agreement. On a quarterly basis, we evaluate the collectability of each mortgage note receivable based on various factors which may include payment history, expected fair value of the collateral securing the loan, internal and external credit information and/or economic trends. A loan is considered impaired when, based upon current information and events, it is probable that we will be unable to collect all amounts due under the existing contractual terms. When a loan is considered impaired, the amount of the loss accrual is calculated by comparing the carrying amount of the mortgage note receivable to the present value of expected future cash flows. Since all of our loans are collateralized by either a first or second mortgage, the loans have risk characteristics similar to the risks in owning commercial real estate.

Share Based Compensation

We grant share based compensation awards to employees and trustees typically in the form of options, commons shares, and restricted common shares. We measure stock based compensation expense based on the grant date fair value of the award and recognize the expense ratably over the requisite service period, which is typically the vesting period. See Note 15 for further discussion regarding our share based compensation plans and policies.

Variable Interest Entities

Certain entities that do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties or in which equity investors do not have the characteristics of a controlling financial interest qualify as VIEs. VIEs are required to be consolidated by their primary beneficiary. The primary beneficiary of a VIE has both the power to direct the activities that most significantly impact economic performance of the VIE and the obligation to absorb losses or the right to receive benefits that could potentially be significant to the VIE.

We have evaluated our investments in certain joint ventures including our real estate partnership with affiliates of a discretionary fund created and advised by ING Clarion Partners and our Taurus Newbury Street JV II Limited Partnership and determined that these joint ventures do not meet the requirements of a variable interest entity and, therefore, consolidation of these ventures is not required. These investments are accounted for using the equity method. We have also evaluated our mortgage loans receivable and determined that entities obligated under the mortgage loans are not VIEs except from March 30, 2010 to June 29, 2011 with respect to our mortgage loans on a shopping center and adjacent building located in Norwalk, Connecticut as further discussed in Note 4. Our investment balances from our real estate partnerships and mortgage notes receivable are presented separately in our consolidated balance sheets.

On October 16, 2006, we acquired the leasehold interest in Melville Mall under a 20 year master lease. Additionally, we loaned the owner of Melville Mall $34.2 million secured by a second mortgage on the property. We have an option to purchase the shopping center on or after October 16, 2021 for a price of $5.0 million plus the assumption of the first mortgage and repayment of the second mortgage. If we fail to exercise our purchase option, the owner of Melville Mall has a put option which would require us to purchase Melville Mall in 2023 for $5.0 million and the assumption of the owner’s mortgage debt. We have determined that this property is held in a variable interest entity for which we are the primary beneficiary. Accordingly, beginning October 16, 2006, we consolidated this property and its operations. As of December 31, 2012 and 2011, $21.4 million and $22.1 million, respectively, are included in mortgages payable (net of unamortized discounts) for the mortgage loan secured by Melville Mall, however, the loan is not our legal obligation. At December 31, 2012 and 2011, net real estate assets related to Melville Mall included in our consolidated balance sheet are approximately $63.1 million and $64.0 million, respectively.

In conjunction with the acquisitions of several of our properties, we entered into Reverse Section 1031 like-kind exchange agreements with a third party intermediary. The exchange agreements are for a maximum of 180 days and allow us, for tax purposes, to defer gains on sale of other properties sold within this period. Until the earlier of termination of the exchange agreements or 180 days after the respective acquisition dates, the third party intermediary is the legal owner of each property, although we control the activities that most significantly impact each property and retain all of the economic benefits and risks associated with each property. Each property is held by a third party intermediary in a variable interest entity for which we are the primary beneficiary. Accordingly, we consolidate these properties and their operations even during the period they are held by a third party intermediary. A summary of the significant properties is as follows:

Property		Dates Held by a Third Party Intermediary		Date Consolidated
Huntington Square		August 16, 2010 to February 12, 2011		August 16, 2010
Tower Shops		January 19, 2011 to July 12, 2011		January 19, 2011

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We determined the joint venture that owns Plaza El Segundo is a variable interest entity for which we are the primary beneficiary. We are the managing member and own 48.2% of the entity. We control the significant operating decisions, consequently having the power to direct the activities that most significantly impact economic performance of the VIE, and have the obligation to absorb the majority of the losses and receive the majority of the benefits. Therefore, the entity is consolidated in our financial statements as of December 30, 2011. As of December 31, 2012 and 2011, net real estate assets related to Plaza El Segundo included in our consolidated balance sheet are approximately $189.4 million and $194.6 million, respectively, and mortgages payable (net of unamortized premium) of $183.9 million and $185.6 million, respectively. Plaza El Segundo's creditors do not have recourse to our general credit. Our maximum exposure to loss is approximately $17.5 million.

Redeemable Noncontrolling Interests

We have certain noncontrolling interests that are redeemable for cash upon the occurrence of an event that is not solely in our control and therefore are classified outside of permanent equity. We adjust the carrying amounts of these noncontrolling interests that are currently redeemable to redemption value at the balance sheet date. Adjustments to the carrying amount to reflect changes in redemption value are recorded as adjustments to additional paid-in capital in shareholders' equity. These amounts are classified within the mezzanine section of the consolidated balance sheets.

The following table provides a rollforward of the redeemable noncontrolling interests:

	Year Ended
	December 31,
	2012				2011
	(in thousands)
Beginning balance	$	85,325			$	65,362
Net income	2,592				3,492
Distributions & Redemptions	(6,985		)		(3,020		)
Contributions	19				10,064
Adjustment to redeemable noncontrolling interests	13,469				9,427
Ending balance	$	94,420			$	85,325

Income Taxes

We operate in a manner intended to enable us to qualify as a REIT for federal income tax purposes. A REIT that distributes at least 90% of its taxable income to its shareholders each year and meets certain other conditions is not taxed on that portion of its taxable income which is distributed to its shareholders. Therefore, federal income taxes on our taxable income have been and are generally expected to be immaterial. We are obligated to pay state taxes, generally consisting of franchise or gross receipts taxes in certain states. Such state taxes also have not been material.

We have elected to treat certain of our subsidiaries as taxable REIT subsidiaries, which we refer to as a TRS. In general, a TRS may engage in any real estate business and certain non-real estate businesses, subject to certain limitations under the Internal Revenue Code of 1986, as amended (the “Code”). A TRS is subject to federal and state income taxes. Our TRS activities have not been material.

With few exceptions, we are no longer subject to U.S. federal, state, and local tax examinations by tax authorities for years before 2008. As of December 31, 2012 and 2011, we had no material unrecognized tax benefits. While we currently have no material unrecognized tax benefits, as a policy, we recognize penalties and interest accrued related to unrecognized tax benefits as income tax expense.

Segment Information

Our primary business is the ownership, management, and redevelopment of retail and mixed-use properties. We review operating and financial information for each property on an individual basis and therefore, each property represents an individual operating segment. We evaluate financial performance using property operating income, which consists of rental income, other property income and mortgage interest income, less rental expenses and real estate taxes. No individual property constitutes more than 10% of our revenues or property operating income and we have no operations outside of the United States of America. Therefore, we have aggregated our properties into one reportable segment as the properties share similar long-term economic characteristics and have other similarities including the fact that they are operated using consistent business strategies, are typically located in major metropolitan areas, and have similar tenant mixes.

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Recently Adopted Accounting Pronouncements

In May 2011, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU") 2011-04, “Fair Value Measurement (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs.” The pronouncement was issued to provide a uniform framework for fair value measurements and related disclosures between U.S. GAAP and International Financial Reporting Standards (“IFRS”). ASU 2011-04 changes certain fair value measurement principles and enhances the disclosure requirements particularly for level 3 fair value measurements. We adopted the standard effective January 1, 2012 and it did not have a significant impact to our consolidated financial statements.

In June 2011, the FASB issued ASU 2011-05, “Comprehensive Income (Topic 220): Presentation of Comprehensive Income.” ASU 2011-05 eliminates the option to present components of other comprehensive income solely as part of the statement of shareholders’ equity and requires the presentation of components of net income and components of other comprehensive income either in a single continuous statement of comprehensive income or in two separate but consecutive statements. In December 2011, the FASB deferred the requirement to present reclassification adjustments for each component of accumulated other comprehensive income in both net income and other comprehensive income on the face of the financial statements. We adopted the standards effective January 1, 2012 and modified the presentation in our consolidated financial statements accordingly. Other comprehensive loss in our financial statements relates to the change in valuation on our interest rate swap agreements as further discussed in Note 8.

Recently Issued Accounting Pronouncement

In February 2013, the FASB issued ASU 2013-2, “Comprehensive Income (Topic 220): Reporting Amounts Reclassified Out of Accumulated Other Comprehensive Income.” ASU 2013-2 requires entities to disclose certain information relating to amounts reclassified out of accumulated other comprehensive income. This pronouncement is effective for us in the first quarter of 2013 and is not expected to have a significant impact to our consolidated financial statements.

Consolidated Statements of Cash Flows—Supplemental Disclosures

The following table provides supplemental disclosures related to the Consolidated Statements of Cash Flows:

	Year Ended December 31,
	2012				2011				2010
	(In thousands)
SUPPLEMENTAL DISCLOSURES:
Total interest costs incurred	$	123,441			$	106,562			$	108,167
Interest capitalized	(10,105		)		(8,097		)		(6,285		)
Interest expense	$	113,336			$	98,465			$	101,882
Cash paid for interest, net of amounts capitalized	$	114,419			$	95,424			$	98,932
Cash (refunded) paid for income taxes	$	(1,151	)		$	832			$	255
NON-CASH INVESTING AND FINANCING TRANSACTIONS:
Mortgage loan assumed/entered into with acquisition	$	67,615			$	308,506			$	—
Deconsolidation of VIE	$	—			$	18,311			$	—
Capital lease obligation	$	—			$	4,556			$	—
Extinguishment of deferred ground rent liability	$	—			$	—			$	8,832
Extinguishment of capital lease obligation	$	—			$	—			$	1,031

Capitalized lease costs are direct costs incurred which were essential to originate a lease and would not have been incurred had the leasing transaction not taken place. These costs include third party commissions and salaries and personnel costs related to obtaining a lease. Capitalized lease costs are amortized over the initial term of the related lease which generally ranges from three to ten years. We view these lease costs as part of the up-front initial investment we made in order to generate a long-term cash inflow and therefore, we classify cash outflows related to leasing costs as an investing activity in our consolidated statements of cash flows.

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NOTE 3—REAL ESTATE

A summary of our real estate investments and related encumbrances is as follows:

		Cost				Accumulated Depreciation and Amortization				Encumbrances
		(In thousands)
December 31, 2012
Retail and mixed-use properties		$	4,655,943			$	(1,187,993	)		$	737,899
Retail properties under capital leases		114,571				(29,051		)		71,693
Residential		9,160				(7,251		)		22,890
		$	4,779,674			$	(1,224,295	)		$	832,482
December 31, 2011
Retail and mixed-use properties		$	4,304,089			$	(1,087,704	)		$	724,287
Retail properties under capital leases		113,605				(33,019		)		63,093
Residential		8,750				(6,865		)		23,236
		$	4,426,444			$	(1,127,588	)		$	810,616

Retail and mixed-use properties includes the residential portion of Santana Row, Bethesda Row and Congressional Plaza. The residential property investment is our investment in Rollingwood Apartments.

2012 Significant Property Acquisitions

In July and September 2012, we acquired three residential apartment buildings with 47 units located adjacent to Santana Row for $9.0 million. These properties provide potential future redevelopment opportunities for Santana Row.

