**UNITED
      STATES SECURITIES AND EXCHANGE COMMISSION**


**Washington,
      D.C. 20549**





**FORM
      10-K**





**FOR
      ANNUAL AND TRANSITION REPORTS PURSUANT TO SECTION 13 OR 15(d) OF
      THE**


**SECURITIES
      EXCHANGE ACT OF 1934**





**[X]**
            ANNUAL
                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                ACT OF
                1934





For
      the
      fiscal year ended December 31, 2006





OR





[  
              ]
            TRANSITION
                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                ACT OF
                1934





Commission
      File Number 001-12482





**GLIMCHER
      REALTY TRUST**


(Exact
      name of registrant as specified in its charter)


**Maryland**
              **31-1390518**(State
                  or other jurisdiction of
              (I.R.S.
                  Employerincorporation
                  or organization)
              Identification
                  No.)**150
                  East Gay Street**
              **43215****Columbus,
                  Ohio**
              (Zip
                  Code)(Address
                  of principal executive offices)




Registrant’s
      telephone number, including area code: **(614)
      621-9000**





Securities
      registered pursuant to Section 12(b) of the Act:


Title
                  of each class
              Name
                  of each exchange on which registered**Common
                  Shares of Beneficial Interest, par value $0.01 per
                  share**
              **New
                  York Stock Exchange****8
                  3⁄4% Series F Cumulative Redeemable Preferred Shares of
                  Beneficial**
              **New
                  York Stock Exchange****Interest,
                  par value $0.01 per share****8**1⁄8**%
                  Series G Cumulative Redeemable Preferred Shares of
                  Beneficial**
              **New
                  York Stock Exchange****Interest,
                  par value $0.01 per share**









Securities
      registered pursuant to Section 12(g) of the Act: **None**





Indicate
      by check mark if the Registrant is a well-known seasoned issuer, as defined
      in
      Rule 405 of the Securities Act. **Yes
      [X] No [_]**





Indicated
      by check mark if the Registrant is not required to file reports pursuant to
      Section 12 or Section 15(d) of the Securities Exchange Act of 1934. **Yes
      [_] No [X]**





Indicate
      by check mark whether the Registrant (1) has filed all reports required to
      be
      filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
      the
      preceding 12 months (or for such shorter period that the Registrant was required
      to file such reports), and (2) has been subject to such filing requirements
      for
      the past 90 days. **Yes
      [X] No [_]**





Indicate
      by check mark if disclosure of delinquent filers pursuant to Item 405 of
      Regulation S-K is not contained herein, and will not be contained, to the best
      of Registrant’s knowledge, in definitive proxy or information statements
      incorporated by reference in Part III of this Form 10-K or any amendment to
      this
      Form 10-K **[** **** **].**





Indicate
      by check mark whether the Registrant is a large accelerated filer, an
      accelerated filer, or a non-accelerated filer. See definition of “accelerated
      filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check
      One): **Large accelerated filer [X] Accelerated filer [_] Non-accelerated filer
      [_]**





Indicate
      by check mark whether the Registrant is a shell company (as defined in Rule
      12b-2 of the Exchange Act). **Yes
      [_** **]
      No [X]**




As
      of
      February 22, 2007, there were 36,787,254 Common Shares of Beneficial Interest
      outstanding, par value $0.01 per share.





The
      aggregate market value of the voting stock held by non-affiliates of the
      Registrant, based on the closing price of the Registrant’s Common Shares of
      Beneficial Interest as quoted on the New York Stock Exchange on June 30, 2006,
      was $891,387,425.




**Documents
      Incorporated By Reference**





Portions
      of the Glimcher Realty Trust Proxy Statement to be filed with the Securities
      and
      Exchange Commission within 120 days after the end of the year covered by this
      Form 10-K with respect to the Annual Meeting of Shareholders to be held on
      May
      11, 2007 are incorporated by reference into Part III of this
      Report.








**TABLE
      OF CONTENTS**





**Item
                  No.**
              
              **Form
                  10-K****Report
                  Page****PART
                  I**1.
              Business
              31A.
              Risk
                  Factors
              61B.
              Unresolved
                  Staff Comments
              122.
              Properties
              123.
              Legal
                  Proceedings
              194.
              Submission
                  of Matters to a Vote of Security Holders
              19**PART
                  II**5.
              Market
                  for Registrant's Common Equity, Related Shareholder Matters and
                  Issuer
                  Purchases of Equity Securities
              196.
              Selected
                  Financial Data
              197.
              Management's
                  Discussion and Analysis of Financial Condition and Results of
                  Operations
              217A.
              Quantitative
                  and Qualitative Disclosures About Market Risk
              398.
              Financial
                  Statements and Supplementary Data
              399.
              Changes
                  in and Disagreements with Accountants on Accounting and Financial
                  Disclosure
              399A.
              Controls
                  and Procedures
              409B.
              Other
                  Information
              42**PART
                  III**10.
              Trustees,
                  Executive Officers and Corporate Governance
              4211.
              Executive
                  Compensation
              4212.
              Security
                  Ownership of Certain Beneficial Owners and Management and Related
                  Shareholder Matters
              4213.
              Certain
                  Relationships and Related Transactions, and Trustee
                  Independence
              4214.
              Principal
                  Accounting Fees and Services
              4215.
              Exhibits
                  and Financial Statement Schedules
              43**Signatures**
              50







**PART
      I**





This
      Form
      10-K, together with other statements and information publicly disseminated
      by
      Glimcher Realty Trust (“GRT” or the “Registrant”), contains certain
      forward-looking statements within the meaning of Section 27A of the Securities
      Act of 1933, as amended, and Section 21E of the Securities Exchange Act of
      1934,
      as amended. Such statements are based on assumptions and expectations which
      may
      not be realized and are inherently subject to risks and uncertainties, many
      of
      which cannot be predicted with accuracy and some of which might not even be
      anticipated. Future events and actual results, financial and otherwise, may
      differ from the results discussed in the forward-looking statements. Risks
      and
      other factors that might cause differences, some of which could be material,
      include, but are not limited to: the effect of economic and market conditions;
      failure to increase mall store occupancy and same-mall operating income; tenant
      bankruptcies; bankruptcies of joint venture partners; rejection of leases by
      tenants in bankruptcy; the failure to qualify as a REIT (as hereinafter
      defined); failure to consummate financing, including the repayment of debt;
      financing and development risks, including lack of satisfactory equity and
      debt
      financing, construction and lease-up delays and cost overruns; the level and
      volatility of interest rates; increases in and new impairment charges; the
      consummation of asset sales at acceptable prices; the financial stability of
      tenants within the retail industry; the rate of revenue increases versus expense
      increases; the failure of the closing of the sale of properties to take place
      from time to time; the failure to attract innovative retailers; the failure
      to
      complete proposed acquisitions; the failure to sell properties as anticipated
      and the failure to achieve estimated sales prices and proceeds from the sale
      of
      such properties; the failure to achieve earnings and funds from operations
      targets or estimates; conflicts of interest with existing joint venture
      partners; the failure to complete planned redevelopments of properties; the
      failure of the Company to make additional investments in regional mall
      properties and redevelopment of properties; the failure of joint venture
      relationships; and the failure to fully recover tenant obligations for common
      area maintenance (“CAM”), taxes and other property expenses, as well as other
      risks listed from time to time in this Form 10-K and in GRT’s other reports
      filed with the Securities and Exchange Commission (“SEC”).





**Item
      1.**  **Business**





*(a)*
            *General
                Development of Business*





GRT,
      Glimcher Properties Limited Partnership (the “Operating Partnership,” “OP” or
“GPLP”) and entities directly or indirectly owned or controlled by GRT, on a
      consolidated basis, are hereinafter referred to as the “Company,” “we,” “us” or
“our.”





GRT
      is a
      fully-integrated, self-administered and self-managed Maryland real estate
      investment trust (“REIT”) which was formed on September 1, 1993 to continue the
      business of The Glimcher Company (“TGC”) and its affiliates, of owning, leasing,
      acquiring, developing and operating a portfolio of retail properties consisting
      of regional and super regional malls and community shopping centers. Enclosed
      regional and super regional malls in which we hold an ownership position
      (including joint venture interests) are referred to as “Malls” and community
      shopping centers in which we hold an ownership position are referred to as
      “Community Centers.” The Malls and Community Centers may from time to time be
      individually referred to herein as a “Property” and collectively referred to
      herein as the “Properties.” On January 26, 1994, GRT consummated an initial
      public offering (the “IPO”) of 18,198,000 of its common shares of beneficial
      interest (the “Common Shares”) including 2,373,750 over allotment option shares.
      The net proceeds of the IPO were used by GRT primarily to acquire (at the time
      of the IPO) an 86.2% interest in the Operating Partnership, a Delaware limited
      partnership of which Glimcher Properties Corporation (“GPC”), a Delaware
      corporation and a wholly owned subsidiary of GRT, is sole general partner.
      At
      December 31, 2006, GRT held a 91.9% interest in the Operating
      Partnership.





The
      Company does not engage or pay a REIT advisor. Management, leasing, accounting,
      legal, design and construction supervision expertise is provided through its
      own
      personnel, or, where appropriate, through outside professionals.




*(b)*
            *Narrative
                Description of Business*





General: The
      Company is a recognized leader in the ownership, management, acquisition and
      development of regional and super-regional malls. At December 31, 2006, the
      Properties consisted of 26 Malls (24 wholly-owned and 2 partially owned through
      a joint venture) containing an aggregate of 23.7 million square feet of gross
      leasable area (“GLA”) and 4 Community Centers containing an aggregate of 1.0
      million square feet of GLA.





3


For
      purposes of computing occupancy statistics, anchors are defined as tenants
      whose
      space is equal to or greater than 20,000 square feet of GLA. This definition
      is
      consistent with the industry’s standard definition determined by the
      International Council of Shopping Centers (“ICSC”). All tenant spaces less than
      20,000 square feet and outparcels are considered to be stores. The Company
      computes occupancy on an economic basis, which means only those spaces where
      the
      store is open or the tenant is paying rent are considered as occupied. The
      Company includes GLA for certain anchors and outparcels that are owned by third
      parties. Mall anchors, which are owned by third parties and are open and/or
      are
      obligated to pay the Company charges, are considered occupied when reporting
      occupancy statistics. Community Center anchors owned by third parties are
      excluded from the Company’s GLA. These differences in treatment between Malls
      and Community Centers are consistent with industry practice. Outparcels at
      both
      Community Center and Mall Properties are included in GLA if the Company owns
      the
      land or building. The outparcels where a third party owns the land and
      buildings, but contributes nominal ancillary charges are excluded from GLA.





As
      of
      December 31, 2006, the occupancy rate for all of the Properties was 92.8% of
      GLA. The occupied GLA was leased at 84.8%, 8.0% and 7.2% to national, regional
      and local retailers, respectively. The Company’s focus is to maintain high
      occupancy rates for the Properties by capitalizing on management’s long-standing
      relationships with national and regional tenants and its extensive experience
      in
      marketing to local retailers.





As
      of
      December 31, 2006, the Properties had annualized minimum rents of $235.1
      million. Approximately 79.1%, 7.3% and 13.6% of the annualized minimum rents
      of
      the Properties as of December 31, 2006 were derived from national, regional
      and
      local retailers, respectively. No single tenant represents more than 5.0% of
      the
      aggregate annualized minimum rents of the Properties as of December 31, 2006.





Malls: The
      Malls provide a broad range of shopping alternatives to serve the needs of
      customers in all market segments. Each Mall is anchored by multiple department
      stores such as Belk’s, The Bon-Ton, Boscov’s, Dillard’s, Elder-Beerman,
      JCPenney, Kohl’s, Macy’s, Nordstrom, Parisian, Saks, Sears and Von Maur. Mall
      stores, most of which are national retailers, include Abercrombie & Fitch,
      American Eagle Outfitters, Banana Republic, Barnes & Noble, Bath & Body
      Works, The Disney Store, Finish Line, Foot Locker, Gap, Hallmark, Kay Jewelers,
      The Limited, Limited Express, New York and Company, Old Navy, Pacific Sunwear,
      Radio Shack, Victoria’s Secret, Waldenbooks and Zales Jewelers. To provide a
      complete shopping, dining and entertainment experience, the Malls generally
      have
      at least one theme restaurant, a food court which offers a variety of fast
      food
      alternatives, and, in certain Malls, multiple screen movie theaters and other
      entertainment activities. The largest operating Mall has 1.6 million square
      feet
      of GLA and approximately 160 stores, while the smallest has 442,000 square
      feet
      of GLA and approximately 60 stores. The Malls also have additional restaurants
      and retail businesses, such as P.F. Chang’s, The Palm, Red Lobster, Best Buy and
      Pier One, located along the perimeter of the parking areas.





As
      of
      December 31, 2006, the Malls accounted for 95.8% of the total GLA, 96.3% of
      the
      aggregate annualized minimum rents of the Properties and had an overall
      occupancy rate of 93.3%.





Community
      Centers: The
      Company’s Community Centers are designed to attract local and regional area
      customers and are typically anchored by a combination of discount department
      stores, supermarkets or drug stores (“Community Anchors”) which attract shoppers
      to each center’s smaller shops. The tenants at the Company’s Community Centers
      typically offer day-to-day necessities and value-oriented merchandise. Community
      Anchors include nationally recognized retailers such as JCPenney and Kmart,
      and
      supermarkets such as Kroger. Many of the Community Centers have retail
      businesses or restaurants located along the perimeter of the parking
      areas.




As
      of
      December 31, 2006, Community Centers accounted for 4.2% of the total GLA, 3.7%
      of the aggregate annualized minimum rents of the Properties and had an overall
      occupancy rate of 82.2%.





Growth
      Strategies and Operating Policies: Management of the Company believes per share growth in both net income and
      funds
      from operations (“FFO”) are important factors in enhancing shareholder value.
      The Company believes that the presentation of FFO provides useful information
      to
      investors and a relevant basis for comparison among REITS. Specifically, the
      Company believes that FFO is a supplemental measure of the Company’s operating
      performance as it is a recognized standard in the real estate industry, in
      particular, real estate investment trusts. The National Association of Real
      Estate Investment Trusts (“NAREIT”) defines FFO as net income (loss) available
      to common shareholders (computed in accordance with Generally Accepted
      Accounting Principles (“GAAP”)), excluding gains or losses from sales of
      depreciable property, plus real estate related depreciation and amortization
      and
      after adjustments for unconsolidated partnerships and joint ventures. FFO does
      include impairment losses for properties held for use and held-for-sale. The
      Company’s FFO may not be directly comparable to similarly titled measures
      reported by other real estate investment trusts. FFO does not represent cash
      flow from operating activities in accordance with GAAP and should not be
      considered as an alternative to net income (determined in accordance with GAAP)
      as an indication of the Company’s financial performance or to cash flow from
      operating activities (determined in accordance with GAAP) as a measure of the
      Company’s liquidity, nor is it indicative of funds available to fund the
      Company’s cash needs, including its ability to make cash distributions. A
      reconciliation of FFO to net income available to common shareholders is provided
      in Item 7 of this Form 10-K.





4


GRT
      intends to operate in a manner consistent with the requirements of the Internal
      Revenue Code of 1986, as amended (the “Code”), applicable to REITs and related
      regulations with respect to the composition of the Company’s portfolio and the
      derivation of income unless, because of circumstances or changes in the Code
      (or
      any related regulation), the trustees of GRT determine that it is no longer
      in
      the best interests of GRT to qualify as a REIT.





The
      Company’s acquisition strategies are to selectively acquire strategically
      located properties in markets where management has extensive operating
      experience and/or have significant growth potential. Such strategy is focused
      on
      dominant anchored retail properties within the top 100 metropolitan markets
      by
      population that have near-term upside potential or offer advantageous
      opportunities for the Company.





The
      following factors, among others, are considered by the Company in making
      acquisitions: (i) the geographic area and type of property; (ii) the location,
      construction quality, condition and design of the property; (iii) the current
      FFO generated by the property and the ability to increase FFO through property
      repositioning and proactive management of the tenant base; (iv) the potential
      for capital appreciation; (v) the terms of tenant leases; (vi) the existing
      tenant mix at the property; (vii) the potential for economic growth and the
      tax
      and regulatory environment of the communities in which the property is located;
      (viii) the occupancy rates and demand by tenants for properties of similar
      type
      in the vicinity; and (ix) the prospects for financing or refinancing the
      property.





The
      Company acquires and develops its Properties as long-term investments.
      Therefore, its focus is to provide for regular maintenance of its Properties
      and
      to conduct periodic renovations and refurbishments to preserve and increase
      Property values while also increasing the retail sales prospects of its tenants.
      The projects usually include renovating existing facades, installing uniform
      signage, updating interior decor, replacement of roofs and skylights,
      resurfacing parking lots and increasing parking lot lighting. To meet the needs
      of existing or new tenants and changing consumer demands, the Company also
      reconfigures and expands its Properties, including utilizing land available
      for
      expansion and development of outparcels or the addition of new anchors. In
      addition, the Company works closely with its tenants to renovate their stores
      and enhance their merchandising capabilities.




Financing
      Strategies: At
      December 31, 2006, the Company had a total-debt-to-total-market capitalization
      ratio of 55.3% based upon the closing price of the Common Shares on the New
      York
      Stock Exchange as of December 31, 2006. The Company is working to maintain
      this
      ratio in the mid-fifty percent range by managing outstanding debt and increasing
      the value of its outstanding Common Shares. The Company expects that it may,
      from time to time, re-evaluate its policy with respect to its ratio of
      total-debt-to-total-market capitalization in light of then current economic
      conditions; relative costs of debt and equity capital; market values of its
      Properties; acquisition, development and expansion opportunities; and other
      factors, including meeting the taxable income distribution requirement for
      REITs
      under the Code, in the event the Company has taxable income without receipt
      of
      cash sufficient to enable the Company to meet such distribution requirements.
      The Company’s preference is to obtain fixed rate, long-term debt for its
      Properties. At December 31, 2006, 85.6% of total Company debt was fixed rate.
      Shorter term and variable rate debt typically is employed for Properties
      anticipated to be expanded or redeveloped.





Competition: All of
      the Properties are located in areas that have shopping centers and/or malls
      and
      other retail facilities. Generally, there are other retail properties within
      a
      five-mile radius of a Property. The amount of rentable retail space in the
      vicinity of the Company’s Properties could have a material adverse effect on the
      amount of rent charged by the Company and on the Company’s ability to rent
      vacant space and/or renew leases of such Properties. There are numerous
      commercial developers, real estate companies and major retailers that compete
      with the Company in seeking land for development, properties for acquisition
      and
      tenants for properties, some of which may have greater financial resources
      than
      the Company and more operating or development experience than that of the
      Company. There are numerous shopping facilities that compete with the Company’s
      Properties in attracting retailers to lease space. In addition, retailers at
      the
      Properties may face increasing competition from e-commerce, outlet malls,
      discount shopping clubs, catalog companies, direct mail, telemarketing and
      home
      shopping networks.





Employees: At
      December 31, 2006, the Company had an aggregate of 1,168 employees, of which
      565
      were part-time.





Seasonality: The
      shopping center industry is seasonal in nature, particularly in the Company’s
      fourth quarter during the holiday season when retailer occupancy and retail
      sales are typically at their highest levels. In addition, shopping malls achieve
      a substantial portion of their specialty (temporary retailer) rents during
      the
      holiday season.





5


Tax
      Status: GRT
      believes it has been organized and operated in a manner that qualifies for
      taxation as a REIT and intends to continue to be taxed as a REIT under Sections
      856 through 860 of the Code. As such, GRT generally will not be subject to
      federal income tax to the extent it distributes at least 90.0% of its REIT
      ordinary taxable income to its shareholders. Additionally, the Company must
      satisfy certain requirements regarding its organization, ownership and certain
      other requirements, such as a requirement that its shares be transferable.
      Moreover, the Company must meet certain tests regarding its income and assets.
      At least 75.0% of the Company’s gross income must be derived from passive income
      closely connected with real estate activities. In addition, 95.0% of the
      Company’s gross income must be derived from these same sources, plus dividends,
      interest and certain capital gains. To meet the asset test, at the close of
      each
      quarter of the taxable year, at least 75.0% of the value of the total assets
      must be represented by real estate assets, cash and cash equivalent items
      (including receivables), and government securities. Additionally, to qualify
      as
      a REIT, there are several rules limiting the amount and type of securities
      that
      GRT can own, including the requirement that not more than 25.0% of the value
      of
      its total assets can be represented by securities. If GRT fails to meet the
      requirements to qualify for REIT status, the Company may cease to qualify as
      a
      REIT and may be subject to certain penalty taxes. If the Company fails to
      qualify as a REIT in any taxable year, the Company will be subject to federal
      income tax (including any applicable alternative minimum tax) on its taxable
      income at regular corporate rates. As a qualified REIT, the Company is subject
      to certain state and local taxes on its income and property and to federal
      income and excise taxes on its undistributed income.





*(c)*
            *Available
                information*





GRT
      files
      this Form 10-K and other periodic reports and statements electronically with
      the
      SEC. The SEC maintains an Internet site that contains reports, proxy and
      information statements, and other information provided by issuers at http://www.sec.gov .
      GRT’s
      reports, including amendments, are also available free of charge on its website, www.glimcher.com ,
      as soon
      as reasonably practical after such reports are filed with the SEC. Information
      on this website is not considered part of this filing. GRT’s Corporate
      Governance Guidelines, Code of Business Conduct and Ethics, Code of Ethics
      for
      Senior Financial Officers, Audit Committee Charter, Amended and Restated
      Executive Compensation Committee Charter and Amended and Restated Nominating
      and
      Corporate Governance Committee Charter are available on the Company’s website
      and copies of each are available in print to any shareholder who requests them.





**Item
      1A. Risk Factors**





There
      are
      a number of factors that affect our business and the results of our operations,
      many of which are beyond our control. The following is a description of the
      most
      significant factors that might cause the actual results of operations in future
      periods to differ materially from those currently expected or
      desired.





*We
      are subject to risks inherent in owning real estate
      investments.*




Real
      property investments are subject to varying degrees of risk. Our ability to
      make
      dividend distributions may be adversely affected by the economic climate and
      certain local conditions including:




●
            oversupply
                of space or reduced demand for rental space and newly developed
                properties;




●
            the
                attractiveness of our properties compared to other retail space;




●
            our
                ability to provide adequate maintenance to our properties; and




●
            fluctuations
                in real estate taxes, insurance and other operating costs.




Applicable
      laws, including tax laws, interest rate levels and the availability of
      financing, may adversely affect our income and real estate values. In addition,
      real estate investments are relatively illiquid and, therefore, our ability
      to
      sell our properties quickly may be limited. We cannot be sure that we will
      be
      able to lease space as tenants move out or as to the rents we may be able to
      charge new tenants at such space.




*Our
      insurance coverage in the future may not include adequate amounts of terrorism
      insurance.*





Our
      all
      risk property insurance policies include coverage for foreign and domestic
      acts
      of terrorism on our consolidated real estate assets through January 1, 2008.
      In
      the future, insurers may limit the amount of coverage available to us for
      terrorism insurance on our properties (or we may not be able to obtain such
      insurance at all), or the cost of property and liability insurance policies
      including coverage for acts of terrorism may be unreasonable. As a result,
      there
      can be no assurance that we will be able to obtain adequate amounts of terrorism
      insurance on our properties after January 1, 2008 or, if we can, that the
      premiums for the insurance will be reasonable.





6


*We
      rely on major tenants.*




At
      December 31, 2006, our three largest tenants were Gap, Inc., Foot Locker, Inc.
      and Limited Brands, Inc., representing 3.0%, 2.7% and 2.6% of our annualized
      minimum rents, respectively. No other tenant represented more than 2.0% of
      the
      aggregate annualized minimum rents of our properties as of such date. Our
      financial position and ability to make distributions may be adversely affected
      by the bankruptcy, insolvency, or general downturn in the business of any such
      tenant, or in the event any such tenant does not renew a number of its leases
      as
      they expire.




*Bankruptcy
      of our tenants or downturns in our tenants’ businesses may reduce our cash
      flow.*




Since
      we
      derive almost all of our income from rental payments, our cash available for
      distribution would be adversely affected if a significant number of our tenants
      were unable to meet their obligations to us, or if we were unable to lease
      vacant space in our properties on economically favorable terms. A tenant may
      seek the protection of the bankruptcy laws, which could result in the
      termination of its lease causing a reduction in our cash available for
      distribution. A downturn in a tenant’s business may result in a reduction in the
      rent based on a percentage of the tenant’s sales. Furthermore, certain of our
      tenants, including anchor tenants, hold the right under their lease(s) to
      terminate their lease(s) or reduce their rental rate if certain occupancy
      conditions are not met, if certain anchor tenants close, if certain sales levels
      or profit margins are not achieved, or if an exclusive use provision is
      violated.




*We
      face significant competition that may decrease the occupancy and rental rates
      of
      our properties.*




We
      compete with many commercial developers, real estate companies and major
      retailers. Some of these entities develop or own malls, value-oriented retail
      properties and community shopping centers that compete for tenants. We face
      competition for prime locations and for tenants. New regional malls or other
      retail shopping centers with more convenient locations or better rents may
      attract tenants or cause them to seek more favorable lease terms at or prior
      to
      renewal. Retailers at our properties may face increasing competition from other
      retailers, e-commerce, outlet malls, discount shopping clubs, catalog companies,
      direct mail, telemarketing and home shopping networks all of which could affect
      their ability to pay rent or desire to occupy the property.




*The
      failure to fully recover from tenants cost reimbursements for CAM, taxes and
      insurance could adversely affect our operating results.*




The
      computation of cost reimbursements from tenants for CAM, insurance and real
      estate taxes is complex and involves numerous judgments including interpretation
      of terms and other tenant lease provisions. Most tenants make monthly fixed
      payments of CAM, real estate taxes and other cost reimbursements items. After
      the end of the calendar year, we compute each tenant’s final cost reimbursements
      and issue a bill or credit for the full amount, after considering amounts paid
      by the tenants during the year. Final adjustments for the year ended December
      31, 2006 have not yet been determined. At December 31, 2006, we had recorded
      in
      accounts receivables $3.3 million of costs expected to be recovered from tenants
      during the first six months of 2007. There can be no assurance that we will
      collect all or substantially all of this amount.




*The
      results of operations for our properties depend on the economic conditions
      of
      the regions of the United States in which they are located.*




Our
      results of operations and distributions to you will be subject generally to
      economic conditions in the regions in which our properties are located. For
      the
      year ended December 31, 2006, approximately 33% of annualized minimum rents
      came
      from our properties located in Ohio.




*We
      may be unable to successfully develop properties or operate developed
      properties.*




As
      a
      result of economic and other conditions and required government approvals,
      development projects may not be pursued or may be completed later or with higher
      costs than anticipated. Development activities involve significant risks,
      including:




·
            the
                expenditure of funds on and devotion of time to projects which may
                not
                come to fruition;




7


·
            increased
                construction costs, possibly making the project uneconomical;




·
            an
                inability to obtain construction financing and permanent financing
                on
                favorable terms; and




·
            occupancy
                rates and rents not sufficient to make a project profitable.




In
      the
      event of an unsuccessful development project, our loss could exceed our
      investment in the project.




*We
      could incur significant costs related to environmental issues.*




Under
      some environmental laws, a current or previous owner or operator of real
      property, and parties that generate or transport hazardous substances that
      are
      disposed of on real property, may be liable for the costs of investigating
      and
      remediating these substances on or under the property. In connection with the
      ownership or operation of our properties, we could be liable for such costs
      which could be substantial and even exceed the value of such property or the
      value of our aggregate assets. The failure to remediate toxic substances may
      adversely affect our ability to sell or rent any of our properties or to borrow
      funds. In addition, environmental laws may require us to expend substantial
      sums
      in order to use our properties or operate our business.




We
      have
      established a contingency reserve for one environmental matter as noted in
      Note
      13 of our consolidated financial statements.




*Our
      assets may be subject to impairment charges that may materially affect our
      financial results.*




We
      evaluate our real estate assets and other assets for impairment indicators
      whenever events or changes in circumstances indicate that recoverability of
      our
      investment in the asset is not assured. This evaluation is conducted
      periodically, but no less frequently than quarterly. Our determination of
      whether a particular held-for-use asset is impaired is based upon the
      undiscounted projected cash flows used for the impairment analysis and our
      determination of the asset’s estimated fair value that in turn are based upon
      our plans for the respective asset and our views of market and economic
      conditions. With respect to assets held-for-sale, our determination of whether
      such an asset is impaired is based upon market and economic conditions. If
      we
      determine that a significant impairment has occurred, then we would be required
      to make an adjustment to the net carrying value of the asset, which could have
      a
      material adverse effect on our results of operations and funds from operations
      in the period in which the adjustment is made. Furthermore, changes in estimated
      future cash flows due to a change in our plans or views of market and economic
      conditions could result in the recognition of additional impairment losses
      for
      already impaired assets, which, under the applicable accounting guidance, could
      be substantial.




*We
      may incur significant costs of complying with the Americans with Disabilities
      Act and similar laws.*




We
      may be
      required to expend significant sums of money to comply with the Americans with
      Disabilities Act of 1990, as amended (“ADA”), and other federal and local laws
      in order for our properties to meet requirements related to access and use
      by
      disabled persons. We may incur additional costs when complying with the ADA
      in
      the future.




*Our
      failure to qualify as a REIT would have serious adverse
      consequences.*




GRT
      believes that it has qualified as a REIT under the Code, since 1994, but cannot
      be sure that it will remain so qualified. Qualification as a REIT involves
      the
      application of highly technical and complex Code provisions, and the
      determination of various factual matters and circumstances not entirely within
      GRT’s control that may impact GRT’s ability to qualify as a REIT under the Code.
      In addition, GRT cannot be sure that new laws, regulations and judicial
      decisions will not significantly change the tax laws relating to REITs, or
      the
      federal income tax consequences of REIT qualification.




If
      GRT
      fails to qualify as a REIT, it will be subject to federal income tax (including
      any applicable alternative minimum tax) on taxable income at regular corporate
      income tax rates. Additionally, unless entitled to relief under certain
      statutory provisions, GRT will also be disqualified from electing to be treated
      as a REIT for the four taxable years following the year during which the
      qualification is lost, thereby reducing net earnings available for investment
      or
      distribution to you because of the additional tax liability imposed for the
      year
      or years involved. Lastly, GRT would no longer be required by the Code to make
      any dividend distributions as a condition to REIT qualification. To the extent
      that dividend distributions to you may have been made in anticipation of
      qualifying as a REIT, we might be required to borrow funds or to liquidate
      certain of our investments to pay the applicable tax.




8


*Our
      ownership interests in certain partnerships and other ventures are subject
      to
      certain tax risks.*




Some
      of
      our property interests and other investments are made or held through entities
      in which we have an interest (the “Subsidiary Partnerships”). The tax risks of
      this type of ownership include possible challenge by the Internal Revenue
      Service of allocations of income and expense items which could affect the
      computation of our taxable income, or a challenge to the status of any such
      entities as partnerships (as opposed to associations taxable as corporations)
      for federal income tax purposes, as well as the possibility of action being
      taken by such entities that could adversely affect GRT’s qualification as a
      REIT, for example, by requiring the sale of a property. We believe that the
      entities in which we have an interest have been and will be treated for tax
      purposes as partnerships (and not treated as associations taxable as
      corporations). If our ownership interest in any entity taxable as a corporation
      exceeded 10% (in terms of vote or value) of such entity’s outstanding securities
      (unless such entity were a “taxable REIT subsidiary,” or a “qualified REIT
      subsidiary,” as those terms are defined in the Code) or the value of interest in
      any such entity exceeded 5% of the value of our assets, then GRT would cease
      to
      qualify as a REIT; distributions from any of these entities would be treated
      as
      dividends, to the extent of earnings and profits, and we would not be able
      to
      deduct our share of losses, if any, generated by such entity in computing our
      taxable income.




*We
      may not have access to other sources of funds necessary to meet our REIT
      distribution requirements.*




In
      order
      to qualify to be taxed as a REIT, we must make annual distributions to our
      shareholders of at least 90% of our taxable income (determined by excluding
      any
      net capital gain). The amount available for distribution will be affected by
      a
      number of factors, including the operation of our properties. We have sold
      a
      number of non-core assets and intend in the future to sell additional selected
      non-core assets. The loss of rental income associated with our properties sold
      will in turn affect net income and FFO. In order to maintain REIT status, we
      may
      be required to make distributions in excess of net income and FFO. In such
      a
      case, it may be necessary to arrange for short-term (or possibly long-term)
      borrowings, or to issue preferred or other securities, to raise funds, which
      may
      not be possible.




*Debt
      financing could adversely affect our performance.*




As
      of
      December 31, 2006, we had $1.6 billion of combined mortgage indebtedness and
      outstanding borrowings under our credit facility, of which $107.2 million
      matures during 2007. After the payoff of a $25.0 million loan on January 22,
      2007, $82.2 million remains scheduled to mature in 2007. As of December 31,
      2006, we have borrowed $272.0 million from our credit facility, which matures
      on
      December 13, 2009. A number of our outstanding loans will require lump sum
      or
“balloon” payments for the outstanding principal balance at maturity, and we may
      finance future investments that may be structured in the same manner. Our
      ability to repay indebtedness at maturity, or otherwise, may depend on our
      ability to either refinance such indebtedness or to sell our properties. If
      we
      are unable to repay any of our debt at or before maturity, then we may have
      to
      borrow against our properties that are not encumbered or from our credit
      facility, to the extent it has availability thereunder, to make such repayments.
      In addition, a lender could foreclose on one or more of our properties to
      collect its debt. This could cause us to lose part or all of our investment,
      which could reduce the value of the Common Shares and the distributions payable
      to you.




*Certain
      of our financing arrangements contain limitations on the amount of debt that
      we
      may incur.*




Our
      $470
      million unsecured credit facility is the most restrictive of our financing
      arrangements. Accordingly, at December 31, 2006, the additional amount that
      may
      be borrowed from this facility or other sources based upon the restrictive
      covenants in the credit facility is $318.4 million. Additional amounts could
      be
      borrowed as long as we maintain a ratio of total-debt-to-total-asset value
      that
      complies with the restrictive covenants of the credit facility. The ratio of
      total-debt-to-total-market capitalization was 55.3% as of December 31, 2006.
      As
      used herein, “total market capitalization” means the sum of the outstanding
      amount of all indebtedness, the total liquidation preference of all preferred
      shares and the total market value of the outstanding Common Shares and the
      units
      of operating partnership interest in GPLP (“OP Units”) (based on the closing
      price of the Common Shares on December 31, 2006).







9




*Our
      financial condition and distributions could be adversely affected by financial
      covenants.*




Our
      mortgage indebtedness and credit facility impose certain financial and operating
      restrictions on our properties and restrictions on secured subordinated
      financing and financings on properties. These restrictions include restrictions
      on borrowings, prepayments and distributions. Additionally, our credit facility
      requires certain financial tests to be met and some of our mortgage indebtedness
      provides for prepayment penalties, each of which could restrict financial
      flexibility.




*Our
      variable rate debt obligations may impede our operating performance and put
      us
      at a competitive disadvantage, as well as adversely affect our ability to pay
      distributions to you.*




Required
      repayments of debt and related interest can adversely affect our operating
      performance. As of December 31, 2006, approximately $227.0 million of our
      indebtedness bears interest at a variable rate. Accordingly, an increase in
      interest rates on our existing indebtedness would increase interest expense,
      which could adversely affect our cash flow and ability to pay distributions.
      For
      example, if market rates of interest on our variable rate debt outstanding
      as of
      December 31, 2006, increased by 100 basis points, the increase in interest
      expense on our existing variable rate debt would decrease future earnings and
      cash flows by approximately $2.3 million annually.




*An
      increase in interest rates or total-debt-to-total-market capitalization could
      cause a decrease in the market price of the outstanding Common
      Shares.*




We
      believe that investors generally perceive REITs as yield-driven investments
      and
      compare the annual yield from distributions by REITs with yields on various
      other types of financial instruments. Thus, an increase in market interest
      rates
      generally could adversely affect the market price of Common Shares.
      Additionally, investors may react negatively to an increase in
      total-debt-to-total-market capitalization.




*The
      Board of Trustees has unlimited authority to increase the amount of debt that
      we
      may incur.*




The
      Board
      of Trustees (the “Board”) determines financing objectives and the amount of the
      indebtedness that we may incur and may make revisions to these objectives at
      any
      time without a vote of our shareholders. Although the Board has no present
      intention to change these objectives, revisions could result in a more highly
      leveraged company with an increased risk of default on indebtedness and an
      increase in debt service charges.




*Our
      issuance of additional Common Shares may affect prevailing market prices for
      the
      outstanding Common Shares.*




Future
      sales or the anticipation of such sales of additional Common Shares may have
      an
      adverse effect on the market price of our Common Shares.




*Our
      ability to operate or dispose of any partially-owned properties that we may
      acquire may be restricted.*




Our
      ownership of properties through partnership or joint venture investments may
      involve risks not otherwise present for wholly-owned properties. These risks
      include the possibility that our partners or co-venturers might become bankrupt,
      might have economic or other business interests or goals which are inconsistent
      with our business interests or goals and may be in a position to take action
      contrary to our instructions or make requests contrary to our policies or
      objectives, including our policy to maintain our qualification as a REIT. We
      may
      need the consent of our partners for major decisions affecting properties that
      are partially-owned. Joint venture agreements may also contain provisions that
      could force us to sell all of our interest in, or buy all of our partners’
interests in, such entity or property. These provisions may be triggered at
      a
      time when it is not advantageous for us to either buy our partners’ interests or
      sell our interest. Additionally, if we serve as the managing member of a
      property-owning joint venture, we may have certain fiduciary responsibilities
      to
      the other participants in such entity. There is no limitation under our
      organizational documents as to the amount of funds that may be invested in
      partnerships or joint ventures; however, covenants of our unsecured credit
      facility limit the amount of capital that we may invest in joint ventures at
      any
      one time.







10




*We
      are subject to certain conflicts of interest and limitations on property
      sales.*




Pursuant
      to GPLP’s limited partnership agreement, GPLP may not sell all or substantially
      all of its assets without the consent of the holders of a majority of the OP
      Units, excluding GRT, if limited partners (other than GRT) at the time of the
      sale own in the aggregate ten percent or greater of the outstanding OP Units.
      At
      the present time, GRT owns 91.9% of the outstanding OP Units, resulting in
      the
      consent not being required. However, should limited partners (excluding GRT)
      own
      10% or greater of the outstanding OP Units in the future, the majority vote
      requirement would effectively mean that Herbert Glimcher, the Chairman of the
      Board, and his sons, David Glimcher and Michael Glimcher, the President, Chief
      Executive Officer and a Trustee of GRT, must approve any such transaction
      because, together with their spouses, they own approximately 4.9% of the OP
      Units (which constitutes a majority of the OP Units other than those owned
      by
      GRT) outstanding as of December 31, 2006.




As
      a
      result of Herbert Glimcher’s, David Glimcher’s and Michael Glimcher’s status as
      holders of both Common Shares and OP Units, they have interests that conflict
      with GRT shareholders with respect to business decisions affecting GRT and
      GPLP.
      In particular, as holders of OP Units, they may suffer different and/or more
      adverse tax consequences than GRT upon the sale or refinancing of some of our
      properties due to unrealized gains attributable to these properties. Therefore,
      GRT may have objectives different from Herbert Glimcher, David Glimcher and
      Michael Glimcher regarding the appropriate pricing and timing of any sale or
      refinancing of certain of our properties. Although GRT (through a wholly owned
      subsidiary), as the sole general partner of GPLP, has the exclusive authority
      as
      to whether and on what terms to sell, refinance, or seek to purchase an interest
      in an individual property, Herbert Glimcher, David Glimcher and Michael Glimcher
      might seek to influence decisions with respect to these actions, even though
      those actions might otherwise be financially advantageous or adverse to GRT.
      They also may seek to influence management to refinance one or more of our
      properties with a higher level of debt than would be in GRT’s best
      interests.




*Our
      charter and bylaws and the laws of the state of our incorporation contain
      provisions that may delay, defer or prevent a change in control or other
      transactions that could provide shareholders with the opportunity to realize
      a
      premium over the then-prevailing market price for our Common
      Shares.*




In
      order
      to maintain GRT’s qualification as a REIT for federal income tax purposes, not
      more than 50% in value of the outstanding Common Shares may be owned, directly
      or indirectly, by five or fewer individuals (as defined in the Code to include
      certain entities) at any time during the last half of the taxable year.
      Additionally, 100 or more persons must beneficially own the outstanding Common
      Shares during the last 335 days of a taxable year of 12 months or during a
      proportionate part of a shorter tax year.




To
      ensure
      that GRT will not fail to qualify as a REIT under this test, GRT’s
      organizational documents authorize the Board to take such action as may be
      required to preserve GRT’s qualification as a REIT and to limit any person,
      other than Herbert Glimcher, David Glimcher (only with respect to the limitation
      on the ownership of outstanding Common Shares) and any entities or persons
      approved by the Board, to direct or indirect ownership exceeding (i) 8.0% of
      the
      lesser of the number or value of the outstanding Common Shares, (ii) 9.9% of
      the
      lesser of the number or value of the total 83⁄4% Series F Cumulative Redeemable
      Preferred Shares of Beneficial Interest (“Series F Preferred Shares”)
      outstanding and (iii) 9.9% of the lesser of the number or value of the total
      81⁄8%
      Series G Cumulative Redeemable Preferred Shares of Beneficial Interest (“Series
      G Preferred Shares”) outstanding. Herbert Glimcher and David Glimcher are
      limited to an aggregate of 25% direct or indirect ownership of Common Shares
      outstanding without approval of the Board. The Board has also granted an
      exemption to Cohen & Steers Capital Management, Inc., permitting them to
      own, directly or indirectly, of record or beneficially (i) up to 600,000 Series
      F Preferred Shares and (ii) up to 14.9% of the lesser of the number or value
      of
      the outstanding shares of any other class of the GRT’s equity securities. The
      Board has also granted an exemption to Neuberger Berman permitting them to
      own
      608,800 Series G Preferred Shares. However, in no event, shall they be permitted
      to own, directly or indirectly, of record or beneficially, more than 14.9%
      of
      the lesser of the number or value of all outstanding shares of GRT’s equity
      securities. Despite these provisions, GRT cannot be sure that there will not
      be
      five or fewer individuals who will own more than 50% in value of its outstanding
      Common Shares, thereby causing GRT to fail to qualify as a REIT. The ownership
      limits may also discourage a change of control in GRT.




The
      members of the Board are currently divided into three equal classes whose terms
      expire in 2007, 2008 and 2009, respectively. Each year one class of trustees
      is
      elected by GRT’s shareholders to hold office for three years. The staggered
      terms for Board members may affect the ability of GRT shareholders to change
      control of GRT even if a change in control were in the interests of the
      shareholders.




11


GRT’s
      Amended and Restated Declaration of Trust, as amended (the “Declaration of
      Trust”) authorizes the Board to establish one or more series of preferred
      shares, in addition to those currently outstanding, and to determine the
      preferences, rights and other terms of any series. The Board could authorize
      GRT
      to issue other series of preferred shares that could deter or impede a merger,
      tender offer or other transaction that some, or a majority, of GRT shareholders
      might believe to be in their best interest or in which GRT shareholders might
      receive a premium for their shares over the then current market price of such
      shares.




On
      March
      9, 1999, GRT adopted a shareholder rights plan. Under the terms of the rights
      plan, the Board can in effect prevent a person or group from acquiring more
      than
      15% of the outstanding Common Shares. Unless the Board approves of such person’s
      purchase, after that person acquires more than 15% of the outstanding Common
      Shares, all other shareholders will have the right to purchase Common Shares
      from GRT at a price that is half of their then fair market value. These
      purchases by the other shareholders would substantially reduce the value and
      influence of the Common Shares owned by the acquiring person. The Board,
      however, can prevent the rights plan from operating in this manner. This gives
      the Board significant discretion to approve or disapprove of a person’s efforts
      to acquire a large interest in GRT and, accordingly, may discourage a change
      in
      control of GRT.




The
      Declaration of Trust and Amended and Restated Bylaws also contain other
      provisions that may delay or prevent a transaction or a change in control that
      might involve a premium price for the Common Shares or otherwise be in the
      best
      interests of GRT’s shareholders. As a Maryland REIT, GRT is subject to the
      provisions of the Maryland REIT law which imposes restrictions on some business
      combinations and requires compliance with statutory procedures before some
      mergers and acquisitions can occur, thus delaying or preventing offers to
      acquire GRT or increasing the difficulty of completing an acquisition of GRT,
      even if the acquisition is in the best interests of GRT’s
      shareholders.




*Risks
      associated with information systems may interfere with our
      operations.*




We
      are
      continuing to implement new information systems and problems with the design
      or
      implementation of these new systems could interfere with our
      operations.




*Our
      operations could be affected if we lose any key management
      personnel.*




Our
      executive officers have substantial experience in owning, operating, managing,
      acquiring and developing shopping centers. Success depends in large part upon
      the efforts of these executives, and we cannot guarantee that they will remain
      with us. The loss of key management personnel in leasing, finance, legal and
      operations could have a negative impact on our operations. In addition, except
      for isolated examples, there are generally no restrictions on the ability of
      these executives to compete with us after termination of their
      employment.





*Inflation
      may influence our operations.*





Inflation
      risks could impact our operations due to increases in construction costs as
      well
      as other costs pertinent to our business, including, but not limited to, the
      cost of insurance and utilities.





**Item
      1B. Unresolved Staff Comments**





The
      Company has received no written comments regarding its periodic or current
      reports from the staff of the SEC that were issued 180 days or more preceding
      the end of its 2006 fiscal year and that remain unresolved.





**Item
      2. Properties**





The
      Company’s headquarters are located at 150 East Gay Street, Columbus, Ohio 43215,
      and its telephone number is (614) 621-9000. In addition, the Company maintains
      management offices at each of its Malls.





At
      December 31, 2006, the Company managed and leased a total of 30 Properties
      of
      which the Company had an ownership interest (28 wholly-owned and 2 partially
      owned through a joint venture). The Properties are located in 16 states as
      follows: Ohio (10), West Virginia (3), California (2), Florida (2), Texas (2),
      Alabama (1), Kansas (1), Kentucky (1), Minnesota (1), New Jersey (1), North
      Carolina (1), Oklahoma (1), Oregon (1), Pennsylvania (1), Tennessee (1) and
      Washington (1).








12





*(a)*
            *Malls*




Twenty-six
      of the Properties are Malls and range in size from 442,000 square feet of GLA
      to
      1.6 million square feet of GLA. Seven of the Malls are located in Ohio and
      19
      are located throughout the country in the states of California (2), Florida
      (2),
      Texas (2), West Virginia (2), Alabama (1), Kansas (1), Kentucky (1), Minnesota
      (1), New Jersey (1), North Carolina (1), Oklahoma (1), Oregon (1), Pennsylvania
      (1), Tennessee (1) and Washington (1). The location, general character and
      major
      tenant information are set forth below.





**Summary
      of Malls at December 31, 2006**





**Property/Location**
            **Anchors**
              **GLA**
            **Stores**
              **GLA
                (1)**
            **Total**
              **GLA**
            **%
                of**
              **Anchors**
              **Occupied**
            **%
                of**
              **Stores**
              **Occupied**
            **Store**
              **Sales
                Per**
              **Square
                Ft.(2)**
            **Anchors**
            **Lease**
              **Expiration
                (3)**




Almeda
                Mall,
              Houston,
                TX (10)
            586,042
            193,870
            779,912
            100.0
            98.7
            $281
            JCPenney
                (8)
              Macy’s
              Palais
                Royal
              Ross
                Dress for Less
              Steve
                & Barry’s
            (4)
              (4)
              12/31/09
              01/31/12
              01/31/13Ashland
                Town Center
              Ashland,
                KY
            263,794
            177,966
            441,760
            58.1
            94.6
            $371
            Belk
              Goody’s
              JCPenney
            01/31/10
              03/31/09
              10/31/09Colonial
                Park Mall
              Harrisburg,
                PA
            504,446
            239,034
            743,480
            100.0
            98.3
            $308
            The
                Bon-Ton
              Boscov’s
              Sears
            01/31/15
              (4)
              (4)Dayton
                Mall, The
              Dayton,
                OH
            935,130
            422,720
            1,357,850
            100.0
            93.8
            $341
            Borders
                Books &
              Music
              DSW
                Shoe
              Warehouse
              Elder-Beerman
              JCPenney
              Linens’N
                Things
              Macy’s
              Old
                Navy
              Sears
            12/31/21
              
              07/31/10
              (4)
              03/31/11
              01/31/17
              (4)
              07/31/10
              (4)Eastland
                Mall (“Eastland
              North
                Carolina”)
              Charlotte,
                NC (10)
            725,720
            335,770
            1,061,490
            96.4
            84.4
            $209
            Belk
              Burlington
                Coat
              Factory
              Dillard’s
              Eastland-Fields
                LLC
              Sears
            (4)
              
              (7)
              (4)
              (7)
              (4)Eastland
                Mall
              (“Eastland
                Ohio”)
              Columbus,
                OH
            726,534
            290,667
            1,017,201
            100.0
            83.2
            $277
            JCPenney
                (5)
              Kaufmann’s
              Macy’s
                (8)
              Sears
            01/31/13
              (4)
              (4)
              (4)




13
 
 **Property/Location**
                **Anchors**
                  **GLA**
                **Stores**
                  **GLA
                    (1)**
                **Total**
                  **GLA**
                **%
                    of**
                  **Anchors**
                  **Occupied**
                **%
                    of**
                  **Stores**
                  **Occupied**
                **Store**
                  **Sales
                    Per**
                  **Square
                    Ft.(2)**
                **Anchors**
                **Lease**
                  **Expiration
                    (3)**


Grand
                Central Mall
              Parkersburg,
                WV
            562,394
            367,580
            929,974
            100.0
            92.8
            $313
            Belk
              Elder-Beerman
                (5)
              Goody’s
              JCPenney
              Regal
                Cinemas
              Sears
              Steve
                & Barry’s
            03/31/18
              01/31/33
              04/30/06
              09/30/07
              01/31/17
              09/25/12
              01/31/11Great
                Mall of the Great
              Plains,
                The
              Olathe,
                KS
            397,947
            385,063
            783,010
            75.8
            85.6
            $170
            Burlington
                Coat
              Factory
              Dickinson
                Theatres
              Foozles
              Group
                USA
              Steve
                & Barry’s
              VF
                Factory Outlet
              Zonkers
            01/31/08
              09/30/08
              01/31/09
              08/13/07
              01/31/13
              01/10/08
              04/30/09Indian
                Mound Mall
              Heath,
                OH
            389,589
            167,890
            557,479
            100.0
            90.7
            $247
            Crown
                Cinema
              Elder-Beerman
              Goody’s
              JCPenney
              Sears
                (5)
              Steve
                & Barry’s
            12/31/12
              01/31/09
              05/31/08
              10/31/11
              09/23/27
              01/31/11Jersey
                Gardens
              Elizabeth,
                NJ
            648,980
            641,931
            1,290,911
            100.0
            99.3
            $502
            Bed
                Bath & Beyond
              Burlington
                Coat
              Factory
              Cohoes
                Fashions
              Daffy’s
              DSW
                Shoe Warehouse/
              Filene’s
                Basement
              Gap
                Outlet, The
              Group
                USA
              Jeepers!
              Last
                Call
              Loew’s
                Theaters
              Marshalls
              Modell’s
                Sporting Goods
              Nike
                Factory Store
              Off
                5thSaks Fifth Ave
              Outlet
              Old
                Navy
            01/31/10
              
              01/31/10
              01/31/10
              01/31/10
              
              10/31/11
              01/31/10
              12/31/08
              01/31/10
              11/30/09
              12/31/20
              10/31/09
              01/31/17
              11/30/11
              
              10/31/14
              05/31/10Lloyd
                Center
              Portland,
                OR
            738,444
            733,833
            1,472,277
            93.8
            96.8
            $395
            Barnes
                & Noble
              Lloyd
                Center Ice
              Rink(6)
              Lloyd
                Mall Cinemas
              Macy’s
              Marshalls
              Nordstrom
              Ross
                Dress for Less
              Sears
            01/31/12
              
              12/31/08
              01/31/12
              01/31/11
              01/31/09
              (4)
              01/31/15
              (4)




14


**Property/Location**
              **Anchors**
                **GLA**
              **Stores**
                **GLA
                  (1)**
              **Total**
                **GLA**
              **%
                  of**
                **Anchors**
                **Occupied**
              **%
                  of**
                **Stores**
                **Occupied**
              **Store**
                **Sales
                  Per**
                **Square
                  Ft.(2)**
              **Anchors**
              **Lease**
                **Expiration
                  (3)**


Mall
                at Fairfield
              Commons,
                The
              Beavercreek,
                OH
            768,284
            375,628
            1,143,912
            100.0
            98.7
            $367
            Dick’s
                Sporting
              Good’s
              Elder-Beerman
              JCPenney
              Macy’s
                (5)
              Parisian
              Sears
            01/31/21
              01/31/15
              10/31/08
              01/31/15
              01/31/14
              10/31/08Mall
                at Johnson
              City,
                The
              Johnson
                City, TN
            358,395
            174,064
            532,459
            93.4
            94.8
            $417
            Belk
                for Her
              Belk
                Home Store
              Goody’s
              JCPenney
              Sears
            10/31/12
              06/30/11
              05/31/11
              03/31/10
              (5)Montgomery
                Mall
              Montgomery,
                AL (10)
            460,341
            266,552
            726,893
            61.7
            39.1
            $232
            Parisian
                (8)
              Steve
                & Barry’s
            (4)
              01/31/13Morgantown
                Mall
              Morgantown,
                WV
            396,358
            161,374
            557,732
            100.0
            92.2
            $310
            Belk
              Carmike
                Cinemas
              Elder-Beerman
              JCPenney
              Sears
              Steve
                & Barry’s
            03/15/11
              10/31/24
              01/29/11
              09/30/10
              09/30/10
              01/31/13New
                Towne Mall
              New
                Philadelphia, OH
            361,501
            155,095
            516,596
            100.0
            94.8
            $247
            Elder-Beerman
              Goody’s
              JCPenney
              Kohl’s
              Regal
                Cinemas
              Sears
              Super
                Fitness Center
            02/02/09
              08/31/14
              09/30/08
              01/31/27
              03/31/07
              10/31/08
              02/28/14Northtown
                Mall
              Blaine,
                MN
            316,015
            294,024
            610,039
            58.6
            86.0
            $344
            Best
                Buy
              Burlington
                Coat
              Factory
              Steve
                & Barry’s
            01/31/10
              
              09/30/10
              01/31/11Northwest
                Mall
              Houston,
                TX (10)
            584,016
            211,662
            795,678
            64.2
            80.3
            $301
            Academy
                of Healthcare
              Professionals
              All
                Shoes $9.99
              Macy’s
              Palais
                Royal
            10/31/16
              06/30/08
              (4)
              12/31/09Polaris
                Fashion Place
              Columbus,
                OH
            1,088,075
            518,807
            1,606,882
            100.0
            98.3
            $399
            Great
                Indoors, The
              JCPenney
              Kaufmann’s
                (8)
              Macy’s
              Saks
                Fifth Avenue
              Sears
              Von
                Maur
            (4)
              (4)
              (4)
              (4)
              (4)
              (4)
              (4)




15


**Property/Location**
              **Anchors**
                **GLA**
              **Stores**
                **GLA
                  (1)**
              **Total**
                **GLA**
              **%
                  of**
                **Anchors**
                **Occupied**
              **%
                  of**
                **Stores**
                **Occupied**
              **Store**
                **Sales
                  Per**
                **Square
                  Ft.(2)**
              **Anchors**
              **Lease**
                **Expiration
                  (3)**


River
                Valley Mall
              Lancaster,
                OH
            316,947
            260,520
            577,467
            100.0
            92.8
            $298
            Elder-Beerman
              JCPenney
              Macy’s
              Regal
                Cinemas
              Sears
              Steve
                & Barry’s
            02/02/08
              09/30/12
              09/30/07
              12/31/06
              10/31/09
              01/31/11SuperMall
                of the Great
              Northwest
              Auburn,
                WA
            541,669
            400,855
            942,524
            100.0
            93.4
            $262
            Bed
                Bath & Beyond
              Burlington
                Coat
              Factory
              Gart
                Sports
              Marshalls
              Nordstrom
              Old
                Navy
              Sam’s
                Club
              Steve
                & Barry’s
              Vision
                Quest
            01/31/07
              
              01/31/11
              01/31/11
              01/31/11
              08/31/10
              01/31/11
              05/31/19
              01/31/14
              11/30/18University
                Mall
              Tampa,
                FL (10)
            807,677
            428,842
            1,236,519
            97.5
            92.7
            $315
            Burlington
                Coat
              Factory
              Cobb
                Theater (6)
              Dillard’s
              Macy’s
              Sears
              Steve
                & Barry’s
            (4)
              12/31/11
              (4)
              (4)
              (4)
              01/31/13Weberstown
                Mall
              Stockton,
                CA
            602,817
            256,506
            859,323
            100.0
            96.3
            $411
            Barnes
                & Noble
              Dillard’s
              JCPenney
              Sears
            01/31/09
              (4)
              03/31/09
              (4)WestShore
                Plaza
              Tampa,
                FL
            769,878
            289,647
            1,059,525
            100.0
            99.0
            $512
            AMC
                Theatres
              JCPenney
              Macy’s
              Old
                Navy
              Saks
                Fifth Avenue
              Sears
            01/31/21
              09/30/12
              (4)
              01/31/11
              11/30/18
              09/30/17**Subtotal**
            13,850,993
            7,749,900
            21,600,893
            93.9%
            91.7%
            $348






**Malls
              owned in a joint venture**Puente
                Hills Mall (9)
              City
                of Industry, CA
            731,289
            452,183
            1,183,472
            96.4
            93.8
            $271
            AMC
                20 Theaters
              Burlington
                Coat
              Factory
              Circuit
                City
              Comp
                USA (8)
              Linen’s
                N Things
              Macy’s
              Ross
                Dress for Less
              Sears
              Spectrum
                Club
            04/30/17
              
              10/31/08
              01/31/19
              10/31/17
              01/31/14
              (4)
              01/31/10
              (4)
              01/31/14




16


**Property/Location**
              **Anchors**
                **GLA**
              **Stores**
                **GLA
                  (1)**
              **Total**
                **GLA**
              **%
                  of**
                **Anchors**
                **Occupied**
              **%
                  of**
                **Stores**
                **Occupied**
              **Store**
                **Sales
                  Per**
                **Square
                  Ft.(2)**
              **Anchors**
              **Lease**
                **Expiration
                  (3)**


Tulsa
                Promenade (9)
              ****Tulsa,
                OK
            690,235
            234,497
            924,732
            100.0
            80.2
            $307
            Dillard’s
              Hollywood
                Theaters
              JCPenney
              Macy’s
              MDS
                Realty II, LLC
              (8)
            12/31/16
              01/31/19
              03/31/11
              03/31/11
              (11)**Subtotal**
            1,421,524
            686,680
            2,108,204
            98.2%
            89.1%
            $288**Total**
            15,272,517
            8,436,580
            23,709,097
            94.3%
            91.5%
            $344





(1)
            Includes
                outparcels.


(2)
            Average
                2006 store sales per square foot for in-line stores of less than
                20,000
                square feet.


(3)
            Lease
                expiration dates do not contemplate or include options to
                renew.


(4)
            The
                tenant owns the land and the building and operates under an operating
                agreement.


(5)
            This
                is a ground lease by the Company to the tenant. The Company owns
                the land
                and not the building.


(6)
            Managed
                by Ohio Entertainment Corporation, a wholly owned subsidiary of Glimcher
                Development Corporation.


(7)
            Building
                owned by third party, space partially occupied at year-end.


(8)
            Tenant
                vacated the store, but continues to pay through the expiration
                date.


(9)
            The
                Operating Partnership has an investment in this Mall of 52%. The
                Company
                is responsible for management and leasing services and receives fees
                for
                providing these services.


(10)
            Property
                was classified as held-for-sale as of December 31,
                2006.


(11)
            The
                tenant owns the land and the building and is subjected to the Mervyn’s
                operating agreement.





*(b)*
            *Community
                Centers*





Four
      of
      the Properties are Community Centers ranging in size from approximately 149,000
      to 443,000 square feet of GLA. They are located in 2 states as follows: Ohio
      (3), and West Virginia (1). The location, general character and major tenant
      information are set forth below.





**Summary
      of Community Centers at December 31, 2006**




**Property/Location**
            **Anchors**
              **GLA**
            **Stores**
              **GLA
                (1)**
            **Total**
              **GLA**
            **%
                of**
              **Anchors**
              **Occupied**
            **%
                of**
              **Stores**
              **Occupied**
            **Anchors**
            **Lease**
              **Expiration
                (2)**Knox
                Village SquareMount
                Vernon, OH
            173,009
            
            34,400
            
            207,409
            
            67.8
            81.1
            JCPenney
            05/31/08Kmart
            11/30/17Morgantown
                CommonsMorgantown,
                WV
            200,187
            
            30,656
            
            230,843
            
            100.0
            20.7
            Gabriel
                Brothers
            01/31/17Kmart
            02/28/21Ohio
                River PlazaGallipolis,
                OH
            106,242
            
            43,136
            
            149,378
            
            15.4
            87.9
            Peebles
            01/31/17Polaris
                Towne CenterColumbus,
                OH
            291,997
            
            151,040
            
            443,037
            
            100.0
            98.5
            Barnes
                & Noble
            01/31/15Best
                Buy
            01/31/15Jo-Ann
                etc.
            01/31/10Kroger
            11/30/18Linens
                ‘N Things
            01/31/15OfficeMax
            09/30/14Old
                Navy
              T.J.
                Maxx
            01/31/10
              03/31/09**Total**
            771,435
            
            259,232
            
            1,030,667
            
            81.1%
            85.2%


(1)
            Includes
                outparcels.


(2)
            Lease
                expiration dates do not contemplate options to
                renew.




17




*(c)*
            *Properties
                Subject to Indebtedness*





At
      December 31, 2006, 25 of the Properties, consisting of 22 Malls (20 wholly-owned
      and 2 partially owned through a joint venture) and 3 Community Centers, were
      encumbered by mortgages and 4 Malls and 1 Community Center were unencumbered.
      The 5 unencumbered Properties had a net book value of $239.4 million at December
      31, 2006. To facilitate the funding of working capital requirements and to
      finance the acquisition and development of the Properties, the Company has
      entered into an unsecured revolving line of credit with several financial
      institutions.





Various
      Mortgage Loans





The
      following table sets forth certain information regarding the mortgages which
      encumber various Properties. All of the mortgages are first mortgage liens
      on
      the Properties. The information is as of December 31, 2006 (dollars in
      thousands).


**Fixed/
                  Variable**
              
              **Interest**
              
              **Loan**
              
              **Annual
                  Debt**
              
              **Payment
                  at****Encumbered
                  Property**
              
              **Interest
                  Rate**
              
              **Rate**
              
              **Balance**
              
              **Service
                  (1)**
              
              **Maturity**
              
              **Maturity**$36.4
                  million SAN Mall note
              
              
              Fixed
              
              
              8.35%
              
              $
              33,020
              
              $
              3,320
              
              $
              32,615
              
              
              10/11/2007
              (2)Almeda
                  MallNorthwest
                  Mall$58.4
                  million Morgantown note
              
              
              Fixed
              
              
              6.89%
              
              
              52,474
              
              $
              4,608
              
              $
              50,823
              
              
              09/11/2008
              (2)Morgantown
                  MallMorgantown
                  CommonsColonial
                  Park Mall
              
              
              Fixed
              
              
              7.73%
              
              
              32,451
              
              $
              3,088
              
              $
              32,033
              
              
              10/11/2007
              (2)Knox
                  Village Square
              
              
              Fixed
              
              
              7.41%
              
              
              8,753
              
              $
              772
              
              $
              8,624
              
              
              02/11/2008Eastland
                  North Carolina
              
              
              Fixed
              
              
              7.84%
              
              
              43,766
              
              $
              4,308
              
              $
              42,302
              
              
              09/11/2008
              (2)Great
                  Mall of the Great Plains, The
              
              
              Fixed
              
              
              6.35%
              
              
              30,000
              
              $
              1,932
              
              $
              30,000
              
              
              01/12/2009Grand
                  Central Mall
              
              
              Fixed
              
              
              7.18%
              
              
              47,815
              
              $
              4,268
              
              $
              46,065
              
              
              02/01/2009Mall
                  at Johnson City, The
              
              
              Fixed
              
              
              8.37%
              
              
              38,787
              
              $
              3,740
              
              $
              37,026
              
              
              06/01/2010Polaris
                  Towne Center
              
              
              Fixed
              
              
              8.20%
              
              
              40,482
              
              $
              3,858
              
              $
              38,543
              
              
              06/01/2010
              (2)Ashland
                  Town Center
              
              
              Fixed
              
              
              7.25%
              
              
              24,809
              
              $
              2,344
              
              $
              21,817
              
              
              11/01/2011Dayton
                  Mall, The
              
              
              Fixed
              
              
              8.27%
              
              
              55,886
              
              $
              5,556
              
              $
              49,864
              
              
              07/11/2012
              (2)WestShore
                  Plaza
              
              
              Fixed
              
              
              5.09%
              
              
              95,255
              
              $
              6,508
              
              $
              84,824
              
              
              09/09/2012Polaris
                  Fashion Place
              
              
              Fixed
              
              
              5.24%
              
              
              142,129
              
              $
              9,928
              
              $
              124,572
              
              
              04/11/2013Lloyd
                  Center
              
              
              Fixed
              
              
              5.42%
              
              
              133,256
              
              $
              9,456
              
              $
              116,922
              
              
              06/11/2013
              (2)Jersey
                  Gardens
              
              
              Fixed
              
              
              4.83%
              
              
              158,791
              
              $
              10,424
              
              $
              135,194
              
              
              06/08/2014Mall
                  at Fairfield Commons, The
              
              
              Fixed
              
              
              5.45%
              
              
              109,232
              
              $
              7,724
              
              $
              92,762
              
              
              11/01/2014SuperMall
                  of the Great Northwest
              
              
              Fixed
              
              
              7.54%
              
              
              59,515
              
              $
              5,412
              
              $
              49,969
              
              
              02/11/2015
              (2)River
                  Valley Mall
              
              
              Fixed
              
              
              5.65%
              
              
              50,000
              
              $
              2,864
              
              $
              44,931
              
              
              01/11/2016Weberstown
                  Mall
              
              
              Fixed
              
              
              5.90%
              
              
              60,000
              
              $
              3,590
              
              $
              60,000
              
              
              06/08/2016Eastland
                  Ohio
              
              
              Fixed
              
              
              5.87%
              
              
              43,000
              
              $
              2,557
              
              $
              38,057
              
              
              12/11/2016Total
                  fixed rate notes:
              
              
              
              
              
              
              
              
              1,259,421Montgomery
                  Mall
              
              
              Variable
              
              
              7.03%
              
              
              25,000
              
              $
              1,781
              
              $
              25,000
              
              
              01/31/2007Total
                  variable rate notes:
              
              
              
              
              
              
              
              
              25,000**Total
                  Wholly Owned Properties:**
              
              
              
              
              
              
              
              $
              1,284,421
              (3)**Joint
                  Venture Properties:**Puente
                  Hills Mall (4)
              
              
              Fixed
              
              
              5.20%
              
              $
              45,436
              
              $
              3,151
              
              $
              44,324
              
              
              06/01/2008Tulsa
                  Promenade (5)
              
              
              Fixed
              
              
              6.52%
              
              
              18,200
              
              $
              1,203
              
              $
              18,200
              
              
              03/14/2009**Total
                  Joint Venture Properties:**
              
              
              
              
              
              
              
              $
              63,636




(1)
            Annual
                debt service for variable rate notes is calculated based on the interest
                rate at December 31, 2006.


(2)
            Optional
                prepayment date (without penalty) is shown. Loan matures at a later
                date.


(3)
            This
                total differs from the amounts reported in the financial statements
                due to
                $19.0 million in tax exempt borrowings which are not secured by a
                mortgage
                and fair value adjustments to debt instruments as required by SFAS
                No.
                141, “Business Combinations.”


(4)
            The
                Company acquired a 52% interest in this Property on December 29,
                2005.


(5)
            On
                March 14, 2006, the Company divested of its 100% interest in this
                Property
                and transferred it to a joint venture in which it has a 52%
                interest.




18


**Item
      3.**  **Legal
      Proceedings**





The
      Company is involved in lawsuits, claims and proceedings, which arise in the
      ordinary course of business. The Company is not presently involved in any
      material litigation. In accordance with Statement of Financial Accounting
      Standards (“SFAS”) No. 5, “Accounting for Contingencies,” the Company makes a
      provision for a liability when it is both probable that a liability has been
      incurred and the amount of the loss can be reasonably estimated.





**Item
      4.**  **Submission
      of Matters to a Vote of Security Holders**





No
      matter
      was submitted to a vote of security holders through the solicitation of proxies
      or otherwise during the fourth quarter of fiscal year 2006. ****





**PART
      II.**





**Item
      5. Market for Registrant’s Common Equity, Related Shareholder Matters and Issuer
      Purchases of Equity Securities**





*(a)*
            *Market
                Information*




The
      Common Shares are currently listed and traded on the New York Stock Exchange
      (“NYSE”) under the symbol “GRT.” On February 22, 2007, the last reported sales
      price of the Common Shares on the NYSE was $29.21. The following table shows
      the
      high and low sales prices for the Common Shares on the NYSE for the 2006 and
      2005 quarterly periods indicated as reported by the New York Stock Exchange
      Composite Tape and the cash distributions per Common Share paid by GRT with
      respect to such period.




**Distributions****Quarter
                Ended**
            **High**
            **Low**
            **Per
                Share**March
                31, 2005
            $28.03
            $23.40
            $0.4808June
                30, 2005
            $29.00
            $23.45
            $0.4808September
                30, 2005
            $30.16
            $24.03
            $0.4808December
                31, 2005
            $26.70
            $21.74
            $0.4808March
                31, 2006
            $29.10
            $23.95
            $0.4808June
                30, 2006
            $28.36
            $23.88
            $0.4808September
                30, 2006
            $25.63
            $23.08
            $0.4808December
                31, 2006
            $27.72
            $24.20
            $0.4808





*(b)*
            *Holders*





The
      number of holders of record of the Common Shares was 911 as of February 22,
      2007.





*(c)*
            *Distributions*





Future
      distributions paid by GRT on the Common Shares will be at the discretion of
      the
      trustees of GRT and will depend upon the actual cash flow of GRT, its financial
      condition, capital requirements, the annual distribution requirements under
      the
      REIT provisions of the Code and such other factors as the trustees of GRT deem
      relevant.





GRT
      has
      implemented a Distribution Reinvestment and Share Purchase Plan (the “Plan”)
      under which its shareholders or OP Unit holders may elect to purchase additional
      Common Shares at fair value and/or automatically reinvest their distributions
      in
      Common Shares at fair value. In order to fulfill its obligations under the
      Plan,
      GRT may purchase Common Shares in the open market or issue Common Shares that
      have been registered and authorized specifically for the Plan. As of December
      31, 2006, 2,100,000 Common Shares were authorized, of which 268,052 Common
      Shares have been issued under the Plan.





**Item
      6. Selected Financial Data**




The
      following table sets forth Selected Financial Data for the Company. This
      information should be read in conjunction with the consolidated financial
      statements of the Company and Management’s Discussion and Analysis of the
      Financial Condition and Results of Operations, each included elsewhere in this
      Form 10-K.





19


**SELECTED
      FINANCIAL DATA**  **** **** **** **** ****





**For the Years Ended December 31,****2006**
            
            **2005**
            
            **2004**
            
            **2003**
            
            **2002****Operating
                Data (in thousands, except per share amounts):
                (1)**Total
                revenues
            
            $
            309,264
            
            $
            300,026
            
            $
            288,839
            
            $
            244,327
            
            $
            204,973Operating
                income
            
            $
            63,742
            
            $
            105,994
            
            $
            103,563
            
            $
            85,534
            
            $
            68,831Interest
                expense
            
            $
            84,985
            
            $
            74,396
            
            $
            78,359
            
            $
            68,824
            
            $
            85,773Gain
                on sales of properties, net
            
            $
            1,717
            
            $
            1,619
            
            $
            19,646
            
            $
            703
            
            $
            15,756(Loss)
                income from continuing operations
            
            $
            (11,602
            )
            $
            31,666
            
            $
            22,488
            
            $
            18,982
            
            $
            (14,479
            )(Loss)
                income from continuing operations per share common
                (diluted)
            
            $
            (0.93
            )
            $
            0.36
            
            $
            0.08
            
            $
            0.18
            
            $
            (0.68
            )Net
                (loss) income
            
            $
            (77,165
            )
            $
            20,850
            
            $
            51,755
            
            $
            32,961
            
            $
            33,604Preferred
                stock dividends
            
            $
            17,437
            
            $
            17,437
            
            $
            17,517
            
            $
            13,688
            
            $
            11,833Net
                (loss) income available to common shareholders
            
            $
            (94,602
            )
            $
            3,413
            
            $
            29,360
            
            $
            19,273
            
            $
            21,771Per
                common share data: Earnings per share (diluted)
            
            $
            (2.58
            )
            $
            0.09
            
            $
            0.82
            
            $
            0.55
            
            $
            0.67Distributions
                (per common share)
            
            $
            1.9232
            
            $
            1.9232
            
            $
            1.9232
            
            $
            1.9232
            
            $
            1.9232**Balance
                Sheet Data (in thousands):**Investment
                in real estate, net
            
            $
            1,773,805
            
            $
            1,877,059
            
            $
            1,835,298
            
            $
            1,724,226
            
            $
            1,507,277Total
                assets
            
            $
            1,888,820
            
            $
            1,995,312
            
            $
            1,947,024
            
            $
            1,837,423
            
            $
            1,622,433Total
                long-term debt
            
            $
            1,576,886
            
            $
            1,501,481
            
            $
            1,402,604
            
            $
            1,295,058
            
            $
            1,095,930Total
                shareholders’ equity
            
            $
            225,235
            
            $
            387,054
            
            $
            443,822
            
            $
            441,939
            
            $
            416,492**Other
                Data:**Cash
                provided by operating activities (in thousands)
            
            $
            96,230
            
            $
            108,345
            
            $
            102,305
            
            $
            98,894
            
            $
            67,600Cash
                (used in) provided by investing activities (in thousands)
            
            $
            (108,911
            )
            $
            (120,203
            )
            $
            38,133
            
            $
            (200,229
            )
            $
            175,697Cash
                provided by (used in) financing activities (in thousands)
            
            $
            16,611
            
            $
            11,233
            
            $
            (143,032
            )
            $
            101,066
            
            $
            (240,697
            )Funds
                from operations (2) (in thousands)
            
            $
            (25,502
            )
            $
            77,666
            
            $
            89,629
            
            $
            88,897
            
            $
            74,828Number
                of properties (3) (4)
            
            
            30
            
            
            36
            
            
            41
            
            
            70
            
            
            73Total
                GLA (in thousands) (3) (4)
            
            
            24,740
            
            
            24,615
            
            
            24,291
            
            
            27,061
            
            
            25,716Occupancy
                rate % (3)
            
            
            92.8
            %
            
            91.9
            %
            
            89.3
            %
            
            89.8
            %
            
            88.9
            %





(1)
            Operating
                data for the years ended December 31, 2005, 2004, 2003 and 2002 are
                restated to reflect the impact of SFAS No.
                144.