On December 21, 2012, we acquired the fee interest in East Bay Bridge, a 438,000 square foot shopping center located in Emeryville and Oakland, California. The purchase price was $116.6 million which included the assumption of a mortgage loan with a face amount of $62.9 million and a fair value of approximately $67.6 million. Approximately $0.9 million and $47.8 million of net assets acquired were allocated to other assets for “above market leases” and other liabilities for “below market leases”, respectively. Additionally, we acquired a 37,000 square foot single-tenant office/warehouse building in Ontario, California for $2.5 million as part of the transaction. We incurred a total of $0.9 million of acquisition costs which are included in “general and administrative expenses” in 2012.

2011 Significant Acquisitions and Disposition

On January 19, 2011, we acquired the fee interest in Tower Shops located in Davie, Florida for a net purchase price of $66.1 million which included the assumption of a mortgage loan with a face amount of $41.0 million and a fair value of approximately $42.9 million. The property contains approximately 368,000 square feet of gross leasable area on 67 acres and is shadow-anchored by Home Depot and Costco. Approximately $1.2 million and $4.4 million of net assets acquired were allocated to other assets for “above market leases” and other liabilities for “below market leases”, respectively. We incurred a total of $0.4 million of acquisition costs of which $0.2 million were incurred in 2011 and are included in “general and administrative expenses” for the year ended December 31, 2011.

On July 12, 2011, we sold Feasterville Shopping Center located in Feasterville, Pennsylvania for a sales price of $20.0 million resulting in a gain of $14.8 million. The operations of this property are included in “discontinued operations” in the consolidated statements of comprehensive income for all periods presented. The sale was completed as a Section 1031 tax deferred exchange transaction with the acquisition of Tower Shops.

On December 27, 2011, we acquired an 89.9% controlling interest in Montrose Crossing, a 357,000 square foot shopping center located in Rockville, Maryland. The purchase price was $141.5 million and our 89.9% ownership interest was $127.2 million which was funded with cash and our pro-rata share of $80.0 million of new mortgage debt. We are the managing member of the entity, control all significant operating decisions, and receive approximately 89.9% of the cash flow of the entity. Therefore, we have consolidated the property and its operations effective on the acquisition date. Approximately $2.9 million and $3.8 million of net assets acquired were allocated to other assets for "above market leases" and other liabilities for "below market leases", respectively. We incurred approximately $2.4 million of acquisition costs which are included in “general and administrative expenses” in 2011.

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On December 30, 2011, we acquired a 48.2% controlling interest in Plaza El Segundo, a 381,000 square foot shopping center located in El Segundo, California. The purchase price was $192.7 million and our 48.2% ownership interest was funded with $8.5 million of cash and the assumption of our pro-rata share of the existing $175.0 million mortgage debt. We are the managing member of the entity, control all significant decisions, and receive the majority of the cash flow of the entity. Therefore, we have consolidated the property and its operations effective on the acquisition date. Approximately $7.5 million and $2.3 million of net assets acquired were allocated to other assets for "above market leases" and other liabilities for "below market leases", respectively. We incurred approximately $1.0 million of acquisition costs which are included in “general and administrative expenses” in 2011.

On December 30, 2011, we acquired an 8.1 acre land parcel adjacent to Plaza El Segundo for a purchase price of $15.9 million. We intend to use the land parcel for future development.

NOTE 4—MORTGAGE NOTES RECEIVABLE

At December 31, 2012 and 2011, we had five mortgage notes receivable with an aggregate carrying amount of $55.6 million and $56.0 million, respectively. Approximately $44.9 million and $44.7 million of the loans are secured by first mortgages on retail buildings at December 31, 2012 and 2011, respectively. One of the loans, which is secured by a second mortgage on a hotel at our Santana Row property, was considered impaired when it was amended in August 2006. At December 31, 2012 and 2011, the loan has an outstanding face amount of $12.9 million and $14.2 million, respectively, and is carried net of a valuation allowance of $2.1 million and $2.9 million, respectively. At December 31, 2012 and 2011, our mortgages had a weighted average interest rate of 9.4% and 9.2%, respectively. Under the terms of certain of these mortgages, we receive additional interest based upon the gross income of the secured properties and upon sale, share in the appreciation of the properties.

Prior to June 30, 2011, we were the lender on a first and second mortgage loan on a shopping center and an adjacent commercial building in Norwalk, Connecticut. Our carrying amount of the loans was approximately $18.3 million. The loans were in default and foreclosure proceedings had been filed, however, we were in negotiations with the borrower to refinance the loans. On June 30, 2011, we refinanced the existing loans with a first mortgage loan which had an initial principal balance of $11.9 million, bears interest at 6.0%, and matures on June 30, 2014, subject to a one year extension option. The loan is secured by the shopping center in Norwalk, Connecticut. As part of the refinancing, we received approximately $8.7 million in cash.

Because the loans were in default, we had certain rights under the first mortgage loan agreement that gave us the ability to direct the activities that most significantly impacted the shopping center. Although we did not exercise those rights, the existence of those rights in the loan agreement resulted in the entity being a VIE. Additionally, given our investment in both the first and second mortgage on the property, the overall decline in fair market value since the loans were initiated, and the default status of the loans, we also had the obligation to absorb losses or rights to receive benefits that could potentially be significant to the VIE. Consequently, we were the primary beneficiary of this VIE and consolidated the shopping center and adjacent building from March 30, 2010 to June 29, 2011; the operations of the entity are included in “discontinued operations”.

In conjunction with the refinancing of the loans, we re-evaluated our status as the primary beneficiary of the VIE. Because the loan is not in default, we no longer have those certain rights that give us the ability to control the activities that most significantly impact the shopping center. Our current involvement in the property is solely as the lender on the mortgage loan with protective rights as the lender. Therefore, we are no longer the primary beneficiary and deconsolidated the entity as of June 30, 2011. The mortgage loan receivable was recorded at its estimated fair value of $11.9 million and we recognized a $2.0 million gain on deconsolidation as part of the refinancing which is included in “discontinued operations - gain on deconsolidation of VIE” for the year ended December 31, 2011. As of December 31, 2012, the loan was performing and the carrying amount of the mortgage loan of $11.7 million is included in “mortgage notes receivable” on the balance sheet. This amount also reflects our maximum exposure to loss related to this investment.

The change in design of the entity including the refinancing of the loan was a VIE reconsideration event. Given that the loan is no longer in default, we, as lender, do not have the power to direct the activities that most significantly impact the entity, and the additional equity investment at risk provided by the entity’s equity holders, the entity is no longer a VIE.

NOTE 5—REAL ESTATE PARTNERSHIPS

Federal/Lion Venture LP

We have a joint venture arrangement (the “Partnership”) with affiliates of a discretionary fund created and advised by ING Clarion Partners (“Clarion”). We own 30% of the equity in the Partnership and Clarion owns 70%. We hold a general partnership interest, however, Clarion also holds a general partnership interest and has substantive participating rights. We cannot make significant decisions without Clarion’s approval. Accordingly, we account for our interest in the Partnership using

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the equity method. As of December 31, 2012, the Partnership owned seven retail real estate properties. We are the manager of the Partnership and its properties, earning fees for acquisitions, dispositions, management, leasing, and financing. Intercompany profit generated from fees is eliminated in consolidation. We also have the opportunity to receive performance-based earnings through our Partnership interest. Accounting policies for the Partnership are similar to accounting policies followed by the Trust. The Partnership is subject to a buy-sell provision which is customary for real estate joint venture agreements and the industry. Either partner may initiate this provision at any time, which could result in either the sale of our interest or the use of available cash or borrowings to acquire Clarion’s interest. As of December 31, 2012, we have made total contributions of $42.1 million and received total distributions of $15.7 million.

The following tables provide summarized operating results and the financial position of the Partnership:

	Year Ended December 31,
	2012				2011				2010
	(In thousands)
OPERATING RESULTS
Revenue	$	19,051			$	19,289			$	18,639
Expenses
Other operating expenses	5,234				5,593				6,149
Depreciation and amortization	5,508				5,179				5,046
Interest expense	3,376				3,388				3,400
Total expenses	14,118				14,160				14,595
Net income	$	4,933			$	5,129			$	4,044
Our share of net income from real estate partnership	$	1,815			$	1,771			$	1,449

	December 31,
	2012				2011
	(In thousands)
BALANCE SHEETS
Real estate, net	$	174,509			$	178,693
Cash	2,735				3,035
Other assets	5,536				6,116
Total assets	$	182,780			$	187,844
Mortgages payable	$	57,155			$	57,376
Other liabilities	4,771				5,391
Partners’ capital	120,854				125,077
Total liabilities and partners’ capital	$	182,780			$	187,844
Our share of unconsolidated debt	$	17,147			$	17,213
Our investment in real estate partnership	$	33,169			$	34,352

Taurus Newbury Street JV II Limited Partnership

In May 2010, we formed Taurus Newbury Street JV II Limited Partnership (“Newbury Street Partnership”), a joint venture with an affiliate of Taurus Investment Holdings, LLC (“Taurus”), to acquire, operate and redevelop properties located primarily in the Back Bay section of Boston, Massachusetts. We held an 85% limited partnership interest in Newbury Street Partnership and Taurus held a 15% limited partnership interest and served as general partner. As general partner, Taurus was responsible for the operation and management of the properties, subject to our approval on major decisions. We evaluated the entity and determined that it was not a VIE. Accordingly, given Taurus’ role as general partner, we accounted for our interest in Newbury Street Partnership using the equity method. Accounting policies for the Newbury Street Partnership were similar to accounting policies followed by the Trust. Intercompany profit generated from interest income on loans we provided to the partnership are eliminated in consolidation. Due to the timing of receiving financial information from the general partner, our share of earnings was recorded one quarter in arrears. Our share of earnings in the consolidated statements of comprehensive income in 2011 was income of less than $0.1 million.

On May 26, 2010, Newbury Street Partnership acquired the fee interest in two buildings located on Newbury Street in Boston, Massachusetts for a purchase price of $17.5 million. We contributed $7.8 million towards the acquisition and provided an $8.8

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million interest-only loan secured by the buildings. On May 26, 2011, Newbury Street Partnership acquired the fee interest in a third building for a purchase price of $6.2 million. We contributed approximately $2.8 million towards the acquisition and provided a $3.1 million interest-only loan secured by the building. The $11.8 million loans bore interest at LIBOR plus 400 basis points and were to mature on May 25, 2012.

On October 31, 2011, our Newbury Street Partnership sold its entire portfolio of three buildings for $44.0 million. As part of the sale, we received $34.6 million of the net proceeds which included the repayment of our $11.8 million loans. Due to our earnings being recorded one quarter in arrears, we recognized the gain on sale of $11.9 million in the first quarter of 2012. At December 31, 2011, the deferred gain was included in "other liabilities and deferred credits" on the balance sheet.

NOTE 6—ACQUIRED IN-PLACE LEASES

Acquired above market leases are included in prepaid expenses and other assets and had a balance of $31.8 million at both December 31, 2012 and 2011, and accumulated amortization of $14.3 million and $11.9 million at December 31, 2012 and 2011, respectively. Acquired below market leases are included in other liabilities and deferred credits and had a balance of $110.1 million and $63.4 million and accumulated amortization of $29.8 million and $26.3 million at December 31, 2012 and 2011, respectively. The value allocated to in-place leases is amortized over the related lease term and reflected as additional rental income for below market leases or a reduction of rental income for above market leases in the statement of operations. Rental income included amortization from acquired above market leases of $3.4 million, $2.4 million and $2.0 million in 2012, 2011 and 2010, respectively and amortization from acquired below market leases of $4.5 million, $3.8 million and $3.6 million in 2012, 2011 and 2010, respectively. The remaining weighted-average amortization period as of December 31, 2012, is 6.6 years and 22.7 years for above market leases and below market leases, respectively.