(2)
            FFO
                as defined by NAREIT is used by the real estate industry and investment
                community as a supplemental measure of the performance of real estate
                  companies. NAREIT defines FFO as net income (loss) available to
                common
                shareholders (computed in accordance with GAAP), excluding gains
                or losses
                from sales of depreciable property, plus real estate related depreciation
                and amortization and after adjustments for unconsolidated partnerships
                and
                joint ventures. FFO does include impairment losses for properties
                held-for-use and held-for-sale. The Company’s FFO may not be directly
                comparable to similarly titled measures reported by other real estate
                investment trusts. FFO does not represent cash flow from operating
                activities in accordance with GAAP and should not be considered as
                an
                alternative to net income (determined in accordance with GAAP), as
                an
                indication of the Company’s financial performance or to cash flow from
                operating activities (determined in accordance with GAAP), as a measure
                of
                the Company’s liquidity, nor is it indicative of funds available to fund
                the Company’s cash needs, including its ability to make cash
                distributions. A reconciliation of FFO to net income available to
                common
                shareholders is provided in Item 7 of this Form
                10-K.





(3)
            Number
                of Properties and GLA include Properties which are both wholly owned
                by
                the Company or by a joint venture in which the Company has a joint
                venture
                interest. Occupancy of the Properties is defined as any space where
                a
                store is open or a tenant is paying rent at the date indicated, excluding
                all tenants with leases having an initial term of less than one
                year.





(4)
            The
                number of Properties owned by joint ventures in which the Company
                has an
                interest and the GLA of those Properties included in the table are
                as
                follows: 2006 includes 2.1 million square feet of GLA (2 Properties),
                2005
                includes 1.2 million square feet of GLA (1 Property), none in 2004,
                2003
                includes 2.0 million square feet of GLA (2 Properties) and 2002 includes
                3.8 million square feet of GLA (4 Properties).








20


**Item
      7.**  **Management’s
      Discussion and Analysis of Financial Condition and Results of
      Operations**





**Overview**





GRT
      is a
      self-administered and self-managed Maryland real estate investment trust, or
      REIT, which commenced business operations in January 1994 at the time of its
      initial public offering. We own, lease, manage and develop a portfolio of retail
      properties consisting of regional and super regional malls and community
      shopping centers. As of December 31, 2006, we owned interests in and managed
      30
      Properties, consisting of 26 Malls (24 wholly-owned and 2 partially owned
      through a joint venture) and 4 Community Centers located in 16 states. The
      Properties contain an aggregate of approximately 24.7 million square feet of
      GLA
      of which approximately 92.8% was occupied at December 31, 2006.





Our
      primary business objective is to achieve growth in net income and funds from
      operations, or FFO, by developing and acquiring retail properties; by improving
      the operating performance and value of our existing portfolio through selective
      expansion and renovation of our Properties; and by maintaining high occupancy
      rates, increasing minimum rents per square-foot of GLA and aggressively
      controlling costs.





Key
      elements of our growth strategies and operating policies are to:





·
            Increase
                Property values by aggressively marketing available GLA and renewing
                existing leases;





·
            Negotiate
                and sign leases which provide for regular or fixed contractual increases
                to minimum rents;





·
            Capitalize
                on management’s long-standing relationships with national and regional
                retailers and extensive experience in marketing to local retailers,
                as
                well as exploit the leverage inherent in a larger portfolio of properties
                in order to lease available space;





·
            Utilize
                our team-oriented management approach to increase productivity and
                efficiency;





·
            Acquire
                strategically located malls;





·
            Hold
                Properties for long-term investment and emphasize regular maintenance,
                periodic renovation and capital improvements to preserve and maximize
                value;





·
            Selectively
                dispose of assets we believe have achieved long-term investment potential
                and redeploy the proceeds;





·
            Control
                operating costs by utilizing our employees to perform management,
                leasing,
                marketing, finance, accounting, construction supervision, legal and
                information technology services;





·
            Renovate,
                reconfigure or expand Properties and utilize existing land available
                for
                expansion and development of outparcels to meet the needs of existing
                or
                new tenants; and





·
            Utilize
                our development capabilities to develop quality properties at low
                costs.





Our
      strategy is to be a leading REIT focusing on anchored-retail properties located
      primarily in the top 100 metropolitan statistical areas by population. We expect
      to continue investing in select development opportunities and in strategic
      acquisitions of mall properties that provide growth potential. We expect to
      finance acquisition, redevelopment and development opportunities with cash
      on
      hand, borrowings under credit facilities, proceeds from strategic joint venture
      partners, asset dispositions, secured mortgage financings, the issuance of
      equity or debt securities, or a combination of two or more of the
      foregoing.





**Critical
      Accounting Policies and Estimates**





General





Management’s
      Discussion and Analysis of Financial Condition and Results of Operations is
      based upon our consolidated financial statements, which have been prepared
      in
      accordance with GAAP. The preparation of these financial statements requires
      management to make estimates and assumptions that affect the reported amounts
      of
      assets, liabilities, revenue and expenses, and related disclosure of contingent
      assets and liabilities. Management bases its estimates on historical experience
      and on various other assumptions that are believed to be reasonable under the
      circumstances, the results of which form the basis for making judgments about
      the carrying values of assets and liabilities that are not readily apparent
      from
      other sources. Senior management has discussed the development, selection and
      disclosure of these estimates with the Audit Committee of the Board and the
      Company’s independent registered public accounting firm. Actual results may
      differ from these estimates under different assumptions or conditions.





21


An
      accounting policy is deemed to be critical if it requires an accounting estimate
      to be made based on assumptions about matters that are highly uncertain at
      the
      time the estimate is made and if different estimates that are reasonably likely
      to occur could materially impact the financial statements. Management believes
      the critical accounting policies discussed in this section reflect its more
      significant estimates and assumptions used in preparation of the consolidated
      financial statements.





Revenue
      Recognition





The
      Company’s revenue recognition policy relating to minimum rents does not require
      the use of significant estimates. Percentage rents, tenant reimbursements and
      components of other revenue associated with the margins related to outparcel
      sales include estimates.





*Percentage
      Rents*





Percentage
      rents, which are based on tenants’ sales as reported to the Company, are
      recognized once the sales reported by such tenants exceed any applicable
      breakpoints as specified in the tenants’ leases. The percentage rents are
      recognized based upon the measurement dates specified in the leases which
      indicate when the percentage rent is due.





*Tenant
      reimbursements*





Estimates
      are used to record cost reimbursements from tenants for CAM, real estate tax,
      utilities and insurance. We recognize revenue based upon the amounts to be
      reimbursed from our tenants in the same period these reimbursable expenses
      are
      incurred. Differences between estimated cost reimbursements and final amounts
      billed are recognized in the subsequent year. Leases are not uniform in dealing
      with such cost reimbursements and variations exist in computations between
      Properties and tenants. The Company analyzes the balance of its estimated
      accounts receivable for real estate taxes, CAM and insurance for each of its
      Properties by comparing actual reimbursements versus actual expenses.
      Adjustments are also made throughout the year to these receivables and the
      related cost reimbursement income based upon the Company’s best estimate of the
      final amounts to be billed and collected. If management’s estimate of the
      percent of recoverable expenses that can be billed to the tenants in 2006
      differs from actual amounts billed in 2007 by 1%, the amount of income recorded
      during 2006 would increase or decrease by $1.0 million.





*Outparcel
      sales*





The
      Company sells outparcels at its various Properties. The estimated cost used
      to
      calculate the margin from these sales involves a number of estimates. The
      estimates made are based either upon assigning a proportionate cost, upon
      historical cost paid for the total parcel to the portion of the parcel that
      is
      sold, or by incorporating the sales value method. The proportionate share of
      actual cost is derived through consideration of numerous factors. These factors
      include items such as ease of access to the parcel, visibility from high traffic
      areas and other factors that may differentiate the desirability of the
      particular section of the parcel that is sold.





Accounts
      Receivable and Allowance for Doubtful Accounts





The
      allowance for doubtful accounts reflects the Company’s estimate of the amounts
      of the recorded accounts receivable at the balance sheet date that will not
      be
      recovered from cash receipts in subsequent periods. The Company’s policy is to
      record a periodic provision for doubtful accounts based on total revenues.
      The
      Company also periodically reviews specific tenant balances and determines
      whether an additional allowance is necessary. In recording such a provision,
      the
      Company considers a tenant’s creditworthiness, ability to pay, probability of
      collection and consideration of the retail sector in which the tenant operates.
      The allowance for doubtful accounts is reviewed periodically based upon the
      Company’s historical experience.








22




Investment
      in Real Estate





*Carrying
      Value of Assets*





The
      Company maintains a diverse portfolio of real estate assets. The portfolio
      holdings have increased as a result of both acquisitions and the development
      of
      new Properties and have been reduced by selected sales of assets. The amounts
      to
      be capitalized as a result of acquisition and developments and the periods
      over
      which the assets are depreciated or amortized are determined based on the
      application of accounting standards that may require estimates as to fair value
      and the allocation of various costs to the individual assets. The Company
      allocates the cost of the acquisition based upon the estimated fair value of
      the
      net assets acquired. The
      Company also estimates the fair value of intangibles related to its
      acquisitions. The valuation of the fair value of the intangibles involves
      estimates related to market conditions, probability of lease renewals and the
      current market value of in-place leases. This market value is determined by
      considering factors such as the tenant’s industry, location within the Property
      and competition in the specific market in which the Property operates.
      Differences in the amount attributed to the intangible assets can be significant
      based upon the assumptions made in calculating these estimates.





*Impairment
      Evaluation*





Management
      evaluates the recoverability of its investment in real estate assets in
      accordance with SFAS No. 144, “Accounting for the Impairment or Disposal of
      Long-Lived Assets.” This statement requires that long-lived assets be reviewed
      for impairment whenever events or changes in circumstances indicate that
      recoverability of the asset is not assured.





The
      Company evaluates the recoverability of its investments in real estate assets
      to
      be held and used each quarter and records an impairment charge when there is
      an
      indicator of impairment and the undiscounted projected cash flows are less
      than
      the carrying amount for a particular Property. The estimated cash flows used
      for
      the impairment analysis and the determination of estimated fair value are based
      on the Company’s plans for the respective assets and the Company’s views of
      market and economic conditions. The estimates consider matters such as current
      and historical rental rates, occupancies for the respective Properties and
      comparable properties and recent sales data for comparable properties. Changes
      in estimated future cash flows due to changes in the Company’s plans or views of
      market and economic conditions could result in recognition of impairment losses,
      which, under the applicable accounting guidance, could be substantial.





*Investment
      in Real Estate - Held-for-Sale*





The
      Company evaluates the held-for-sale classification of its owned real estate
      each
      quarter. Assets that are classified as held-for-sale are recorded at the lower
      of their carrying amount or fair value less cost to sell. Assets are generally
      classified as held-for-sale once management commits to a plan to sell the
      Properties and has initiated an active program to market them for sale. The
      results of operations of these real estate properties are reflected as
      discontinued operations in all periods reported.





On
      occasion, the Company will receive unsolicited offers from third parties to
      buy
      individual Properties. Under these circumstances, the Company will classify
      the
      particular Property as held-for-sale when a sales contract is executed with
      no
      contingencies and the prospective buyer has funds at risk to ensure
      performance.





*Sale
      of Real Estate Assets*





The
      sale
      of real estate assets may also involve the application of judgments in
      determining whether the risks and rewards of ownership have transferred to
      the
      buyer and that a sale has been completed for purposes of recognizing a gain
      on
      the sale. The Company recognizes property sales in accordance with SFAS No.
      66,
“Accounting for Sales of Real Estate.” The Company generally records the sales
      of operating properties and outparcels using the full accrual method at closing,
      when the earnings process is deemed to be complete. Sales not qualifying for
      full recognition at the time of sale are accounted for under other appropriate
      deferral methods.





*Accounting
      for Acquisitions*





The
      fair
      value of the real estate acquired is allocated to acquired tangible assets,
      consisting of land, building and tenant improvements, and identified intangible
      assets and liabilities, consisting of the value of above-market and below-market
      leases for acquired in-place leases, the value of tenant relationships, and
      the
      value of in-place leases, based in each case on their fair values. Purchase
      accounting is applied to assets and liabilities related to real estate entities
      acquired based upon the percentage of interest acquired.





23


The
      fair
      value of the tangible assets of an acquired property (which includes land,
      building and tenant improvements) is determined by valuing the property as
      if it
      were vacant, based on management’s determination of the relative fair values of
      these assets. Management determines the as-if-vacant fair value of a property
      using methods to determine the replacement cost of the tangible assets.





In
      determining the fair value of the identified intangible assets and liabilities
      of an acquired property, above-market and below-market in-place lease values
      are
      recorded based on the present value (using an interest rate which reflects
      the
      risks associated with the leases acquired) of the difference between (i) the
      contractual amounts to be paid pursuant to the in-place leases and (ii)
      management’s estimate of fair market lease rates for the corresponding in-place
      leases, measured over a period equal to the remaining non-cancelable term of
      the
      lease. The capitalized above-market lease values and the capitalized
      below-market lease values are amortized as an adjustment to rental income over
      the initial lease term.





The
      aggregate value of in-place leases is determined by evaluating various factors,
      including an estimate of carrying costs during the expected lease-up periods,
      current market conditions and similar leases. In estimating carrying costs,
      management includes real estate taxes, insurance and other operating expenses
      and estimates of lost rental revenue during the expected lease-up periods based
      on current market demand. Management also estimates costs to execute similar
      leases including leasing commissions, legal and other related costs. The value
      assigned to this intangible asset is amortized over the remaining lease term
      plus an assumed renewal period that is reasonably assured.





The
      aggregate value of other acquired intangible assets include tenant
      relationships. Factors considered by management in assigning a value to these
      relationships include: assumptions of probability of lease renewals, investment
      in tenant improvements, leasing commissions and an approximate time lapse in
      rental income while a new tenant is located. The value assigned to this
      intangible asset is amortized over the average life of the
      relationship.





*Depreciation
      and Amortization*





Depreciation
      expense for real estate assets is computed using a straight-line method and
      estimated useful lives for buildings and improvements using a weighted average
      composite life of forty years and equipment and fixtures of five to ten years.
      Expenditures for leasehold improvements and construction allowances paid to
      tenants are capitalized and amortized over the initial term of each lease.
      Cash
      allowances paid to retailers that are used for purposes other than improvements
      to the real estate are amortized as a reduction to minimum rents over the
      initial lease term. Maintenance and repairs are charged to expense as incurred.
      Cash allowances paid in return for operating covenants from retailers who own
      their real estate are capitalized as contract intangibles. These intangibles
      are
      amortized over the period the retailer is required to operate their store.





Investment
      in Unconsolidated Real Estate Entities





The
      Company evaluates all joint venture arrangements for consolidation. The
      percentage interest in the joint venture, evaluation of control and whether
      a
      variable interest entity (“VIE”) exists are all considered in determining if the
      arrangement qualifies for consolidation.





The
      Company accounts for its investments in unconsolidated real estate entities
      using the equity method of accounting, whereby the cost of an investment is
      adjusted for the Company’s share of equity in net income or loss beginning on
      the date of acquisition and reduced by distributions received. The income or
      loss of each investee is allocated in accordance with the provisions of the
      applicable operating agreements. The allocation provisions in these agreements
      may differ from the ownership interest held by each investor. Differences
      between the carrying amount of the Company’s investment in the respective
      investees and the Company’s share of the underlying equity of such
      unconsolidated entities are amortized over the respective lives of the
      underlying assets as applicable.





The
      Company periodically reviews its investment in unconsolidated real estate
      entities for other than temporary declines in market value. Any decline that
      is
      not expected to be recovered in the next twelve months is considered other
      than
      temporary and an impairment charge is recorded as a reduction in the carrying
      value of the investment. No impairment charges were recognized during the year
      ended December 31, 2006 related to our investment in unconsolidated real estate
      entities.





24


Deferred
      Costs





The
      Company capitalizes initial direct costs in accordance with SFAS No. 91,
“Accounting for Nonrefundable Fees and Costs Associated with Originating or
      Acquiring Loans and Initial Direct Costs of Leases,” and amortizes these costs
      over the initial lease term. The costs are capitalized upon the execution of
      the
      lease and the amortization period begins the earlier of the store opening date
      or the date the tenant’s lease obligation begins.





Derivatives





The
      Company has used interest rate cap agreements to hedge interest rate exposure
      and interest rate swap contracts to convert a portion of its variable rate
      debt
      to fixed rate debt. The Company has a policy of only entering into contracts
      with major financial institutions based upon their credit ratings and other
      factors, and all contracts are intended to be effective as hedges of specific
      interest rate risk exposures. In connection with the determination of the
      effectiveness of these hedges and the recognition of any unrealized gain or
      loss
      on these contracts, the Company computes the fair value of the contracts at
      each
      balance sheet date. To determine the fair values of derivative instruments,
      the
      Company uses a variety of methods and assumptions that are based on market
      conditions and risks existing at each balance sheet date. Standard market
      conventions and techniques such as discounted cash flow analysis, replacement
      cost and termination cost are used to determine fair value. All methods of
      assessing fair value result in a general approximation of value, and such value
      may never actually be realized. The Company at times employs an external third
      party to perform an independent assessment of the fair value of the derivatives
      portfolio. The aggregate fair value of the Company’s derivative instruments was
      nominal at December 31, 2006 and 2005.





**Funds
      From Operations**





Our
      consolidated financial statements have been prepared in accordance with GAAP.
      We
      have also indicated that FFO is a key measure of financial performance. FFO
      is
      an important and widely used financial measure of operating performance in
      the
      REIT industry, which we believe provides important information to investors
      and
      a relevant basis for comparison among REITs.




We
      believe that FFO is an appropriate and valuable measure of our operating
      performance because real estate generally appreciates over time or maintains
      a
      residual value to a much greater extent than personal property and, accordingly,
      reductions for real estate depreciation and amortization charges are not
      meaningful in evaluating the operating results of the Properties.





FFO,
      as
      defined by NAREIT (defined fully in Item 1) is used by the real estate industry
      and investment community as a supplemental measure of the performance of real
      estate companies. FFO does not represent cash flow from operating activities
      in
      accordance with GAAP and should not be considered as an alternative to net
      income as the primary indicator of our operating performance or as an
      alternative to cash flow as a measure of liquidity. Our FFO may not be directly
      comparable to similarly titled measures reported by other REIT’s.





The
      following table illustrates the calculation of FFO and the reconciliation of
      FFO
      to net income available to common shareholders for the years ended December
      31,
      2006, 2005 and 2004 (in thousands):




**For
                the Years Ended December
                31,****2006**
            
            **2005**
            
            **2004**Net
                (loss) income available to common shareholders
            
            $
            (94,602
            )
            $
            3,413
            
            $
            29,360Add
                back (less):Real
                estate depreciation and amortization
            
            
            73,926
            
            
            75,620
            
            
            76,970Equity
                in income of unconsolidated entities
            
            
            (1,443
            )
            
            (51
            )
            
            (3
            )Share
                of joint venture real estate depreciation and amortization
            
            
            6,067
            
            
            51
            
            
            42Minority
                interest in Operating Partnership
            
            
            (7,733
            )
            
            252
            
            
            2,906Discontinued
                operations: Gain on sales of properties
            
            
            (1,717
            )
            
            (1,619
            )
            
            (19,646
            )Funds
                from operations
            
            $
            (25,502
            )
            $
            77,666
            
            $
            89,629




FFO
      -
      Comparison of year ended December 31, 2006 to December 31, 2005





FFO
      decreased 132.8%, or $103.2 million, for the year ended December 31, 2006
      compared to the year ended December 31, 2005. During 2006, we incurred $111.9
      million of impairment charges primarily related to three Mall Properties, two
      of
      which were listed as held-for-sale, as compared to $16.4 million related
      primarily to Community Centers for the same period ended December 31, 2005.
      Also
      contributing to the decrease in FFO was a $18.0 million increase in overall
      interest expense. This increase in interest expense can be attributed to a
      $9.4
      million defeasance charge associated with the release of a lien and security
      interest related to the mortgage loan on University Mall and release of the
      Company from our obligation under the loan. The increase in interest expense
      is
      also attributable to a higher average loan balance during 2006 as compared
      to
      2005, primarily due to funding of acquisitions, capital improvements and the
      Company’s redevelopment program. Excluding the non-cash impairment charges and
      defeasance costs, FFO would have been $95.8 million for the year ended December
      31, 2006 compared to $94.1 million for the year ended December 31,
      2005.





25


Offsetting
      these decreases to FFO was an increase of $6.0 million to our pro-rata share
      of
      FFO from our joint venture investment in Puente Hills Mall (“Puente”) and Tulsa
      Promenade (“Tulsa”). Also, our general and administrative costs decreased by
      $3.1 million. This decrease is primarily due to $3.3 million of charges in
      2005
      relating to an employment agreement ($2.0 million) and a severance agreement
      ($1.3 million) with two of the Company’s former executives.





FFO
      -
      Comparison of year ended December 31, 2005 to December 31, 2004





FFO
      decreased 13.3%, or $12.0 million, for the year ended December 31, 2005 compared
      to the year ended December 31, 2004. During 2005, we incurred $16.4 million
      of
      impairment charges to FFO in connection with Community Centers that were either
      sold or held-for-sale. Also contributing to the decrease in FFO was a $7.6
      million reduction in net operating income previously generated from sold
      Properties. Lastly, general and administrative costs increased by $4.1 million.
      This increase is related to charges associated with an employment agreement
      ($2.0 million) and a severance agreement ($1.3 million) with two of the
      Company’s former executives in 2005 and increased costs associated with
      corporate governance.





Offsetting
      these decreases in FFO was lower overall interest expense of approximately
      $4.5
      million, a $7.4 million greater contribution of operating income from our
      Properties in 2005 and no redemption costs as incurred in the previous year.
      The
      decrease in interest expense was driven primarily by lower outstanding
      borrowings for the year ended December 31, 2005 as compared to the year ended
      December 31, 2004. We also incurred a $4.9 million charge associated with the
      original issuance costs of the 9.25% Series B Cumulative Preferred Shares of
      Beneficial Interest (the “Series B Preferred Shares”) that were redeemed during
      the first quarter of 2004.





**Results
      of Operations - Year Ended December 31, 2006 Compared to Year Ended December
      31,
      2005**




Revenues





Total
      revenues increased 3.1%, or $9.2 million, for the year ended December 31, 2006.
      Each revenue category increased for the year ended December 31, 2006 compared
      to
      December 31, 2005 primarily due to improved performance at our Mall
      Properties.





*Minimum
      rents*





Minimum
      rents increased 1.8%, or $3.3 million, for the year ended December 31, 2006.
      The
      increase is due to higher base rent at the Malls of $5.3 million resulting
      from
      improved in-line store occupancy and increased rental rates. Lease termination
      income decreased $82,000 from the prior year. Straight-line rents decreased
      $1.9
      million for the year ended December 31, 2006, compared to the same period in
      2005.





*Tenant
      reimbursements*





Tenant
      reimbursements reflect an increase of 2.2%, or $1.8 million, for the year ended
      December 31, 2006. This is due to an associated increase of $1.8 million in
      reimbursable expenses for the year and a 20 basis point improvement in recovery
      rates.





*Other
      revenues*





Other
      revenues increased 16.7%, or $3.8 million for the year ended December 31, 2006
      compared to the year ended December 31, 2005. The components of other revenues
      are shown below:





26




**For
                the Years Ended**
              **December
                31,********2006**
            
            **2005**
            
            **Inc.
                (Dec.)**Licensing
                Agreement Income
            
            $
            11,554
            
            $
            13,526
            
            $
            (1,972
            )Outparcel
                Sales
            
            
            6,220
            
            
            2,525
            
            
            3,695Sponsorship
                Income
            
            
            1,069
            
            
            810
            
            
            259Management
                Fees
            
            
            2,231
            
            
            632
            
            
            1,599Other
            
            
            5,588
            
            
            5,359
            
            
            229Total
            
            $
            26,662
            
            $
            22,852
            
            $
            3,810




Licensing
      agreement income relates to our tenants with rental agreement terms of less
      than
      thirteen months. The decline in this revenue is due to extending the terms
      of
      many of these agreements for longer periods. In 2006, revenue from our sales
      of
      outparcels primarily related to seven outparcels sold at The Great Mall of
      the
      Great Plains (“Great Mall”) Property for $5.9 million in the fourth quarter. The
      2005 outparcel income related primarily to sales of undeveloped land in Ohio.
      The increase in management fee income relates to Properties we own through
      a
      joint venture that was formed in late 2005.





Expenses





Total
      expenses increased 26.5%, or $51.5 million, for the year ended December 31,
      2006. Property operating expenses and real estate taxes increased $1.8 million,
      the provision for doubtful accounts decreased $75,000, other operating expenses
      increased $656,000, depreciation and amortization increased $5.5 million,
      general and administrative costs decreased $3.1 million and impairment losses
      on
      held-for-use real estate assets increased $46.7 million.





*Real
      estate taxes and property operating expenses*





Real
      estate taxes and property operating expenses increased $1.8 million, or 1.9%,
      for the year ended December 31, 2006. Real estate taxes decreased $288,000,
      or
      0.8%. Successful real estate tax appeals resulted in decreases in real estate
      taxes at two of our Properties of approximately $783,000 for 2006 compared
      to
      the prior year. Offsetting these reductions were increases in real estate taxes
      for the year ended December 31, 2006 for WestShore Plaza and The Mall at
      Fairfield Commons of $346,000 and $324,000, respectively.





Property
      operating expenses increased $2.1 million, or 3.4% for the year ended December
      31, 2006. Salaries and related expenses were up by $1.1 million. These increases
      related primarily to wages for our housekeeping and security personnel. Utility
      expense increased $1.7 million, with the majority of the increase at Jersey
      Gardens Mall. Offsetting these increases were decreases in parking lot
      maintenance of $390,000 and snow removal of $835,000.





*Provision
      for doubtful accounts*





The
      provision for doubtful accounts was $3.7 million for the year ended December
      31,
      2006 and $3.8 million for 2005. The provision represented 1.2% of revenues
      in
      2006 and 1.3% of revenues in 2005 related to our continuing operations. We
      have
      recorded a total provision for doubtful accounts (including discontinued
      operations) of $6.7 million in 2006 compared to $5.1 million in 2005. The
      increase relates primarily to aged receivables for sold Properties.





*Other
      Operating Expenses*





Other
      operating expenses were $9.6 million for the year ended December 31, 2006
      compared to $9.0 million for the corresponding period in 2005. Cost associated
      with outparcel sales increased $432,000, primarily due to costs associated
      with
      the outparcel sale at our Great Mall Property. Landlord expenses including
      utilities and repairs increased $379,000 from 2005 to 2006. Offsetting these
      increases, our legal expenses decreased in the current year by $264,000 from
      the
      prior year.





*Depreciation
      and Amortization*





Depreciation
      expense increased for the year ended December 31, 2006 by $5.5 million, or
      8.2%.
      The investment of $12 million in improvements to the Nordstrom store at the
      Lloyd Center Mall increased depreciation $1.2 million from the prior year.
      Depreciation expense increased at Eastland Ohio by $2.6 million for 2006
      compared to 2005, primarily due to the addition of the new Macy’s anchor store
      that opened in late 2005.





27


*General
      and Administrative*





General
      and administrative expense was $15.3 million for the year ended December 31,
      2006 compared to $18.4 million for the year ended December 31, 2005. The
      decrease is due primarily to $3.3 million of charges in 2005 relating to
      employment agreement ($2.0 million) and a severance agreement ($1.3 million)
      with two of our former executives.





*Impairment
      losses - real estate assets, continuing operations*





We
      recognized a $46.7 million non-cash impairment charge on our Great Mall Property
      during the fourth quarter of 2006. Even though we have no current intentions
      to
      sell the Property, we are working on multiple redevelopment opportunities that
      may involve a substantial reconfiguration of the Property. These plans result
      in
      more than temporary declines in future cash flow shortfalls when compared to
      the
      carrying value of approximately $89.4 million.





Interest
      expense/capitalized interest





Interest
      expense increased, related to our continuing operations,  14.2%,
      or
      $10.6  million,
      for the year ended December 31, 2006. The summary below identifies the increase
      by its various components (dollars in thousands).




**Year
                Ended December 31,****2006**
            
            **2005**
            
            **Inc.
                (Dec.)**Average
                loan balance
            
            $
            1,375,809
            
            $
            1,235,267
            
            $
            140,542Average
                rate
            
            
            6.21
            %
            
            6.04
            %
            
            0.17
            %Total
                interest
            
            $
            85,438
            
            $
            74,610
            
            $
            10,828Amortization
                of loan fees
            
            
            2,039
            
            
            2,100
            
            
            (61
            )Capitalized
                interest and other expense, net
            
            
            (2,492
            )
            
            (2,314
            )
            
            (178
            )Interest
                expense
            
            $
            84,985
            
            $
            74,396
            
            $
            10,589





The
      increase in the “Average loan balance” was primarily the result of funding
      acquisitions, capital improvements and the Company’s redevelopment program. The
      variance in “Capitalized interest and other, net” was also primarily due to the
      increase in construction activity.





Equity
      in income of unconsolidated entities, net





The
      $1.4
      million income results primarily from our investment in Puente and Tulsa. This
      represents our share of the $2.8 million of net income (available after payment
      of the preferred dividend) for the year ended December 31, 2006 for these
      Properties for the period during 2006 in which they were held through a joint
      venture (the “ORC Venture”) with OMERS Realty Corporation (“ORC”), an affiliate
      of Oxford Properties Group (“Oxford”), which is the global real estate platform
      for the Ontario (Canada) Municipal Employees Retirement System, a Canadian
      pension plan. The reconciliation of the net income from the ORC Venture to
      FFO
      for these Properties is shown below (in thousands).




**Year
                Ended**
              **December
                31, 2006**Net
                income available to joint ventures
            
            $
            2,776Add
                back:Real
                estate depreciation and amortization
            
            
            8,892FFO
            
            $
            11,668Pro-rata
                share of joint venture FFO
            
            $
            6,067




Discontinued
      Operations





During
      2006, we sold seven Community Centers for $24.7 million and reflected five
      Mall
      Properties as held-for-sale. In connection with the sales, we recorded a net
      gain on the sale of $1.7 million. We recorded an impairment loss of $65.2
      million primarily associated with two of the held-for-sale Malls. The impairment
      loss is reported in discontinued operations in accordance with SFAS No. 144.
      During 2005, we sold five Community Centers and one Mall for $18.4 million
      and
      reflected seven Community Centers and one Mall as held-for-sale. We reported
      a
      net gain of $1.6 million associated with the sale of these Community Centers
      and
      the Mall and recorded an impairment loss of $16.4 million. Total revenues for
      discontinued operations were $44.9 million and $52.6 million for the years
      ended
      December 31, 2006 and 2005, respectively.





28


**Results
      of Operations - Year Ended December 31, 2005 Compared to Year Ended December
      31,
      2004**




Revenues





Total
      revenues increased 3.9%, or $11.2 million, for the year ended December 31,
      2005.
      Minimum rents increased $9.0 million, percentage rents increased $207,000,
      tenant reimbursements increased $3.0 million and other income decreased $1.0
      million.




*Minimum
      rents*





Minimum
      rents increased 5.1%, or $9.0 million, for the year ended December 31, 2005.
      The
      increase is primarily due to higher base rents at the Properties of $5.8 million
      and lease termination income increasing by $3.2 million.




*Tenant
      reimbursements*





Tenant
      reimbursements reflect an increase of 3.6%, or $3.0 million, for the year ended
      December 31, 2005. The increase in revenues relates to increases in recoverable
      operating expenses of $1.6 million and an improvement to the recovery rate
      of
      160 basis points compared to 2004.




*Other
      revenues*





The
      $1.0
      million decrease in other revenue is a result of a decrease of $1.8 million
      in
      licensing agreement revenue and a decrease of $188,000 in revenue from outparcel
      sales. These decreases were partially offset by higher fee income of $532,000
      primarily related to the acquisition fee earned following the purchase of Puente
      on December 29, 2005.




Expenses





Total
      expenses increased $8.8 million, or 4.7%, for the year ended December 31, 2005.
      Real estate taxes and property operating expenses increased $1.6 million, the
      provision for doubtful accounts decreased $507,000, other operating expenses
      increased $1.1 million, depreciation and amortization increased $2.5 million
      and
      general and administrative expenses increased $4.1 million.





*Real
      estate taxes and property operating expenses*





Real
      estate taxes and property operating expenses increased 1.7%, or $1.6 million,
      for the year ended December 31, 2005. Real estate taxes increased $2.3 million
      from 2004 as a result of increases in the assessed value of several Properties
      and a change in the calculation of commercial property real estate tax at our
      Properties located in Ohio. The increase was partially offset by a reduction
      in
      property operating expenses of $646,000, primarily a result of bringing
      housekeeping and security services in-house.




*Provision
      for doubtful accounts*





The
      provision for doubtful accounts was $3.8 million for the year ended December
      31,
      2005 and $4.3 million for 2004. The provision represented 1.3% of revenues
      in
      2005 and 1.5% of revenues in 2004. The allowance for doubtful accounts has
      not
      changed significantly as of December 31, 2005 compared to December 31,
      2004.


*Other
        operating expenses*
  Other
        operating expenses were $9.0 million for the year ended December 31, 2005
        compared to $7.9 million for the corresponding period in 2004. The increase
        was
        primarily due to higher legal fees of $525,000 at the Properties and an increase
        of $495,000 in costs related to outparcel sales.




29




*Depreciation
      and Amortization*




Depreciation
      and amortization expense increased for the year ended December 31, 2005 by
      $2.5
      million, or 3.8%. The increase in depreciation and amortization is primarily
      a
      result of depreciation for additions to real estate assets and the write-offs
      related to improvements in spaces vacated by anchor tenants.




*General
      and Administrative*





General
      and administrative expense was $18.4 million and represented 6.1% of total
      revenues for the year ended December 31, 2005 compared to $14.3 million and
      5.0%
      of total revenues for 2004. The increase is primarily due to $3.3 million of
      charges in 2005 relating to an employment agreement ($2.0 million) and a
      severance agreement ($1.3 million) with two of our former executives; higher
      professional services fees associated with corporate governance initiatives
      and
      increased corporate salaries.





Interest
      expense/capitalized interest





Interest
      expense decreased, related to our continuing operations, 5.1% or $4.0 million
      for the year ended December 31, 2005. The summary below identifies the decrease
      by its various components (dollars in thousands).




**Year
                Ended December 31,****2005**
            
            **2004**
            
            **Inc.
                (Dec.)**Average
                loan balance
            
            $
            1,235,267
            
            $
            1,249,549
            
            $
            (14,282
            )Average
                rate
            
            
            6.04
            %
            
            5.93
            %
            
            0.11
            %Total
                interest
            
            $
            74,610
            
            $
            74,099
            
            $
            511Amortization
                of loan fees
            
            
            2,100
            
            
            4,033
            
            
            (1,933
            )Capitalized
                interest and other expense, net
            
            
            (2,314
            )
            
            227
            
            
            (2,541
            )Interest
                expense
            
            $
            74,396
            
            $
            78,359
            
            $
            (3,963
            )





Costs
      associated with early extinguishment of debt, which are reflected in interest
      expense, were $1.8 million for the year ended December 31, 2004. Of this cost,
      $1.2 million is included under “Amortization of loan fees” and represents the
      acceleration of loan fee amortization associated with the refinancing of
      mortgages. Decreases in “Capitalized interest and other expense, net” was due to
      a significant increase in construction activity resulting in a $1.1 million
      increase in capitalized interest in 2005. Other items causing the decrease
      were
      the settlement of an interest rate swap arrangement of $391,000 and fees
      associated with a mortgage refinancing of $557,000, both of which occurred
      in
      2004 with no similar expense in 2005.





Equity
      in income of unconsolidated entities, net





The
      $51,000 income results from our investment in Puente.





Discontinued
      Operations





During
      2005, we sold five Community Centers and one Mall for $18.4 million and
      reflected seven Community Centers and one Mall as held-for-sale. We reported
      a
      net gain of $1.6 million associated with the sale of these Community Centers
      and
      the Mall and recorded an impairment loss of $16.4 million, which, in accordance
      with SFAS No. 144, is reported in discontinued operations. During 2004, we
      sold
      twenty-nine Community Centers for $113.3 million and reflected one Community
      Center as held-for-sale. We recorded a net gain on the sale of discontinued
      operations of $19.6 million. Total revenues for discontinued operations were
      $52.6 million and $66.3 million for the years ended December 31, 2005 and 2004,
      respectively.





**Liquidity
      and Capital Resources**





*Liquidity*





Our
      short-term (less than one year) liquidity requirements include recurring
      operating costs, capital expenditures, debt service requirements and dividend
      and distribution requirements pertaining to our preferred shares, Common Shares
      and OP Units. We anticipate that these needs will be primarily met with cash
      flows provided by operations.





30


Our
      long-term (greater than one year) liquidity requirements include scheduled
      debt
      maturities, capital expenditures to maintain, renovate and expand existing
      assets, property acquisitions and development projects. Management anticipates
      that net cash provided by operating activities, the funds available under our
      credit facility, construction financing, long-term mortgage debt, contributions
      from our strategic joint venture partnerships, issuance of preferred shares
      and
      Common Shares, and proceeds from the sale of assets will provide sufficient
      capital resources to carry out our business strategy.





At
      December 31, 2006, our total-debt-to-total-market capitalization was 55.3%
      compared to 56.1% at December 31, 2005. We are working to maintain this ratio
      in
      the mid-fifty percent range. We expect to utilize the proceeds from future
      asset
      sales to reduce debt and, to the extent that market capitalization remains
      in
      the current range, to fund expansion, renovation and redevelopment of existing
      Properties and the acquisition of additional regional mall properties.
      Total-debt-to-total-market capitalization is calculated below (dollars and
      shares in thousands, except stock price).


****


**Dec.
                31, 2006**
            
            **Dec.
                31, 2005**Stock
                Price (end of period)
            
            $
            26.71
            
            $
            24.32Market
                Capitalization Ratio:Common
                Shares outstanding
            
            
            36,776
            
            
            36,506OP
                Units outstanding
            
            
            2,996
            
            
            3,115Total
                Common Shares and OP Units outstanding at end of period
            
            
            39,772
            
            
            39,621Market
                capitalization - Common Shares outstanding
            
            $
            982,287
            
            $
            887,826Market
                capitalization - OP Units outstanding
            
            
            80,023
            
            
            75,757Market
                capitalization - Preferred Shares
            
            
            210,000
            
            
            210,000Total
                debt (end of period)
            
            
            1,576,886
            
            
            1,501,481Total
                market capitalization
            
            $
            2,849,196
            
            $
            2,675,064Total
                debt/total market capitalization
            
            
            55.3
            %
            
            56.1
            %Total
                debt/total market capitalization including pro-rata share of joint
                ventures
            
            
            56.3
            %
            
            56.9
            %





Capital **** Resource
      Availability





In
      December 2006, we amended our existing unsecured line of credit (the “Prior
      Credit Facility”) to increase the borrowing availability from $300 million to
      $470 million (the “Amended Credit Facility”) and extend the maturity date to
      December 2009 with a one-year extension option available to the Company, subject
      to the satisfaction of certain conditions. The Amended Credit Facility is
      expandable to $600 million, subject to certain conditions. The interest rate
      of
      the Amended Credit Facility ranges from LIBOR plus 0.95% to LIBOR plus 1.40%
      depending upon our ratio of debt to total asset value.





In
      December 2005, we formed the ORC Venture with OMERS. The initial acquisition
      of
      the ORC Venture was the $170.1 million purchase of Puente. We have a 52%
      interest in the ORC Venture and ORC has a 48% interest, but GPLP will be
      entitled to certain preferred payments provided that ORC earns a specified
      rate
      of return. **** As part
      of the ORC Venture, ORC made $200 million available for acquisitions of certain
      mall and anchored lifestyle retail properties that GPLP offers to the ORC
      Venture. The properties to be acquired by the ORC Venture will be operated
      by us
      under separate management agreements. During 2006, the ORC Venture utilized
      $11.3 million of the $200.0 million to acquire Tulsa from GPLP and $188.7
      million remains available. Under these agreements, Glimcher will be entitled
      to
      management fees, leasing commissions and other compensation including an asset
      management fee and acquisition fees based upon the purchase price paid for
      each
      property.





On
      March
      24, 2004, we filed with the SEC a universal shelf registration statement. This
      registration statement permits us to engage in offerings of debt securities,
      preferred and common shares, warrants, rights to purchase the Company’s common
      shares, purchase contracts and any combination of the foregoing. The
      registration statement was declared effective on April 6, 2004. The amount
      of
      securities registered was $400 million, all of which is currently available
      for
      future offerings.




Cash
      Activity




*For
      the Year Ended December 31, 2006*





Net
      cash
      provided by operating activities was $96.2 million for the year ended December
      31, 2006.





31


Net
      cash
      used in investing activities was $108.9 million for the year ended December
      31,
      2006. On January 17, 2006, we purchased Tulsa, a 927,000 square foot enclosed
      regional mall located in Tulsa, Oklahoma for $55.7 million. This Property was
      wholly owned until March 14, 2006 when we received $11.3 million upon transfer
      of this Property to the ORC Venture. Also, we paid $77.1 million towards our
      investment in real estate. Of this amount we spent $29.2 million on constructing
      additional GLA and interior renovations, primarily at The Dayton Mall, Eastland
      Ohio, Northtown Mall and Lloyd Center. We also spent $21.4 million on tenant
      improvements to re-tenant existing spaces. Another $9.4 million was spent on
      operational capital expenditures. The remaining amounts pertain to corporate
      projects, capitalized wages, real estate taxes and interest. We also invested
      $13.3 million in our unconsolidated properties. During September 2006, we paid
      $1.9 million to enter into a joint venture in Surprise, Arizona to develop
      a
      27,000 square foot retail development (“Surprise Venture”). During December
      2006, we invested $10.3 million in a joint venture to develop a 650,000 square
      foot premium retail and office complex in Scottsdale, Arizona (“Scottsdale
      Venture”). We also increased our investment in Puente by $1.0 million to fund
      that Property’s ongoing redevelopment program. Offsetting this was the receipt
      of $24.7 million in connection with the sale of seven non-strategic Community
      Center assets and $6.8 million received from the sale of outparcels.





Net
      cash
      provided by financing activities was $16.6 million for the year ended December
      31, 2006. During 2006, we received $168.3 million from the issuance of new
      mortgage debt. This increase was primarily the result of the $35.0 million
      mortgage on Tulsa entered into subsequent to our acquisition of that particular
      Mall and the $133.0 million of new mortgage debt associated with the
      refinancings of Weberstown Mall, Eastland Ohio and Great Mall. We also received
      net proceeds of $122.0 million from our Amended Credit Facility. These proceeds
      were used primarily to fund our initial investments in both our Surprise Venture
      and Scottsdale Venture. We also used these proceeds to defease our University
      Mall mortgage debt. Offsetting these increases to cash were principal payments
      of $179.5 million. During 2006, we repaid mortgage debt totaling $153.6 million
      associated with University Mall, Weberstown Mall, Eastland Ohio and Great Mall.
      We also repaid $7.7 million of mortgage debt associated with Properties sold
      during 2006. The remaining payments were normal principal payments associated
      with mortgage debt. Lastly, we paid $93.8 million in dividend distributions
      to
      holders of our Common Shares, OP Units and preferred shares.





*For
      the Year Ended December 31, 2005*





Net
      cash
      provided by operating activities was $108.3 million for the year ended December
      31, 2005.





Net
      cash
      used in investing activities was $120.2 million for the year ended December
      31,
      2005. During 2005, we spent $95.9 million towards our investment in real estate
      for i) $63.9 million to construct additional GLA and interior renovations,
      primarily at Eastland Ohio, The Mall at Fairfield Commons, The Dayton Mall,
      Lloyd Center and Northtown Mall and the purchase of vacant anchor space at
      Polaris Fashion Place, ii) $12.8 million on tenant improvements and allowances
      to re-tenant existing space, iii) $7.7 million for the acquisition of land
      in
      connection with the development of an anchored retail project to serve the
      Cincinnati, Ohio market (“City Park development”), iv) $4.6 million on
      operational capital expenditures and v) $6.9 million on other items such as
      corporate projects, capitalized wages, real estate taxes and interest. We also
      spent $44.2 million in connection with our investment, through the ORC Venture,
      in Puente. The remaining amounts pertain to corporate projects, capitalized
      wages, real estate taxes and interest. Offsetting these capital outlays, we
      received $23.6 million in proceeds from the sale of i) Southside Mall, ($13.0
      million), ii) the former Lord & Taylor anchor space at Polaris Fashion Place
      ($5.3 million) and iii) the sale of 5 Community Centers ($5.3 million). We
      also
      received $3.0 million from the sale of outparcels.





Net
      cash
      provided by financing activities was $11.2 million for the year ended December
      31, 2005. During 2005, we received $111.7 from the issuance of mortgage notes
      payable. These funds were received in connection with the new $44.0 million
      mortgage loan on Montgomery Mall, the new $50.0 million mortgage loan on River
      Valley Mall and $17.7 million for the construction loan in connection with
      the
      redevelopment activities at Eastland Ohio. Also, we received net proceeds of
      $76.0 million from our Prior Credit Facility of which the majority of the
      proceeds were used to fund numerous redevelopment projects that are currently
      ongoing. Offsetting these increases was the $88.4 million paid for principal
      payments on existing mortgage debt. This amount consisted of the extinguishment
      of the existing mortgage on Montgomery Mall and Southside Mall as well as normal
      principal payments. We also paid $92.9 million in dividend distributions to
      holders of our Common Shares, OP Units and preferred shares.





32




*For
      the Year Ended December 31, 2004*





Net
      cash
      provided by operating activities was $102.3 million for the year ended December
      31, 2004.





Net
      cash
      provided by investing activities was $38.1 million for the year ended December
      31, 2004. The primary uses were the investments in real estate of $72.7 million.
      These real estate investments were for development and redevelopment activities
      of $12.7 million, property capital expenditures of $16.2 million and the cash
      portion of the purchase price related to Polaris Fashion Place and Polaris
      Towne
      Center of $42.9 million. We received proceeds of $106.8 million from the sale
      of
      twenty-nine Community Centers and $2.7 million from the sale of
      outparcels.





Net
      cash
      used in financing activities was $143.0 million for the year ended December
      31,
      2004. Proceeds were received from the issuance of $150 million of the Series
      G
      Preferred Shares, which totaled a net amount of $144.8 million. This amount
      was
      offset by the redemption of the Series B Preferred Shares totaling $128.0
      million. We received $231.5 million from the issuance of mortgage notes payable.
      In the first quarter of 2004, we received $36.5 million in loan proceeds that
      was used to fund the acquisition of the remaining joint venture interest in
      Polaris Fashion Place not previously owned by the Company (the “Polaris
      acquisition”). During the second quarter of 2004, we refinanced Jersey Gardens
      Mall with a $165.0 million permanent mortgage loan and refinanced Great Mall
      with a $30.0 million two-year bridge facility. Cash used to repay mortgage
      notes
      payable was $303.4 million, of which $292.7 million related to repayment of
      the
      previous debt on Jersey Gardens Mall, Great Mall, River Valley Mall and a bridge
      facility associated with the Polaris acquisition. The remainder of the repayment
      amount relates to scheduled debt amortizations of $17.2 million. We also paid
      $89.2 million in dividend distributions.





Financing
      Activity





Total
      debt increased by $75.4 million during 2006. The change in outstanding
      borrowings is summarized as follows (in thousands):




**Mortgage**
              **Notes**
            
            **Notes**
              **Payable**
            
            **Total**
              **Debt**December
                31, 2005
            
            $
            1,351,481
            
            $
            150,000
            
            $
            1,501,481New
                mortgage debt
            
            
            168,331
            
            
            -
            
            
            168,331Repayment
                of debt
            
            
            (161,237
            )
            
            -
            
            
            (161,237
            )Debt
                assignment to ORC Venture
            
            
            (35,000
            )
            
            -
            
            
            (35,000
            )Debt
                amortization payments in 2006
            
            
            (18,260
            )
            
            -
            
            
            (18,260
            )Amortization
                of fair value adjustment
            
            
            (429
            )
            
            -
            
            
            (429
            )Net
                borrowings, line of credit
            
            
            -
            
            
            122,000
            
            
            122,000December
                31, 2006
            
            $
            1,304,886
            
            $
            272,000
            
            $
            1,576,886





During
      2006, we entered into four new financing arrangements and modified three
      existing arrangements. On January 13, 2006, the Company entered into a loan
      agreement to borrow $30.0 million (the “Great Mall Loan”). The Great Mall Loan
      is represented by a promissory note secured by a first mortgage lien and
      assignment of leases and rents on Great Mall. The Great Mall Loan has a floating
      interest rate of LIBOR plus 1.65% per annum and a maturity date of January
      12,
      2009. The interest rate for the Great Mall Loan was subsequently fixed through
      an interest rate protection agreement at 6.35% through January 15, 2008. The
      Great Mall Loan requires the Company to make interest only periodic payments
      with all outstanding principal and accrued interest being due and payable at
      the
      maturity date. The proceeds of the Great Mall Loan were used to payoff the
      previous loan in the same amount. Also on January 13, 2006, we amended the
      $25
      million mortgage loan agreement on Montgomery Mall to reduce the interest rate
      to LIBOR plus 1.65% from LIBOR plus 1.85%. After extending the loan for six
      months on July 31, 2006, the $25 million mortgage was repaid on January 22,
      2007. On March 14, 2006, we entered into a loan agreement to borrow $35 million
      initially (the “Tulsa Loan”) and up to $50 million in total as part of a
      mortgage financing arrangement for Tulsa. The Tulsa Loan is represented by
      two
      promissory notes secured by a first mortgage lien and assignment of leases
      and
      rents on Tulsa. The Tulsa Loan had an initial floating interest rate of LIBOR
      plus 1.35% per annum and has a maturity date of March 14, 2009. The initial
      interest rate for the Tulsa Loan was subsequently fixed at a rate of 6.52%
      through an interest rate protection agreement. Under the Tulsa Loan, we are
      required to make interest only periodic payments for the length of the term.
      On
      May 25, 2006, we executed a loan agreement to borrow $60 million (the
“Weberstown Loan”). The Weberstown Loan is represented by two promissory notes
      secured by a first mortgage lien and assignment of leases and rents on
      Weberstown Mall located in Stockton, California. The Weberstown Loan has a
      fixed
      interest rate of 5.90% per annum and a maturity date of June 8, 2016. Under
      the
      Weberstown Loan, we are required to make interest only periodic payments for
      the
      length of the term. We are not permitted under the Weberstown Loan to make
      any
      prepayments on outstanding principal until three months prior to the maturity
      date. On November 20, 2006, we entered into a Loan Agreement to borrow $43
      million (the “Eastland Columbus Loan”). The Eastland Columbus Loan is
      represented by a promissory note secured by a first mortgage lien on Eastland
      Ohio. The Eastland Columbus Loan has a fixed interest rate of 5.87% per annum
      and a maturity date of December 11, 2016. Under the Eastland Columbus Loan,
      we
      are required to make interest only periodic payments for the first two years
      of
      the loan’s term and then, beginning in December 2008, payments of interest and
      principal. We are not permitted under the Eastland Columbus Loan to make any
      prepayments on outstanding principal prior to the maturity date.





33


At
      December 31, 2006, our mortgage notes payable were collateralized with first
      mortgage liens on 23 Properties having a net book value of $1,444.2 million.
      We
      also owned 5 unencumbered Properties and other corporate assets having a net
      book value of $239.4 million at that date.





Certain
      of our loans have multiple Properties as collateral for such loans and have
      cross-default provisions. Under the cross-default provisions, a default under
      a
      single mortgage included in a cross-defaulted loan may constitute a default
      under all of the mortgages under that loan and may lead to acceleration of
      the
      indebtedness due on each Property within the collateral pool. Properties which
      are subject to cross-default provisions have a total net book value of $81.0
      million and represent one Community Center and three Malls. Properties under
      such cross-default provisions relate to i) the Morgantown Mall Associates LP
      loan securing two Properties with a net book value of $41.5 million and ii)
      the
      SAN Mall LP loan securing two Properties with a net book value of $39.5
      million.





Financing
      Activity - Joint Ventures





Within
      the ORC Venture, the total debt increased by $33.9 million during 2006. The
      change in outstanding borrowings is summarized as follows (in
      thousands):





**Mortgage
                Notes**
            
            **GRT
                Share (52%)**December
                31, 2005
            
            $
            88,212
            
            $
            45,870Assumed
                mortgage debt
            
            
            35,000
            
            
            18,200Debt
                amortization payments in 2006
            
            
            (1,308
            )
            
            (680
            )Amortization
                of fair value adjustment
            
            
            195
            
            
            102December
                31, 2006
            
            $
            122,099
            
            $
            63,492




At
      December 31, 2006, the mortgage notes payable were collateralized with first
      mortgage liens on two Properties having a net book value of $242.8 million.
      The
      ORC Venture assumed the Tulsa Loan as part of GPLP’s transfer of Tulsa to the
      ORC Venture on March 14, 2006.





We
      also
      had joint venture interests in two unencumbered real estate parcels connected
      with our Surprise Venture and Scottsdale Venture having a net book value of
      $4.1
      million at December 31, 2006.





*Contractual
      Obligations and Commitments*





The
      following table shows the Company’s contractual obligations and commitments as
      of December 31, 2006 related to our consolidated operations as well as our
      pro-rata share of our obligations under our joint venture arrangements (in
      thousands):




**Consolidated
                Obligations and Commitments:**
            
            **Total**
            
            **2007**
            
            **2008-2009**
            
            **2010-2011**
            
            **Thereafter**Long-term
                debt (includes interest payments)
            
            $
            2,039,360
            
            $
            206,529
            
            $
            615,390
            
            $
            238,210
            
            $
            979,231Distribution
                obligations
            
            
            58,284
            
            
            36,564
            
            
            21,720
            
            
            -
            
            
            -OP
                Unit redemptions
            
            
            80,645
            
            
            80,645
            
            
            -
            
            
            -
            
            
            -Lease
                obligations
            
            
            2,246
            
            
            1,322
            
            
            780
            
            
            101
            
            
            43Tenant
                allowances
            
            
            26,279
            
            
            26,279
            
            
            -
            
            
            -Purchase
                obligations
            
            
            13,935
            
            
            13,935
            
            
            -
            
            
            -
            
            
            -Total
                consolidated obligations and commitments
            
            $
            2,220,749
            
            $
            365,274
            
            $
            637,890
            
            $
            238,311
            
            $
            979,274






**Pro-rata
                share of joint venture obligations:**
            
            **Total**
            
            **2007**
            
            ******2008-2009**
            
            **2010-2011**
            
            **Thereafter**Ground
                lease obligation
            
            $
            143,523
            
            $
            2,600
            
            $
            5,318
            
            $
            5,478
            
            $
            130,127Long-term
                debt (includes interest payments)
            
            
            70,864
            
            
            4,253
            
            
            66,611
            
            
            -
            
            
            -Tenant
                allowances
            
            
            1,297
            
            
            1,297
            
            
            -
            
            
            -
            
            
            -Purchase
                obligations
            
            
            5,779
            
            
            5,779
            
            
            -
            
            
            -
            
            
            -Total
                commercial obligations
            
            $
            221,463
            
            $
            13,929
            
            $
            71,929
            
            $
            5,478
            
            $
            130,127




34


Consolidated
      Obligations and Commitments





Long-term
      debt obligations are shown including both scheduled interest and principal
      payments. The nature of the obligations is disclosed in the Notes to the
      consolidated financial statements.





At
      December 31, 2006, we had the following obligations relating to dividend
      distributions. In the fourth quarter of 2006, the Company declared distributions
      of $0.4808 per Common Share ($19.1 million) to be paid during the first quarter
      of 2007. Series F Preferred Shares and Series G Preferred Shares are not
      required to be redeemed and therefore, the dividends on those shares may be
      paid
      in perpetuity. However, as the Series F Preferred Shares are redeemable at
      our
      option on or after August 25, 2008, the obligation for the dividends for the
      Series F Preferred Shares are included in the contractual obligations through
      that date. Also, as the Series G Preferred Shares are redeemable at our option
      on or after February 23, 2009, the obligation for the dividends for the Series
      G
      Preferred Shares are also included in the contractual obligations through that
      date. The total dividend obligation for the Series F Preferred Shares and Series
      G Preferred Shares is $10.0 million and $29.2 million, respectively.





Lease
      obligations include both our capital and operating lease obligations. Capital
      lease obligations are for security equipment and generators at various
      Properties and are included in accounts payable and accrued expenses in the
      consolidated balance sheet. Operating lease obligations are for office space,
      ground leases, phone system, office equipment, computer equipment and other
      miscellaneous items. The obligation for these leases at December 31, 2006 was
      $2.2 million.





At
      December 31, 2006, we had executed leases committing to $26.3 million in tenant
      allowances. The leases will generate gross rents of approximately $95.5 million
      over the original lease term. Purchase obligations relate primarily to
      construction contract commitments.





At
      December 31, 2006, there were approximately 3.0 million OP Units outstanding.
      These OP Units are redeemable, at the option of the holders, beginning on the
      first anniversary of their issuance. The redemption price for an OP Unit shall
      be, at the option of GPLP, payable in the following form and amount: (a) cash
      at
      a price equal to the fair market value of one Common Share of the Company or
      (b)
      Common Shares at the exchange ratio of one share for each OP Unit. The fair
      value of the OP Units outstanding at December 31, 2006 is $80.6 million based
      upon a per unit value of $26.92 at December 31, 2006, (based upon a five-day
      average of the Common Stock price from December 21, 2006 to December 28,
      2006).





Pro-rata
      share of joint venture obligations





In
      the
      second quarter of 2006, the Company announced the Scottsdale Venture, a joint
      venture between GPLP and Vanguard City Home, an affiliate of the Wolff Company.
      The parties will conduct the operations of the Scottsdale Venture through a
      limited liability company (“LLC Co.”) of which GPLP is the managing member. The
      LLC Co. will coordinate and manage the construction of the Scottsdale Crossing
      development, an approximately 650,000 square foot premium retail and office
      complex to be developed in Scottsdale, Arizona. GPLP has made an initial capital
      contribution of approximately $10.3 million to LLC Co. and holds a 50% interest
      in LLC Co. Upon completion of the Scottsdale Crossing development, the LLC
      Co.
      will own and operate (on land subject to a ground lease, the landlord of which
      is an affiliate of Wolff Company, under which the LLC Co. is the tenant) the
      Scottsdale Crossing development. Related to the Scottsdale Venture, the Company
      and LLC Co. have the following commitments:




o
            **Letter
                of Credit:**LLC Co. has provided a letter of credit in the amount of $20 million
                to
                serve as security for the construction at the Scottsdale Crossing
                development. LLC Co. shall maintain the letter of credit until substantial
                completion of the construction of the Scottsdale Crossing development
                occurs.





o
            **Lease
                Payment:**The
                LLC Co. shall make rent payments under a ground lease executed as
                part of
                the Scottsdale Venture. The initial base rent under the ground lease
                is
                $5.2 million per year during the first year of the lease term and
                shall be
                periodically increased 1.5% to 2% during the lease term until the
                fortieth
                year of the lease term and marked to market thereafter (“Base Rent”).
                Additionally, the LLC Co. has provided the landlord with a security
                deposit consisting of a portfolio of U.S. government securities valued
                at
                approximately $19 million (the “Deposit”) which will be used: i) to make
                base rent payments under the ground lease for the first forty-seven
                months
                of the ground lease’s initial term, ii) as security for LLC Co.’s
                performance under the ground lease, and iii) in the event of LLC
                Co,’s
                default, to pay base rent or additional rent under the ground lease
                for
                the first forty-seven months of the ground lease’s initial term as well as
                any other charges related to a LLC Co.’s default under the ground lease.
                After the first forty-seven months of the ground lease’s initial term, any
                remaining portion of the Deposit shall be returned to LLC Co. A portion
                of
                GPLP’s capital contribution will be used to fund its pro rata share of
                LLC
                Co.’s payments under the ground
                lease.





o
            **Property
                Purchase:**LLC
                Co. will purchase certain retail units consisting of approximately
                82,000
                square feet in a condominium to be built as a part of the Scottsdale
                Crossing development at a price of $181 per square
                foot.





35


The
      long-term debt obligation is our pro-rata share of the scheduled payments of
      interest and principle related to our loans at Puente and Tulsa. The tenant
      allowances relate to both the ORC Venture and the Scottsdale Venture for tenants
      who have signed leases at our Puente, Scottsdale Crossing and Tulsa Properties.
      Our pro-rata share of purchase obligations primarily relate to construction
      commitments for our redevelopment work at Puente.





Capital
      Expenditures





We
      plan
      our capital expenditures by considering various factors such as: return on
      investment, our five-year capital plan for major facility expenditures such
      as
      roof and parking lot repairs and tenant construction allowances based upon
      the
      economics of the lease terms and cash available for making such expenditures.
      We
      categorize our capital expenditures into two broad categories, first-generation
      and second-generation expenditures. The first-generation expenditures relate
      to
      incremental revenues associated with new developments or creation of new GLA
      at
      our existing Properties. Second-generation expenditures are those expenditures
      associated with maintaining the current income stream and are generally
      expenditures made to maintain the Properties and to replace tenants for spaces
      that have been previously occupied. Capital expenditures are generally
      accumulated into a project and classified as “developments in progress” on the
      consolidated balance sheet until such time as the project is completed. At
      the
      time the project is complete, the dollars are transferred to the appropriate
      category on the balance sheet and are depreciated on a straight-line basis
      over
      the estimated useful life of the asset.





We
      invested approximately $28 million in redevelopment activity in 2006. These
      projects focused primarily on eight Malls. In addition, we invested $29 million
      in property capital expenditures for both operational needs and tenant
      improvements and $2 million in renovations.





Off-Balance
      Sheet Arrangements





We
      have
      no off-balance sheet arrangements (as defined in Item 303 of Regulation
      S-K).





Acquisitions
      of Additional Properties





In
      December 2005, we formed the ORC Venture with an affiliate of Oxford, which
      is
      the global real estate platform for the Ontario (Canada) Municipal Employees
      Retirement System, a Canadian pension plan. The initial acquisition of the
      ORC
      Venture was the $170.1 million purchase of Puente. We have a 52% interest in
      the
      ORC Venture and ORC has a 48% interest, but GPLP will be entitled to certain
      preferred payments provided that ORC earns a specified rate of
      return. **** In
      connection with the acquisition, the ORC Venture assumed an $88.8 million
      non-recourse mortgage loan, with the remainder of the purchase price being
      funded by contributions to the ORC Venture from GPLP and ORC.




In
      addition to our acquisition of Puente through the ORC Venture, we also acquired
      Tulsa on January 17, 2006. Tulsa is a regional mall located in Tulsa, Oklahoma
      with approximately 927,000 square feet of GLA. The purchase price was $58.3
      million and we did not assume any debt in connection with this purchase. We
      funded the acquisition with funds made available through our Prior Credit
      Facility. On March 14, 2006, we transferred our 100% interest in Tulsa into
      the
      ORC Venture and continue to hold a 52% interest through the joint
      venture.





**Expansion,
      Renovation and Development Activity**





We
      continue to be active in expansion, renovation and development activities.
      Our
      business strategy is to grow the Company’s assets, net income and cash flow to,
      among other things, provide for dividend requirements and to preserve, maintain
      and expand value for shareholders.








36




Expansions
      and Renovations





We
      maintain a strategy of selective expansions and renovations in order to improve
      the operating performance and the competitive position of our existing
      portfolio. We also engage in an active redevelopment program with the objective
      of attracting innovative retailers, which we believe will enhance the operating
      performance of the Properties.





*Malls*





In
      2006
      we added a lifestyle retail component to The Dayton Mall in Dayton, Ohio further
      enhancing the strong market share already enjoyed by this Property. The Dayton
      Mall project includes a façade renovation and the addition of 116,000 square
      feet of new retail GLA in a new open-air center and additional outward-facing
      retail stores. This addition was over 50% occupied at December 31, 2006 and
      is
      anticipated to be more than 80% occupied upon the opening of several new retail
      stores committed for 2007.





The
      Polaris Fashion Place redevelopment project, located in Columbus, Ohio, centers
      around a replacement anchor store for the vacated Lord & Taylor anchor store
      (the “Lord & Taylor parcel”). On May 16, 2005, we purchased the Lord &
Taylor parcel from The May Department Stores Company. On July 20, 2005, we
      sold
      the Lord & Taylor parcel to Von Maur, Inc., an Iowa-based fashion specialty
      retailer (“Von Maur”). During the fourth quarter of 2005, Von Maur opened its
      first Ohio store in the 140,000 square foot anchor space. In addition, a newly
      constructed approximately 9,450 square foot multi-tenant building and some
      new
      restaurants have opened. Retailers in this new addition to Polaris Fashion
      Place
      include: Mimi’s Café, Potbelly Sandwiches and Omaha Steaks. In 2007, we have
      plans to purchase the former Kauffman’s anchor store from Federated Department
      Stores, Inc. and redevelop the space with an outward facing “Main Street Retail”
style component.





Redevelopment
      work is in process at Northtown Mall in Blaine, Minnesota. The expansion project
      included tripling the size of the food court, installing new exterior signage,
      adding a new 10,000 square foot freestanding building and demolishing a vacant
      anchor store in order to replace it with a new Home Depot store. We expect
      the
      new Home Depot anchor store to open in the first quarter of 2007.





We
      have
      re-development plans for The Mall at Johnson City (“MJC”) in Johnson City,
      Tennessee. We plan to construct a new Dick’s Sporting Goods store that is
      anticipated to open in the second quarter of 2008. In addition, we plan to
      complete a store remodel and add approximately 35,000 square feet to the
      JCPenney anchor store at the Mall.





Developments





One
      of
      our objectives is to increase our portfolio by developing new retail properties.
      Our management team has developed over 100 retail properties nationwide and
      has
      significant experience in all phases of the development process including:
      site
      selection, zoning, design, pre-development leasing, construction financing
      and
      construction management.





Our
      Scottsdale Crossing development will be an approximately 650,000 square foot
      complex consisting of approximately 380,000 square feet of retail space with
      approximately 270,000 square feet of additional office space constructed above
      the retail units. The Scottsdale Venture intends to retain a third party company
      to lease the office portion of the complex. Our Scottsdale Crossing development
      will be adjacent to a hotel and residential complex that will be developed
      independently by an affiliate of The Wolff Company, an affiliate of which is
      our
      joint venture partner in this development. Once completed, we anticipate that
      the Scottsdale Crossing development will be a dynamic, outdoor urban environment
      featuring sophisticated architectural design, comfortable pedestrian plazas,
      a
      grand central park space, and a variety of upscale shopping, dining and
      entertainment options.





The
      Scottsdale Venture entered into a long-term ground lease for property on which
      a
      portion of the project will be constructed. We own a 50% interest in the
      Scottsdale Venture and will operate and lease the retail portion of the project
      under a separate management agreement. Opening of the approximately $200 million
      development is anticipated during 2009.





Our
      Surprise Venture will be developing a new retail site in Surprise, Arizona
      (northwest of Phoenix). This five-acre development will consist of approximately
      27,000 square feet of new retail space. GPLP also has an option agreement for
      a
      100-acre site contiguous to this five-acre development and is evaluating
      potential development of this site.








37


**Portfolio
      Data**





The
      table
      below reflects Mall sales per square foot (“Sales PSF”) for those tenants
      reporting sales for the twelve-month period ended December 31, 2006. The
      percentage change is based on those tenants reporting sales (“Same Store”) for
      the twenty-four month period ended December 31, 2006.




**Wholly
                Owned**
              **Mall
                Properties**
            
            **Total
                Mall Properties**
              **Including
                ORC
                Venture****Average**
              **Sales
                PSF**
            
            **Same
                  Store****% Change**
            
            **Average**
              **Sales
                PSF**
            
            **Same
                  Store****% Change**Anchors
            
            
            $137
            
            
            (4.1
            )%
            
            $136
            
            
            (4.1
            )%Stores
                (1)
            
            
            $348
            
            
            0.7
            %
            
            $344
            
            
            0.7
            %Total
            
            
            $231
            
            
            (0.7
            )%
            
            $231
            
            
            (0.7
            )%






(1)
            Sales
                PSF for Mall Stores exclude outparcel and licensing agreement
                sales.





As
      we
      continue to upgrade our tenant mix, we believe our regional mall portfolio
      will
      continue to deliver solid performance in the areas of sales productivity and
      rents. Average mall store sales for the 12 months ended December 31, 2006 were
      $348 per square foot, a 4.2% improvement from the $334 per square foot reported
      for the twelve months ended December 31, 2005. Comparable stores sales, which
      include only those stores open for the twelve months ended December 31, 2006
      and
      the same period of 2005, increased 0.7%.





Portfolio
      occupancy statistics by property type are summarized below: ****


**** ****


**Occupancy
                (1)****12/31/06**
            
            **9/30/06**
            
            **6/30/06**
            
            **3/31/06**
            
            **12/31/05**Wholly-owned
                Malls:Mall
                Anchors
            93.9%
            
            94.2%
            
            95.3%
            
            95.0%
            
            95.2%Mall
                Stores
            91.7%
            
            89.0%
            
            87.9%
            
            87.3%
            
            89.5%Total
                Consolidated Mall Portfolio
            93.1%
            
            92.3%
            
            92.6%
            
            92.3%
            
            93.2%Mall
                Portfolio including ORC Venture:Mall
                Anchors
            94.3%
            
            94.6%
            
            95.7%
            
            95.5%
            
            95.5%Mall
                Stores
            91.5%
            
            88.6%
            
            87.3%
            
            86.5%
            
            89.2%Total
                Mall Portfolio
            93.3%
            
            92.4%
            
            92.7%
            
            92.3%
            
            93.2%Wholly-owned
                Community Centers:Community
                Center Anchors
            81.1%
            
            70.6%
            
            68.7%
            
            73.6%
            
            75.0%Community
                Center Stores
            85.2%
            
            85.2%
            
            80.6%
            
            79.7%
            
            78.6%Total
                Community Center Portfolio
            82.2%
            
            74.2%
            
            71.3%
            
            75.1%
            
            75.8%**Comparable
                Property Type (2)**
            
            
            **12/31/2006**
            
            
            
            **12/31/05**Comparable
                Mall Stores
            
            91.8%
            
            
            
            89.2%Comparable
                Mall Portfolio
            
            93.2%
            
            
            
            93.2%Comparable
                Community Center Stores
            
            85.2%
            
            
            
            87.4%Comparable
                Community Center Portfolio
            
            82.2%
            
            
            
            77.1%




(1)
            Occupied
                space is defined as any space where a tenant is occupying the space
                or
                paying rent at the date indicated, excluding all tenants with leases
                having an initial term of less than one
                year.


(2)
            Comparable
                occupancy rates (total portfolio including ORC Venture) exclude the
                properties sold after 12/31/2005 from the 12/31/2005 occupancy calculation
                and those acquired after 12/31/2005 from the 12/31/2006
                calculation.




Mall
      store occupancy (for our wholly-owned Malls) increased to 91.7% at December
      31,
      2006 from 89.5% at December 31, 2005. Mall store occupancy improvements were
      driven primarily by our held-for-investment Malls. If you exclude our five
      held-for-sale assets, store occupancy was 94.4% at December 31, 2006 compared
      to
      91.0% at December 31, 2005. Anchor store occupancy (for our wholly-owned Malls)
      decreased to 93.9% at December 31, 2006 from 95.2% at December 31, 2005. Part
      of
      the anchor store occupancy decline resulted from a Wal-Mart lease termination
      at
      Ashland Town Center in Ashland, Kentucky related to our strategic re-development
      of that Property. We also re-classified in-line store GLA to anchor store GLA
      at
      MJC and University Mall in Tampa, Florida in anticipation of two new anchor
      store openings in 2007. Further contributing to the decline was the closing
      of
      the Marshall’s anchor store at Great Mall. These occupancy declines were
      partially offset by a new Border’s Bookstore opening at The Dayton Mall in
      Dayton, Ohio.




38


**Information
      Technology**





We
      implemented the budgeting and forecasting components of our commercial
      management system in 2006. We also implemented the first phase of a new business
      intelligence platform in December 2006. These key technology initiatives will
      establish the platform for enhanced internal management reporting in
      2007.





**Accounting
      Pronouncements**





In
      September 2006, the Financial Accounting Standards Board (“FASB”) issued SFAS
      No. 157, “Fair Value Measurements.” While this standard does not establish any
      new requirements for reporting assets or liabilities at fair value, it does
      clarify the definition of “fair value” when used in FASB pronouncements. This
      standard is effective no later than for fiscal years beginning after November
      15, 2007. The Company does not anticipate a material impact to the Company’s
      financial position and results of operations.