The amortization for acquired in-place leases during the next five years and thereafter, assuming no early lease terminations, is as follows:

		Above Market Leases				Below Market Leases
		(In thousands)
Year ending December 31,
2013		$	2,749			$	5,716
2014		2,632				5,103
2015		2,503				4,824
2016		2,199				4,487
2017		1,574				4,117
Thereafter		5,868				56,087
		$	17,525			$	80,334

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NOTE 7—DEBT

The following is a summary of our total debt outstanding as of December 31, 2012 and 2011:

		Principal Balance as of December 31,								Stated Interest Rate as of
Description of Debt		2012				2011				December 31, 2012			Stated Maturity Date
Mortgages payable		(Dollars in thousands)
Courtyard Shops		$	—			$	7,045			6.87	%		July 1, 2012
Bethesda Row		—				19,993				5.37	%		January 1, 2013
Bethesda Row		—				4,016				5.05	%		February 1, 2013
White Marsh Plaza		8,970				9,284				6.04	%		April 1, 2013
Crow Canyon		19,485				19,951				5.40	%		August 11, 2013
Idylwood Plaza		15,987				16,276				7.50	%		June 5, 2014
Leesburg Plaza		27,818				28,320				7.50	%		June 5, 2014
Loehmann’s Plaza		35,972				36,621				7.50	%		June 5, 2014
Pentagon Row		51,640				52,572				7.50	%		June 5, 2014
Melville Mall		21,536				22,325				5.25	%		September 1, 2014
THE AVENUE at White Marsh		55,336				56,603				5.46	%		January 1, 2015
Barracks Road		38,070				38,995				7.95	%		November 1, 2015
Hauppauge		14,352				14,700				7.95	%		November 1, 2015
Lawrence Park		26,984				27,640				7.95	%		November 1, 2015
Wildwood		23,719				24,295				7.95	%		November 1, 2015
Wynnewood		27,500				28,168				7.95	%		November 1, 2015
Brick Plaza		28,033				28,757				7.42	%		November 1, 2015
East Bay Bridge		62,946				—				5.13	%		March 1, 2016
Plaza El Segundo		175,000				175,000				6.33	%		August 5, 2017
Rollingwood Apartments		22,890				23,236				5.54	%		May 1, 2019
29th Place (Shoppers’ World)		5,286				5,444				5.91	%		January 31, 2021
Montrose Crossing		78,755				80,000				4.20	%		January 10, 2022
Mount Vernon		—				10,554				5.66	%		April 15, 2028
Chelsea		7,454				7,628				5.36	%		January 15, 2031
Subtotal		747,733				737,423
Net unamortized premium		13,056				10,100
Total mortgages payable		760,789				747,523
Notes payable
Revolving credit facility		—				—				LIBOR + 1.15%			July 6, 2015
Escondido (municipal bonds)		9,400				9,400				0.21	%		October 1, 2016
Term loan		275,000				275,000				LIBOR + 1.45%			November 21, 2018
Various		15,175				10,759				5.27	%		Various through 2027
Total notes payable		299,575				295,159
Senior notes and debentures
6.00% notes		—				175,000				6.00	%		July 16, 2012
5.40% notes		135,000				135,000				5.40	%		December 1, 2013
5.95% notes		150,000				150,000				5.95	%		August 15, 2014
5.65% notes		125,000				125,000				5.65	%		June 1, 2016
6.20% notes		200,000				200,000				6.20	%		January 15, 2017
5.90% notes		150,000				150,000				5.90	%		April 1, 2020
3.00% notes		250,000				—				3.00	%		August 1, 2022
7.48% debentures		29,200				29,200				7.48	%		August 15, 2026
6.82% medium term notes		40,000				40,000				6.82	%		August 1, 2027
Subtotal		1,079,200				1,004,200
Net unamortized (discount) premium		(2,655		)		435
Total senior notes and debentures		1,076,545				1,004,635
Capital lease obligations
Various		71,693				63,093				Various			Various through 2106
Total debt and capital lease obligations		$	2,208,602			$	2,110,410

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During 2012, we repaid the following loans at par:

	Payoff Amount				Repayment Date		Maturity Date
	(In millions)
Courtyard Shops Mortgage Loan	$	6.9			June 1, 2012		July 1, 2012
6.00% Senior Notes	175.0				July 16, 2012		July 16, 2012
Mount Vernon Mortgage Loan	10.2				October 22, 2012		April 15, 2028
Bethesda Row Mortgage Loan	20.0				November 2, 2012		January 1, 2013
Bethesda Row Mortgage Loan	3.9				December 3, 2012		February 1, 2013
	$	216.0

On July 19, 2012, we issued $250.0 million of fixed rate senior notes that mature on August 1, 2022 and bear interest at 3.00%. The net proceeds from this note offering after issuance discounts, underwriting fees, and other costs were approximately $244.8 million.

In connection with the acquisition of East Bay Bridge on December 21, 2012, we assumed a mortgage loan with a face amount of $62.9 million and a fair value of approximately $67.6 million. The mortgage loan bears interest at 5.13% and matures on March 1, 2016.

During 2012, 2011 and 2010, the maximum amount of borrowings outstanding under our revolving credit facility was $186.0 million, $265.0 million and $82.0 million, respectively. The weighted average amount of borrowings outstanding was $1.5 million, $163.5 million and $23.4 million, respectively, and the weighted average interest rate, before amortization of debt fees, was 1.4%, 1.0% and 0.7%, respectively. The revolving credit facility requires an annual facility fee of $0.8 million. At December 31, 2012 and 2011, our revolving credit facility had no amounts outstanding.

Our revolving credit facility and certain notes require us to comply with various financial covenants, including the maintenance of minimum shareholders’ equity and debt coverage ratios and a maximum ratio of debt to net worth. As of December 31, 2012, we were in compliance with all loan covenants.

Scheduled principal payments on mortgages payable, notes payable, senior notes and debentures as of December 31, 2012 are as follows:

	Mortgages Payable					Notes Payable					Senior Notes and Debentures				Total Principal
	(In thousands)
Year ending December 31,
2013	$	40,296				$	256				$	135,000			$	175,552
2014	158,855					10,249					150,000				319,104
2015	206,007					275			(1)		—				206,282
2016	62,412					9,702					125,000				197,114
2017	177,654					335					200,000				377,989
Thereafter	102,509					278,758					469,200				850,467
	$	747,733				$	299,575				$	1,079,200			$	2,126,508			(2)

---

(1)	Our $400.0 million revolving credit facility matures on July 6, 2015, subject to a one-year extension at our option. As of December 31, 2012, there was nothing drawn under this credit facility.

(2)	The total debt maturities differ from the total reported on the consolidated balance sheet due to the unamortized discount or premium on certain senior notes, debentures and mortgages payable.

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Future minimum lease payments and their present value for property under capital leases as of December 31, 2012, are as follows:

	(In thousands)
Year ending December 31,
2013	$	5,787
2014	5,788
2015	5,787
2016	5,788
2017	5,797
Thereafter	171,810
	200,757
Less amount representing interest	(129,064		)
Present value	$	71,693

NOTE 8—FAIR VALUE OF FINANCIAL INSTRUMENTS

A fair value measurement is based on the assumptions that market participants would use in pricing an asset or liability in an orderly transaction. The hierarchy for inputs used in measuring fair value are as follows:

1.	Level 1 Inputs—quoted prices in active markets for identical assets or liabilities

2.	Level 2 Inputs—observable inputs other than quoted prices in active markets for identical assets and liabilities

3.	Level 3 Inputs—prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable

In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement.

Except as disclosed below, the carrying amount of our financial instruments approximates their fair value. The fair value of our mortgages payable, notes payable and senior notes and debentures is sensitive to fluctuations in interest rates. Quoted market prices (Level 1) were used to estimate the fair value of our marketable senior notes and debentures and discounted cash flow analysis (Level 2) is generally used to estimate the fair value of our mortgages and notes payable. Considerable judgment is necessary to estimate the fair value of financial instruments. The estimates of fair value presented herein are not necessarily indicative of the amounts that could be realized upon disposition of the financial instruments. A summary of the carrying amount and fair value of our mortgages payable, notes payable and senior notes and debentures is as follows:

	December 31, 2012								December 31, 2011
Carrying Value				Fair Value				Carrying Value				Fair Value
(In thousands)
Mortgages and notes payable	$	1,060,364			$	1,110,757			$	1,042,682			$	1,099,273
Senior notes and debentures	$	1,076,545			$	1,190,833			$	1,004,635			$	1,085,309

As of December 31, 2012, we have two interest rate swap agreements with a notional amount of $275.0 million that are measured at fair value on a recurring basis. The interest rate swap agreements fix the variable portion of our $275.0 million term loan at 1.72% from December 1, 2011 through November 1, 2018, and effectively fix the rate of the term loan at 3.17%. We assess effectiveness of our cash flow hedges both at inception and on an ongoing basis. The effective portion of changes in fair value of the interest rate swaps associated with our cash flow hedges is recorded in accumulated other comprehensive income/loss and is subsequently reclassified into interest expense as interest is incurred on the related variable debt. Within the next 12 months, we expect to reclassify an estimated $4.2 million as an increase to interest expense. Our cash flow hedges become ineffective if critical terms of the hedging instrument and the debt instrument do not perfectly match such as notional amounts, settlement dates, reset dates, calculation period and LIBOR rate. In addition, we evaluate the default risk of the counterparty by monitoring the credit-worthiness of the counterparty. When ineffectiveness exists, the ineffective portion of

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changes in fair value of the interest rate swaps associated with our cash flow hedges is recognized in earnings in the period affected. Hedge ineffectiveness has not impacted earnings as of December 31, 2012, and we do not anticipate it will have a significant effect in the future.

The fair values of the interest rate swap agreements are based on the estimated amounts we would receive or pay to terminate the contracts at the reporting date and are determined using interest rate pricing models and interest rate related observable inputs. The fair value of our swaps at December 31, 2012 and 2011, was a liability of $12.4 million, and $3.9 million, respectively, and are included in "accounts payable and accrued expenses" on our consolidated balance sheet. The changes in valuation on our interest rate swaps were $8.4 million and $3.9 million (including $4.1 million and $0.3 million, respectively, reclassified from other comprehensive loss to earnings) for 2012 and 2011, and are included in "accumulated other comprehensive loss". A summary of our financial liabilities that are measured at fair value on a recurring basis, by level within the fair value hierarchy is as follows:

	December 31, 2012																December 31, 2011
	Level 1				Level 2				Level 3				Total				Level 1				Level 2				Level 3				Total
	(In thousands)
Interest rate swaps	$	—			$	12,388			$	—			$	12,388			$	—			$	3,940			$	—			$	3,940

NOTE 9—COMMITMENTS AND CONTINGENCIES

We are sometimes involved in lawsuits, warranty claims, and environmental matters arising in the ordinary course of business. Management makes assumptions and estimates concerning the likelihood and amount of any potential loss relating to these matters.

We are currently a party to various legal proceedings. We accrue a liability for litigation if an unfavorable outcome is probable and the amount of loss can be reasonably estimated. If an unfavorable outcome is probable and a reasonable estimate of the loss is a range, we accrue the best estimate within the range; however, if no amount within the range is a better estimate than any other amount, the minimum within the range is accrued. Legal fees related to litigation are expensed as incurred. Other than as described below, we do not believe that the ultimate outcome of these matters, either individually or in the aggregate, could have a material adverse effect on our financial position or overall trends in results of operations; however, litigation is subject to inherent uncertainties. Also under our leases, tenants are typically obligated to indemnify us from and against all liabilities, costs and expenses imposed upon or asserted against us (1) as owner of the properties due to certain matters relating to the operation of the properties by the tenant, and (2) where appropriate, due to certain matters relating to the ownership of the properties prior to their acquisition by us.