In
      June
      2006, the FASB issued Interpretation No. 48 (“FIN 48”), “Accounting for
      Uncertainty in Income Taxes; an interpretation of FASB Statement No. 109.” FIN
      48 clarifies the accounting for uncertainty in income taxes recognized in an
      enterprise’s financial statements in accordance with SFAS No. 109, “Accounting
      for Income Taxes.” It requires a recognition threshold and measurement attribute
      for financial statement disclosure of tax positions taken, or expected to be
      taken, in an income tax return. This Interpretation also provides guidance
      on
      de-recognition, classification, interest and penalties, accounting in interim
      periods, disclosure, and transition. FIN 48 is effective for fiscal years
      beginning after December 15, 2006. The Company will be required to adopt this
      interpretation in the first quarter of fiscal year 2007. While the Company
      is
      currently evaluating the provisions of FIN 48, the adoption is not expected
      to
      have a material impact on its financial position and results of
      operations.





**Item
      7A. Quantitative and Qualitative Disclosures About Market Risk**





Our
      primary market risk exposure is interest rate risk. We use interest rate
      protection agreements to manage interest rate risks associated with long-term,
      floating rate debt. At December 31, 2006, approximately 85.6% of our debt,
      after
      giving effect to interest rate protection agreements, bore interest at fixed
      rates with weighted-average maturity of 5.7 years and a weighted-average
      interest rate of approximately 6.3%. At December 31, 2005 approximately 82.8%
      of
      our debt, after giving effect to interest rate protection agreements, bore
      interest at fixed rates with weighted-average maturity of 6.7 years, and a
      weighted-average interest rate of approximately 6.35%. The remainder of our
      debt
      at December 31, 2006 and December 31, 2005, bears interest at variable rates
      with weighted-average interest rates of approximately 6.56% and 5.96%,
      respectively.





At
      December 31, 2006 and December 31, 2005, the fair value of our debt (excluding
      our Amended Credit Facility) was $1,282.0 million and $1,358.7 million,
      respectively, compared to its carrying amounts of $1,304.9 million and $1,351.5
      million, respectively. Our
      combined future earnings, cash flows and fair values relating to financial
      instruments are dependent upon prevalent market rates of interest, primarily
      LIBOR. Based upon consolidated indebtedness and interest rates at December
      31,
      2006 and 2005, a 100 basis points increase in the market rates of interest
      would
      decrease future earnings and cash flows by $2.3 million and $2.5 million,
      respectively, for the year. Also, the fair value of debt would decrease by
      approximately $54.3 million and $36.7 million at December 31, 2006 and December
      31, 2005, respectively. A 100 basis points decrease in the market rates of
      interest would increase future earnings and cash flows by $2.3 million and
      $2.5
      million for the years ended December 31, 2006 and 2005, respectively, and
      increase the fair value of our debt by approximately $57.8 million and $39.1
      million at December 31, 2006 and December 31, 2005, respectively. We have
      entered into certain swap agreements which impact this analysis at certain
      LIBOR
      rate levels (see Note 9 to the consolidated financial statements).





**Item
      8.**  **Financial
      Statements and Supplementary Data**





The
      consolidated financial statements and financial statement schedules of GRT
      and
      the Report of Independent Registered Public Accounting Firm thereon, to be
      filed
      pursuant to this Item 8 are included in this report in Item 15.





**Item
      9.**  **Changes
      in and Disagreements with Accountants on Accounting and Financial
      Disclosure**





None





39


**Item
      9A. Controls and Procedures**





Disclosure
      Controls and Procedures





The
      Company’s management, with the participation of the Company’s Chief Executive
      Officer and Chief Financial Officer, has evaluated the effectiveness of the
      Company’s disclosure controls and procedures (as such term is defined in Rules
      13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended
      (the “Exchange Act”)) as of the end of the period covered by this report. The
      Company’s disclosure controls and procedures are designed to provide reasonable
      assurance that information is recorded, processed, summarized and reported
      accurately and on a timely basis in the Company’s periodic reports filed with
      the SEC. Based on such evaluation, the Company’s Chief Executive Officer and
      Chief Financial Officer have concluded that, as of the end of such period,
      the
      Company’s disclosure controls and procedures are effective to provide reasonable
      assurance. Notwithstanding the foregoing, a control system, no matter how well
      designed and operated, can provide only reasonable, not absolute assurance,
      that
      it will detect or uncover failures within the Company to disclose material
      information otherwise required to be set forth in the Company’s periodic
      reports.





Management’s
      Report on Internal Control Over Financial Reporting





Our
      management is responsible for establishing and maintaining adequate internal
      control over financial reporting to
      provide reasonable assurance regarding the reliability of our financial
      reporting and the preparation of financial statements for external purposes
      in
      accordance with generally accepted accounting principles.





As
      of
      December 31, 2006, management assessed the effectiveness of the Company's
      internal control over financial reporting based on the criteria for effective
      internal control over financial reporting established in "Internal Control
      --
      Integrated Framework", issued by the Committee of Sponsoring Organizations
      of
      the Treadway Commission.





Based
      on
      this assessment, management has concluded that as of December 31, 2006, the
      Company’s internal control over financial reporting was effective to provide
      reasonable assurance regarding the reliability of our financial reporting and
      the preparation of financial statements for external purposes in accordance
      with
      generally accepted accounting principles.





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.





Our
      independent registered public accounting firm, BDO Seidman, LLP, audited
      management’s assessment and independently assessed the effectiveness of the
      Company’s internal control over financial reporting. BDO Seidman, LLP has issued
      an attestation report concurring with management’s assessment, which is set
      forth below.











40




**Report
      of Independent Registered Public Accounting Firm on Internal
      Control**


**Over
      Financial Reporting**





Board
      of
      Trustees and Shareholders


Glimcher
      Realty Trust


Columbus,
      Ohio





We
      have
      audited management's assessment, included in the accompanying “Management’s
      Report on Internal Control over Financial Reporting” *,* that
      Glimcher Realty Trust maintained effective internal control over financial
      reporting as of December 31, 2006, based on criteria established in Internal
      Control—Integrated Framework issued by the Committee of Sponsoring Organizations
      of the Treadway Commission (COSO). ** Glimcher
      Realty 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. Our responsibility is to express
      an
      opinion on management's assessment and an opinion on the effectiveness of the
      Company'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, evaluating management's assessment, testing and evaluating
      the design and operating effectiveness of internal control, 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, management's assessment that Glimcher Realty Trust maintained effective
      internal control over financial reporting as of December 31, 2006, is fairly
      stated, in all material respects, based on criteria established in Internal
      Control—Integrated Framework issued by the Committee of Sponsoring Organizations
      of the Treadway Commission (COSO). ** Also
      in
      our opinion, Glimcher Realty Trust maintained, in all material respects,
      effective internal control over financial reporting as of December 31, 2006,
      based on criteria
      established in *Internal Control—Integrated Framework* issued
      by the Committee of
      Sponsoring Organizations of the Treadway Commission (COSO).





We
      have
      also audited, in accordance with the standards of the Public Company Accounting
      Oversight Board (United States), the consolidated
      balance sheets of Glimcher Realty Trust as of December 31, 2006 and December
      31,
      2005 and the related consolidated statements of operations and comprehensive
      income, shareholders’ equity, and cash flows for each of the three years ending
      December 31, 2006 ** of
      Glimcher Realty Trust and our report dated February 20, 2007 ** expressed
      an unqualified opinion ** on
      those
      consolidated financial statements.




Chicago,
              Illinois
            /s/
                BDO Seidman, LLP


February
      20, 2007








Internal
      Control Over Financial Reporting .
      There
      have not been any changes in our internal control over financial reporting
      (as
      such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act)
      during the last fiscal quarter to which this report relates that have materially
      affected, or are reasonably likely to materially affect, our internal control
      over financial reporting.





41


**Item
      9B. Other Information**





None





**PART
      III**





**Item
      10.**  **Trustees, Executive Officers and Corporate Governance**




Information
      regarding trustees, board committee members, corporate governance and the
      executive officers of the Registrant is incorporated herein by reference to
      GRT’s definitive proxy statement to be filed with the SEC within 120 days after
      the end of the year covered by this Form 10-K with respect to the Annual
      Meeting.





**Item
      11.**  **Executive Compensation**





Information
      regarding executive compensation of the Company’s executive officers is
      incorporated herein by reference to the Registrant’s definitive proxy statement
      to be filed with the SEC within 120 days after the end of the year covered
      by
      this Form 10-K with respect to the Annual Meeting.





**Item
      12. Security Ownership of Certain Beneficial Owners and Management and Related
      Shareholder Matters**





Information
      regarding the Company’s equity compensation plans in effect as of December 31,
      2006 is as follows:




**Equity
                Compensation Plan Information**Plan
                Category
            Number
                of securities to be issued
              upon
                exercise of outstanding
              options,
                warrants and rights
            Weighted
                average exercise price
              of
                outstanding options, warrants
              and
                rights
            Number
                of securities remaining available for future issuance
                underequity
                compensation plans(excluding
                securitiesreflected
                in column(a))(a)
            (b)
            (c)Equity
                compensation plans approved by shareholders
            2,132,132
            $21.52
            477,503Equity
                compensation plans not approved by shareholders
            N/A
            N/A
            N/A




Additional
      information regarding security ownership of certain beneficial owners and
      management of the Registrant is incorporated herein by reference to GRT’s
      definitive proxy statement to be filed with the SEC within 120 days after the
      end of the year covered by this Form 10-K with respect to the Annual
      Meeting.





**Item
      13.**  **Certain Relationships and Related Transactions, and Trustee
      Independence**




Information
      regarding certain relationships, related transactions and trustee independence
      of the Company is incorporated herein by reference to GRT’s definitive proxy
      statement to be filed with the SEC within 120 days after the end of the year
      covered by this Form 10-K with respect to the Annual Meeting.





**Item
      14. Principal Accountant Fees and Services**





Information
      regarding principal accountant fees and services of the Company is incorporated
      herein by reference to GRT’s definitive proxy statement to be filed with the SEC
      within 120 days after the end of the year covered by this Form 10-K with respect
      to the Annual Meeting.








42




**Item
      15.**  **Exhibits and Financial Statements**





(1)  Financial
      Statements


Page
                  Number-  
                  Report of Independent Registered Public Accounting Firm
              51-
                    Glimcher Realty Trust Consolidated Balance Sheets as of December
                  31, 2006 and 2005
              52-  
                  Glimcher Realty Trust Consolidated Statements of Operations and
                  Comprehensive Income for the years ended December 31, 2006, 2005
                  and 2004
              53-  
                  Glimcher Realty Trust Consolidated Statements of Shareholders'
                  Equity for
                  the years ended December 31, 2006, 2005 and 2004
              54-  
                  Glimcher Realty Trust Consolidated Statements of Cash Flows for
                  the years
                  ended December 31, 2006, 2005 and 2004
              55-  
                  Notes to Consolidated Financial Statements
              56


(2)   Financial
      Statement Schedules


-  
                  Schedule III - Real Estate and Accumulated Depreciation
              80- 
                   Notes to Schedule III
              84




(3)  Exhibits





3.1
            Amended
                and Restated Declaration of Trust of Glimcher Realty Trust.
                (1)3.2
            Bylaws,
                as amended. (1)3.3
            Amendment
                to the Company's Amended and Restated Declaration of Trust.
                (2)3.4
            Limited
                Partnership Agreement of Glimcher Properties Limited Partnership.
                (3)3.5
            Amendment
                to Limited Partnership Agreement of Glimcher Properties Limited
                Partnership. (3)3.6
            Amendment
                No. 1 to Limited Partnership Agreement of Glimcher Properties Limited
                Partnership. (3)3.7
            Amendment
                No. 2 to Limited Partnership Agreement of Glimcher Properties Limited
                Partnership. (3)3.8
            Amendment
                No. 3 to Limited Partnership Agreement of Glimcher Properties Limited
                Partnership. (3)3.9
            Amendment
                No. 4 to Limited Partnership Agreement of Glimcher Properties Limited
                Partnership. (3)3.10
            Amendment
                No. 5 to Limited Partnership Agreement of Glimcher Properties Limited
                Partnership. (3)3.11
            Amendment
                No. 6 to Limited Partnership Agreement of Glimcher Properties Limited
                Partnership. (3)3.12
            Amendment
                No. 7 to Limited Partnership Agreement of Glimcher Properties Limited
                Partnership dated August 7, 2003. (8)3.13
            Amendment
                No. 8 to Limited Partnership agreement of Glimcher Properties Limited
                Partnership. (10)3.14
            Articles
                Supplementary classifying 2,800,000 Shares of Beneficial Interest
                as 8.75%
                Series F Cumulative Redeemable Preferred Shares of Beneficial Interest
                of
                the Registrant. (15)3.15
            Articles
                Supplementary Classifying 6,900,000 Shares of Beneficial Interest
                as
                8.125% Series G Cumulative Redeemable Preferred Shares of Beneficial
                Interest of the Registrant, par value $0.01 per share.
                (16)4.1
            Specimen
                Certificate for Common Shares of Beneficial Interest.
                (1)4.2
            Specimen
                Certificate for evidencing 8.75% Series F Cumulative Redeemable Preferred
                Shares of Beneficial Interest. (15)4.3
            Specimen
                Certificate for evidencing 8.125% Series G Cumulative Redeemable
                Preferred
                Shares of Beneficial Interest. (16)10.01
            Glimcher
                Realty Trust 1993 Employee Share Option Plan. (1)10.02
            Glimcher
                Realty Trust 1993 Trustee Share Option Plan. (1)10.03
            Glimcher
                Realty Trust 1997 Incentive Plan. (3)10.04
            Glimcher
                Realty Trust 2004 Incentive Compensation Plan. (17)10.05
            Exhibit
                A to Glimcher Properties Limited Partnership Agreement, as amended,
                as of
                December 31, 2006.10.06
            Severance
                Benefits Agreement, dated June 11, 1997, by and among Glimcher Realty
                Trust, Glimcher Properties Limited Partnership and Herbert Glimcher.
                (3)10.07
            Severance
                Agreement and Release of All Claims between William G. Cornely, Glimcher
                Realty Trust, its affiliated and subsidiary entities, and its
                shareholders, directors, officers, agents, employees, successors
                and
                assigns, dated as of July 1, 2005. (5)10.08
            Severance
                Benefits Agreement dated June 11, 1997, by and among Glimcher Realty
                Trust, Glimcher Properties Limited Partnership and Michael P. Glimcher.
                (3)10.09
            Severance
                Benefits Agreement, dated June 11, 1997, by and among Glimcher Realty
                Trust, Glimcher Properties Limited Partnership and George A. Schmidt.
                (3)




43


10.10
            Severance
                Benefits Agreement, dated June 26, 2002, by and among Glimcher Realty
                Trust, Glimcher Properties Limited Partnership and Thomas J. Drought,
                Jr.
                (20)10.11
            Severance
                Benefits Agreement, dated June 28, 2004 by and among Glimcher Realty
                Trust, Glimcher Properties Limited Partnership and Lisa A. Indest.
                (22)10.12
            Severance
                Benefits Agreement, dated August 30, 2004, by and among Glimcher
                Realty
                Trust, Glimcher Properties Limited Partnership and Mark E. Yale.
                (11)10.13
            Severance
                Benefits Agreement, dated May 16, 2005, by and among Glimcher Realty
                Trust, Glimcher Properties Limited Partnership and Marshall A. Loeb.
                (24)10.14
            Severance
                Benefits Agreement, dated May 16, 2005, by and among Glimcher Realty
                Trust, Glimcher Properties Limited Partnership and George “Buck”
                Sappenfield, III. (24)10.15
            Severance
                Benefits Agreement, dated August 17, 2005, by and among Glimcher
                Realty
                Trust, Glimcher Properties Limited Partnership and Robert F. Beffa.
                (25)10.16
            First
                Amendment to the Severance Benefits Agreement, dated September 8,
                2006 by
                and between Glimcher Realty Trust, Glimcher Properties Limited
                Partnership, and Mark E. Yale. (7)10.17
            Offer
                Letter of Employment to Marshall A. Loeb, dated April 26, 2005.
                (23)10.18
            Offer
                Letter of Employment to George “Buck” Sappenfield, III, dated May 9, 2005.
                (24)10.19
            Offer
                Letter of Employment to Robert Beffa, dated June 29, 2005.
                (5)10.20
            Defeasance
                Pledge And Security Agreement, Dated As Of December 22, 2006 by and
                among
                Glimcher University Mall Limited Partnership,Lasalle National Bank Association (f/k/a Lasalle National Bank),
                as
                Trustee for Nomura Asset Securities Corporation, Commercial Mortgage
                Pass-Through Certificates, Series 1998-D6, and Wells Fargo Bank,
                N.A.10.21
            Defeasance,
                Assignment, Assumption and Release Agreement, dated as of December
                22,
                2006, by and among Glimcher University Mall Limited
                Partnership,SB
                NASC 1998-D6 Holdings, LLC, Lasalle National Bank Association (f/k/a
                Lasalle National Bank), as Trustee For Nomura Asset Securities
                Corporation, Commercial Mortgage Pass-Through Certificates, Series
                1998-D6, Capmark Finance Inc.,and
                Wells Fargo Bank, N.A.10.22
            Promissory
                Note, dated as of July 31, 2005, issued by Glimcher Properties, L.P.
                and
                Montgomery Mall Associates, L.P. in the principal amount of $44,000,000
                (relates to Montgomery Mall). (26)10.23
            Term
                Loan Agreement, dated as of July 31, 2005, between Glimcher Properties,
                L.P. and Montgomery Mall Associates, L.P. (each as co-borrower) and
                KeyBank National Association. (26)10.24
            Amended
                and Restated Mortgage, Assignment of Rents, Security Agreement and
                Fixture
                Filing made by Montgomery Mall Associates, L.P. in favor of KeyBank
                National Association, dated as of July 31, 2005. (26)10.25
            First
                Amendment to Term Loan Agreement between KeyBank National Association
                and
                Montgomery Mall Associates Limited Partnership and Glimcher Properties
                Limited Partnership dated January 13, 2006. (30)10.26
            Promissory
                Note dated as of September 1, 1998, issued by Morgantown Mall Associates
                Limited Partnership in the amount of fifty eight million three hundred
                fifty thousand dollars ($58,350,000). (4)10.27
            Deed
                of Trust, Assignment of Leases and Rents and Security Agreement by
                Morgantown Mall Associates Limited Partnership to Michael B. Keller
                (Trustee) for the use and benefit of The Capital Company of America,
                LLC
                dated as of September 1, 1998. (4)10.28
            Promissory
                Note dated as of November 1, 1998, issued by Glimcher Properties
                Limited
                Partnership in the amount of nineteen million dollars ($19,000,000)
                (relates to New Jersey Tax Exempt Bonds). (4)10.29
            Deed
                of Trust and Security Agreement by Grand Central Limited Partnership
                for
                the benefit of Lehman Brothers Holdings Inc. dated as of January
                21, 1999.
                (18)10.30
            Promissory
                Note dated as of January 21, 1999, issued by Grand Central Limited
                Partnership in the amount of fifty two million five hundred thousand
                dollars ($52,500,000). (18)10.31
            Loan
                Agreement, dated as of May 25, 2006, by and between WTM Glimcher,
                LLC and
                Morgan Stanley Credit Corporation (relates to Weberstown Mall).
                (19)10.32
            Promissory
                Note A1, dated May 25, 2006, issued by WTM Glimcher, LLC in the principal
                amount of thirty million dollars ($30,000,000) (relates to Weberstown
                Mall) (19).10.33
            Promissory
                Note A2, dated May 25, 2006, issued by WTM Glimcher, LLC in the principal
                amount of thirty million dollars ($30,000,000) (relates to Weberstown
                Mall). (19)10.34
            Deed
                of Trust and Security Agreement, dated May 25, 2006, by and between
                WTM
                Glimcher, LLC, Chicago Title Insurance Company, and Morgan Stanley
                Credit
                Corporation (relates to Weberstown Mall). (19)10.35
            Assignment
                of Leases and Rents, dated as of May 25, 2006, by and between WTM
                Glimcher, LLC and Morgan Stanley Credit Corporation (relates to Weberstown
                Mall). (19)10.36
            Guaranty
                of Recourse Obligations, dated as of May 25, 2006, by Glimcher Properties
                Limited Partnership in favor of Morgan Stanley Credit Corporation
                (relates
                to Weberstown Mall). (19)




44


10.37
            Open-end
                Mortgage and Security Agreement by Mount Vernon Venture, LLC to Lehman
                Brothers Bank, FSB dated as of January 16, 2001. (6)10.38
            Promissory
                Note dated as of January 16, 2001, issued by Mount Vernon Venture,
                LLC in
                the amount of nine million three hundred thousand dollars ($9,300,000).
                (6)10.39
            Mortgage,
                Assignment of Leases and Rents, Security Agreement, and Fixture Filing
                by
                Glimcher Ashland Venture, LLC to KeyBank National Association dated
                as of
                October 15, 2001. (6)10.40
            Promissory
                Note dated as of October 15, 2001 issued by Glimcher Ashland Venture,
                LLC
                in the amount of twenty seven million dollars ($27,000,000).
                (6)10.41
            Amended
                and Restated Promissory Note 1 dated as of June 30, 2003 issued by
                LC
                Portland, LLC in the amount of seventy million dollars ($70,000,000.00).
                (21)10.42
            Amended
                and Restated Promissory Note 2 dated June 30, 2003 issued by LC Portland,
                LLC in the amount of seventy million dollars ($70,000,000.00).
                (21)10.43
            Agreement
                of Sale and Purchase and Joint Escrow Instructions, dated October
                5, 2005,
                by and between Glimcher Properties Limited Partnership and Passco
                Colima,
                LLC, Passco PHM, LLC and PHM-1, LLC through PHM-29, LLC (relates
                to Puente
                Hills Mall acquisition). (30)10.44
            Amendment
                to Agreement of Sale and Purchase and Joint Escrow Instructions,
                dated
                November 4, 2005, by and between Glimcher Properties Limited Partnership
                and Passco Colima, LLC, Passco PHM, LLC and PHM-1, LLC through PHM-29,
                LLC
                (relates to Puente Hills Mall acquisition). (30)10.45
            Loan
                Assumption Agreement, dated as of December 29, 2005, between Passco
                Colima, LLC, Passco PHM, LLC and PHM-1, LLC through PHM-29, LLC,
                Puente
                Hills Mall, LLC and LaSalle Bank National Association, as Trustee
                for the
                Registered Holders of Greenwich Capital Commercial Funding Corp.,
                Commercial Mortgage Trust 2003-C1, Commercial Mortgage Pass-Through
                Certificates, Series 2003-C1 (relates to Puente Hills Mall acquisition).
                (30)10.46
            Guaranty
                of Recourse Obligations, dated as of December 29, 2005, by Glimcher
                Properties Limited Partnership in favor of LaSalle Bank National
                Association, as Trustee for the Registered Holders of Greenwich Capital
                Commercial Funding Corp., Commercial Mortgage Trust 2003-C1, Commercial
                Mortgage Pass-Through Certificates, Series 2003-C1 (relates to loan
                assumption for Puente Hills Mall acquisition). (30)10.47
            Allonge
                to Promissory Note (relates to loan assumption for Puente Hills Mall
                acquisition). (30)10.48
            Operating
                Agreement for OG Retail Holding Co., LLC, dated as of December 29,
                2005
                (pertains to joint venture between Glimcher Properties Limited Partnership
                and Oxford Properties Group). (30)10.49
            Promissory
                Note A1 dated as of August 27, 2003, issued by Glimcher WestShore,
                LLC in
                the amount of sixty six million dollars ($66,000,000).
                (9)10.50
            Promissory
                Note A2 dated as of August 27, 2003, issued by Glimcher WestShore,
                LLC in
                the amount of thirty four million dollars ($34,000,000).
                (9)10.51
            Mortgage,
                Assignment of Leases and Rents and Security Agreement by Glimcher
                WestShore, LLC to Morgan Stanley Mortgage Capital Inc. dated as of
                August
                27, 2003. (9)10.52
            Guaranty
                of Recourse Obligations by Glimcher Properties Limited Partnership
                to
                Morgan Stanley Mortgage Capital, Inc. dated as of August 27, 2003,
                relating to WestShore Plaza Mall. (9)10.53
            Note
                dated as of August 11, 1998 issued by Eastland Mall Limited Partnership
                to
                The Capital Company of America LLC in the amount of forty six million
                six
                hundred seventy three thousand two hundred twenty five dollars
                ($46,673,225). (9)10.54
            Deed
                of Trust, Assignment of Leases and Rents, Security Agreement and
                Fixture
                Filing dated as of August 11, 1998 by Eastland Mall Limited Partnership
                to
                M. Jay Devaney, as Trustee, for the benefit of The Capital Company
                of
                America LLC. (9)10.55
            Promissory
                Note dated as of October 1, 1997, issued by Catalina Partners, L.P.
                to
                Nomura Asset Capital Corporation in the amount of thirty six million
                ($36,000,000), relating to Colonial Park Mall. (9)10.56
            Open-end
                Fee Mortgage, Leasehold Mortgage, Assignment of Rents, Security Agreement
                and Fixture Filing dated as of October 1, 1997 by Catalina Partners,
                L.P.
                to Nomura Asset Capital Corporation, relating to Colonial Park Mall.
                (9)10.57
            Amended
                and Restated Credit Agreement, dated August 22, 2005, by and among
                Glimcher Properties Limited Partnership, KeyBank National Association
                and
                several other financial institutions. (27)10.58
            Guaranty,
                dated August 22, 2005, by Glimcher Realty Trust and Glimcher Properties
                Corporation to and for the benefit of KeyBank National Association,
                individually and as administrative agent for itself and the lenders
                under
                the Amended and Restated Credit Agreement. (27)10.59
            Form
                of Note. (27)10.60
            Amended
                and Restated Credit Agreement, dated December 14, 2006, by and among
                Glimcher Properties Limited Partnership, KeyBank National Association,
                KeyBanc Capital Markets, and several other financial institutions
                (Replaces Exhibit 10.57).




45


10.61
            Guaranty,
                dated December 14, 2006, by Glimcher Realty Trust and Glimcher Properties
                Corporation to and for the benefit of KeyBank National Association,
                individually and as administrative agent for itself and the lenders
                under
                the Amended and Restated Credit Agreement (Replaces Exhibit
                10.58).10.62
            Form
                of Note. (included in Exhibit 10.60)10.63
            Promissory
                Note A1, dated October 17, 2003, between MFC Beavercreek, LLC and
                KeyBank
                National Association in the amount of eighty-five million dollars
                ($85,000,000), relating to the Mall at Fairfield Commons in Beavercreek,
                Ohio. (13)10.64
            Promissory
                Note A2, dated October 17, 2003, between MFC Beavercreek, LLC and
                KeyBank
                National Association in the amount of twenty-eight million five hundred
                thousand dollars ($28,500,000), relating to the Mall at Fairfield
                Commons
                in Beavercreek, Ohio. (13)10.65
            Open
                End Mortgage, Assignment of Leases and Rents, Security Agreement,
                and
                Fixture Filing, dated October 17, 2003, between MFC Beavercreek,
                LLC and
                KeyBank National Association, relating to the Mall at Fairfield Commons
                in
                Beavercreek, Ohio. (13)10.66
            Key
                Principal's Guaranty Agreement, dated October 17, 2003, between Glimcher
                Properties Limited Partnership and KeyBank National Association,
                relating
                to the loan on the Mall at Fairfield Commons in Beavercreek, Ohio.
                (13)10.67
            Open
                End Mortgage, Assignment of Rents and Security Agreement, dated November
                20, 2006, by EM Columbus II, LLC to Lehman Brothers Bank, FSB (relating
                to
                Eastland Ohio).10.68
            Assignment
                of Leases and Rents, dated as of November 20, 2006, between EM Columbus
                II, LLC to Lehman Brothers Bank, FSB (relating to Eastland
                Ohio).10.69
            Loan
                Agreement, dated November 20, 2006, by and between EM Columbus II,
                LLC,
                and Lehman Brothers Bank, FSB (relating to Eastland
                Ohio).10.70
            Guaranty,
                dated November 20, 2006 by and between Glimcher Properties Limited
                Partnership to and for the benefit of Lehman Brothers Bank, FSB (relating
                to Eastland Ohio).10.71
            Promissory
                Note, dated November 20, 2006 by EM Columbus II, LLC in favor of
                Lehman
                Brothers Bank, FSB in the principal amount of 43,000,000 (relating
                to
                Eastland Ohio).10.72
            Promissory
                Note, dated as of July 15, 2005, issued by EM Columbus, LLC in the
                amount
                of Six Million Dollars ($6,000,000). (26).10.73
            Unconditional
                Guaranty of Payment and Performance, dated July 15, 2005, by Glimcher
                Properties, L.P. to The Huntington National Bank. (26)10.74
            Open-End
                Mortgage Modification of Mortgage and Note, dated July 15, 2005,
                by and
                between EM Columbus, LLC and The Huntington National Bank.
                (26)10.75
            Unconditional
                Guaranty of Payment and Performance, dated July 15, 2005, by Glimcher
                Properties Limited Partnership to The Huntington National Bank.
                (26)10.76
            Promissory
                Note, dated May 17, 2000, from Polaris Center, LLC to First Union
                National
                Bank, in the amount of $43,000,000, relating to the Polaris Towne
                Center
                existing debt. (13)10.77
            Open-End
                Mortgage and Security Agreement, dated May 17, 2000, between Polaris
                Center, LLC and First Union National Bank, relating to Polaris Towne
                Center. (13)10.78
            Amended
                and Restated Promissory Note A, between UBS Warburg Real Estate
                Investments Inc. and PFP Columbus, LLC, dated May 22, 2003, for
                $135,000,000, relating to the Polaris Fashion Place existing debt.
                (13)10.79
            Amended
                and Restated Promissory Note B, between UBS Warburg Real Estate
                Investments Inc. and PFP Columbus, LLC, dated May 22, 2003, for
                $24,837,623 relating to the Polaris Fashion Place existing debt.
                (13)10.80
            Mortgage
                Assignment of Leases and Rents and Security Agreement, dated April
                1,
                2003, from PFP Columbus, LLC to UBS Warburg Real Estate Investments
                Inc.
                relating to Polaris Fashion Place. (13)10.81
            Loan
                Agreement, dated as of April 1, 2003, between PFP Columbus, LLC,
                as
                borrower, and UBS Warburg Real Estate Investments Inc., as lender.
                (13)10.82
            Loan
                Agreement dated as of June 9, 2004 between N.J. METROMALL Urban Renewal,
                Inc., JG Elizabeth, LLC and Morgan Stanley Mortgage Capital Inc.
                relating
                to Jersey Gardens Mall in Elizabeth, New Jersey. (22)10.83
            Promissory
                Note A1, dated June 9, 2004, between N.J. METROMALL Urban Renewal,
                Inc.,
                JG Elizabeth, LLC and Morgan Stanley Mortgage Capital Inc. in the
                amount
                of $85,000,000, relating to Jersey Gardens Mall in Elizabeth, New
                Jersey.
                (22)10.84
            Promissory
                Note A2, dated June 9, 2004, between N.J. METROMALL Urban Renewal,
                Inc.,
                JG Elizabeth, LLC and Morgan Stanley Mortgage Capital Inc. in the
                amount
                of $80,000,000, relating to Jersey Gardens Mall in Elizabeth, New
                Jersey.
                (22)10.85
            Fee
                and Leasehold Mortgage, Assignment of Leases and Rents and Security
                Agreement dated June 9, 2004 between N.J. METROMALL Urban Renewal
                Inc, JG
                Elizabeth, LLC and Morgan Stanley Mortgage Capital, Inc. relating
                to
                Jersey Gardens Mall in Elizabeth, New Jersey.
                (22)




46


10.86
            Guaranty
                dated June 9, 2004, by Glimcher Properties Limited Partnership to
                Morgan
                Stanley Mortgage Capital Inc., relating to Jersey Gardens Mall in
                Elizabeth, New Jersey. (22)10.87
            Loan
                Agreement, dated as of March 14, 2006, by and between Tulsa Promenade,
                LLC
                and Charter One Bank, N.A. (relating to Tulsa Promenade).
                (29)10.88
            Promissory
                Note, dated March 14, 2006, issued by Tulsa Promenade, LLC to the
                order of
                Charter One Bank, N.A. in the principal amount of $50,000,000 (relating
                to
                Tulsa Promenade). (29)10.89
            Mortgage
                with Power of Sale, Security Agreement and Financing Statement, made
                as of
                March 14, 2006, by Tulsa Promenade, LLC in favor of Charter One Bank,
                N.A.
                (relating to Tulsa Promenade). (29)10.90
            Term
                Loan Agreement, dated January 13, 2006, between GM Olathe, LLC, Glimcher
                Properties Limited Partnership (as co-borrowers) and LLC and KeyBank
                National Association, relating to The Great Mall of the Great Plains
                in
                Olathe, Kansas. (30)10.91
            Promissory
                Note, dated January 13, 2006, issued by GM Olathe, LLC and Glimcher
                Properties Limited Partnership (as co-borrowers) to the order of
                KeyBank
                National Association in the principal amount of $30,000,000, relating
                to
                The Great Mall of the Great Plains in Olathe, Kansas.
                (30)10.92
            Amended
                and Restated Mortgage, Assignment of Rents, Security Agreement and
                Fixture
                Filing, dated January 13, 2006, between Glimcher Properties Limited
                Partnership and GM Olathe in the amount of $30,000,000, relating
                to The
                Great Mall of the Great Plains in Olathe, Kansas. (30)10.93
            Promissory
                Note, dated as of December 15, 2005, issued by RVM Glimcher, LLC
                to the
                order of Lehman Brothers Bank, FSB in the principal amount of $50,000,000,
                relating to River Valley Mall in Lancaster, Ohio. (30)10.94
            Loan
                Agreement, dated as of December 15, 2005, between RVM Glimcher, LLC
                and
                Lehman Brothers Bank, FSB, relating to River Valley Mall in Lancaster,
                Ohio. (30)10.95
            Open-End
                Mortgage and Security Agreement, dated December 15, 2005, between
                RVM
                Glimcher, LLC and Lehman Brothers Bank, FSB, relating to River Valley
                Mall
                in Lancaster, Ohio. (30)10.96
            Assignment
                of Leases and Rents, dated as of December 15, 2005, between RVM Glimcher,
                LLC and Lehman Brothers Bank, FSB, relating to River Valley Mall
                in
                Lancaster, Ohio. (30)10.97
            Guaranty
                of Recourse Obligations, dated as of December 15, 2005, by Glimcher
                Properties Limited Partnership to and for the benefit of Lehman Brothers
                Bank, FSB, relating to River Valley Mall in Lancaster, Ohio.
                (30)10.98
            Agreement
                of Purchase and Sale, between Coyote Tulsa Mall, L.L.C. and Glimcher
                Properties Limited Partnership (relating to acquisition of Tulsa
                Promenade). (30)10.99
            Employment
                & Consulting Agreement, dated January 20, 2005, between Herbert
                Glimcher, Glimcher Realty Trust and Glimcher Properties Limited
                Partnership. (14)10.100
            Limited
                Liability Company Agreement of Kierland Crossing, LLC, dated as of
                May 12,
                2006 (relating to joint venture between Glimcher Properties Limited
                Partnership and Vanguard City Home in Scottsdale, AZ).
                (19).10.101
            Purchase
                Agreement and Escrow Instructions, dated May 12, 2006 by and between
                Kierland Crossing, LLC and Kierland Crossing Residential, LLC (relating
                to
                joint venture between Glimcher Properties Limited Partnership and
                Vanguard
                City Home in Scottsdale, AZ). (19)10.102
            Ground
                Lease, dated as of May 12, 2006, by and betweenSucia
                Scottsdale, LLC and Kierland Crossing, LLC (relating to joint venture
                betweenGlimcher
                Properties Limited Partnership and Vanguard City Home in Scottsdale,
                AZ).
                (19)10.103
            First
                Amended and Restated Ground Lease, dated as of December 6, 2006,
                by and
                betweenSucia
                Scottsdale, LLC and Kierland Crossing, LLC (relating to joint venture
                betweenGlimcher
                Properties Limited Partnership and Vanguard City Home in Scottsdale,
                AZ).10.104
            Form
                Restricted Stock Award Agreement for Glimcher Realty Trust’s 2004
                Incentive Compensation Plan (Extended Vesting). (31)10.105
            Form
                Option Award Agreement for the Glimcher Realty Trust 2004 Incentive
                Compensation Plan (Non-Qualified Stock Options). (28)10.106
            Form
                Option Award Agreement for the Glimcher Realty Trust 2004 Incentive
                Compensation Plan (Incentive Stock Options). (28)10.107
            Form
                Restricted Stock Award Agreement for Glimcher Realty Trust’s 2004
                Incentive Compensation Plan. (23)10.108
            Form
                Option Award Agreement for the Glimcher Realty Trust 2004 Incentive
                Compensation Plan (Non-Qualified Stock Options/Grant Date
                Valuation).10.109
            Form
                Option Award Agreement for the Glimcher Realty Trust 2004 Incentive
                Compensation Plan (Incentive Stock Options/Grant Date
                Valuation).








47





21.1
            Subsidiaries
                of the Registrant


23.1
            Consent
                of Independent Registered Public Accounting
                Firm


31.1
            Certification
                of the Company’s CEO pursuant to Section 302 of the Sarbanes-Oxley Act of
                2002.