In May 2003, a breach of contract action was filed against us in the United States District Court for the Northern District of California, San Jose Division, alleging that a one page document entitled “Final Proposal” constituted a ground lease of a parcel of property located adjacent to our Santana Row property and gave the plaintiff the option to require that we acquire the property at a price determined in accordance with a formula included in the “Final Proposal.” The “Final Proposal” explicitly stated that it was subject to approval of the terms and conditions of a formal agreement. A trial as to liability only was held in June 2006 and a jury rendered a verdict against us.

A trial on the issue of damages was held in April 2008, the court issued a final judgment awarding damages of $15.9 million plus costs of suit in June 2009, and in July 2009, we and the plaintiff both filed a notice of appeal with the United States Court of Appeals for the Ninth Circuit. In December 2009, the plaintiff filed an “appellee’s principal and response brief” providing additional information regarding the issues the plaintiff is appealing; our accrual of $16.4 million at December 31, 2009 reflected our best estimate of the litigation liability. A final ruling on the appeal was issued in February 2011 rejecting both appeals and consequently, affirmed the final judgment against us. Therefore, in December 2010, we adjusted our accrual to $16.2 million which reflects the amount we paid in first quarter 2011. The net change in our accrual in 2010 as well as additional legal and other costs related to the lawsuit and appeal process are included in “litigation provision” in our consolidated statements of comprehensive income.

We reserve for estimated losses, if any, associated with warranties given to a buyer at the time real estate is sold or other potential liabilities relating to that sale, taking any insurance policies into account. These warranties may extend up to ten years and require significant judgment. If changes in facts and circumstances indicate that warranty reserves are understated, we will accrue additional reserves at such time a liability has been incurred and the costs can be reasonably estimated. Warranty reserves are released once the legal liability period has expired or all related work has been substantially completed. Any increases to our estimated warranty losses would usually result in a decrease in net income.

F-22

In 2005 and 2006, warranty reserves for condominium units sold at Santana Row were established to cover potential costs for materials, labor and other items associated with warranty-type claims that may arise within the ten-year statutorily mandated latent construction defect warranty period. In 2006 and 2007, we increased our warranty reserves related to defective work done by third party contractors while upgrades were made to certain units being prepared for sale. Due to the inherent uncertainty, these amounts did not reflect any recoveries from the contractors responsible for the defective work. However, in 2010, we reached a settlement with the contractors responsible for performing the defective work for approximately $1.0 million which is included in “Discontinued operations—gain on sale of real estate”.

We are self-insured for general liability costs up to predetermined retained amounts per claim, and we believe that we maintain adequate accruals to cover our retained liability. We currently do not maintain third party stop-loss insurance policies to cover liability costs in excess of predetermined retained amounts. Our accrual for self-insurance liability is determined by management and is based on claims filed and an estimate of claims incurred but not yet reported. Management considers a number of factors, including third-party actuarial analysis and future increases in costs of claims, when making these determinations. If our liability costs exceed these accruals, it will reduce our net income.

At December 31, 2012 and 2011, our reserves for warranties and general liability costs were $7.1 million for both periods and are included in “accounts payable and accrued expenses” in our consolidated balance sheets. Any potential losses which exceed our estimates would result in a decrease in our net income. During 2012 and 2011, we made payments from these reserves of $1.3 million and $0.9 million, respectively. Although we consider the reserve to be adequate, there can be no assurance that the reserve will prove to be adequate over-time to cover losses due to the difference between the assumptions used to estimate the reserve and actual losses.

At December 31, 2012, we had letters of credit outstanding of approximately $15.9 million which are collateral for existing indebtedness and other obligations of the Trust.

As of December 31, 2012 in connection with capital improvement, development, and redevelopment projects, the Trust has contractual obligations of approximately $233.0 million.

We are obligated under ground lease agreements on several shopping centers requiring minimum annual payments as follows, as of December 31, 2012:

	(In thousands)
Year ending December 31,
2013	$	1,488
2014	1,478
2015	1,428
2016	1,372
2017	1,088
Thereafter	50,207
	$	57,061

A master lease for Mercer Mall includes a fixed purchase price option for $55 million in 2023. If we fail to exercise our purchase option, the owner of Mercer Mall has a put option which would require us to purchase Mercer Mall for $60 million in 2025.

Under the terms of the Congressional Plaza partnership agreement, from and after January 1, 1986, an unaffiliated third party has the right to require us and the other minority partner to purchase its 29.47% interest in Congressional Plaza at the interest’s then-current fair market value. If the other minority partner defaults in their obligation, we must purchase the full interest. Based on management’s current estimate of fair market value as of December 31, 2012, our estimated maximum liability upon exercise of the put option would range from approximately $65 million to $71 million.

Under the terms of a partnership which owns a project in southern California, if certain leasing and revenue levels are obtained for the property owned by the partnership, the other partner may require us to purchase their 10% partnership interest at a formula price based upon property operating income. The purchase price for the partnership interest will be paid using our common shares or, subject to certain conditions, cash. If the other partner does not redeem their interest, we may choose to purchase the partnership interest upon the same terms.

F-23

A master lease for Melville Mall includes a fixed purchase price option in 2021 for $5 million and the assumption of the owner’s debt which is $21.5 million at December 31, 2012. If we fail to exercise our purchase option, the owner of Melville Mall has a put option which would require us to purchase Melville Mall in 2023 for $5 million and the assumption of the owner’s mortgage debt.

Effective December 27, 2013, the other member in Montrose Crossing has the right to require us to purchase all of its 10.1% interest in Montrose Crossing at the interest's then-current fair market value. If the other member fails to exercise its put option, we have the right to purchase its interest on or after December 27, 2021 at fair market value.

Effective December 30, 2013, two of the members have the right to require us to purchase their 10.0% and 11.8% ownership interests in Plaza El Segundo at the interests' then-current fair market value. If the members fail to exercise their put options, we have the right to purchase each of their interests on or after December 30, 2026 at fair market value. Also, between January 1, 2017 and February 1, 2017, we have an option to purchase the preferred interest of another member in Plaza El Segundo. The purchase price will be the lesser of fair value or the $4.9 million stated value of the preferred interest plus any accrued and unpaid preferred returns.

Under the terms of certain partnership agreements, the partners have the right to exchange their operating partnership units for cash or the same number of our common shares, at our option. A total of 320,646 operating partnership units are outstanding which have a total fair value of $33.4 million, based on our closing stock price on December 31, 2012.

NOTE 10—SHAREHOLDERS’ EQUITY

We have a Dividend Reinvestment Plan (the “Plan”), whereby shareholders may use their dividends and optional cash payments to purchase shares. In 2012, 2011 and 2010, 22,814 shares, 28,823 shares and 34,401 shares, respectively, were issued under the Plan.

As of December 31, 2012, 2011, and 2010, we had 399,896 shares of 5.417% Series 1 Cumulative Convertible Preferred Shares (“Series 1 Preferred Shares”) outstanding that have a liquidation preference of $25 per share and

par value $0.01 per share. The Series 1 Preferred Shares accrue dividends at a rate of 5.417% per year and are convertible at any time by the holders to our common shares at a conversion rate of $104.69 per share. The Series 1 Preferred Shares are also convertible under certain circumstances at our election. The holders of the Series 1 Preferred Shares have no voting rights.

On May 8, 2012, we replaced our existing at the market (“ATM”) equity program with a new program in which we may from time to time offer and sell common shares having an aggregate offering price of up to $300.0 million. We intend to use the net proceeds to fund potential acquisition opportunities, fund our development and redevelopment pipeline, repay amounts outstanding under our revolving credit facility and/or for general corporate purposes. For the year ended December 31, 2012, we issued 1,040,946 common shares at a weighted average price per share of $103.69 for net cash proceeds of $106.4 million and paid $1.4 million in commissions related to the sales of these common shares. For the year ended December 31, 2011, we issued 1,662,038 common shares at a weighted average price per share of $85.26 for net cash proceeds of $139.3 million and paid $2.1 million in commissions related to the sales of these common shares. As of December 31, 2012, we had the capacity to issue up to $213.4 million in common shares under our ATM equity program.

NOTE 11—DIVIDENDS

The following table provides a summary of dividends declared and paid per share:

	Year Ended December 31,
	2012								2011								2010
	Declared				Paid				Declared				Paid				Declared				Paid
Common shares	$	2.840			$	2.800			$	2.720			$	2.700			$	2.660			$	2.650
5.417% Series 1 Cumulative Convertible Preferred shares	$	1.354			$	1.354			$	1.354			$	1.354			$	1.354			$	1.354

F-24

A summary of the income tax status of dividends per share paid is as follows:

	Year Ended December 31,
2012				2011				2010
Common shares
Ordinary dividend	$	2.772			$	2.349			$	2.519
Ordinary dividend eligible for 15% rate	—				0.027				0.025
Return of capital	—				0.162				0.106
Capital gain	0.028				0.162				—
	$	2.800			$	2.700			$	2.650
5.417% Series 1 Cumulative Convertible Preferred shares
Ordinary dividend	1.340				1.246				1.341
Ordinary dividend eligible for 15% rate	—				0.013				0.013
Capital gain	0.014				0.095				—
	$	1.354			$	1.354			$	1.354

On November 1, 2012, the Trustees declared a quarterly cash dividend of $0.73 per common share, payable January 15, 2013 to common shareholders of record on January 2, 2013.

NOTE 12—OPERATING LEASES

At December 31, 2012, our 88 predominantly retail shopping center and mixed-use properties are located in 13 states and the District of Columbia. There are approximately 2,500 leases with tenants providing a wide range of retail products and services. These tenants range from sole proprietorships to national retailers; no one tenant or corporate group of tenants accounts for more than 3.2% of annualized base rent.

Our leases with commercial property and residential tenants are classified as operating leases. Commercial property leases generally range from three to ten years (certain leases with anchor tenants may be longer), and in addition to minimum rents, may provide for percentage rents based on the tenant’s level of sales achieved and cost recoveries for the tenant’s share of certain operating costs. Leases on apartments are generally for a period of 1 year or less.

As of December 31, 2012, minimum future commercial property rentals from noncancelable operating leases, before any reserve for uncollectible amounts and assuming no early lease terminations, at our operating properties are as follows:

	(In thousands)
Year ending December 31,
2013	$	434,042
2014	399,040
2015	355,013
2016	311,820
2017	254,413
Thereafter	1,384,196
	$	3,138,524

F-25

NOTE 13—COMPONENTS OF RENTAL INCOME AND EXPENSE

The principal components of rental income are as follows:

	Year Ended December 31,
	2012				2011				2010
	(In thousands)
Minimum rents
Retail and commercial	$	422,894			$	392,657			$	378,836
Residential (1)	27,611				23,101				21,583
Cost reimbursement	112,740				106,347				107,008
Percentage rent	8,568				7,576				6,358
Other	10,522				9,020				8,866
Total rental income	$	582,335			$	538,701			$	522,651

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(1)	Residential minimum rents consist of the rental amounts for residential units at Rollingwood Apartments, The Crest at Congressional Plaza Apartments, Santana Row and Bethesda Row.

Minimum rents include the following:

	Year Ended December 31,
	2012				2011				2010
	(In millions)
Straight-line rents	$	6.1			$	5.7			$	4.6
Net amortization of above and below market leases	$	1.1			$	1.4			$	1.6

The principal components of rental expenses are as follows:

	Year Ended December 31,
2012				2011				2010
(In thousands)
Repairs and maintenance	$	41,616			$	41,977			$	42,278
Utilities	19,213				18,823				18,545
Management fees and costs	15,167				14,989				14,641
Payroll	8,704				8,080				7,909
Bad debt expense	2,151				2,649				6,396
Ground rent	2,189				2,047				3,049
Insurance	6,298				5,282				5,054
Marketing	7,321				6,868				4,789
Other operating	10,101				8,834				7,858
Total rental expenses	$	112,760			$	109,549			$	110,519

NOTE 14—DISCONTINUED OPERATIONS

Results of properties disposed or held for disposal which meet certain requirements, constitute discontinued operations and as such, the operations of these properties are classified as discontinued operations for all periods presented. A summary of the financial information for the discontinued operations is as follows:

	Year Ended December 31,
	2012				2011				2010
	(in millions)
Revenue from discontinued operations	$	—			$	2.3			$	3.5
Income from discontinued operations	$	—			$	1.0			$	1.0

F-26

NOTE 15—SHARE-BASED COMPENSATION PLANS

A summary of share-based compensation expense included in net income is as follows:

	Year Ended December 31,
	2012				2011				2010
	(In thousands)
Share-based compensation incurred
Grants of common shares	$	9,846			$	7,308			$	5,232
Grants of options	525				939				1,255
	10,371				8,247				6,487
Capitalized share-based compensation	(908		)		(663		)		(745		)
Share-based compensation expense	$	9,463			$	7,584			$	5,742

As of December 31, 2012, we have grants outstanding under two share-based compensation plans. In May 2010, our shareholders approved the 2010 Performance Incentive Plan, as amended (“the 2010 Plan”), which authorized the grant of share options, common shares and other share-based awards for up to 2,450,000 common shares of beneficial interest. Our 2001 Long Term Incentive Plan (the “2001 Plan”), which expired in May 2010, authorized the grant of share options, common shares and other share-based awards of 3,250,000 common shares of beneficial interest.

Option awards under both plans are required to have an exercise price at least equal to the closing trading price of our common shares on the date of grant. Options and restricted share awards under these plans generally vest over three to six years and option awards typically have a ten-year contractual term. We pay dividends on unvested shares. Certain options and share awards provide for accelerated vesting if there is a change in control. Additionally, the vesting on certain option and share awards can accelerate in part or in full upon retirement based on the age of the retiree or upon termination without cause.

The fair value of each option award is estimated on the date of grant using the Black-Scholes model. Expected volatilities, term, dividend yields, employee exercises and estimated forfeitures are primarily based on historical data. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant. The fair value of each share award is determined based on the closing trading price of our common shares on the grant date. No options were granted in 2012 and 2011.

The following table provides a summary of the weighted-average assumption used to value options in 2010:

		Year Ended December 31,
		2010
Volatility		30.0	%
Expected dividend yield		4.0	%
Expected term (in years)		4.3
Risk free interest rate		1.9	%

The following table provides a summary of option activity for 2012:

	Shares Under Option			Weighted- Average Exercise Price				Weighted- Average Remaining Contractual Term		Aggregate Intrinsic Value
								(In years)		(In thousands)
Outstanding at December 31, 2011	517,653			$	61.08
Granted	—			—
Exercised	(97,430	)		58.46
Forfeited or expired	(29,334	)		44.61
Outstanding at December 31, 2012	390,889			$	62.96			5.2		$	16,048
Exercisable at December 31, 2012	293,946			$	65.66			5.0		$	11,276

The weighted-average grant-date fair value of options granted during 2010 was $11.77 per share. The total cash received from options exercised during 2012, 2011 and 2010 was $5.7 million, $15.2 million and $4.2 million, respectively. The total intrinsic value of options exercised during the year ended December 31, 2012, 2011 and 2010 was $4.2 million, $5.6 million and $4.2 million, respectively.

F-27

The following table provides a summary of restricted share activity for 2012:

	Shares			Weighted-Average Grant-Date Fair Value
Unvested at December 31, 2011	282,837			$	74.00
Granted	126,169			96.35
Vested	(106,804	)		72.78
Forfeited	(14,522	)		53.76
Unvested at December 31, 2012	287,680			$	85.28

The weighted-average grant-date fair value of stock awarded in 2012, 2011 and 2010 was $96.35, $81.94 and $73.51, respectively. The total vesting-date fair value of shares vested during the year ended December 31, 2012, 2011 and 2010, was $10.3 million, $6.3 million and $4.3 million, respectively.

As of December 31, 2012, there was $15.3 million of total unrecognized compensation cost related to unvested share-based compensation arrangements (i.e. options and unvested shares) granted under our plans. This cost is expected to be recognized over the next 4.6 years with a weighted-average period of 2.3 years.

Subsequent to December 31, 2012, common shares were awarded under various compensation plans as follows:

Date		Award				Vesting Term		Beneficiary
February 7, 2013		98,913		Restricted shares		3 years		Officers and key employees
January 2, 2013		5,767		Shares		Immediate		Trustees

NOTE 16—SAVINGS AND RETIREMENT PLANS

We have a savings and retirement plan in accordance with the provisions of Section 401(k) of the Code. Generally, employees can elect, at their discretion, to contribute a portion of their compensation up to a maximum of $17,000 for 2012 and $16,500 for 2011 and 2010. Under the plan, we contribute 50% of each employee’s elective deferrals up to 5% of eligible earnings. In addition, we may make discretionary contributions within the limits of deductibility set forth by the Code. Our full-time employees are immediately eligible to become plan participants. Employees are eligible to receive matching contributions immediately on their participation; however, these matching payments will not vest until their third anniversary of employment for new employees who joined the Trust after December 31, 2011, and their first anniversary of employment for all other participants. Our expense for the years ended December 31, 2012, 2011 and 2010 was approximately $427,000, $365,000 and $596,000, respectively.

A non-qualified deferred compensation plan for our officers and certain other employees was established in 1994 that allows the participants to defer a portion of their income. As of December 31, 2012 and 2011, we are liable to participants for approximately $7.2 million and $5.9 million, respectively, under this plan. Although this is an unfunded plan, we have purchased certain investments to match this obligation. Our obligation under this plan and the related investments are both included in the accompanying consolidated financial statements.

NOTE 17—EARNINGS PER SHARE

We have calculated earnings per share (“EPS”) under the two-class method. The two-class method is an earnings allocation methodology whereby EPS for each class of common stock and participating securities is calculated according to dividends declared and participation rights in undistributed earnings. For 2012, 2011 and 2010, we had 0.3 million, 0.3 million and 0.2 million weighted average unvested shares outstanding, respectively, which are considered participating securities. Therefore, we have allocated our earnings for basic and diluted EPS between common shares and unvested shares; the portion of earnings allocated to the unvested shares is reflected as “earnings allocated to unvested shares” in the reconciliation below.

In the dilutive EPS calculation, dilutive stock options were calculated using the treasury stock method consistent with prior periods. There were no anti-dilutive stock options in 2012. Approximately 0.1 million and 0.2 million stock options have been excluded in 2011 and 2010, respectively, as they were anti-dilutive. The conversions of downREIT operating partnership units and 5.417% Series 1 Cumulative Convertible Preferred Shares are anti-dilutive for all periods presented and accordingly, have been excluded from the weighted average common shares used to compute diluted EPS.

F-28

	Year Ended December 31,
	2012				2011				2010
	(In thousands, except per share data)
NUMERATOR
Income from continuing operations	$	144,372			$	131,554			$	125,851
Less: Preferred share dividends	(541		)		(541		)		(541		)
Less: Income from continuing operations attributable to noncontrolling interests	(4,307		)		(5,475		)		(5,247		)
Less: Earnings allocated to unvested shares	(845		)		(705		)		(572		)
Income from continuing operations available for common shareholders	138,679				124,833				119,491
Results from discontinued operations attributable to the Trust	—				17,838				1,776
Gain on sale of real estate	11,860				—				410
Net income available for common shareholders, basic and diluted	$	150,539			$	142,671			$	121,677
DENOMINATOR
Weighted average common shares outstanding—basic	63,881				62,438				61,182
Effect of dilutive securities:
Stock options	175				165				142
Weighted average common shares outstanding—diluted	64,056				62,603				61,324
EARNINGS PER COMMON SHARE, BASIC
Continuing operations	$	2.17			$	2.00			$	1.95
Discontinued operations	—				0.29				0.03
Gain on sale of real estate	0.19				—				0.01
	$	2.36			$	2.29			$	1.99
EARNINGS PER COMMON SHARE, DILUTED
Continuing operations	$	2.16			$	1.99			$	1.94
Discontinued operations	—				0.29				0.03
Gain on sale of real estate	0.19				—				0.01
	$	2.35			$	2.28			$	1.98
Income from continuing operations attributable to the Trust	$	140,065			$	126,079			$	120,604

F-29

NOTE 18—SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)

Summarized quarterly financial data is as follows:

	First Quarter				Second Quarter				Third Quarter				Fourth Quarter
	(In thousands, except per share data)
2012
Revenue	$	146,289			$	147,560			$	157,805			$	156,364
Operating Income	$	60,547			$	61,779			$	67,123			$	65,813
Net income	$	44,122			$	33,596			$	39,656			$	38,858
Net income attributable to the Trust	$	42,986			$	32,603			$	38,644			$	37,692
Net income available for common shareholders	$	42,851			$	32,468			$	38,508			$	37,557
Earnings per common share—basic	$	0.67			$	0.51			$	0.60			$	0.58
Earnings per common share—diluted	$	0.67			$	0.51			$	0.60			$	0.58
	First Quarter				Second Quarter				Third Quarter				Fourth Quarter
	(In thousands, except per share data)
2011
Revenue(1)	$	137,650			$	136,279			$	137,664			$	141,466
Operating Income(2)	$	56,373			$	57,334			$	56,757			$	57,233
Net income(2)	$	32,384			$	36,471			$	48,302			$	32,455
Net income attributable to the Trust(2)	$	31,186			$	34,757			$	47,053			$	30,921
Net income available for common shareholders(2)	$	31,051			$	34,622			$	46,917			$	30,786
Earnings per common share—basic(2)	$	0.50			$	0.55			$	0.74			$	0.48
Earnings per common share—diluted(2)	$	0.50			$	0.55			$	0.74			$	0.48

(1)	Revenue has been reduced to reflect the results of discontinued operations. Revenue from discontinued operations, by quarter, is summarized as follows:

	First Quarter				Second Quarter				Third Quarter				Fourth Quarter
	(In thousands)
2011 revenue from discontinued operations	$	978			$	1,048			$	163			$	93

(2)	Third quarter 2011 amounts include a $14.8 million gain on sale of our Feasterville Shopping Center as further discussed in Note 3.

NOTE 19—SUBSEQUENT EVENT

On January 2, 2013, we repaid the mortgage loan at par on White Marsh Plaza prior to its original maturity date for $9.0 million. The loan had an original maturity date of April 1, 2013.