31.2
            Certification
                of the Company’s CFO pursuant to Section 302 of the Sarbanes-Oxley Act of
                2002.


32.1
            Certification
                of the Company’s CEO pursuant to Section 906 of the Sarbanes-Oxley Act of
                2002.


32.2
            Certification
                of the Company’s CFO pursuant to Section 906 of the Sarbanes-Oxley Act of
                2002.





(1)
            Incorporated
                by reference to Glimcher Realty Trust’s Registration Statement No.
                33-69740.


(2)
            Incorporated
                by reference to Glimcher Realty Trust’s Annual Report on Form 10-K for the
                fiscal year ended December 31, 1994, filed with the Securities and
                Exchange Commission on March 21, 1995.


(3)
            Incorporated
                by reference to Glimcher Realty Trust’s Annual Report on Form 10-K for the
                fiscal year ended December 31, 1997, filed with the Securities and
                Exchange Commission on March 31, 1998.


(4)
            Incorporated
                by reference to Glimcher Realty Trust’s Annual Report on Form 10-K for the
                fiscal year ended December 31, 1998, filed with the Securities and
                Exchange Commission on March 30,
                1999.


(5)
            Incorporated
                by reference to Glimcher Realty Trust’s Form 8-K, filed with the
                Securities and Exchange Commission on July 11,
                2005.


(6)
            Incorporated
                by reference to Glimcher Realty Trust’s Annual Report on Form 10-K for the
                fiscal year ended December 31, 2001, filed with the Securities and
                Exchange Commission on March 16,
                2002.


(7)
            Incorporated
                by reference to Glimcher Realty Trust’s Form 8-K, filed with the
                Securities and Exchange Commission on September 8,
                2006.


(8)
            Incorporated
                by reference to Glimcher Realty Trust’s Form 8-K, filed with the
                Securities and Exchange Commission on August 29,
                2003.


(9)
            Incorporated
                by reference to Glimcher Realty Trust’s Form 8-K, filed with the
                Securities and Exchange Commission on September 8,
                2003.


(10)
            Incorporated
                by reference to Glimcher Realty Trust’s Form 8-K, with the Securities and
                Exchange Commission on February 25,
                2004.


(11)
            Incorporated
                by reference to Glimcher Realty Trust’s Form 8-K, filed with the
                Securities and Exchange Commission on August 31,
                2004.


(12)
            Incorporated
                by reference to Glimcher Realty Trust’s Form 8-K, filed with the
                Securities and Exchange Commission on September 2,
                2004.


(13)
            Incorporated
                by reference to Glimcher Realty Trust’s Form 8-K, filed with the
                Securities and Exchange Commission on January 20,
                2004.


(14)
            Incorporated
                by reference to Glimcher Realty Trust’s Form 8-K, filed with the
                Securities and Exchange Commission on January 24,
                2005.


(15)
            Incorporated
                by reference to Glimcher Realty Trust’s Form 8-A, filed with the
                Securities and Exchange Commission on August 22,
                2003.


(16)
            Incorporated
                by reference to Glimcher Realty Trust’s Form 8-A, filed with the
                Securities and Exchange Commission on February 20,
                2004.


(17)
            Incorporated
                by reference to Appendix B of Glimcher Realty Trust’s Schedule 14A Proxy
                Statement, filed with the Securities and Exchange Commission on March
                29,
                2004.


(18)
            Incorporated
                by reference to Glimcher Realty Trust’s Quarterly Report on Form 10-Q for
                the period ended March 31, 1999, filed with the Securities and Exchange
                Commission on May 14, 1999.


(19)
            Incorporated
                by reference to Glimcher Realty Trust’s Quarterly Report on Form 10-Q for
                the period ended June 30, 2006, filed with the Securities and Exchange
                Commission on July 28, 2006.


(20)
            Incorporated
                by reference to Glimcher Realty Trust’s Quarterly Report on Form 10-Q for
                the period ended June 30, 2002, filed with the Securities and Exchange
                Commission on August 13, 2002.


(21)
            Incorporated
                by reference to Glimcher Realty Trust’s Quarterly Report on Form 10-Q for
                the period ended June 30, 2003, filed with the Securities and Exchange
                Commission on August 12, 2003.


(22)
            Incorporated
                by reference to Glimcher Realty Trust’s Quarterly Report on Form 10-Q for
                the period ended June 30, 2004, filed with the Securities and Exchange
                Commission on August 13, 2004.


(23)
            Incorporated
                by reference to Glimcher Realty Trust’s Quarterly Report on Form 10-Q for
                the period ended March 31, 2005, filed with the Securities and Exchange
                Commission on April 29, 2005.


(24)
            Incorporated
                by reference to Glimcher Realty Trust’s Form 8-K, filed with the
                Securities and Exchange Commission on May 17,
                2005.


(25)
            Incorporated
                by reference to Glimcher Realty Trust’s Form 8-K, filed with the
                Securities and Exchange Commission on August 18,
                2005.


(26)
            Incorporated
                by reference to Glimcher Realty Trust’s Quarterly Report on Form 10-Q for
                the period ended June 30, 2005, filed with the Securities and Exchange
                Commission on August 2, 2005.


(27)
            Incorporated
                by reference to Glimcher Realty Trust’s Form 8-K, filed with the
                Securities and Exchange Commission on August 23,
                2005.






48


(28)
            Incorporated
                by reference to Glimcher Realty Trust’s Annual Report on Form 10-K for the
                fiscal year ended December 31, 2004, filed with the Securities and
                Exchange Commission on March 11,
                2005.


(29)
            Incorporated
                by reference to Glimcher Realty Trust’s Quarterly Report on Form 10-Q for
                the period ended March 31, 2006, filed with the Securities and Exchange
                Commission on April 28, 2006.


(30)
            Incorporated
                by reference to Glimcher Realty Trust’s Annual Report on Form 10-K for the
                fiscal year ended December 31, 2005, filed with the Securities and
                Exchange Commission on February 24,
                2006.


(31)
            Incorporated
                by reference to Glimcher Realty Trust’s Form 8-K, filed with the
                Securities and Exchange Commission on May 9,
                2006.











49




**SIGNATURES**





Pursuant
      to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
      1934, the Registrant has duly caused this report to be signed on its behalf
      by
      the undersigned, thereunto duly authorized.


GLIMCHER
              REALTY
              TRUSTBy:
            /s/ Mark
              E.
              YaleMark
                E. Yale
              Executive
                Vice President, Chief Financial Officer and Treasurer
              (Principal
                Accounting and Financial Officer)
              February
                21, 2007






Pursuant
      to the requirements of the Securities Exchange Act of 1934, this report has
      been
      executed below by the following persons on behalf of the Registrant and in
      the
      capacities and on the dates indicated.


**SIGNATURE**
              **TITLE**
              **DATE**/s/
                  Michael P. Glimcher
              President,
                  Chief Executive Officer
              February
                  21, 2007Michael
                  P. Glimcher
              and
                  Trustee(Principal
                  Executive Officer)/s/
                  Mark E. Yale
              Executive
                  Vice President,
              February
                  21, 2007Mark
                  E. Yale
              Chief
                  Financial Officer and Treasurer(Principal
                  Accounting and Financial Officer)/s/
                  Herbert Glimcher
              Chairman
                  of the Board
              February
                  21, 2007Herbert
                  Glimcher
              and
                  Trustee/s/
                  David M. Aronowitz
              Member,
                  Board of Trustees
              February
                  21, 2007David
                  M. Aronowitz/s/
                  Philip G. Barach
              Member,
                  Board of Trustees
              February
                  21, 2007Philip
                  G. Barach/s/
                  Wayne S. Doran
              Member,
                  Board of Trustees
              February
                  21, 2007Wayne
                  S. Doran/s/
                  Howard Gross
              Member,
                  Board of Trustees
              February
                  21, 2007Howard
                  Gross/s/
                  Niles C. Overly
              Member,
                  Board of Trustees
              February
                  21, 2007Niles
                  C. Overly/s/
                  Alan R. Weiler
              Member,
                  Board of Trustees
              February
                  21, 2007Alan
                  R. Weiler/s/
                  William S. Williams
              Member,
                  Board of Trustees
              February
                  21, 2007William
                  S. Williams








50





**Report
      of the Independent Registered Public Accounting Firm**








To
      the
      Board of Trustees and Shareholders


Glimcher
      Realty Trust


Columbus,
      Ohio





We
      have
      audited the accompanying consolidated balance sheets of Glimcher Realty Trust
      as
      of December 31, 2006 and 2005 and the related consolidated statements of
      operations and comprehensive income, shareholders’ equity and cash flows for
      each of the three years in the period ended December 31, 2006. We have also
      audited the schedule listed in Item 15(a) 2. These financial statements and
      schedule are the responsibility of the Company’s management. Our responsibility
      is to express an opinion on these financial statements and schedule 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 and schedule are free of material misstatement. An audit includes
      examining, on a test basis, evidence supporting the amounts and disclosures
      in
      the financial statements and schedule, assessing the accounting principles
      used
      and the significant estimates made by management, as well as evaluating the
      overall presentation of the financial statements and schedule. 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 Glimcher Realty Trust at
      December 31, 2006 and 2005, and the results of its operations and cash flows
      for
      each of the three years in the period ended December 31, 2006, in conformity
      with accounting principles generally accepted in the United States of
      America.





Also,
      in
      our opinion, the schedule presents fairly, in all material respects, the
      information set forth therein.





We
      have
      also audited, in accordance with the standards of the Public Company Accounting
      Oversight Board (United States), the effectiveness of Glimcher Realty Trust’s
      internal control over financial reporting as of December 31, 2006, 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 20, 2007 expressed an unqualified opinion
      thereon.




/s/
      BDO
      Seidman, LLP


Chicago,
      Illinois


February
      20, 2007






51


**GLIMCHER
      REALTY TRUST**


**CONSOLIDATED
      BALANCE SHEETS**


**(dollars
      in thousands, except share and par value amounts)**





**ASSETS**




**December
                31,****2006**
            
            **2005**Investment
                in real estate:Land
            
            $
            247,149
            
            $
            291,998Buildings,
                improvements and equipment
            
            
            1,679,935
            
            
            1,869,381Developments
                in progress
            
            
            49,803
            
            
            50,2351,976,887
            
            
            2,211,614Less
                accumulated depreciation
            
            
            483,115
            
            
            470,397Property
                and equipment, net
            
            
            1,493,772
            
            
            1,741,217Deferred
                costs, net
            
            
            17,316
            
            
            18,863Real
                estate assets held-for-sale
            
            
            192,301
            
            
            72,731Investment
                in and advances to unconsolidated real estate entities
            
            
            70,416
            
            
            44,248Investment
                in real estate, net
            
            
            1,773,805
            
            
            1,877,059Cash
                and cash equivalents
            
            
            11,751
            
            
            7,821Non-real
                estate assets associated with discontinued operations
            
            
            12,662
            
            
            4,162Restricted
                cash
            
            
            12,132
            
            
            15,410Tenant
                accounts receivable, net
            
            
            40,233
            
            
            49,877Deferred
                expenses, net
            
            
            8,134
            
            
            8,665Prepaid
                and other assets
            
            
            30,103
            
            
            32,318Total
                assets
            
            $
            1,888,820
            
            $
            1,995,312





**LIABILITIES
      AND SHAREHOLDERS’ EQUITY**





Mortgage
                notes payable
            
            $
            1,203,100
            
            $
            1,299,193Mortgage
                notes payable associated with properties held-for-sale
            
            
            101,786
            
            
            52,288


Notes
                payable
            
            
            272,000
            
            
            150,000Other
                liabilities associated with discontinued operations
            
            
            3,926
            
            
            1,374


Accounts
                payable and accrued expenses
            
            57,520
            
            66,264Distributions
                payable
            
            23,481
            
            23,410Total
                liabilities
            
            1,661,813
            
            1,592,529Minority
                interest in operating partnership
            
            
            1,772
            
            
            15,729Shareholders’
                equity:Series
                F Cumulative Preferred Shares of Beneficial Interest, $0.01par
                value, 2,400,000 shares issued and outstanding
            
            
            60,000
            
            
            60,000Series
                G Cumulative Preferred Shares of Beneficial Interest, $0.01par
                value, 6,000,000 shares issued and outstanding
            
            
            150,000
            
            
            150,000Common
                Shares of Beneficial Interest, $0.01 par value, 36,776,365and
                36,506,448 shares issued and outstanding as of December 31,2006
                and December 31, 2005, respectively
            
            
            368
            
            
            365Additional
                paid-in capital
            
            
            547,036
            
            
            543,639Distributions
                in excess of accumulated earnings
            
            
            (532,141
            )
            
            (366,924
            )Accumulated
                other comprehensive loss
            
            
            (28
            )
            
            (26
            )Total
                shareholder’s equity
            
            
            225,235
            
            
            387,054Total
                liabilities and shareholder’s equity
            
            $
            1,888,820
            
            $
            1,995,312





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


52


**GLIMCHER
      REALTY TRUST**


**CONSOLIDATED
      STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME**


**(dollars
      in thousands, except per share amounts)**




**For
                the Years Ended December 31,****2006**
            
            **2005**
            
            **2004**Revenues:Minimum
                rents
            
            $
            189,729
            
            $
            186,429
            
            $
            177,395Percentage
                rents
            
            
            5,848
            
            
            5,556
            
            
            5,349Tenant
                reimbursements
            
            
            87,025
            
            
            85,189
            
            
            82,200Other
            
            
            26,662
            
            
            22,852
            
            
            23,895Total
                revenues
            
            
            309,264
            
            
            300,026
            
            
            288,839Expenses:Property
                operating expenses
            
            
            63,364
            
            
            61,252
            
            
            61,898Real
                estate taxes
            
            
            33,835
            
            
            34,123
            
            
            31,84197,199
            
            
            95,375
            
            
            93,739Provision
                for doubtful accounts
            
            
            3,733
            
            
            3,808
            
            
            4,315Other
                operating expenses
            
            
            9,624
            
            
            8,968
            
            
            7,881Depreciation
                and amortization
            
            
            72,965
            
            
            67,466
            
            
            64,994General
                and administrative
            
            
            15,313
            
            
            18,415
            
            
            14,347Impairment
                losses - real estate asset
            
            
            46,688
            
            
            -
            
            
            -Total
                expenses
            
            
            245,522
            
            
            194,032
            
            
            185,276Operating
                income
            
            
            63,742
            
            
            105,994
            
            
            103,563Interest
                income
            
            
            465
            
            
            269
            
            
            187Interest
                expense
            
            
            84,985
            
            
            74,396
            
            
            78,359Equity
                in income of unconsolidated entities, net
            
            
            1,443
            
            
            51
            
            
            3(Loss)
                income before minority interest in operating partnership and discontinued
                operations
            
            
            (19,335
            )
            
            31,918
            
            
            25,394Minority
                interest in operating partnership
            
            
            (7,733
            )
            
            252
            
            
            2,906(Loss)
                income from continuing operations
            
            
            (11,602
            )
            
            31,666
            
            
            22,488Discontinued
                operations:Impairment
                losses - real estate assets
            
            
            (65,230
            )
            
            (16,393
            )
            
            -Gain
                on sales of properties, net
            
            
            1,717
            
            
            1,619
            
            
            19,646(Loss)
                income from operations
            
            
            (2,050
            )
            
            3,958
            
            
            9,621Net
                (loss) income
            
            
            (77,165
            )
            
            20,850
            
            
            51,755Less:
                Preferred stock dividends
            
            
            17,437
            
            
            17,437
            
            
            17,517Less:
                Issuance costs related to preferred stock redemption
            
            
            -
            
            
            -
            
            
            4,878Net
                (loss) income available to common shareholders
            
            $
            (94,602
            )
            $
            3,413
            
            $
            29,360Earnings
                (loss) Per Common Share (“EPS”):Basic:Continuing
                operations
            
            $
            (0.93
            )
            $
            0.37
            
            $
            0.08Discontinued
                operations
            
            $
            (1.65
            )
            $
            (0.27
            )
            $
            0.75Net
                (loss) income
            
            $
            (2.58
            )
            $
            0.09
            
            $
            0.83Diluted:Continuing
                operations
            
            $
            (0.93
            )
            $
            0.36
            
            $
            0.08Discontinued
                operations
            
            $
            (1.65
            )
            $
            (0.27
            )
            $
            0.74Net
                (loss) income
            
            $
            (2.58
            )
            $
            0.09
            
            $
            0.82Weighted
                average common shares outstanding
            
            
            36,611
            
            
            36,036
            
            
            35,456Weighted
                  average common shares and common share equivalentoutstanding
            
            
            39,646
            
            
            39,856
            
            
            39,496Cash
                distributions declared per common share of beneficial
                interest
            
            $
            1.9232
            
            $
            1.9232
            
            $
            1.9232Net
                (loss) income
            
            $
            (77,165
            )
            $
            20,850
            
            $
            51,755Other
                comprehensive (loss) income on derivative instruments, net
            
            
            (2
            )
            
            9
            
            
            1,192Comprehensive
                (loss) income
            
            $
            (77,167
            )
            $
            20,859
            
            $
            52,947





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





53


**GLIMCHER
      REALTY TRUST**


**CONSOLIDATED
      STATEMENTS OF SHAREHOLDERS’ EQUITY**


**For
      the Years Ended December 31, 2006, 2005 and 2004**


**(dollars
      in thousands, except share, par value and unit amounts)**




**Series
                  B Convertible Preferred**
              
              **Series
                  F Cumulative Preferred**
              
              **Series
                  G Cumulative Preferred**
              
              **Common
                  Shares of Beneficial Interest**
              
              **Additonal
                  Paid-in**
              
              **Distri-butions
                  In Excess of Accumu-lated**
              
              **Accumu-lated
                  Other Compre-hensive Income/****Shares**
              
              **Shares**
              
              **Shares**
              
              **Shares**
              
              **Amount**
              
              **Capital**
              
              **Earnings**
              
              **(Loss)**
              
              **Total**Balance,
                  December 31, 2003
              
              $
              127,950
              
              $
              60,000
              
              $
              -
              
              
              35,066,112
              
              $
              350
              
              $
              516,632
              
              $
              (261,766
              )
              $
              (1,227
              )
              $
              441,939Distributions
                  declared, $1.9232 per share
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (68,380
              )
              
              
              
              
              (68,380
              )Distribution
                  Reinvestment and Share Purchase Plan
              
              
              
              
              
              
              
              
              
              
              
              23,658
              
              
              1
              
              
              569
              
              
              
              
              
              
              
              
              570Exercise
                  of stock options
              
              
              
              
              
              
              
              
              
              
              
              503,882
              
              
              5
              
              
              8,752
              
              
              
              
              
              
              
              
              8,757OP
                  unit conversion
              
              
              
              
              
              
              
              
              
              
              
              89,206
              
              
              1
              
              
              2,365
              
              
              
              
              
              
              
              
              2,366Issuance
                    of Series G cumulative redeemable preferred shares of beneficial
                    interest
              
              
              
              
              
              
              
              
              150,000
              
              
              
              
              
              
              
              
              (5,198
              )
              
              
              
              
              
              
              
              144,802Redemption
                    of Series B cumulative redeemable referred shares of beneficial
                    interest
              
              
              (127,950
              )
              
              
              
              
              
              
              
              
              
              
              
              
              
              4,878
              
              
              (4,878
              )
              
              
              
              
              (127,950
              )Preferred
                  stock dividends
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (17,517
              )
              
              
              
              
              (17,517
              )Net
                  income
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              51,755
              
              
              
              
              
              51,755Other
                  comprehensive income on derivative instruments
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              1,192
              
              
              1,192Stock
                  offering expense
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              237
              
              
              
              
              
              
              
              
              237Transfer
                  from minority interest in partnership
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              6,051
              
              
              
              
              
              
              
              
              6,051Balance,
                  December 31, 2004
              
              
              -
              
              
              60,000
              
              
              150,000
              
              
              35,682,858
              
              
              357
              
              
              534,286
              
              
              (300,786
              )
              
              (35
              )
              
              443,822Distributions
                  declared, $1.9232 per share
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (69,551
              )
              
              
              
              
              (69,551
              )Distribution
                  Reinvestment and Share Purchase Plan
              
              
              
              
              
              
              
              
              
              
              
              21,954
              
              
              
              
              
              560
              
              
              
              
              
              
              
              
              560Exercise
                  of stock options
              
              
              
              
              
              
              
              
              
              
              
              386,384
              
              
              4
              
              
              6,531
              
              
              
              
              
              
              
              
              6,535OP
                  unit conversion
              
              
              
              
              
              
              
              
              
              
              
              358,586
              
              
              3
              
              
              9,656
              
              
              
              
              
              
              
              
              9,659Restricted
                  stock grant
              
              
              
              
              
              
              
              
              
              
              
              56,666
              
              
              1
              
              
              (1
              )
              
              
              
              
              
              
              
              -Amortization
                  of stock incentive program
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              314
              
              
              
              
              
              
              
              
              314Preferred
                  stock dividends
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (17,437
              )
              
              
              
              
              (17,437
              )Net
                  income
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              20,850
              
              
              
              
              
              20,850Other
                  comprehensive income on derivative instruments
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              9
              
              
              9Stock
                  offering expense
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              297
              
              
              
              
              
              
              
              
              297Transfer
                  to minority interest in partnership
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (8,004
              )
              
              
              
              
              
              
              
              (8,004
              )Balance,
                  December 31, 2005
              
              
              -
              
              
              60,000
              
              
              150,000
              
              
              36,506,448
              
              
              365
              
              
              543,639
              
              
              (366,924
              )
              
              (26
              )
              
              387,054Distributions
                  declared, $1.9232 per share
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (70,615
              )
              
              
              
              
              (70,615
              )Distribution
                  Reinvestment and Share Purchase Plan
              
              
              
              
              
              
              
              
              
              
              
              17,855
              
              
              
              
              
              457
              
              
              
              
              
              
              
              
              457Exercise
                  of stock options
              
              
              
              
              
              
              
              
              
              
              
              87,298
              
              
              1
              
              
              1,629
              
              
              
              
              
              
              
              
              1,630OP
                  unit conversion
              
              
              
              
              
              
              
              
              
              
              
              119,766
              
              
              2
              
              
              3,104
              
              
              
              
              
              
              
              
              3,106Restricted
                  stock grant, net of cancellations
              
              
              
              
              
              
              
              
              
              
              
              44,998
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              -Amortization
                  of stock incentive program
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              560
              
              
              
              
              
              
              
              
              560Preferred
                  stock dividends
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (17,437
              )
              
              
              
              
              (17,437
              )Net
                  loss
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (77,165
              )
              
              
              
              
              (77,165
              )Other
                  comprehensive loss on derivative instruments
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (2
              )
              
              (2
              )Stock
                  offering expense
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              348
              
              
              
              
              
              
              
              
              348Transfer
                  to minority interest in partnership
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (2,701
              )
              
              
              
              
              
              
              
              (2,701
              )Balance,
                  December 31, 2006
              
              $
              -
              
              $
              60,000
              
              $
              150,000
              
              
              36,776,365
              
              $
              368
              
              $
              547,036
              
              $
              (532,141
              )
              $
              (28
              )
              $
              225,235
 
  The
        accompanying notes are an integral part of these consolidated financial
        statements.
 
 54
  **GLIMCHER
        REALTY TRUST**
 **CONSOLIDATED
        STATEMENTS OF CASH FLOWS**
 **(dollars
        in thousands)**
  **For
                  the Years Ended December 31,****2006**
              
              **2005**
              
              **2004**Cash
                  flows from operating activities:Net
                  (loss) income
              
              $
              (77,165
              )
              $
              20,850
              
              $
              51,755Adjustments
                  to reconcile net (loss) income to net cash providedby
                  operating activities:Provision
                  for doubtful accounts
              
              
              6,696
              
              
              5,097
              
              
              6,241Depreciation
                  and amortization
              
              
              75,481
              
              
              77,815
              
              
              79,185Loan
                  fee amortization
              
              
              2,819
              
              
              2,662
              
              
              4,383Equity
                  in income of unconsolidated entities
              
              
              (1,443
              )
              
              (51
              )
              
              (3
              )Capitalized
                  development costs charged to expense
              
              
              367
              
              
              257
              
              
              125Minority
                  interest in operating partnership
              
              
              (7,733
              )
              
              252
              
              
              2,906Return
                  of minority interest share of earnings
              
              
              -
              
              
              (252
              )
              
              (2,906
              )Gain
                  on sales of properties from discontinued operations
              
              
              (1,717
              )
              
              (1,619
              )
              
              (19,646
              )Impairment
                  losses - real estate assets
              
              
              111,918
              
              
              16,393
              
              
              -Gain
                  on sales of outparcels
              
              
              (3,895
              )
              
              (517
              )
              
              (813
              )Stock
                  compensation expense
              
              
              908
              
              
              664
              
              
              237Net
                  changes in operating assets and liabilities:Tenant
                  accounts receivable, net
              
              
              (1,383
              )
              
              (5,722
              )
              
              (2,498
              )Prepaid
                  and other assets
              
              
              1,144
              
              
              (7,182
              )
              
              (4,423
              )Accounts
                  payable and accrued expenses
              
              
              (9,767
              )
              
              (302
              )
              
              (12,238
              )Net
                  cash provided by operating activities
              
              
              96,230
              
              
              108,345
              
              
              102,305Cash
                  flows from investing activities:Additions
                  to investment in real estate
              
              
              (77,128
              )
              
              (95,880
              )
              
              (72,726
              )Acquisitions
                  of properties
              
              
              (55,715
              )
              
              -
              
              
              -Contribution
                  from joint venture partner
              
              
              11,257
              
              
              -
              
              
              -Investment
                  in unconsolidated entities
              
              
              (13,266
              )
              
              (44,248
              )
              
              -Proceeds
                  from sales of properties
              
              
              24,690
              
              
              23,624
              
              
              106,834Proceeds
                  from sales of outparcels
              
              
              6,770
              
              
              2,975
              
              
              2,713Withdrawals
                  from restricted cash
              
              
              266
              
              
              101
              
              
              5,326Additions
                  to deferred expenses and other
              
              
              (5,785
              )
              
              (6,775
              )
              
              (4,014
              )Net
                  cash (used in) provided by investing activities
              
              
              (108,911
              )
              
              (120,203
              )
              
              38,133Cash
                  flows from financing activities:Proceeds
                  from (payments to) revolving line of credit, net
              
              
              122,000
              
              
              76,000
              
              
              (6,800
              )Additions
                  to deferred financing costs
              
              
              (2,511
              )
              
              (2,259
              )
              
              (1,896
              )Proceeds
                  from issuance of mortgages and other notes payable
              
              
              168,331
              
              
              111,669
              
              
              231,500Principal
                  payments on mortgages and other notes payable
              
              
              (179,497
              )
              
              (88,364
              )
              
              (303,400
              )Loss
                  on early extinguishment of debt
              
              
              -
              
              
              -
              
              
              557Proceeds
                  from issuance of Preferred Stock - Series G, net ofunderwriting
                  and other offering costs of $5,198
              
              
              -
              
              
              -
              
              
              144,802Redemption
                  Preferred Shares, Series B
              
              
              -
              
              
              -
              
              
              (127,950
              )Exercise
                  of stock options and other
              
              
              2,087
              
              
              7,095
              
              
              9,327Cash
                  distributions
              
              
              (93,799
              )
              
              (92,908
              )
              
              (89,172
              )Net
                  cash provided by (used in) financing activities
              
              
              16,611
              
              
              11,233
              
              
              (143,032
              )Net
                  change in cash and cash equivalents
              
              
              3,930
              
              
              (625
              )
              
              (2,594
              )Cash
                  and cash equivalents, at beginning of period
              
              
              7,821
              
              
              8,446
              
              
              11,040Cash
                  and cash equivalents, at end of period
              
              $
              11,751
              
              $
              7,821
              
              $
              8,446
 
 The
        accompanying notes are an integral part of these consolidated financial
        statements.
  55
 **GLIMCHER
        REALTY TRUST**
 **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS**
 **(dollars
        in thousands, except share and unit amounts)**
 
 **1.**
              **Organization
                  and Basis of Presentation**
 
 *Organization*
 
 Glimcher
        Realty Trust is a fully-integrated, self-administered and self-managed, Maryland
        real estate investment trust (“REIT”), which owns, leases, manages and develops
        a portfolio of retail properties (the “Property” or “Properties”) consisting of
        enclosed regional and super regional malls (“Malls”) and community shopping
        centers (“Community Centers”). At December 31, 2006, the Company owned and
        operated a total of 30 Properties consisting of 26 Malls (24 wholly-owned
        and 2
        partially owned through a joint venture) and 4 Community Centers. The “Company”
refers to Glimcher Realty Trust and Glimcher Properties Limited Partnership,
        a
        Delaware limited partnership, as well as entities in which the Company has
        an
        interest, collectively.
 
 *Basis
        of Presentation*
 
 The
        consolidated financial statements include the accounts of Glimcher Realty
        Trust
        (“GRT”), Glimcher Properties Limited Partnership (the “Operating Partnership,”
“OP” or “GPLP”) and Glimcher Development Corporation (“GDC”). As of December 31,
        2006, GRT was a limited partner in GPLP with a 91.9% ownership interest and
        GRT’s wholly owned subsidiary, Glimcher Properties Corporation (“GPC”), was
        GPLP’s sole general partner, with a 0.5% interest in GPLP. GDC, a wholly-owned
        subsidiary of GPLP, provides development, construction, leasing and legal
        services to the Company’s affiliates and is a taxable REIT subsidiary. The
        equity method of accounting is applied to entities in which the Company does
        not
        have controlling direct or indirect voting interest, but can exercise influence
        over the entity with respect to its operations and major decisions. These
        entities are reflected on the Company’s consolidated financial statements as
“Investments in unconsolidated real estate entities.” All significant
        intercompany accounts and transactions have been eliminated in the consolidated
        financial statements.
 
 **2.**
              **Summary
                  of Significant Accounting
                  Policies**
 
 *Revenue
        Recognition*
 
 Minimum
        rents are recognized on an accrual basis over the terms of the related leases
        on
        a straight-line basis. Percentage rents, which are based on tenants’ sales as
        reported to the Company, are recognized once the sales reported by such tenants
        exceed any applicable breakpoints as specified in the tenants’ leases. The
        percentage rents are recognized based upon the measurement dates specified
        in
        the leases that indicate when the percentage rent is due. Recoveries from
        tenants for real estate taxes, insurance and other shopping center operating
        expenses are recognized as revenues in the period that the applicable costs
        are
        incurred. The Company recognizes differences between estimated recoveries
        and
        the final billed amounts in the subsequent year. Other revenues primarily
        consist of fee income which relates to property management services and is
        recognized in the period in which the service is performed, licensing agreement
        revenues which are recognized as earned and the proceeds from sales of
        development land which are generally recognized at the closing
        date.
 
 *Tenant
        Accounts Receivable*
 
 The
        allowance for doubtful accounts reflects the Company’s estimate of the amounts
        of the recorded accounts receivable at the balance sheet date that will not
        be
        recovered from cash receipts in subsequent periods. The Company’s policy is to
        record a periodic provision for doubtful accounts based on total revenues.
        The
        Company also periodically reviews specific tenant balances and determines
        whether an additional allowance is necessary. In recording such a provision,
        the
        Company considers a tenant’s creditworthiness, ability to pay, probability of
        collections and the retail sector in which the tenant operates. The allowance
        for doubtful accounts is reviewed periodically based upon the Company’s
        historical experience.
 
 56
 **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS - continued**
 **(dollars
        in thousands, except share and unit amounts)**
 
 *Investment
        in Real Estate - Carrying Value of Assets*
 
 The
        Company maintains a diverse portfolio of real estate assets. The portfolio
        holdings have increased as a result of both acquisitions and the development
        of
        new Properties and have been reduced by selected sales of assets. The amounts
        to
        be capitalized as a result of acquisitions and developments and the periods
        over
        which the assets are depreciated or amortized are determined based on the
        application of accounting standards that may require estimates as to fair
        value
        and the allocation of various costs to the individual assets. The Company
        allocates the cost of the acquisition based upon the estimated fair value
        of the
        net assets acquired. The
        Company also estimates the fair value of intangibles related to its
        acquisitions. The valuation of the fair value of the intangibles involves
        estimates related to market conditions, probability of lease renewals and
        the
        current market value of in-place leases. This market value is determined
        by
        considering factors such as the tenant’s industry, location within the Property
        and competition in the specific market in which the Property operates.
        Differences in the amount attributed to the intangible assets can be significant
        based upon the assumptions made in calculating these estimates.
 
 *Depreciation
        and Amortization*
 
 Depreciation
        expense is computed using a straight-line method and estimated useful lives
        for
        buildings and improvements using a weighted average composite life of forty
        years and equipment and fixtures of five to ten years. Expenditures for
        leasehold improvements and construction allowances paid to tenants are
        capitalized and amortized over the initial term of each lease. Cash allowances
        paid to retailers that are used for purposes other than improvements to the
        real
        estate are amortized as a reduction to minimum rents over the initial lease
        term. Maintenance and repairs are charged to expense as incurred. Cash
        allowances paid in return for operating covenants from retailers who own
        their
        real estate are capitalized as contract intangibles. These intangibles are
        amortized over the period the retailer is required to operate its
        store.
 
 *Investment
        in Real Estate - Impairment evaluation*
 
 Management
        evaluates the recoverability of its investment in real estate assets in
        accordance with Statement of Financial Accounting Standards (“SFAS”) No. 144,
“Accounting for the Impairment or Disposal of Long-Lived Assets.” This statement
        requires that long-lived assets be reviewed for impairment whenever events
        or
        changes in circumstances indicate that recoverability of the asset is not
        assured.
 
 The
        Company evaluates the recoverability of its investments in real estate assets
        to
        be held and used each quarter and records an impairment charge when there
        is an
        indicator of impairment and the undiscounted projected future cash flows
        are
        less than the carrying amount for a particular Property. The estimated cash
        flows used for the impairment analysis and the determination of estimated
        fair
        value are based on the Company’s plans for the respective assets and the
        Company’s views of market and economic conditions. The estimates consider
        matters such as current and historical rental rates, occupancies for the
        respective Properties and comparable properties and recent sales data for
        comparable properties. Changes in estimated future cash flows due to changes
        in
        the Company’s plans or views of market and economic conditions could result in
        recognition of impairment losses, which, under the applicable accounting
        guidance, could be substantial.
 
 The
        Company recognized a $46,688 non-cash impairment charge on The Great Mall
        of the
        Great Plains Property during the fourth quarter of 2006. Even though The
        Company
        has no current intentions to sell the Property, the Company is working on
        multiple redevelopment opportunities that may involve a substantial
        reconfiguration of the Property. These plans result in more than temporary
        declines in future cash flow shortfalls when compared to the carrying value
        of
        approximately $89.4 million. The Company estimated the fair value of the
        asset
        by utilizing the average of several different valuation methods.
 
 
 57
 **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS - continued**
 **(dollars
        in thousands, except share and unit amounts)**
 
 *Sale
        of Real Estate Assets*
 
 The
        Company recognizes property sales in accordance with SFAS No. 66, “Accounting
        for Sales of Real Estate.” The Company generally records the sales of operating
        properties and outparcels using the full accrual method at closing when the
        earnings process is deemed to be complete. Sales not qualifying for full
        recognition at the time of sale are accounted for under other appropriate
        deferral methods.
 
 *Investment
        in Real Estate - Held-for-Sale*
 
 The
        Company evaluates the held-for-sale classification of its real estate each
        quarter. Assets that are classified as held-for-sale are recorded at the
        lower
        of their carrying amount or fair value less cost to sell. Assets are generally
        classified as held-for-sale once management commits to a plan to sell the
        properties and has initiated an active program to market them for sale. The
        results of operations of these real estate properties are reflected as
        discontinued operations in all periods reported.
 
 On
        occasion, the Company will receive unsolicited offers from third parties
        to buy
        individual Company properties. Under these circumstances, the Company will
        classify the particular property as held-for-sale when a sales contract is
        executed with no contingencies and the prospective buyer has funds at risk
        to
        ensure performance.
 
 *Accounting
        for Acquisitions*
 
 The
        fair
        value of the real estate acquired is allocated to acquired tangible assets,
        consisting of land, building and tenant improvements, and identified intangible
        assets and liabilities, consisting of the value of above-market and below-market
        leases for acquired in-place leases, the value of tenant relationships, and
        the
        value of in-place leases based in each case on their fair values. Purchase
        accounting is applied to assets and liabilities related to real estate entities
        acquired based upon the percentage of interest acquired.
 
 The
        fair
        value of the tangible assets of an acquired property (which includes land,
        building and tenant improvements) is determined by valuing the property as
        if it
        were vacant, based on management’s determination of the relative fair values of
        these assets. Management determines the as-if-vacant fair value of a property
        using methods to determine the replacement cost of the tangible assets.
 
 In
        determining the fair value of the identified intangible assets and liabilities
        of an acquired property, above-market and below-market in-place lease values
        are
        recorded based on the present value (using an interest rate which reflects
        the
        risks associated with the leases acquired) of the difference between (i)
        the
        contractual amounts to be paid pursuant to the in-place leases and (ii)
        management’s estimate of fair market lease rates for the corresponding in-place
        leases, measured over a period equal to the remaining non-cancelable term
        of the
        lease. The capitalized above-market lease values and the capitalized
        below-market lease values are amortized as an adjustment to rental income
        over
        the initial lease term.
 