F-30

FEDERAL REALTY INVESTMENT TRUST SCHEDULE III SUMMARY OF REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 2012 (Dollars in thousands)
COLUMN A				COLUMN B				COLUMN C								COLUMN D				COLUMN E												COLUMN F				COLUMN G		COLUMN H		COLUMN I
Descriptions				Encumbrance				Initial cost to company								Cost Capitalized Subsequent to Acquisition				Gross amount at which carried at close of period												Accumulated Depreciation and Amortization				Date of Construction		Date Acquired		Life on which depreciation in latest income statements is computed
Land				Building and Improvements				Land				Building and Improvements				Total
150 POST STREET (California)		CA		$	—			$	11,685			$	9,181			$	16,863			$	11,685			$	26,044			$	37,729			$	14,825			1908, 1965		10/23/1997		35 years
29TH PLACE (SHOPPERS' WORLD) (Virginia)		VA		5,253				10,211				18,863				7,695				10,225				26,544				36,769				4,287				1975 - 2001		5/30/2007		35 years
ANDORRA (Pennsylvania)		PA		—				2,432				12,346				10,346				2,432				22,692				25,124				15,264				1953		1/12/1988		35 years
ASSEMBLY SQUARE MARKETPLACE/ASSEMBLY ROW (Massachusetts)		MA		—				75,139				34,196				143,053				75,139				177,249				252,388				15,525				2005-2012		2005-2011		35 years
THE AVENUE AT WHITE MARSH (Maryland)		MD		55,353				20,682				72,432				3,522				20,685				75,951				96,636				16,277				1997		3/8/2007		35 years
BALA CYNWYD (Pennsylvania)		PA		—				3,565				14,466				21,347				3,566				35,812				39,378				13,795				1955		9/22/1993		35 years
BARRACKS ROAD (Virginia)		VA		38,070				4,363				16,459				34,946				4,363				51,405				55,768				33,651				1958		12/31/1985		35 years
BETHESDA ROW (Maryland)		MD		—				46,579				35,406				135,297				44,880				172,402				217,282				43,065				1945-2008		12/31/93, 1/20/06, 9/25/08, 9/30/08, & 12/27/10		35 - 50 years
BRICK PLAZA (New Jersey)		NJ		28,033				—				24,715				35,896				3,935				56,676				60,611				39,808				1958		12/28/1989		35 years
BRISTOL (Connecticut)		CT		—				3,856				15,959				8,474				3,856				24,433				28,289				12,486				1959		9/22/1995		35 years
CHELSEA COMMONS (Massachusetts)		MA		7,135				9,417				19,466				5,891				9,396				25,378				34,774				3,656				1962/1969/2008		08/25/06, 1/30/07, & 7/16/08		35 years
COLORADO BLVD (California)		CA		—				5,262				4,071				9,056				5,262				13,127				18,389				7,825				1905-1988		12/31/96 & 8/14/98		35 years
CONGRESSIONAL PLAZA (Maryland)		MD		—				2,793				7,424				63,129				1,020				72,326				73,346				43,424				1965/2003		4/1/1965		35 years
COURTHOUSE CENTER (Maryland)		MD		—				1,750				1,869				1,086				1,750				2,955				4,705				1,354				1975		12/17/1997		35 years
COURTYARD SHOPS (Florida)		FL		—				16,862				21,851				1,488				16,894				23,307				40,201				3,710				1990/1998		9/4/2008		35 years
CROSSROADS (Illinois)		IL		—				4,635				11,611				14,559				4,635				26,170				30,805				11,915				1959		7/19/1993		35 years
CROW CANYON COMMONS (California)		CA		19,485				27,245				54,575				3,118				27,245				57,693				84,938				12,215				Late 1970's/2006		12/29/05 & 02/28/07		35 years

F-31

FEDERAL REALTY INVESTMENT TRUST SCHEDULE III SUMMARY OF REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 2012 (Dollars in thousands)
COLUMN A				COLUMN B				COLUMN C								COLUMN D				COLUMN E												COLUMN F				COLUMN G		COLUMN H		COLUMN I
Descriptions				Encumbrance				Initial cost to company								Cost Capitalized Subsequent to Acquisition				Gross amount at which carried at close of period												Accumulated Depreciation and Amortization				Date of Construction		Date Acquired		Life on which depreciation in latest income statements is computed
Land				Building and Improvements				Land				Building and Improvements				Total
DEDHAM PLAZA (Massachusetts)		MA		—				12,287				12,918				8,897				12,287				21,815				34,102				11,203				1959		12/31/1993		35 years
DEL MAR VILLAGE (Florida)		FL		—				14,218				39,559				1,876				14,180				41,473				55,653				6,547				1982/1994/2007		5/30/08 & 7/11/08		35 years
EAST BAY BRIDGE (California)		CA		67,574				29,091				138,088				—				29,091				138,088				167,179				150				1994-2001, 2011-2012		12/21/2012		35 years
EASTGATE (North Carolina)		NC		—				1,608				5,775				19,354				1,608				25,129				26,737				15,655				1963		12/18/1986		35 years
ELLISBURG CIRCLE (New Jersey)		NJ		—				4,028				11,309				14,960				4,013				26,284				30,297				15,682				1959		10/16/1992		35 years
ESCONDIDO PROMENADE (California)		CA		—				19,117				15,829				10,530				19,117				26,359				45,476				9,252				1987		12/31/96 & 11/10/10		35 years
FALLS PLAZA (Virginia)		VA		—				1,798				1,270				9,582				1,819				10,831				12,650				7,029				1960/1962		09/30/67 & 10/05/72		25 years
FEDERAL PLAZA (Maryland)		MD		—				10,216				17,895				36,689				10,216				54,584				64,800				33,660				1970		6/29/1989		35 years
FIFTH AVENUE (California)		CA		—				2,149				584				3,323				2,149				3,907				6,056				2,092				1888-1998		1996		35 years
FINLEY SQUARE (Illinois)		IL		—				9,252				9,544				13,592				9,252				23,136				32,388				14,960				1974		4/27/1995		35 years
FLOURTOWN (Pennsylvania)		PA		—				1,345				3,943				10,772				1,470				14,590				16,060				7,625				1957		4/25/1980		35 years
FOREST HILLS (New York)		NY		—				2,885				2,885				2,822				3,031				5,561				8,592				2,503				1937 - 1987		12/16/1997		35 years
FRESH MEADOWS (New York)		NY		—				24,625				25,255				27,635				24,627				52,888				77,515				25,421				1946-1949		12/5/1997		35 years
FRIENDSHIP CTR (District of Columbia)		DC		—				12,696				20,803				1,959				12,696				22,762				35,458				7,111				1998		9/21/2001		35 years
GAITHERSBURG SQUARE (Maryland)		MD		—				7,701				5,271				12,559				5,973				19,558				25,531				14,252				1966		4/22/1993		35 years
GARDEN MARKET (Illinois)		IL		—				2,677				4,829				5,032				2,677				9,861				12,538				5,508				1958		7/28/1994		35 years
GOVERNOR PLAZA (Maryland)		MD		—				2,068				4,905				19,635				2,068				24,540				26,608				14,834				1963		10/1/1985		35 years
GRATIOT PLAZA (Michigan)		MI		—				525				1,601				16,896				525				18,497				19,022				13,685				1964		3/29/1973		25.75 years
GREENWICH AVENUE (Connecticut)		CT		—				7,484				5,445				1,040				7,484				6,485				13,969				3,201				1968		4/12/1995		35 years
HAUPPAUGE (New York)		NY		14,352				8,791				15,262				3,996				8,791				19,258				28,049				8,360				1963		8/6/1998		35 years
HERMOSA AVE. (California)		CA		—				1,116				280				4,190				1,368				4,218				5,586				2,028				1922		9/17/1997		35 years

F-32

FEDERAL REALTY INVESTMENT TRUST SCHEDULE III SUMMARY OF REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 2012 (Dollars in thousands)
COLUMN A				COLUMN B				COLUMN C								COLUMN D				COLUMN E												COLUMN F				COLUMN G		COLUMN H		COLUMN I
Descriptions				Encumbrance				Initial cost to company								Cost Capitalized Subsequent to Acquisition				Gross amount at which carried at close of period												Accumulated Depreciation and Amortization				Date of Construction		Date Acquired		Life on which depreciation in latest income statements is computed
Land				Building and Improvements				Land				Building and Improvements				Total
HOLLYWOOD BLVD. (California)		CA		—				8,300				16,920				14,878				8,300				31,798				40,098				8,180				1929/1991		3/22/99 & 6/18/99		35 years
HOUSTON STREET (Texas)		TX		—				14,680				1,976				49,140				14,778				51,018				65,796				24,986				var		1998		35 years
HUNTINGTON (New York)		NY		—				11,713				16,008				15,680				11,713				31,688				43,401				9,745				1962		12/12/88 & 10/26/07		35 years
HUNTINGTON SQUARE (New York)		NY		—				—				10,075				619				—				10,694				10,694				874				1980/2004-2007		8/16/2010		35 years
IDYLWOOD PLAZA (Virginia)		VA		15,987				4,308				10,026				2,155				4,308				12,181				16,489				6,545				1991		4/15/1994		35 years
KINGS COURT (California)		CA		—				—				10,714				957				—				11,671				11,671				6,630				1960		8/24/1998		26 years
LANCASTER (Pennsylvania)		PA		4,907				—				2,103				11,224				75				13,252				13,327				6,638				1958		4/24/1980		22 years
LANGHORNE SQUARE (Pennsylvania)		PA		—				720				2,974				16,736				720				19,710				20,430				11,809				1966		1/31/1985		35 years
LAUREL (Maryland)		MD		—				7,458				22,525				21,158				7,464				43,677				51,141				30,624				1956		8/15/1986		35 years
LAWRENCE PARK (Pennsylvania)		PA		26,984				5,723				7,160				18,295				5,734				25,444				31,178				21,981				1972		7/23/1980		22 years
LEESBURG PLAZA (Virginia)		VA		27,818				8,184				10,722				16,321				8,184				27,043				35,227				10,118				1967		9/15/1998		35 years
LINDEN SQUARE (Massachusetts)		MA		—				79,382				19,247				47,817				79,269				67,177				146,446				10,504				1960-2008		8/24/2006		35 years
LOEHMANN'S PLAZA (Virginia)		VA		35,972				1,237				15,096				16,543				1,248				31,628				32,876				22,431				1971		7/21/1983		35 years
MELVILLE MALL (New York)		NY		21,406				35,622				32,882				532				35,622				33,414				69,036				5,961				1974		10/16/2006		35 years
MERCER MALL (New Jersey)		NJ		55,844				28,684				48,028				33,878				28,684				81,906				110,590				24,957				1975		10/14/2003		25 - 35 years
MID PIKE PLAZA/PIKE & ROSE (Maryland)		MD		—				31,388				10,335				46,393				31,451				56,665				88,116				5,146				1963		05/18/82 & 10/26/07		50 years
MONTROSE CROSSING (Maryland)		MD		78,755				38,490				101,953				1,108				38,490				103,061				141,551				4,168				1960-1979, 1996 & 2011		12/27/2011		35 years
MOUNT VERNON/SOUTH VALLEY/7770 RICHMOND HWY. (Virginia)		VA		—				10,068				33,501				35,361				10,204				68,726				78,930				20,794				1966/1972/1987/2001		03/31/03, 3/21/03, & 1/27/06		35 years
TOWN CENTER OF NEW BRITAIN (Pennsylvania)		PA		—				1,282				12,285				1,031				1,262				13,336				14,598				2,874				1969		6/29/2006		35 years

F-33

FEDERAL REALTY INVESTMENT TRUST SCHEDULE III SUMMARY OF REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 2012 (Dollars in thousands)
COLUMN A				COLUMN B				COLUMN C								COLUMN D				COLUMN E												COLUMN F				COLUMN G		COLUMN H		COLUMN I
Descriptions				Encumbrance				Initial cost to company								Cost Capitalized Subsequent to Acquisition				Gross amount at which carried at close of period												Accumulated Depreciation and Amortization				Date of Construction		Date Acquired		Life on which depreciation in latest income statements is computed
Land				Building and Improvements				Land				Building and Improvements				Total
NORTH DARTMOUTH (Massachusetts)		MA		—				27,214				—				(17,846		)		9,366				2				9,368				1				2004		8/24/2006
NORTHEAST (Pennsylvania)		PA		—				1,152				10,596				12,500				1,153				23,095				24,248				16,503				1959		8/30/1983		35 years
NORTH LAKE COMMONS (Illinois)		IL		—				2,782				8,604				4,467				2,628				13,225				15,853				5,981				1989		4/27/1994		35 years
OLD KEENE MILL (Virginia)		VA		—				638				998				4,835				638				5,833				6,471				4,766				1968		6/15/1976		33.33 years
OLD TOWN CENTER (California)		CA		—				3,420				2,765				30,208				3,420				32,973				36,393				16,930				1962, 1997-1998		10/22/1997		35 years
PAN AM SHOPPING CENTER (Virginia)		VA		—				8,694				12,929				7,016				8,695				19,944				28,639				11,987				1979		2/5/1993		35 years
PENTAGON ROW (Virginia)		VA		51,640				—				2,955				86,744				—				89,699				89,699				33,883				1999 - 2002		1998 & 11/22/10		35 years
PERRING PLAZA (Maryland)		MD		—				2,800				6,461				19,309				2,800				25,770				28,570				18,998				1963		10/1/1985		35 years
PIKE 7 (Virginia)		VA		—				9,709				22,799				3,266				9,653				26,121				35,774				12,329				1968		3/31/1997		35 years
PLAZA EL SEGUNDO (California)		CA		183,893				56,606				153,556				3,457				56,606				157,013				213,619				6,063				2006 & 2007		12/30/2011		35 years
QUEEN ANNE PLAZA (Massachusetts)		MA		—				3,319				8,457				5,063				3,319				13,520				16,839				7,603				1967		12/23/1994		35 years
QUINCE ORCHARD PLAZA (Maryland)		MD		—				3,197				7,949				15,541				2,928				23,759				26,687				12,714				1975		4/22/1993		35 years
ROCKVILLE TOWN SQUARE (Maryland)		MD		4,538				—				8,092				42,232				—				50,324				50,324				7,999				2005 - 2007		2006 - 2007		50 years
ROLLINGWOOD APTS. (Maryland)		MD		22,890				552				2,246				6,362				572				8,588				9,160				7,251				1960		1/15/1971		25 years
SAM'S PARK & SHOP (District of Columbia)		DC		—				4,840				6,319				1,701				4,840				8,020				12,860				4,032				1930		12/1/1995		35 years
SANTANA ROW (California)		CA		—				44,562				7,502				567,816				52,318				567,562				619,880				109,434				1999 - 2009, 2011		3/5/1997 & 2012		40 - 50 years
SAUGUS (Massachusetts)		MA		—				4,383				8,291				1,970				4,383				10,261				14,644				4,638				1976		10/1/1996		35 years
SHIRLINGTON (Virginia)		VA		6,404				9,761				14,808				34,475				5,798				53,246				59,044				16,919				1940, 2006-2009		12/21/1995		35 years
THE SHOPPES AT NOTTINGHAM SQUARE (Maryland)		MD		—				4,441				12,849				37				4,441				12,886				17,327				2,617				2005 - 2006		3/8/2007		35 years

F-34

FEDERAL REALTY INVESTMENT TRUST SCHEDULE III SUMMARY OF REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 2012 (Dollars in thousands)
COLUMN A				COLUMN B				COLUMN C								COLUMN D				COLUMN E												COLUMN F				COLUMN G		COLUMN H		COLUMN I
Descriptions				Encumbrance				Initial cost to company								Cost Capitalized Subsequent to Acquisition				Gross amount at which carried at close of period												Accumulated Depreciation and Amortization				Date of Construction		Date Acquired		Life on which depreciation in latest income statements is computed
Land				Building and Improvements				Land				Building and Improvements				Total
THIRD STREET PROMENADE (California)		CA		—				22,645				12,709				42,891				25,125				53,120				78,245				25,333				1888-2000		1996-2000		35 years
TOWER (Virginia)		VA		—				7,170				10,518				3,458				7,280				13,866				21,146				6,289				1953-1960		8/24/1998		35 years
TOWER SHOPS (Florida)		FL		—				28,823				36,313				10,797				28,845				47,088				75,933				3,873				1989		1/19/2011		35 years
TROY (New Jersey)		NJ		—				3,126				5,193				20,478				4,028				24,769				28,797				17,278				1966		7/23/1980		22 years
TYSON'S STATION (Virginia)		VA		—				388				453				3,240				475				3,606				4,081				3,040				1954		1/17/1978		17 years
WESTGATE MALL (California)		CA		—				6,319				107,284				10,688				6,319				117,972				124,291				24,862				1960-1966		3/31/2004		35 years
WHITE MARSH PLAZA (Maryland)		MD		8,970				3,478				21,413				163				3,478				21,576				25,054				4,681				1987		3/8/2007		35 years
WHITE MARSH OTHER (Maryland)		MD		—				60,400				1,843				(26,052		)		34,311				1,880				36,191				434				1985		3/8/2007		35 years
WILDWOOD (Maryland)		MD		23,719				9,111				1,061				8,360				9,111				9,421				18,532				8,009				1958		5/5/1969		33.33 years
WILLOW GROVE (Pennsylvania)		PA		—				1,499				6,643				20,851				1,499				27,494				28,993				21,015				1953		11/20/1984		35 years
WILLOW LAWN (Virginia)		VA		—				3,192				7,723				69,824				7,790				72,949				80,739				43,711				1957		12/5/1983		35 years
WYNNEWOOD (Pennsylvania)		PA		27,500				8,055				13,759				15,032				8,055				28,791				36,846				16,315				1948		10/29/1996		35 years
MISCELLANEOUS INVESTMENTS				—				1,115				1,319				—				1,115				1,319				2,434				2
TOTALS				$	832,482			$	1,052,783			$	1,627,077			$	2,099,814			$	1,019,905			$	3,759,769			$	4,779,674			$	1,224,295

F-35

FEDERAL REALTY INVESTMENT TRUST SCHEDULE III SUMMARY OF REAL ESTATE AND ACCUMULATED DEPRECIATION - CONTINUED Three Years Ended December 31, 2012 Reconciliation of Total Cost (in thousands)
Balance, December 31, 2009	$	3,759,234
Additions during period
Acquisitions	34,855
Consolidation of VIE	18,311
Improvements	97,129
Deduction during period—disposition and retirements of property	(13,587		)
Balance, December 31, 2010	3,895,942
Additions during period
Acquisitions	430,758
Improvements	147,996
Deconsolidation of VIE	(18,311		)
Deduction during period—disposition and retirements of property	(29,941		)
Balance, December 31, 2011	4,426,444
Additions during period
Acquisitions	193,131
Improvements	187,990
Deduction during period—disposition and retirements of property	(27,891		)
Balance, December 31, 2012	$	4,779,674

---

(1)	For Federal tax purposes, the aggregate cost basis is approximately $4.2 billion as of December 31, 2012.

F-36

FEDERAL REALTY INVESTMENT TRUST SCHEDULE III SUMMARY OF REAL ESTATE AND ACCUMULATED DEPRECIATION - CONTINUED Three Years Ended December 31, 2012 Reconciliation of Accumulated Depreciation and Amortization (in thousands)
Balance, December 31, 2009	$	938,087
Additions during period—depreciation and amortization expense	108,261
Deductions during period—disposition and retirements of property	(11,144		)
Balance, December 31, 2010	1,035,204
Additions during period—depreciation and amortization expense	114,180
Deductions during period—disposition and retirements of property	(21,796		)
Balance, December 31, 2011	1,127,588
Additions during period—depreciation and amortization expense	128,654
Deductions during period—disposition and retirements of property	(31,947		)
Balance, December 31, 2012	$	1,224,295

F-37

FEDERAL REALTY INVESTMENT TRUST SCHEDULE IV MORTGAGE LOANS ON REAL ESTATE Year Ended December 31, 2012 (Dollars in thousands)
Column A		Column B		Column C		Column D		Column E						Column F						Column G						Column H
Description of Lien		Interest Rate		Maturity Date		Periodic Payment Terms		Prior Liens						Face Amount of Mortgages						Carrying Amount of Mortgages(1)						Principal Amount of Loans Subject to delinquent Principal or Interest
Mortgage on retail buildings in Philadelphia, PA		8% or 10% based on timing of draws, plus participation		May 2021		Interest only monthly; balloon payment due at maturity		$	—					$	20,286					$	20,286			(2)		$	—
Mortgage on retail buildings in Philadelphia, PA		10% plus participation		May 2021		Interest only monthly; balloon payment due at maturity		—						9,250						9,250						—
Second Mortgage on hotel building in San Jose, CA		9%		August 2016		Principal and interest; balloon payment due at maturity(3)		35,000				(4)		12,914						10,785						—
Mortgage on restaurant building in Rockville, MD		9%		December 2014		Interest only monthly through January 31, 2011; balloon payment due at maturity(5)		—						3,612						3,612						—
Mortgage on retail building in Norwalk, CT		6%		June 2014		Interest only; balloon payment due at maturity(6)		$	—					$	11,715					$	11,715					$	—
								$	35,000					$	57,777					$	55,648					$	—

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(1)	For Federal tax purposes, the aggregate tax basis is approximately $57.8 million as of December 31, 2012.

(2)	This mortgage is available for up to $25.0 million.

(3)	This note was amended on August 4, 2006. The amended note decreased the interest from 14% to 9% per annum, and requires monthly payments of principal and interest based on 15-year amortization schedule.

(4)	We do not hold the first mortgage loan on this property. Accordingly, the amount of the prior lien at December 31, 2012 is estimated.

(5)	Beginning February 1, 2011, the note requires monthly payments of principal and interest based on a 30-year amortization schedule. The borrower has one, three-year extension option with an interest rate of 12% which increases 1% in each subsequent year of the extension term.

(6)	The loan is subject to a one year extension option with an interest rate of 7% .

F-38

FEDERAL REALTY INVESTMENT TRUST SCHEDULE IV MORTGAGE LOANS ON REAL ESTATE - CONTINUED Three Years Ended December 31, 2012 Reconciliation of Carrying Amount (in thousands)
Balance, December 31, 2009	$	48,336
Additions during period:
Issuance of loans	14,787
Deductions during period:
Collection and satisfaction of loans	(464		)
Amortization of discount /loan fee	465
Consolidation of VIE	(18,311		)
Balance, December 31, 2010	44,813
Additions during period:
Issuance of loans	130
Deconsolidation of VIE	18,311
Deductions during period:
Collection and satisfaction of loans	(7,598		)
Amortization of discount	311
Balance, December 31, 2011	55,967
Additions during period:
Issuance of loans	70
Deductions during period:
Collection and satisfaction of loans	(1,161		)
Amortization of discount	772
Balance, December 31, 2012	$	55,648