 The
        aggregate value of in-place leases is determined by evaluating various factors,
        including an estimate of carrying costs during the expected lease-up periods,
        current market conditions and similar leases. In estimating carrying costs,
        management includes real estate taxes, insurance and other operating expenses
        and estimates of lost rental revenue during the expected lease-up periods
        based
        on current market demand. Management also estimates costs to execute similar
        leases including leasing commissions, legal and other related costs. The
        value
        assigned to this intangible asset is amortized over the remaining lease term
        plus an assumed renewal period that is reasonably assured.
 
 The
        aggregate value of other acquired intangible assets include tenant
        relationships. Factors considered by management in assigning a value to these
        relationships include: assumptions of probability of lease renewals, investment
        in tenant improvements, leasing commissions and an approximate time lapse
        in
        rental income while a new tenant is located. The value assigned to this
        intangible asset is amortized over the average life of the
        relationship.
 
 58
 **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS - continued**
 **(dollars
        in thousands, except share and unit amounts)**
 
 *Deferred
        Costs*
 
 The
        Company capitalizes initial direct costs in accordance with SFAS No. 91,
        “Accounting for Nonrefundable Fees and Costs Associated with Originating or
        Acquiring Loans and Initial Direct Costs of Leases,” and amortizes these costs
        over the initial lease term. The costs are capitalized upon the execution
        of the
        lease and the amortization period begins the earlier of the store opening
        date
        or the date the tenant’s lease obligation begins.
 
 *Stock-Based
        Compensation*
 
 Effective
        January 1, 2006, the Company adopted the fair value recognition provisions
        of
        SFAS No. 123(R), which expands and clarifies SFAS No. 123 “Accounting for
        Stock-Based Compensation”. In January 2003, the Company adopted the fair value
        recognition provisions of SFAS No. 123 as amended by SFAS No. 148, “Accounting
        for Stock-Based Compensation - Transition and Disclosure,” prospectively to all
        awards granted, modified or settled on or after January 1, 2003. Accordingly,
        the Company recognized as compensation expense the fair value of all awards
        granted after January 1, 2003. SFAS No. 123(R) requires companies to measure
        the
        cost of employee services received in exchange for an award of an equity
        instrument based on the grant-date fair value of the award. The cost is expensed
        over the requisite service period (usually the vesting period) beginning
        the
        first quarter of 2006 for awards issued after June 15, 2005. Stock compensation
        expense exclusive of restricted stock was $348, $350 and $237 for the years
        ended December 31, 2006, 2005 and 2004 respectively. Had compensation cost
        for
        the plans been determined based on the fair value at the grant dates for
        grants
        under these plans consistent with SFAS No. 123 (R) prior to January 1, 2003,
        the
        Company’s net income available to common shareholders would have decreased $0,
        $4 and $39 for the years ended December 31, 2006, 2005 and 2004, respectively.
        Earnings per share diluted would have remained unchanged as a result of this
        stock compensation expense for 2006, 2005 and 2004.
 
 *Cash
        and Cash Equivalents*
 
 For
        purposes of the statements of cash flows, all highly liquid investments
        purchased with original maturities of three months or less are considered
        to be
        cash equivalents. At December 31, 2006 and 2005, cash and cash equivalents
        primarily consisted of overnight purchases of debt securities. The carrying
        amounts approximate fair value.
 
 *Restricted
        Cash*
 
 Restricted
        cash consists primarily of cash held for real estate taxes, insurance, property
        reserves for maintenance and expansion or leasehold improvements as required
        by
        certain of the loan agreements.
 
 *Deferred
        Expenses*
 
 Deferred
        expenses consist principally of financing fees. These costs are amortized
        as
        interest expense over the terms of the respective agreements. Deferred expenses
        in the accompanying consolidated balance sheets are shown net of accumulated
        amortization.
 
 *Derivative
        Instruments and Hedging Activities*
 
 The
        Company recognizes all derivative financial instruments in the consolidated
        financial statements at fair value regardless of the purpose or intent for
        holding the instrument. Changes in the fair value of derivative financial
        instruments that qualify for hedge accounting are recorded in stockholders’
equity as a component of comprehensive income or as an adjustment to the
        carrying value of the hedged item. Changes in fair values of derivatives
        not
        qualifying for hedge accounting are reported in earnings.
 
 59
  **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS - continued**
 **(dollars
        in thousands, except share and unit amounts)**
 
 For
        derivative instruments that are designated and qualify as a cash flow hedge
        (i.e., hedging the exposure to variability in expected future cash flows
        that is
        attributable to a particular risk), the effective portion of the gain or
        loss on
        the derivative instrument is reported as a component of accumulated other
        comprehensive income and reclassified into interest income or interest expense
        in the same period or periods during which the hedged item affects interest
        income or interest expense. The remaining gain or loss of the derivative
        instruments in excess of the cumulative change in
        the
        present value of future cash flows of the hedged item, if any, is ineffective
        and is recognized in other income/other expense during the period of change.
        Upon termination of a derivative instrument prior to maturity, the
        aforementioned adjustment to accumulated other comprehensive income is
        amortized/accreted into interest income or interest expense over the remaining
        term of the hedge relationship using the effective interest method. Should
        the
        hedged item be sold, mature or extinguished prior to the end of the hedge
        relationship or a forecasted transaction is probable of not occurring, the
        aforementioned amounts in accumulated other comprehensive income are
        reclassified to interest income or interest expense and the derivative
        instrument’s change in fair value from that point forward will be recorded in
        other income or other expense.
 
 *Interest
        Costs*
 
 The
        components of the Company’s interest costs related to its continuing operations
        are shown in the table below. Interest expense and loan fees are recorded
        consistent with the terms of the Company’s financing arrangements. Capitalized
        interest is recorded as a reduction to interest expense based upon the Company’s
        weighted average borrowing rate.
 **** **** **** ****
 **Year
                  Ended December 31,****2006**
              
              **2005**
              
              **2004**Interest
                  expense
              
              $
              82,946
              
              $
              72,296
              
              $
              74,326Amortization
                  of loan fees
              
              
              2,039
              
              
              2,100
              
              
              4,033Total
                  interest expense
              
              
              84,985
              
              
              74,396
              
              
              78,359Interest
                  capitalized
              
              
              2,844
              
              
              2,270
              
              
              597Total
                  interest costs
              
              $
              87,829
              
              $
              76,666
              
              $
              78,956
 
 *Investment
        in Unconsolidated Real Estate Entities*
 
 The
        Company evaluates all joint venture arrangements for consolidation. The
        percentage interest in the joint venture, evaluation of control and whether
        a
        variable interest entity (“VIE”) exists are all considered in determining if the
        arrangement qualifies for consolidation.
 
 The
        Company accounts for its investments in unconsolidated real estate entities
        using the equity method of accounting, whereby the cost of an investment
        is
        adjusted for the Company’s share of equity in net income or loss from the date
        of acquisition and reduced by distributions received. The income or loss
        of each
        investee is allocated in accordance with the provisions of the applicable
        operating agreements. The allocation provisions in these agreements may differ
        from the ownership interest held by each investor. Differences between the
        carrying amount of the Company’s investment in the respective investees and the
        Company’s share of the underlying equity of such unconsolidated entities are
        amortized over the respective lives of the underlying assets as
        applicable.
 
 The
        Company periodically reviews its investment in unconsolidated real estate
        entities for other than temporary declines in market value. Any decline that
        is
        not expected to be recovered in the next twelve months is considered other
        than
        temporary and an impairment charge is recorded as a reduction in the carrying
        value of the investment.
 
 
 60
  **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS - continued**
 **(dollars
        in thousands, except share and unit amounts)**
 
 *Advertising
        Costs*
 
 The
        Company promotes its Properties on behalf of its tenants through various
        media.
        Advertising is expensed as
        incurred and the majority of the advertising expense is recovered from the
        tenants through lease obligations. Net advertising expense was $303, $487,
        and
        $422 for the years ended December 31, 2006, 2005 and 2004,
        respectively.
 
 *Income
        Taxes*
 
 GRT
        files
        as a REIT under Sections 856-860 of the Internal Revenue Code of 1986, as
        amended (the “Code”). In order to qualify as a REIT, GRT is required to
        distribute at least 90.0% of its ordinary taxable income to shareholders
        and to meet certain asset and income tests as well as certain other
        requirements. GRT will generally not be liable for federal income taxes,
        provided it satisfies the necessary distribution requirements and maintains
        its
        REIT status. Even as a qualified REIT, the Company is subject to certain
        state
        and local taxes on its income and property.
 
 The
        Company’s subsidiary, GDC, has elected taxable REIT subsidiary status under
        Section 856(l) of the Code. GPLP wholly owns GDC. For federal income tax
        purposes, GDC is treated as a separate entity and taxed as a regular
        C-Corporation. In accordance with SFAS No. 109 “Accounting for Income Taxes,”
deferred tax assets and liabilities are recognized for the estimated future
        tax
        consequences attributable to differences between the financial statement
        carrying amounts of existing assets and liabilities and their respective
        tax
        bases, and operating loss carryforwards of GDC. Deferred tax assets and
        liabilities are measured using enacted tax rates in effect for the year in
        which
        those temporary differences are expected to be recovered or
        settled.
  *Minority
        Interests*
 
 Minority
        interests represent the aggregate partnership interest in the Operating
        Partnership held by the Operating Partnership limited partner unit holders
        (the
“Unit Holders”). Income allocated to minority interest is based on the Unit
        Holders ownership percentage of the Operating Partnership. The ownership
        percentage is determined by dividing the numbers of Operating Partnership
        Units
        (“OP Units”) held by the Unit Holders by the total OP Units outstanding. The
        issuance of additional shares of beneficial interest (the “Common Shares”,
“Shares” or “Share”) or OP Units changes the percentage ownership of both the
        Unit Holders and the Company. Since an OP unit is generally redeemable for
        cash
        or Shares at the option of the Company, it is deemed to be equivalent to
        a
        Share. Therefore, such transactions are treated as capital transactions and
        result in an allocation between shareholders’ equity and minority interest in
        the accompanying balance sheets to account for the change in the ownership
        of
        the underlying equity in the Operating Partnership.
 
 *Supplemental
        Disclosure of Non-Cash Financing and Investing Activities*
 
 As
        a
        result of the Company’s acquisitions of joint venture interests not previously
        owned, the Company had non-cash debt assumptions and issued OP Units. The
        debt
        assumed was $193,190 for the year ended December 31, 2004. In January 2004,
        the
        Company issued 594,342 new OP Units with an approximate value of $13,564
        in
        connection with the acquisition of the remaining joint venture interest in
        Polaris Fashion Place, an approximately 1.6 million square foot upscale regional
        mall in Columbus, Ohio (“Polaris”).
 
 Non-cash
        transactions resulting from other accounts payable and accrued expenses for
        ongoing operations such as real estate improvements and other assets were
        $13,645 and $13,815 as of December 31, 2006 and 2005, respectively.
 
 Share
        distributions of $17,682 and $17,552 and Operating Partnership distributions
        of
        $1,440 and $1,498 had been declared but not paid as of December 31, 2006
        and
        December 31, 2005, respectively. 8.75% Series F Cumulative Preferred Shares
        of
        Beneficial Interest (“Series F Preferred Shares”) distributions of $1,313 had
        been declared but not paid as of December 31, 2006 and 2005. 8.125% Series
        G
        Cumulative Preferred Shares of Beneficial Interest (“Series G Preferred Shares”)
        distributions of $3,046 had been declared but not paid as of December 31,
        2006
        and December 31, 2005.
  61
 **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS - continued**
 **(dollars
        in thousands, except share and unit amounts)**
  Amounts
        paid for interest, exclusive of capitalized interest were $97,924, $88,937
        and
        $89,864 in 2006, 2005 and 2004, respectively.
 
 *Comprehensive
        Income*
 
 SFAS
        No.
        130, “Reporting Comprehensive Income,” establishes guidelines for the reporting
        and display of comprehensive income and its components in financial statements.
        Comprehensive income includes net income and all other non-owner charges
        in
        shareholder’s equity during a period including unrealized gains and losses from
        value adjustments on certain derivative instruments.
 
 *Use
        of Estimates*
 
 The
        preparation of financial statements in conformity with generally accepted
        accounting principles in the United States of America requires management
        to
        make estimates and assumptions that affect the reported amounts of assets
        and
        liabilities and disclosure of contingent assets and liabilities at the date
        of
        the financial statements and the reported amounts of revenues and expenses
        during the reporting periods. Actual results could differ from those
        estimates.
 
 *New
        Accounting Pronouncements*
 
 In
        September 2006, the Financial Accounting Standards Board (“FASB”) issued SFAS
        No. 157, “Fair Value Measurements.” While this standard does not establish any
        new requirements for reporting assets or liabilities at fair value, it does
        clarify the definition of “fair value” when used in FASB pronouncements. This
        standard is effective no later than for fiscal years beginning after November
        15, 2007. The Company does not anticipate a material impact to the Company’s
        financial position and results of operations.
 
 In
        June
        2006, the FASB issued Interpretation No. 48 (“FIN 48”), “Accounting for
        Uncertainty in Income Taxes; an interpretation of FASB Statement No. 109.” FIN
        48 clarifies the accounting for uncertainty in income taxes recognized in
        an
        enterprise’s financial statements in accordance with SFAS No. 109, “Accounting
        for Income Taxes.” It requires a recognition threshold and measurement attribute
        for financial statement disclosure of tax positions taken, or expected to
        be
        taken, in an income tax return. This Interpretation also provides guidance
        on
        de-recognition, classification, interest and penalties, accounting in interim
        periods, disclosure and transition. FIN 48 is effective for fiscal years
        beginning after December 15, 2006. The Company will be required to adopt
        this
        interpretation in the first quarter of fiscal year 2007. While the Company
        is
        currently evaluating the provisions of FIN 48, the adoption is not expected
        to
        have a material impact on its financial position and results of
        operations.
 
 *Reclassifications*
 
 Certain
        reclassifications of prior period amounts, including the presentation of
        the
        statements of operations required by SFAS No. 144, have been made in the
        financial statements to conform to the 2006 presentation.
 
 
 
 62
  **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS - continued**
 **(dollars
        in thousands, except share and unit amounts)**
 
 
 **3.**
              **Real
                  Estate Assets
                  Held-for-Sale**
 
 SFAS
        No.
        144, “Accounting for the Impairment or Disposal of Long-Lived Assets” requires
        that long-lived assets that are to be disposed of by sale be measured at
        the
        lower of book value or fair value less costs to sell. At December 31, 2005,
        eight of the Company’s Properties were classified as held-for-sale. During 2006,
        the Company sold seven of these Properties and committed to a plan to sell
        four
        additional Properties, resulting in five assets held-for-sale at December
        31,
        2006. In addition to classifying these properties as held-for-sale, the
        financial results, including any impairment charges of these properties,
        are
        reported as discontinued operations in the Statement of Operations and the
        net
        book value of the assets are reflected as held-for-sale on the balance sheet.
        The table below provides information on our held-for-sale
        assets.
  **For
                  the Years Ended December 31,********2006**
              
              ******2005**Number
                  of Properties sold
              
              
              7
              
              
              6Number
                  of Properties held-for-sale
              
              
              5
              
              
              8Real
                  estate assets held-for-sale
              
              $
              192,301
              
              $
              72,731Mortgage
                  notes payable associated with properties held-for-sale
              
              $
              101,786
              
              $
              52,288
  **4.**
              **Tenant
                  Accounts Receivable**
 
 The
        Company’s accounts receivable is comprised of the following
        components.
 
 **Accounts
                  Receivable - Assets Held-For-Investment**
              
              **December
                  31, 2006**
              
              **December
                  31, 2005**Billed
                  Receivables
              
              $
              14,333
              
              $
              20,736Straight-line
                  Receivables
              
              
              22,132
              
              
              25,496Unbilled
                  Receivables
              
              
              9,553
              
              
              11,881Less:
                  Allowance for Doubtful Accounts
              
              
              (5,785
              )
              
              (8,236
              )Net
                  Accounts Receivable
              
              $
              40,233
              
              $
              49,877
  **Accounts
                  Receivable - Assets Held-For-Sale**
              
              **December
                  31, 2006**
              
              **December
                  31, 2005**Billed
                  Receivables
              
              $
              6,429
              
              $
              2,125Straight-line
                  Receivables
              
              
              2,279
              
              
              694Unbilled
                  Receivables
              
              
              1,142
              
              
              526Less:
                  Allowance for Doubtful Accounts
              
              
              (2,613
              )
              
              (439
              )Net
                  Accounts Receivable
              
              $
              7,237
              
              $
              2,906
 
 
 63
  **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS - continued**
 **(dollars
        in thousands, except share and unit amounts)**
 
 **5.**
              **Mortgage
                  Notes Payable as of December 31, 2006 and December 31, 2005 consist
                  of the
                  following:**
  **Carrying
                    amount of Mortgage Notes Payable**
                
                **Interest
                    Rate**
                
                **Interest**
                
                **Payment**
                
                **Payment**
                
                **Maturity****Description/Borrower**
                
                **2006**
                
                **2005**
                
                **2006**
                
                **2005**
                
                **Terms**
                
                **Terms**
                
                **at
                    Maturity**
                
                **Date****Fixed
                    Rate:**SAN
                    Mall, LP (p)
                
                $
                33,020
                
                $
                33,523
                
                
                8.35%
                
                
                8.35%
                
                
                (o)
                
                
                (a)
                
                $
                32,615
                
                
                (f)Colonial
                    Park Mall, LP
                
                
                32,451
                
                
                32,975
                
                
                7.73%
                
                
                7.73%
                
                
                (o)
                
                
                (a)
                
                $
                32,033
                
                
                (f)Mount
                    Vernon Venture, LLC
                
                
                8,753
                
                
                8,865
                
                
                7.41%
                
                
                7.41%
                
                
                
                
                
                (a)
                
                $
                8,624
                
                
                Feb.
                    11, 2008Charlotte
                    Eastland Mall, LLC (p)
                
                
                43,766
                
                
                44,559
                
                
                7.84%
                
                
                7.84%
                
                
                (o)
                
                
                (a)
                
                $
                42,302
                
                
                (g)Morgantown
                    Mall Associates, LP
                
                
                52,474
                
                
                53,381
                
                
                6.89%
                
                
                6.89%
                
                
                (o)
                
                
                (a)
                
                $
                50,823
                
                
                (g)GM
                    Olathe, LLC
                
                
                30,000
                
                
                (q)
                
                
                6.35%
                
                
                (q)
                
                
                (l)
                
                
                (b)
                
                $
                30,000
                
                
                Jan.
                    12, 2009Grand
                    Central, LP
                
                
                47,815
                
                
                48,572
                
                
                7.18%
                
                
                7.18%
                
                
                
                
                
                (a)
                
                $
                46,065
                
                
                Feb.
                    1, 2009Johnson
                    City Venture, LLC
                
                
                38,787
                
                
                39,214
                
                
                8.37%
                
                
                8.37%
                
                
                
                
                
                (a)
                
                $
                37,026
                
                
                June
                    1, 2010Polaris
                    Center, LLC
                
                
                40,482
                
                
                40,953
                
                
                8.20%
                
                
                8.20%
                
                
                (o)
                
                
                (a)
                
                $
                38,543
                
                
                (h)Glimcher
                    Ashland Venture, LLC
                
                
                24,809
                
                
                25,307
                
                
                7.25%
                
                
                7.25%
                
                
                
                
                
                (a)
                
                $
                21,817
                
                
                Nov.
                    1, 2011Dayton
                    Mall Venture, LLC
                
                
                55,886
                
                
                56,717
                
                
                8.27%
                
                
                8.27%
                
                
                (o)
                
                
                (a)
                
                $
                49,864
                
                
                (i)Glimcher
                    WestShore, LLC
                
                
                95,255
                
                
                96,804
                
                
                5.09%
                
                
                5.09%
                
                
                
                
                
                (a)
                
                $
                84,824
                
                
                Sept.
                    9, 2012PFP
                    Columbus, LLC
                
                
                142,129
                
                
                144,439
                
                
                5.24%
                
                
                5.24%
                
                
                
                
                
                (a)
                
                $
                124,572
                
                
                April
                    11, 2013LC
                    Portland, LLC
                
                
                133,256
                
                
                135,326
                
                
                5.42%
                
                
                5.42%
                
                
                (o)
                
                
                (a)
                
                $
                116,922
                
                
                (j)JG
                    Elizabeth, LLC
                
                
                158,791
                
                
                161,371
                
                
                4.83%
                
                
                4.83%
                
                
                
                
                
                (a)
                
                $
                135,194
                
                
                June
                    8, 2014MFC
                    Beavercreek, LLC
                
                
                109,232
                
                
                110,871
                
                
                5.45%
                
                
                5.45%
                
                
                
                
                
                (a)
                
                $
                92,762
                
                
                Nov.
                    1, 2014Glimcher
                    SuperMall Venture, LLC
                
                
                59,515
                
                
                60,341
                
                
                7.54%
                
                
                7.54%
                
                
                (o)
                
                
                (a)
                
                $
                49,969
                
                
                (k)RVM
                    Glimcher, LLC
                
                
                50,000
                
                
                50,000
                
                
                5.65%
                
                
                5.65%
                
                
                
                
                
                (c)
                
                $
                44,931
                
                
                Jan.
                    11, 2016WTM
                    Glimcher, LLC
                
                
                60,000
                
                
                (q)
                
                
                5.90%
                
                
                (q)
                
                
                
                
                
                (b)
                
                $
                60,000
                
                
                June
                    8, 2016EM
                    Columbus II, LLC
                
                
                43,000
                
                
                (q)
                
                
                5.87%
                
                
                (q)
                
                
                
                
                
                (d)
                
                $
                38,057
                
                
                Dec.
                    11, 2016Tax
                    Exempt Bonds
                
                
                19,000
                
                
                19,000
                
                
                6.00%
                
                
                6.00%
                
                
                
                
                
                (e)
                
                $
                19,000
                
                
                Nov.
                    1, 20281,278,421
                
                
                1,162,218**Variable
                    Rate/Bridge:**Montgomery
                    Mall Associates, LP (p)
                
                
                25,000
                
                
                25,000
                
                
                7.03%
                
                
                6.16%
                
                
                (m)
                
                
                (b)
                    (r)
                
                $
                25,000
                
                
                Jan.
                    31, 200725,000
                
                
                25,000**Other:**Fair
                    Value Adjustment - Polaris Center, LLC
                
                
                1,465
                
                
                1,894Extinguished
                    Debt
                
                
                -
                
                
                162,369
                
                
                
                
                
                (n)**Total
                    Mortgage Notes Payable:**
                
                $
                1,304,886
                
                $
                1,351,481
  (a)
              The
                  loan requires monthly payments of principal and
                  interest.(b)
              The
                  loan requires monthly payments of interest only.(c)
              The
                  loan requires monthly payments of interest only until February
                  2009,
                  thereafter principal and interest are required.(d)
              The
                  loan requires monthly payments of interest only until December
                  2008,
                  thereafter principal and interest are required.(e)
              The
                  loan requires semi-annual payments of interest.(f)
              The
                  loan matures in October 2027, with an optional prepayment (without
                  penalty) date on October 11, 2007.(g)
              The
                  loan matures in September 2028, with an optional prepayment (without
                  penalty) date on September 11, 2008.(h)
              The
                  loan matures in June 2030, with an optional prepayment (without
                  penalty)
                  date on June 1, 2010.(i)
              The
                  loan matures in July 2027, with an optional prepayment (without
                  penalty)
                  date on July 11, 2012.(j)
              The
                  loan matures in June 2033, with an optional prepayment (without
                  penalty)
                  date on June 11, 2013.(k)
              The
                  loan matures in September 2029, with an optional prepayment (without
                  penalty) date on February 11, 2015.(l)
              Interest
                  rate of LIBOR plus 165 basis points fixed through a SWAP agreement
                  at a
                  rate of 6.35%.(m)
              Interest
                  rate of LIBOR plus 165 basis points.(n)
              Interest
                  rate ranging from 6.37% to 7.43% at December 31, 2005.(o)
              Interest
                  rate escalates after optional prepayment date.(p)
              Mortgage
                  notes payable associated with properties held-for-sale.(q)
              Mortgage
                  was refinanced in 2006 and amount included in extinguished
                  debt.(r)
              Mortgage
                  repaid on January 22, 2007.
 
 64
 **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS - continued**
 **(dollars
        in thousands, except share and unit amounts)**
 
 All
        mortgage notes payable are collateralized by certain Properties owned by
        the
        respective entities with net book values of $1,444,186 and $1,684,178 at
        December 31, 2006 and 2005, respectively. Certain of the loans contain financial
        covenants regarding minimum net operating income and coverage ratios. Management
        believes the Company is in compliance with all covenants at December 31,
        2006.
        Additionally, certain of the loans have cross-default provisions and are
        cross-collateralized with mortgages on the Properties owned by the borrowers
        SAN
        Mall, LP and Morgantown Mall Associates, LP. Under such cross-default
        provisions, a default under any mortgage included in a cross-defaulted loan
        may
        constitute a default under all such mortgages under that loan and may lead
        to
        acceleration of the indebtedness due on each Property within the collateral
        pool. Additionally, $55,000 of mortgage notes payable relating to certain
        Properties have been guaranteed by GPLP as of December 31, 2006.
 
 Principal
        maturities (excluding extension options) on mortgage notes payable during
        the
        five years subsequent to December 31, 2006, are as follows: $107,239 in 2007;
        $118,618 in 2008; $92,957 in 2009; $92,741 in 2010; $39,324 in 2011; $852,542
        matures thereafter.
  **6.**
              **Notes
                  Payable**
 
 In
        December 2006, the Company closed on a $470,000 amended credit facility (the
        “Amended Credit Facility”) that matures in December 2009 and has a one-year
        extension option available to the Company, subject to the satisfaction of
        certain conditions. The Amended Credit Facility is unsecured and amends a
        $300,000 unsecured credit facility that was due to expire in August 2008
        (the
“Prior Facility”). The Amended Credit Facility is expandable to $600,000,
        provided there is no default under the Amended Credit Facility and that one
        or
        more participating lenders agrees to increase their funding commitment or
        one or
        more new participating lenders is added to the facility. The interest rate
        ranges from LIBOR plus 0.95% to LIBOR plus 1.40% depending upon the Company’s
        ratio of debt to total asset value. The Amended Credit Facility contains
        customary covenants, representations, warranties and events of default,
        including maintenance of a specified minimum net worth requirement; a total
        debt
        to total asset value ratio; a secured debt to total asset value ratio; an
        interest coverage ratio; and a fixed charge coverage ratio. Management believes
        the Company is in compliance with all covenants as of December 31, 2006.
 
 At
        December 31, 2006, the outstanding balance on the Amended Credit Facility
        was
        $272,000. Additionally, $20,150 represents a holdback on the available balance
        for letters of credit issued under the Amended Credit Facility. As of December
        31, 2006, the unused balance of the Amended Credit Facility available to
        the
        Company was $177,850 and the interest rate was 6.40%.
 
 At
        December 31, 2005, the outstanding balance on the Prior Facility was $150,000.
        Additionally, $5,070 represented a holdback on the available balance for
        letters
        of credit issued under the Prior Facility at December 31, 2005. As of December
        31, 2005, the unused balance of the Prior Facility available to the Company
        was
        $144,930 and the interest rate was 5.54%.
 
 **7.**
              **Income
                  taxes**
 
 The
        following table reconciles the Company’s net income to taxable income for the
        years ended December 31, 2006, 2005 and 2004:
 
 **2006**
              
              **2005**
              
              **2004**Net
                  (loss) income
              
              $
              (77,165
              )
              $
              20,850
              
              $
              51,755Add:
                  Net loss of taxable REIT subsidiaries
              
              
              1,163
              
              
              2,501
              
              
              1,696Net
                  (loss) income from REIT operations (1)
              
              
              (76,002
              )
              
              23,351
              
              
              53,451Add:
                  Book depreciation and amortization
              
              
              71,923
              
              
              73,622
              
              
              75,817Less:
                  Tax depreciation and amortization
              
              
              (57,573
              )
              
              (56,847
              )
              
              (59,207
              )Book
                  loss (gain) from capital transactions and impairments
              
              
              99,687
              
              
              13,083
              
              
              (18,087
              )Tax
                  (loss) gain from capital transactions
              
              
              (4,079
              )
              
              (14,624
              )
              
              6,736Other
                  book/tax differences, net
              
              
              (1,037
              )
              
              (1,408
              )
              
              (14,436
              )Taxable
                  income before adjustments
              
              
              32,919
              
              
              37,177
              
              
              44,274Less:
                  Capital gains
              
              
              (196
              )
              
              (1,614
              )
              
              (6,736
              )Adjusted
                  taxable income subject to 90% requirement
              
              $
              32,723
              
              $
              35,563
              
              $
              37,538
  (1)
                  Adjustments to “Net (loss) income from REIT operations” are net of amounts
                  attributable to minority interest and taxable REIT
                  subsidiaries.
 
 65
  **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS - continued**
 **(dollars
        in thousands, except share and unit amounts)**
 
 Reconciliation
        between cash dividends paid and dividends paid deduction:
 
 The
        following table reconciles cash dividends paid with the dividends paid deduction
        for the years ended December 31, 2006, 2005 and 2004:
 
 ******2006**
              
              ******2005**
              
              ******2004**Cash
                  dividends paid
              
              $
              87,922
              
              $
              86,593
              
              $
              85,511Less:
                  Dividends designated to prior year
              
              
              (21,912
              )
              
              (21,516
              )
              
              (21,131
              )Plus:
                  Dividends designated from following year
              
              
              22,041
              
              
              21,912
              
              
              21,516Less:
                  Portion designated return of capital
              
              
              (55,132
              )
              
              (49,812
              )
              
              (41,622
              )Dividends
                  paid deduction
              
              $
              32,919
              
              $
              37,177
              
              $
              44,274
 
 Characterization
        of distributions:
 
 The
        following table characterizes distributions paid per common share for the
        years
        ended December 31, 2006, 2005 and 2004:
  **2006**
              
              **2005**
              
              **2004****Amount**
              
              **%**
              
              **Amount**
              
              **%**
              
              **Amount**
              
              **%**Ordinary
                  income
              
              $
              0.4191
              
              
              21.79
              %
              $
              0.5221
              
              
              27.15
              %
              $
              0.6380
              
              
              33.18
              %Return
                  of capital
              
              
              1.5016
              
              
              78.08
              
              
              1.3774
              
              
              71.62
              
              
              1.1707
              
              
              60.87Capital
                  gains
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -Unrecaptured
                  Section 1250 gain
              
              
              0.0025
              
              
              0.13
              
              
              0.0237
              
              
              1.23
              
              
              0.1145
              
              
              5.95$
              1.9232
              
              
              100.00
              %
              $
              1.9232
              
              
              100.00
              %
              $
              1.9232
              
              
              100.00
              %
 
 The
        following table characterizes distributions paid per Series B Preferred Share
        for the year ended December 31, 2004 (redeemed in 2004):
  **2004****Amount**
              
              **%**Ordinary
                  income
              
              $
              0.3104
              
              
              84.79
              %Return
                  of capital
              
              
              -
              
              
              -Capital
                  gains
              
              
              -
              
              
              -Unrecaptured
                  Section 1250 gain
              
              
              0.0557
              
              
              15.21$
              0.3661
              
              
              100.00
              %
 
 The
        following table characterizes distributions paid per Series F Preferred Share
        for the years ended December 31, 2006, 2005 and 2004:
  **2006**
              
              **2005**
              
              **2004****Amount**
              
              **%**
              
              **Amount**
              
              **%**
              
              **Amount**
              
              **%**Ordinary
                  income
              
              $
              2.1746
              
              
              99.40
              %
              $
              2.0926
              
              
              95.66
              %
              $
              1.8548
              
              
              84.79
              %Return
                  of capital
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -Capital
                  gains
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -Unrecaptured
                  Section 1250 gain
              
              
              0.0130
              
              
              0.60
              
              
              0.0950
              
              
              4.34
              
              
              0.3328
              
              
              15.21$
              2.1876
              
              
              100.00
              %
              $
              2.1876
              
              
              100.00
              %
              $
              2.1876
              
              
              100.00
              %
 
 The
        following table characterizes distributions paid per Series G Preferred Share
        for the years ended December 31, 2006, 2005 and 2004:
  **2006**
              
              **2005**
              
              **2004****Amount**
              
              **%**
              
              **Amount**
              
              **%**
              
              **Amount**
              
              **%**Ordinary
                  income
              
              $
              2.0191
              
              
              99.40
              %
              $
              1.9430
              
              
              95.66
              %
              $
              1.4687
              
              
              84.79
              %Return
                  of capital
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -Capital
                  gains
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -Unrecaptured
                  Section 1250 gain
              
              
              0.0121
              
              
              0.60
              
              
              0.0882
              
              
              4.34
              
              
              0.2635
              
              
              15.21$
              2.0312
              
              
              100.00
              %
              $
              2.0312
              
              
              100.00
              %
              $
              1.7322
              
              
              100.00
              %
  66
 **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS - continued**
 **(dollars
        in thousands, except share and unit amounts)**
 
 Deferred
        income taxes represent the tax effect of the differences between the book
        and
        tax bases of assets and liabilities of GDC. Deferred tax assets (liabilities)
        include the following :
  Deferred
        tax assets (liabilities):
  **2006**
              
              **2005**
              
              **2004**Investment
                  in partnership
              
              $
              16
              
              $
              (5
              )
              $
              (1
              )Capitalized
                  development costs
              
              
              (719
              )
              
              (412
              )
              
              (198
              )Depreciation
                  and amortization
              
              
              24
              
              
              41
              
              
              36Charitable
                  contributions
              
              
              22
              
              
              22
              
              
              22Accrued
                  bonuses
              
              
              295
              
              
              -
              
              
              -Interest
                  expense
              
              
              1,424
              
              
              756
              
              
              248Other
              
              
              8
              
              
              8
              
              
              (3
              )Net
                  operating losses
              
              
              2,045
              
              
              2,322
              
              
              1,957Net
                  deferred tax asset
              
              
              3,115
              
              
              2,732
              
              
              2,061Valuation
                  allowance
              
              
              (3,115
              )
              
              (2,732
              )
              
              (2,061
              )Net
                  deferred tax asset after valuation allowance
              
              $
              -
              
              $
              -
              
              $
              -
 
 The
        gross
        tax loss carryforwards total $5,111, and $2,037, $355, $144, $479, $623,
        $561
        and $912, and will expire in 2018, 2020, 2021, 2022, 2023, 2024 and 2025,
        respectively.
 
 The
        income tax provision consisted of $5, $2 and $12 in 2006, 2005 and 2004,
        respectively, related to current state and local taxes. Net deferred tax
        expense
        for each of the years was $0. The income tax expense reflected in consolidated
        statements of operations differs from the amount determined by applying the
        federal statutory rate of 34% to the income before taxes of the Company’s
        taxable REIT subsidiaries as a result of state income taxes and the utilization
        of tax loss carryforwards of $277, $0 and $0 in 2006, 2005 and 2004,
        respectively. A full valuation allowance had previously been provided against
        the tax loss carryforwards utilized.
  In
        2006,
        the Company continued to maintain a valuation allowance for the Company’s net
        deferred tax assets, which consisted primarily of tax loss carryforwards.
        The
        valuation allowance was determined in accordance with the provisions of SFAS
        No.
        109 “Accounting for Income Taxes” which requires the recording of a valuation
        allowance when it is more likely than not that any or all of the deferred
        tax
        assets will not be realized. In absence of favorable factors, application
        of
        SFAS No. 109 requires a 100% valuation allowance for any net deferred tax
        assets
        when a company has cumulative financial accounting losses, excluding unusual
        items, over several years. The Company’s cumulative loss represented negative
        evidence sufficient to require a full valuation allowance under the provisions
        of SFAS No. 109. The Company intends to maintain a full valuation allowance
        for
        its net deferred tax asset until sufficient positive evidence exists to support
        reversal of the reserve. Until such time, except for minor state and local
        tax
        provisions, the Company will have no reported tax provision, net of valuation
        allowance adjustments.
 
 **8.**
              **Preferred
                  Shares**
 
 GRT’s
        Declaration of Trust authorizes GRT to issue up to an aggregate 100,000,000
        shares of GRT, consisting of common shares and/or one or more series of
        preferred shares of beneficial interest.
 
 On
        November 17, 1997, GRT completed a $120,000 public offering of 4,800,000
        shares
        of 9.25% Series B Cumulative Preferred Shares of Beneficial Interest (the
        “Series B Preferred Shares”). On November 25, 1997, GRT sold an additional
        318,000 Series B Preferred Shares as a result of the underwriters exercising
        the
        over-allotment option granted to them. Aggregate net proceeds of the offering
        were $123,072. Distributions on the Series B Preferred Shares were payable
        quarterly in arrears and the Company was able to redeem the Series B Preferred
        Shares anytime on or after November 15, 2003, at a redemption price of $25.00
        per share, plus accrued and unpaid distributions. On February 27, 2004, the
        Company redeemed 5,118,000 of the Series B Preferred Shares. Shareholders
        of
        record at the close of business on February 27, 2004 received a redemption
        price
        of $25.00 per share plus an amount equal to the dividends accrued and unpaid.
        The total cost to redeem the shares was $129,824.
  