F-39

EXHIBIT INDEX

Exhibit No.		Description
3.1		Declaration of Trust of Federal Realty Investment Trust dated May 5, 1999 as amended by the Articles of Amendment of Declaration of Trust of Federal Realty Investment Trust dated May 6, 2004, as corrected by the Certificate of Correction of Articles of Amendment of Declaration of Trust of Federal Realty Investment Trust dated June 17, 2004, as amended by the Articles of Amendment of Declaration of Trust of Federal Realty Investment Trust dated May 6, 2009 (previously filed as Exhibit 3.1 to the Trust’s Registration Statement on Form S-3 (File No. 333-160009) and incorporated herein by reference)
3.2		Amended and Restated Bylaws of Federal Realty Investment Trust dated February 12, 2003, as amended October 29, 2003, May 5, 2004, February 17, 2006 and May 6, 2009 (previously filed as Exhibit 3.2 to the Trust’s Registration Statement on Form S-3 (File No. 333-160009) and incorporated herein by reference)
4.1		Specimen Common Share certificate (previously filed as Exhibit 4(i) to the Trust’s Annual Report on Form 10-K for the year ended December 31, 1999 (File No. 1-07533) and incorporated herein by reference)
4.2		Articles Supplementary relating to the 5.417% Series 1 Cumulative Convertible Preferred Shares of Beneficial Interest (previously filed as Exhibit 4.1 to the Trust’s Current Report on Form 8-K filed on March 13, 2007, (File No. 1-07533) and incorporated herein by reference)
4.3		** Indenture dated December 1, 1993 related to the Trust’s 7.48% Debentures due August 15, 2026; and 6.82% Medium Term Notes due August 1, 2027; (previously filed as Exhibit 4(a) to the Trust’s Registration Statement on Form S-3 (File No. 33-51029), and amended on Form S-3 (File No. 33-63687), filed on December 13, 1993 and incorporated herein by reference)
4.4		** Indenture dated September 1, 1998 related to the Trust’s 5.65% Notes due 2016; 6.00% Notes due 2012; 6.20% Notes due 2017; 5.40% Notes due 2013; 5.95% Notes due 2014 and the 5.90% Notes due 2020 (previously filed as Exhibit 4(a) to the Trust’s Registration Statement on Form S-3 (File No. 333-63619) filed on September 17, 1998 and incorporated herein by reference)
10.1		Amended and Restated 1993 Long-Term Incentive Plan, as amended on October 6, 1997 and further amended on May 6, 1998 (previously filed as Exhibit 10.26 to the Trust’s Annual Report on Form 10-K for the year ended December 31, 1998 (File No. 1-07533) and incorporated herein by reference)
10.2		* Severance Agreement between the Trust and Donald C. Wood dated February 22, 1999 (previously filed as a portion of Exhibit 10 to the Trust’s Quarterly Report on Form 10-Q for the quarter ended March 31, 1999 (File No. 1-07533) (the “1999 1Q Form 10-Q”) and incorporated herein by reference)
10.3		* Executive Agreement between Federal Realty Investment Trust and Donald C. Wood dated February 22, 1999 (previously filed as a portion of Exhibit 10 to the 1999 1Q Form 10-Q and incorporated herein by reference)
10.4		* Amendment to Executive Agreement between Federal Realty Investment Trust and Donald C. Wood dated February 16, 2005 (previously filed as Exhibit 10.12 to the Trust’s Annual Report on Form 10-K for the year ended December 31, 2004 (File No. 1-07533) (the “2004 Form 10-K”) and incorporated herein by reference)
10.5		* Split Dollar Life Insurance Agreement dated August 12, 1998 between the Trust and Donald C. Wood (previously filed as a portion of Exhibit 10 to the Trust’s Annual Report on Form 10-K for the year ended December 31, 2000 (File No. 1-07533) and incorporated herein by reference)
10.6		2001 Long-Term Incentive Plan (previously filed as Exhibit 99.1 to the Trust’s S-8 Registration Number 333-60364 filed on May 7, 2001 and incorporated herein by reference)

Exhibit No.		Description
10.7		* Health Coverage Continuation Agreement between Federal Realty Investment Trust and Donald C. Wood dated February 16, 2005 (previously filed as Exhibit 10.26 to the 2004 Form 10-K and incorporated herein by reference)
10.8		* Severance Agreement between the Trust and Dawn M. Becker dated April 19, 2000 (previously filed as Exhibit 10.26 to the Trust’s 2005 2Q Form 10-Q and incorporated herein by reference)
10.9		* Amendment to Severance Agreement between the Trust and Dawn M. Becker dated February 16, 2005 (previously filed as Exhibit 10.27 to the 2004 Form 10-K and incorporated herein by reference)
10.10		Form of Restricted Share Award Agreement for awards made under the Trust’s 2003 Long-Term Incentive Award Program for shares issued out of 2001 Long-Term Incentive Plan (previously filed as Exhibit 10.28 to the 2004 Form 10-K and incorporated herein by reference)
10.11		Form of Restricted Share Award Agreement for awards made under the Trust’s Annual Incentive Bonus Program for shares issued out of 2001 Long-Term Incentive Plan (previously filed as Exhibit 10.29 to the 2004 Form 10-K and incorporated herein by reference)
10.12		Form of Option Award Agreement for awards made under the Trust’s 2003 Long-Term Incentive Award Program for shares issued out of the 2001 Long-Term Incentive Plan (previously filed as Exhibit 10.32 to the 2005 Form 10-K and incorporated herein by reference)
10.13		Amended and Restated 2001 Long-Term Incentive Plan (previously filed as Exhibit 10.34 to the Trust’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2008 (File No. 1-07533) and incorporated herein by reference)
10.14		Change in Control Agreement between the Trust and Andrew P. Blocher dated February 12, 2007 (previously filed as Exhibit 10.27 to the Trust’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2008 (File No. 1-07533) and incorporated herein by reference)
10.15		* Amendment to Severance Agreement between the Trust and Donald C. Wood dated January 1, 2009 (previously filed as Exhibit 10.26 to the Trust’s Annual Report on Form 10-K for the year ended December 31, 2008 (File No. 1-07533) (“the 2008 Form 10-K”) and incorporated herein by reference)
10.16		* Second Amendment to Executive Agreement between the Trust and Donald C. Wood dated January 1, 2009 (previously filed as Exhibit 10.27 to the Trust’s 2008 Form 10-K and incorporated herein by reference)
10.17		* Amendment to Health Coverage Continuation Agreement between the Trust and Donald C. Wood dated January 1, 2009 (previously filed as Exhibit 10.28 to the Trust’s 2008 Form 10-K and incorporated herein by reference)
10.18		* Second Amendment to Severance Agreement between the Trust and Dawn M. Becker dated January 1, 2009 (previously filed as Exhibit 10.30 to the Trust’s 2008 Form 10-K and incorporated herein by reference)
10.19		Amendment to Change in Control Agreement between the Trust and Andrew P. Blocher dated January 1, 2009 (previously filed as Exhibit 10.31 to the Trust’s 2008 Form 10-K and incorporated herein by reference)
10.20		Amendment to Stock Option Agreements between the Trust and Andrew P. Blocher dated February 17, 2009 (previously filed as Exhibit 10.32 to the Trust’s 2008 Form 10-K and incorporated herein by reference)
10.21		Restricted Share Award Agreement between the Trust and Andrew P. Blocher dated February 17, 2009 (previously filed as Exhibit 10.33 to the Trust’s 2008 Form 10-K and incorporated herein by reference)
10.22		Combined Incentive and Non-Qualified Stock Option Agreement between the Trust and Andrew P. Blocher dated February 17, 2009 (previously filed as Exhibit 10.34 to the Trust’s 2008 Form 10-K and incorporated herein by reference)
10.23		* Severance Agreement between the Trust and Andrew P. Blocher dated February 17, 2009 (previously filed as Exhibit 10.35 to the Trust’s 2008 Form 10-K and incorporated herein by reference)

Exhibit No.		Description
10.24		2010 Performance Incentive Plan (previously filed as Appendix A to the Trust’s Definitive Proxy Statement for the 2010 Annual Meeting of Shareholders (File No. 01-07533) and incorporated herein by reference)
10.25		Amendment to 2010 Performance Incentive Plan (“the 2010 Plan”) (previously filed as Appendix A to the Trust’s Proxy Supplement for the 2010 Annual Meeting of Shareholders (File No. 01-07533) and incorporated herein by reference)
10.26		* Restricted Share Award Agreement between the Trust and Donald C. Wood dated October 12, 2010 (previously filed as Exhibit 10.36 to the Trust’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2010 (File No. 01-07533) and incorporated herein by reference)
10.27		Form of Restricted Share Award Agreement for awards made under the Trust’s Long-Term Incentive Award Program and the Trust’s Annual Incentive Bonus Program and basic awards with annual vesting for shares issued out of the 2010 Plan (previously filed as Exhibit 10.34 to the Trust’s Annual Report on Form 10-K for the year ended December 31, 2010 (File No. 1-07533) (the “2010 Form 10-K”) and incorporated herein by reference)
10.28		Form of Option Award Agreement for awards made under the Trust’s Long-Term Incentive Award Program for shares issued out of the 2010 Plan (previously filed as Exhibit 10.38 to the Trust’s 2010 Form 10-K (File No. 1-07533) and incorporated herein by reference)
10.29		Form of Option Award Agreement for front loaded awards made under the Trust’s Long-Term Incentive Award Program for shares issued out of the 2010 Plan (previously filed as Exhibit 10.39 to the Trust’s 2010 Form 10-K (File No. 1-07533) and incorporated herein by reference)
10.30		Form of Option Award Agreement for basic options awarded out of the 2010 Plan (previously filed as Exhibit 10.40 to the Trust’s 2010 Form 10-K (File No. 1-07533) and incorporated herein by reference)
10.31		Form of Restricted Share Award Agreement, dated as of February 10, 2011, between the Trust and each of Dawn M. Becker, and Andrew P. Blocher (previously filed as Exhibit 10.41 to the Trust’s 2010 Form 10-K (File No. 1-07533) and incorporated herein by reference)
10.32		* Severance Agreement between the Trust and James M. Taylor dated July 30, 2012 (previously filed as Exhibit 10.35 to the Trust's Quarterly Report on Form 10-Q for the quarter ended September 30, 2012 (File No. 1-07533) and incorporated herein by reference)
10.33		Credit Agreement dated as of July 7, 2011, by and among the Trust, as Borrower, the financial institutions party thereto and their permitted assignees under Section 12.6., as Lenders, Wells Fargo Bank, National Association, as Administrative Agent, PNC Bank, National Association, as Syndication Agent, Wells Fargo Securities, LLC, as a Lead Arranger and Book Manager, and PNC Capital Markets LLC, as a Lead Arranger and Book Manager (previously filed as Exhibit 10.1 to the Trust’s Current Report on Form 8-K (File No. 1-07533), filed on July 11, 2011 and incorporated herein by reference)
10.34		Credit Agreement dated as of November 22, 2011, by and among the Trust, as Borrower, the financial institutions party thereto and their permitted assignees under Section 12.6., as Lenders, PNC Bank, National Association, as Administrative Agent, Capital One, N.A., as Syndication Agent, PNC Capital Markets, LLC, as a Lead Arranger and Book Manager, and Capital One, N.A., as a Lead Arranger and Book Manager (previously filed as Exhibit 10.1 to the Trust’s Current Report on Form 8-K (File No. 1-07533), filed on November 28, 2011 and incorporated herein by reference)
10.35		Form of Restricted Share Award Agreement for front loaded awards made under the Trust’s Long-Term Incentive Award Program for shares issued out of the 2010 Plan (filed herewith)
10.36		Form of Restricted Share Award Agreement for long-term vesting and retention awards made under the Trust’s Long-Term Incentive Award Program for shares issued out of the 2010 Plan (filed herewith)
10.37		Form of Performance Share Award Agreement for shares awarded out of the 2010 Plan (filed herewith)
10.38		Revised Form of Restricted Share Award Agreement for awards made under the Trust’s Long-Term Incentive Award Program and the Trust’s Annual Incentive Bonus Program and basic awards with annual vesting for shares issued out of the 2010 Plan (filed herewith)

Exhibit No.		Description
21.1		Subsidiaries of Federal Realty Investment Trust (filed herewith)
23.1		Consent of Grant Thornton LLP (filed herewith)
31.1		Rule 13a-14(a) Certification of Chief Executive Officer (filed herewith)
31.2		Rule 13a-14(a) Certification of Chief Financial Officer (filed herewith)
32.1		Section 1350 Certification of Chief Executive Officer (filed herewith)
32.2		Section 1350 Certification of Chief Financial Officer (filed herewith)
101		The following materials from Federal Realty Investment Trust’s Quarterly Report on Form 10-K for the year ended December 31, 2012, formatted in XBRL (Extensible Business Reporting Language): (1) the Consolidated Balance Sheets, (2) the Consolidated Statements of Comprehensive Income, (3) the Consolidated Statement of Shareholders’ Equity, (4) the Consolidated Statements of Cash Flows, and (5) Notes to Consolidated Financial Statements that have been detail tagged.

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• Management contract or compensatory plan required to be filed as an exhibit pursuant to Item 15(b) of Form 10-K.

** Pursuant to Regulation S-K Item 601(b)(4)(iii), the Trust by this filing agrees, upon request, to furnish to the Securities and Exchange Commission a copy of other instruments defining the rights of holders of long-term debt of the Trust.