 67
 **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS - continued**
 **(dollars
        in thousands, except share and unit amounts)**
  The
        redemption of the Series B Preferred Shares resulted in a $4,878 non-cash
        charge
        as required under EITF Topic Number D-42, “The Effect on the Calculation of
        Earnings Per Share for the Redemption or Induced Conversion of Preferred
        Stock.”
This one time non-cash charge represents costs that were incurred and recorded
        in “Additional Paid In Capital” at the time of the initial issuance of the
        Series B Preferred Shares in 1997.
 
 On
        March
        9, 1999, the Board of Trustees adopted a Preferred Share Purchase Plan (the
        “Plan”) pursuant to which a distribution will be made of one preferred share
        purchase right (a “Right”) for each outstanding Common Share. The distribution
        was made on March 22, 1999, to the shareholders of record at the close of
        business on that date. These rights trade with our Common Shares. Each Right
        entitles the registered holder to purchase from the Company one one-hundredth
        of
        a Series E Junior Participating Preferred Share of the Company, par value
        $0.01
        per share (the “Preferred Shares”), at a price of $55.00 per one one-hundredth
        of a Preferred Share (the “Purchase Price”), subject to adjustment. The Rights
        will become exercisable in the event that any person or group acquires or
        announces its intention to acquire beneficial ownership of 15.0% or more
        of the
        outstanding common shares of the Company (an “Acquiring Person”). Alternatively,
        each Right holder, except the Acquiring Person, will have the right to receive
        upon exercise that number of common shares having a market value of two times
        the Purchase Price of the Right. At any time before any person or group becomes
        an Acquiring Person, the Board of Trustees may redeem the Rights at a price
        of
        $0.01 per Right at which time the ability to exercise the Rights will terminate.
        At any time after a person or group becomes an Acquiring Person, the Board
        of
        Trustees may exchange the Rights at an exchange ratio of one common share
        or one
        Preferred Share per Right. The Plan expires on March 9, 2009.
 
 On
        August
        25, 2003, the Company completed a $60,000 public offering of 2,400,000 shares
        of
        Series F Preferred Shares, par value $0.01 per share, at a purchase price
        of
        $25.00 per Series F Preferred Share. Aggregate net proceeds of the offering
        were
        $58,110. Distributions on the Series F Preferred Shares are payable quarterly
        in
        arrears. The Company generally may redeem the Series F Preferred Shares anytime
        on or after August 25, 2008, at a redemption price of $25.00 per share, plus
        accrued and unpaid distributions.
 
 On
        February 23, 2004, the Company completed a $150,000 public offering of 6,000,000
        shares of Series G Preferred Shares. Aggregate net proceeds of the offering
        were
        $145,300. Distributions on the Series G Preferred Shares are payable quarterly
        in arrears beginning on April 15, 2004. The Company generally may redeem
        the
        Series G Preferred Shares anytime on or after February 23, 2009, at a redemption
        price of $25.00 per share, plus accrued and unpaid distributions. The proceeds
        were used to redeem the Series B Preferred Shares on February 27, 2004 and
        to
        pay down $16,900 of the Company’s credit facility.
 
 **9.**
              **Derivative
                  Financial Instruments**
 
 The
        Company accounts for its derivatives and hedging activities under SFAS No.
        133
        as amended by SFAS No. 138 and 149. During the year ended December 31, 2006,
        the
        Company recognized additional other comprehensive loss of $2 to adjust the
        carrying amount of the interest rate swaps to fair values at December 31,
        2006,
        net of $(163) in reclassifications to earnings for interest rate swap
        settlements and interest rate cap amortization during the period. During
        the
        twelve months ended December 31, 2005, the Company recognized additional
        other
        comprehensive income of $9 to adjust the carrying amount of the interest
        rate
        swaps and caps to fair values at December 31, 2005, net of $11 in
        reclassifications to earnings for interest rate swap settlements and interest
        rate cap amortization during the period and $1 in minority interest
        participation. During the year ended December 31, 2004, the Company recognized
        additional other comprehensive income of $1,192 to adjust the carrying amount
        of
        the interest rate swaps and caps to fair values at December 31, 2004, net
        of
        $1,325 in reclassifications to earnings for interest rate swap settlements
        and
        interest rate cap amortization during the period and $100 in minority interest
        participation. The interest rate swap settlements were offset by a corresponding
        reduction in interest expense related to the interest payments being
        hedged.
  68
 **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS - continued**
 **(dollars
        in thousands, except share and unit amounts)**
 
 The
        Company may be exposed to the risk associated with variability of interest
        rates
        that might impact the cash flows and the results of operations of the Company.
        Our hedging strategy, therefore, is to eliminate or reduce, to the extent
        possible, the volatility of cash flows. The following table summarizes the
        notional values and fair values of the Company’s derivative financial
        instruments as of December 31, 2006. The notional values provide an indication
        of the extent of the Company’s involvement in these instruments at that time,
        but do not represent exposure to credit, interest rate or market
        risks.
 **Hedge
                    Type**
                
                **Notional
                    Value**
                
                **Interest****Rate**
                
                **Maturity**
                
                **Fair
                    Value**Swap
                    - Cash Flow
                
                $
                    30,000
                
                4.7025%
                
                January
                    15, 2008
                
                $154Swap
                    - Cash Flow
                
                $
                    35,000
                
                5.2285%
                
                August
                    15, 2008
                
                $(85)Swap
                    - Cash Flow
                
                $
                    35,000
                
                5.2285%
                
                August
                    15, 2008
                
                $(85)
  On
        December 31, 2006, the derivative instruments were reported at their fair
        value
        of $(16) in accounts payable and accrued expenses in the accompanying balance
        sheet, with a corresponding adjustment to other comprehensive income for
        the
        unrealized gains and losses (net of minority interest participation). Over
        time,
        the unrealized gains and losses held in accumulated other comprehensive income
        will be reclassified to earnings, of which $0 is expected to be reclassified
        in
        2007. This reclassification will correlate with the recognition of the hedged
        interest payments in earnings. There was no hedge ineffectiveness during
        the
        year ended December 31, 2006.
 
 To
        determine the fair values of derivative instruments, the Company uses a variety
        of methods and assumptions that are based on market conditions and risks
        existing at each balance sheet date. Standard market conventions and techniques
        such as undiscounted cash flow analysis, replacement cost and termination
        cost
        are used to determine fair value.
 
 **10.**
              **Rentals
                  Under Operating Leases**
 
 The
        Company receives rental income from the leasing of retail shopping center
        space
        under operating leases with expiration dates through the year 2027. The minimum
        future base rentals under non-cancelable operating leases as of December
        31,
        2006 are as follows:
 
 2007
              
              $
              199,1252008
              
              
              179,7972009
              
              
              152,9572010
              
              
              125,9032011
              
              
              100,170Thereafter
              
              
              303,375$
              1,061,327
 
 Minimum
        future base rentals do not include amounts which may be received from certain
        tenants based upon a percentage of their gross sales or as reimbursement
        of real
        estate taxes and property operating expenses. Minimum rents contain
        straight-line adjustments for rental revenue increases which aggregated
        $(1,487), $578 and $614 for the years ended December 31, 2006, 2005 and 2004,
        respectively. In 2006, 2005 and 2004, no tenant collectively accounted for
        more
        than 10.0% of rental income. The tenant base includes national, regional
        and
        local retailers, and consequently the credit risk is concentrated in the
        retail
        industry.
 
 69
  **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS - continued**
 **(dollars
        in thousands, except share and unit amounts)**
 
 **11.**
              **Investment
                  in Unconsolidated Entities**
  Investment
        in unconsolidated real estate entities as of December 31, 2006 consists of
        our
        investment in three separate venture arrangements. The Company evaluated
        each of
        its three venture arrangements individually and determined that control was
        shared between the Company and its venture partner. Therefore, the ventures
        do
        not qualify as VIE’s. The Company concluded that its venture arrangements would
        be accounted for under the equity method of accounting. The description of
        the
        three ventures are specified below.
  o
              **ORC
                  Venture**
 
 Investment
        in unconsolidated real estate entities as of December 31, 2006 consisted
        of a
        52% interest held by GPLP in a joint venture with an affiliate of Oxford
        Properties Group (“Oxford”), which is the global real estate platform for the
        Ontario (Canada) Municipal Employees Retirement System, a Canadian pension
        plan.
        On December 29, 2005, the ORC Venture acquired Puente Hills Mall (“Puente”), an
        enclosed regional mall consisting of approximately 1.2 million square feet
        of
        GLA located in the Los Angeles metro area from an independent third party.
        The
        purchase price of $170,080 was funded in part by the assumption of an $88,800
        non-recourse mortgage loan and pro rata contributions to the ORC Venture
        by GPLP
        and Oxford. On March 14, 2006, GPLP transferred all of its  ownership
        interest in Tulsa Promenade (“Tulsa”), an enclosed regional mall located in
        Tulsa, Oklahoma, to the ORC Venture for total consideration of $58,300 (which
        included the ORC Venture’s assumption of a $35,000 mortgage loan).
 
 o
              **Surprise
                  Venture**
 
 Investment
        in unconsolidated real estate entities as of December 31, 2006 consisted
        of a
        50% interest held by a GPLP subsidiary in a joint venture (the “Surprise
        Venture”) formed on September 6, 2006 with the former landowner of the property
        that is to be developed. The Surprise Venture will develop approximately
        27,000
        square feet of retail space on a five-acre site located in an area northwest
        of
        Phoenix, Arizona. In September 2006, the Company invested $1.9 million in
        the
        Surprise Venture.
 
 o
              **Scottsdale
                  Venture**
 
 Investment
        in unconsolidated real estate entities as of December 31, 2006 consisted
        of a
        50% interest held by a GPLP subsidiary in a joint venture (the “Scottsdale
        Venture”) formed in May 2006 with an affiliate of The Wolff Company (“Wolff”).
        The purpose of the venture is to build the Scottsdale Crossing development,
        an
        approximately 650,000 square foot premium retail and office complex to be
        developed in Scottsdale, Arizona. In December of 2006 the Company invested
        approximately $10.3 million in the Scottsdale Venture.
 
 The
        Company may provide management, development, construction, leasing and legal
        services for a fee to each of the ventures described above. Each individual
        agreement specifies which services the Company provides. The Company recognized
        fee income of $1,866, $632 and $14 for these services for the year ended
        December 31, 2006, 2005 and 2004, respectively.
 
 The
        net
        income for each venture is allocated in accordance with the provisions of
        the
        applicable joint venture agreement. The summary statement of operations and
        balance sheet for the Company’s investment in its joint venture arrangements for
        the years ended December 31, 2006 and December 31, 2005 are presented
        below:
 
 70
  **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS - continued**
 **(dollars
        in thousands, except share and unit amounts)**
 
 **For
                  the Year Ended**
                **December
                  31, 2006****Total**
              
              **Company’s
                  Pro-Rata Share of Joint Venture Operations****Statements
                  of Operations**Total
                  revenues
              
              $
              33,957
              
              $
              17,658Operating
                  expenses
              
              
              15,552
              
              
              8,087Depreciation
                  and amortization
              
              
              8,901
              
              
              4,629Operating
                  income
              
              
              9,504
              
              
              4,942Other
                  expenses, net
              
              
              40
              
              
              21Interest
                  expense, net
              
              
              6,665
              
              
              3,466Net
                  income
              
              
              2,799
              
              
              1,455Preferred
                  dividend
              
              
              23
              
              
              12Net
                  income available to the Company’s joint ventures
              
              $
              2,776
              
              $
              1,443
 
 
 The
        $51
        in net income for the year ended December 31, 2005 represents the Company’s
        share of income for Puente for the period December 29, 2005 through December
        31,
        2005. The $3 in net income for the year ended December 31, 2004 represents
        our
        share of income for the period January 1, 2004 through January 4, 2004 for
        both
        Polaris Mall, LLC and Polaris Center, LLC. These two entities were fully
        consolidated on January 5, 2004.
 
 **BALANCE
                  SHEETS**
              
              **December
                  31, 2006**
              
              **December
                  31, 2005**Assets:Investment
                  properties at cost, net
              
              $
              236,744
              
              $
              171,897Intangible
                  assets (1)
              
              
              12,855
              
              
              11,478Other
                  assets
              
              
              28,559
              
              
              4,616$
              278,158
              
              $
              187,991Liabilities
                  and Members’ Equity:Mortgage
                  notes payable
              
              $
              122,099
              
              $
              88,212Intangibles
                  (2)
              
              
              13,634
              
              
              14,360Other
                  liabilities
              
              
              4,827
              
              
              324140,560
              
              
              102,896Members’
                  equity
              
              
              137,598
              
              
              85,095Total
                  liabilities and members’ equity
              
              $
              278,158
              
              $
              187,991GPLP’s
                  share of members’ equity
              
              $
              70,793
              
              $
              44,200
  **Reconciliation
                  of Members’ Equity to Company** **Investment in
                  Unconsolidated Entities:**Members’
                  equity
              
              $
              70,793
              
              $
              44,200Advances
                  and additional costs
              
              
              (377
              )
              
              48Investment
                  in unconsolidated entities
              
              $
              70,416
              
              $
              44,248
  (1)
              Includes
                  value of acquired in-place leases.
 (2)
              Includes
                  the net value of $566 and $410 for above-market acquired leases
                  as of
                  December 31, 2006 and 2005, respectively, and $14,200 and $14,770
                  for
                  below-market acquired leases as of December 31, 2006 and 2005,
                  respectively.
 
 71
 
 **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS - continued**
 **(dollars
        in thousands, except share and unit amounts)**
 
 **12.**
              **Related
                  Party Transactions**
  *Employment
        & Consulting Agreement of Herbert Glimcher*
 
 On
        January 20, 2005, Herbert Glimcher resigned as Chief Executive Officer of
        the
        Company and entered into an Employment and Consulting Agreement (the “Employment
        Agreement”) with GRT. He remains Chairman of the Board of Trustees (“Board”) of
        GRT. Under the Employment Agreement, GRT employs Herbert Glimcher as Senior
        Advisor and as non-executive Chairman of the Board. He also serves as
        non-executive Chairman of the Board of Directors for GPC. Neither GRT nor
        GPC
        considers Herbert Glimcher to be an executive officer. The initial term of
        the
        Employment Agreement commenced on February 1, 2005 and continued through
        May 31,
        2006 (the “Term”); provided, that the Term was subject to renewal for an
        additional one year period if GRT and Herbert Glimcher agreed to renew the
        Term
        prior to its expiration. On March 9, 2006, GRT and Herbert Glimcher agreed
        to
        renew the Employment Agreement for an additional one-year period to end on
        May
        31, 2007.
  Herbert
        Glimcher receives $100 per annum for serving as the non-executive Chairman
        of
        the Board for GRT and GPC and $250 per annum for serving as Senior Advisor
        to
        GRT (the “Salary”). Additionally, he shall receive a total of $2,000 in cash
        during a period of two years following the termination of his employment
        under
        the Employment Agreement (the “Post-Employment Restricted Period”) from GRT. GRT
        recognized $2,000 in compensation expense during the first quarter of 2005
        related to the Employment Agreement. The Salary costs are reflected in the
        general and administrative expenses for the Company for the related period.
 
 GRT
        reimburses Herbert Glimcher for reasonable rent for office space located
        in
        Columbus, Ohio, the reasonable salary of one administrative assistant and
        provides a part-time driver. The Company also maintains a life insurance
        policy
        covering the life of Herbert Glimcher. For the years ended December 31, 2006
        and
        2005, the aggregate total of reimbursements paid by GRT under the Employment
        Agreement was $119 and $123, respectively.
 
 *Corporate
        Flight Inc.*
 
 The
        Company paid Corporate Flight, Inc. (“CFI”), which is wholly owned by Herbert
        Glimcher, the following amounts for the use in connection with Company related
        matters, of an airplane owned by CFI.
 
 **For
                  the Years Ended:**
              
              **Corporate**
                **Flight
                  Inc.**December
                  31, 2006
              
              $
              360December
                  31, 2005
              
              
              304December
                  31, 2004
              
              
              239Total
              
              $
              903
 
 *Archer-Meek-Weiler
        Insurance Agency*
  The
        Company has engaged Archer-Meek-Weiler, a company of which Alan R. Weiler,
        a
        Trustee, is Chairman, as its agent for the purpose of obtaining property,
        liability, directors and officers, and employment practices insurance coverage.
        In connection with securing such insurance coverage, Archer-Meek-Weiler received
        net commissions and fees of $343, $284 and $300 for the years ended December
        31,
        2006, 2005 and 2004, respectively. The stock of Archer-Meek-Weiler is owned
        by a
        trust for the benefit of Alan R. Weiler’s children and the children of his
        brother, Robert J. Weiler.
 
 *Polaris
        Transactions*
 
 On
        January 5, 2004, GPLP completed the acquisition of the joint venture interests
        not previously owned by the
        Company in Polaris Mall, LLC, the indirect owner of Polaris, from NP Limited
        Partnership (“NPLP”), an Ohio limited partnership, and other parties. As part of
        the transaction, the Company acquired in fiscal year 2004 the remaining 60.7%
        interest in Polaris Mall, LLC for approximately $46,500, which was paid with
        approximately $33,000 in cash and the balance by the issuance of 594,342
        OP
        Units in GPLP valued at approximately $13,500.
  72
 **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS - continued**
 **(dollars
        in thousands, except share and unit amounts)**
  On
        January 5, 2004, GPLP also completed the acquisition of the joint venture
        interests not previously owned by the Company in Polaris Center, LLC, the
        owner
        of Polaris Towne Center, a 443,165 square foot town center located in Columbus,
        Ohio, from NPLP. As part of the transaction, the Company acquired in fiscal
        year
        2004 the remaining 50% interest in Polaris Center, LLC for approximately
        $10,000, which was paid in cash.
 
 Mr.
        Weiler, his spouse and children own, in its entirety, WSS Limited Partnership,
        an Ohio limited partnership (“WSS”). WSS directly owns OP Units of limited
        partnership in GPLP. WSS also indirectly owns OP Units by virtue of its
        ownership interest in NPLP. WSS also owns an interest in Star-Weiler Limited
        Partnership, an Ohio limited partnership (“Star-Weiler”). Star-Weiler owns an
        interest in NPLP. Mr. Weiler’s children, nieces and nephews also indirectly own
        an interest in NPLP. In addition, Mr. Weiler’s sister-in-law previously owned an
        interest in Polaris Mall, LLC, which interest was acquired by GPLP on January
        5,
        2004.
 
 Following
        the acquisition of the joint venture interests not previously owned by the
        Company in Polaris Mall, LLC and Polaris Center, LLC, NPLP and WSS converted
        the
        OP Units to Common Shares.
 
 *Leasing
        Activity*
 
 A
        brother
        of Herbert Glimcher owns a company that currently leases four store locations
        in
        the Company’s Properties. Two leases were terminated during 2006. Minimum Rents
        were $227, $266 and $268 for the years ended December 31, 2006, 2005 and
        2004,
        respectively.
 
 **13.**
              **Commitments
                  and Contingencies**
 
 The
        Operating Partnership leases office space under an operating lease that had
        an
        initial term of four years commencing on July 2003. Future minimum rental
        payments as of December 31, 2006 are as follows:
  **Office
                  Lease**2007
              
              $
              4362008
              
              
              362009
              
              
              -2010
              
              
              -Thereafter
              
              
              -$
              472
 
 Office
        rental expenses (including miscellaneous month-to-month lease rentals) for
        the
        years ended December 31, 2006, 2005 and 2004 were $418, $446 and $416,
        respectively.
 
 At
        December 31, 2006, there were 3.0 million OP Units outstanding. These OP
        Units
        are redeemable, at the option of the holders, beginning on the first anniversary
        of their issuance. The redemption price for an OP Unit shall be, at the option
        of GPLP, payable in the following form and amount: (a) cash at a price equal
        to
        the fair market value of one Common Share of GRT or (b) one Common Shares
        for
        each OP Unit. The fair value of the OP Units outstanding at December 31,
        2006 is
        $80,645 based upon a per unit value of $26.92 at December 31, 2006, (based
        upon
        a five-day average of the Common Stock price from December 21, 2006 to December
        28, 2006).
 
 In
        July
        1998, the New Jersey Economic Development Authority issued approximately
        $140,500 of Economic Development Bonds. On May 29, 2002, the New Jersey Economic
        Development Authority refunded certain of the Economic Development Bonds
        issued
        in 1998 and issued approximately $108,940 of replacement Economic Development
        Bonds. The Company began making quarterly Payment In Lieu of Taxes (“PILOT”)
        payments
  73
 **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS - continued**
 **(dollars
        in thousands, except share and unit amounts)**
 
 commencing
        May 2001 and terminating on the date of the final payment of the bonds. Such
        PILOT payments are treated as real estate tax expense in the statements of
        operations. The amount of the annual PILOT payments beginning with the bond
        year
        ended April 1, 2001 was $8,925 and increases 10.0% every five years until
        the
        final payment is made. The Company has provided a limited guarantee of franchise
        tax payments to be received by the city until franchise tax payments achieve
        $5,600 annually; any such payments made by the Company are subject to refund
        from future franchise tax payments. Through December 31, 2006, the Company
        has
        made $12,770 in payments under this agreement.
 
 The
        Company has reserved $475 in relation to a contingency associated with the
        sale
        of Loyal Plaza, a community center sold in 2002, relating to environmental
        assessment and monitoring matters.
 
 The
        Company is involved in lawsuits, claims and proceedings, which arise in the
        ordinary course of business. The Company is not presently involved in any
        material litigation. In accordance with SFAS No. 5, “Accounting for
        Contingencies,” the Company makes a provision for a liability when it is both
        probable that a liability has been incurred and the amount of the loss can
        be
        reasonably estimated. Although the outcome of any litigation is uncertain,
        the
        Company does not expect any such legal actions to have a material adverse
        effect
        on the Company’s consolidated financial condition or results of operations taken
        as a whole.
 
 **14.**
              **Restricted
                  Common Stock**
 
 Shares
        of
        restricted common stock are granted pursuant to GRT’s 2004 Incentive
        Compensation Plan. Shares issued for the year ended December 31, 2005 vest
        in
        one-third installments over a period of three years commencing on the one-year
        anniversary of the grant date for the recipient’s award. Shares issued for the
        year ended December 31, 2006 vest in one-third installments, over a period
        of
        five years beginning on the third annual anniversary of the grant date. The
        restricted common stock value is determined by the Company’s share price on the
        grant date. As restricted stock represents an incentive for future periods,
        the
        Company recognizes the related compensation expense ratably over the applicable
        vesting periods.
 
 For
        the
        year ended December 31, 2006, 58,332 shares of restricted common stock were
        granted. For the year ended December 31, 2005, 56,666 shares of restricted
        common stock were granted. The related compensation expense recorded for
        the
        year ended December 31, 2006 and 2005 was $560 and $314, respectively. The
        amount of unvested restricted shares that will be expensed in future periods
        was
        $1,695 and $1,069 for the years ended December 31, 2006 and 2005,
        respectively.
 
 A
        summary
        of the activity of the Company’s restricted common stock for the year ended
        December 31, 2006 is presented below.
 
 **Activity
                  for the year ended December 31, 2006**
              
              **Restricted
                  Shares**
              
              **Weighted
                  Average****Grant Date Fair Value**Outstanding
                  at beginning of year
              
              
              56,666
              
              $
              24.407Shares
                  granted
              
              
              58,332
              
              $
              26.100Shares
                  vested
              
              
              (17,219
              )
              $
              24.375Shares
                  forfeited
              
              
              (13,334
              )
              $
              25.227Shares
                  outstanding at end of year
              
              
              84,445
              
              $
              25.454
 
 **15.**
              **Share
                  Option Plans**
 
 GRT
        has
        established the 1993 Employee Share Option Plan (the “1993 Employee Plan”), the
        1993 Trustee Share Option Plan (the “1993 Trustee Plan”), the 1997 Incentive
        Plan (the “Incentive Plan”) and the 2004 Incentive Compensation Plan (“2004
        Plan”) for the purpose of attracting and retaining the Company’s trustees,
        executive and other employees (the 1993 Employee Plan, the 1993 Trustee Plan,
        the Incentive Plan and the 2004 Plan are collectively referred to as the
        “Plans”). There are no options that remain outstanding under the 1993 Employee
        Plan, 264,848 options remain outstanding and exercisable under the 1993 Trustee
        Plan; 1,206,470 outstanding under the 1997 Plan of which 1,097,654 are
        exercisable; and 660,814 outstanding under the 2004 Plan of which 179,168
        are
        exercisable.
 
 74
 **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS - continued**
 **(dollars
        in thousands, except share and unit amounts)**
 
  A
        summary
        of the status of the Company's Plans at December 31, 2006, 2005 and 2004
        and
        changes during the years ending on those dates is presented below.
  **Options**
              
              **2006**
                **Weighted-
                  Average**
                **Exercise**
                **Price**
              
              **Options**
              
              **2005**
                **Weighted-
                  Average**
                **Exercise**
                **Price**
              
              **Options**
              
              **2004**
                **Weighted-
                  Average**
                **Exercise**
                **Price****Option
                  Plans:**Outstanding
                  at beginning of year
              
              
              1,953,098
              
              
              $20.886
              
              
              2,128,571
              
              
              $19.617
              
              
              2,235,226
              
              
              $17.748Granted
              
              
              337,250
              
              
              $25.233
              
              
              339,750
              
              
              $25.510
              
              
              559,178
              
              
              $25.472Exercised
              
              
              (87,298
              )
              
              $18.672
              
              
              (386,384
              )
              
              $16.914
              
              
              (503,882
              )
              
              $17.380Forfeited
              
              
              (70,918
              )
              
              $25.182
              
              
              (128,839
              )
              
              $24.030
              
              
              (161,951
              )
              
              $20.995Outstanding
                  at end of year
              
              
              2,132,132
              
              
              $21.522
              
              
              1,953,098
              
              
              $20.886
              
              
              2,128,571
              
              
              $19.617Exercisable
                  at end of year
              
              
              1,541,670
              
              
              $20.057
              
              
              1,286,554
              
              
              $19.020
              
              
              1,261,372
              
              
              $17.553Weighted
                  average per share fair value of options granted during the
                  year
              
              
              
              
              
              $1.028
              
              
              
              
              
              $1.073
              
              
              
              
              
              $1.266
 
 The
        fair
        value of each option grant was estimated on the date of the grant using the
        Black-Scholes options pricing model with the following assumptions: weighted
        average risk free interest rates used in 2006, 2005 and 2004 were
        5.0%, 5.0% and 5.6%, respectively, expected average lives of five years,
        annual
        dividend rates of $1.9232 and
 weighted
        average volatility of 12.3%, 12.3% and 12.2% in 2006, 2005 and 2004,
        respectively.
  The
        following table summarizes information regarding the options outstanding
        at
        December 31, 2006 under the Company’s Plans:
  **Options
                  Outstanding**
              
              **Options
                  Exercisable****Range
                  of**
                **Exercise
                  Prices**
              
              **Number**
                **Outstanding
                  at**
                **December
                  31, 2006**
              
              **Weighted-**
                **Average**
                **Remaining**
                **Contractual
                  Life**
              
              **Weighted-**
                **Average**
                **Exercise Price**
              
              **Number**
                **Exercisable
                  at**
                **December
                  31, 2006**
              
              **Weighted-**
                **Average**
                **Exercise Price**$18.750
                  - $20.750
              
              264,848
              
              0.4
              
              $20.224
              
              264,848
              
              $20.224$20.500
              
              146,122
              
              1.4
              
              $20.500
              
              146,122
              
              $20.500$15.000
              
              265,334
              
              2.2
              
              $15.000
              
              265,334
              
              $15.000$12.280
              
              8,135
              
              3.2
              
              $12.280
              
              8,135
              
              $12.280$14.750
              
              42,816
              
              4.2
              
              $14.750
              
              42,816
              
              $14.750$17.610
              
              153,315
              
              5.2
              
              $17.610
              
              153,315
              
              $17.610$18.930
                  - $22.360
              
              256,477
              
              6.2
              
              $19.015
              
              256,477
              
              $19.015$19.560
                  - $26.690
              
              428,834
              
              7.2
              
              $25.353
              
              288,496
              
              $25.365$24.740
                  - $25.670
              
              259,501
              
              8.2
              
              $25.565
              
              98,127
              
              $25.577$25.220
                  - $25.650
              
              306,750
              
              9.4
              
              $25.234
              
              18,000
              
              $25.2202,132,132
              
              5.4
              
              $21.522
              
              1,541,670
              
              $20.057
  75
 **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS - continued**
 **(dollars
        in thousands, except share and unit amounts)**
 
 All
        options granted under the Plans, except those number of options noted as
        exceptions, are exercisable over a three-year period. The three-year period
        vests with options exercisable at a rate of 33.3% per annum beginning with
        the
        first anniversary of the date of grant and will remain exercisable through
        the
        tenth anniversary of such date. Exceptions to this vesting schedule are options
        that are exercisable immediately and will remain exercisable through the
        tenth
        anniversary of date granted. The number of options that are exercisable
        immediately are 18,000 shares granted under the 2004 Plan in 2006, 2005 and
        2004.
 
 The
        following table summarizes the intrinsic value of options exercised and fair
        value of options vested for the three years ended December 31, 2006, 2005
        and
        2004.
 
 **For
                  the year ended****December 31, 2006**
              
              **For
                  the year ended****December 31, 2005**
              
              **For
                  the year ended****December 31, 2004**Aggregate
                  intrinsic value of options exercised
              
              $
              697
              
              $
              3,255
              
              $
              4,354Aggregate
                  fair value of options vested
              
              $
              336
              
              $
              324
              
              $
              135
   **16.**
              **Employee
                  Benefit Plan - 401(k) Plan**
 
 In
        January 1996, the Company established a qualified retirement savings plan
        under
        Code 401(k) for eligible employees, which contains a cash or deferred
        arrangement which permits participants to defer up to a maximum of 25.0%
        of
        their compensation, subject to certain limitations. Employees 21 years old
        or
        above who have been employed by the Company for at least six months are eligible
        to participate. Participant’s salary deferrals up to a maximum of 4.0% of
        qualified compensation were matched at 50.0% for the year ended December
        31,
        2004. The Company contributed $417, $373 and $228 to the plan in 2006, 2005
        and
        2004, respectively. Effective January 1, 2005, participant’s salary deferrals up
        to a maximum of 6% of qualified compensation were matched at 50.0%.
 
 **17.**
              **Distribution
                  Reinvestment and Share Purchase Plan**
 
 The
        Company has a Distribution Reinvestment and Share Purchase Plan under which
        its
        shareholders may elect to purchase additional common shares of beneficial
        interest and/or automatically reinvest their distributions in Shares. In
        order
        to fulfill its obligations under the plan, the Company may purchase Shares
        in
        the open market or issue Shares that have been registered and authorized
        specifically for the plan. As of December 31, 2006, 2,100,000 Shares were
        authorized of which 268,052 Shares have been issued.
 
 
 76
  **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS - continued**
 **(dollars
        in thousands, except share and unit amounts)**
 
 **18.**
              **Earnings
                  Per Share**
 
 The
        presentation of primary EPS and diluted EPS is summarized in the table below
        (shares in thousands):
 **For
                    the Years Ended December 31,****2006**
                
                **2005**
                
                **2004****Per**
                
                
                
                
                
                **Per**
                
                
                
                
                
                **Per****Income**
                
                **Shares**
                
                **Share**
                
                **Income**
                
                **Shares**
                
                **Share**
                
                **Income**
                
                **Shares**
                
                **Share****Basic
                    EPS**Income
                    from continuing operations
                
                $
                (11,602
                )
                
                
                
                
                
                
                $
                31,666
                
                
                
                
                
                
                
                $
                22,488Less:
                    Preferred stock dividends
                
                
                (17,437
                )
                
                
                
                
                
                
                
                (17,437
                )
                
                
                
                
                
                
                
                (17,517
                )Preferred
                    stock redemption
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                (4,878
                )Add:
                    Minority interest adjustments (1)
                
                
                (5,016
                )
                
                
                
                
                
                
                
                (928
                )
                
                
                
                
                
                
                
                2,671(Loss)
                    income from continuing operations
                
                $
                (34,055
                )
                
                36,611
                
                $
                (0.93
                )
                $
                13,301
                
                
                36,036
                
                $
                0.37
                
                $
                2,764
                
                
                35,456
                
                $
                0.08Discontinued
                    operations
                
                $
                (65,563
                )
                
                
                
                
                
                
                $
                (10,816
                )
                
                
                
                
                
                
                $
                29,267Less:
                    Minority interest adjustment (1)
                
                
                5,016
                
                
                
                
                
                
                
                
                928
                
                
                
                
                
                
                
                
                (2,671
                )Discontinued
                    operations
                
                $
                (60,547
                )
                
                36,611
                
                $
                (1.65
                )
                $
                (9,888
                )
                
                36,036
                
                $
                (0.27
                )
                $
                26,596
                
                
                35,456
                
                $
                0.75**Diluted
                    EPS**Income
                    from continuing operations
                
                $
                (11,602
                )
                
                36,611
                
                
                
                
                $
                31,666
                
                
                36,036
                
                
                
                
                $
                22,488
                
                
                35,456Less:
                    Preferred stock dividends
                
                
                (17,437
                )
                
                
                
                
                
                
                
                (17,437
                )
                
                
                
                
                
                
                
                (17,517
                )Preferred
                    stock redemption
                
                
                -
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                (4,878
                )Add:
                    Minority interest
                
                
                (7,733
                )
                
                
                
                
                
                
                
                252
                
                
                
                
                
                
                
                
                2,906Operating
                    Partnership Units
                
                
                
                
                
                3,035
                
                
                
                
                
                
                
                
                3,333
                
                
                
                
                
                
                
                
                3,549Options
                
                
                
                
                
                -
                
                
                
                
                
                
                
                
                449
                
                
                
                
                
                
                
                
                491Restricted
                    shares
                
                
                
                
                
                -
                
                
                
                
                
                
                
                
                38(Loss)
                    income from continuing operations
                
                $
                (36,772
                )
                
                39,646
                
                $
                (0.93
                )
                $
                14,481
                
                
                39,856
                
                $
                0.36
                
                $
                2,999
                
                
                39,496
                
                $
                0.08Discontinued
                    operations
                
                $
                (65,563
                )
                
                
                
                $
                (1.65
                )
                $
                (10,816
                )
                
                
                
                $
                (0.27
                )
                $
                29,267
                
                
                
                
                $
                0.74
  (1)
              The
                  minority interest adjustment reflects the reclassification of the
                  minority
                  interest expense from continuing to discontinued operations for
                  appropriate allocation in the calculation of the earnings per share
                  for
                  discontinued operations.
 
 Options
        with exercise prices greater than the average share prices for the periods
        presented were excluded from the respective computations of diluted EPS because
        to do so would have been antidilutive for 2005 and 2004. The number of such
        options was 599,000 and 429,000 for the years ended December 31, 2005 and
        2004,
        respectively . All
        common stock equivalents have been excluded in 2006 as they are
        antidilutive.
 
 **19.**
              **Fair
                  Value of Financial Instruments**
 
 The
        carrying values of cash and cash equivalents, restricted cash, tenant accounts
        receivable, accounts payable and accrued expenses are reasonable estimates
        of
        their fair values because of the short maturity of these financial instruments.
        The carrying value of the credit facility is also a reasonable estimate of
        its
        fair value because it bears variable rate interest at current market rates.
        Based on the discounted amount of future cash flows using rates currently
        available to GRT for similar liabilities (ranging from 5.58% to 7.85% per
        annum
        at December 31, 2006 and 5.05% to 7.28% per annum at December 31, 2005),
        the
        fair value of GRT’s mortgage notes payable is estimated at $1,282,023 and
        $1,358,744 at December 31, 2006 and 2005, respectively. The fair value of
        the
        debt instruments considers in part the credit of GRT as an entity, and not
        just
        the individual entities and Properties owned by GRT. ****
 
 77
  **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS - continued**
 **(dollars
        in thousands, except share and unit amounts)**
 
 **20.**
              **Acquisitions**
 
 The
        Company accounts for acquisitions under the purchase method of accounting
        in
        accordance with SFAS No. 141, “Business Combinations.” The Company has finalized
        the allocation of the purchase price for Properties acquired through 2006
        and no
        material adjustments have been made to the original allocations.
 
 Intangibles,
        which were recorded at the acquisition date, associated with acquisitions
        of
        WestShore Plaza, Eastland Mall in Columbus, Ohio, Polaris and Polaris Towne
        Center, are comprised of an asset for acquired above-market leases of $7,940,
        a
        liability for acquired below-market leases of $17,951 and an asset for tenant
        relationships of $4,156. The intangibles related to above and below-market
        leases are being amortized as a net increase to minimum rents on a straight-line
        basis over the lives of the leases with a weighted average amortization period
        of 10.2 years. Amortization of the tenant relationship is recorded as
        amortization expense on a straight-line basis over the estimated life of
        the
        12.5 years. Net amortization for all of the acquired intangibles is an increase
        to net income in the amount of $656, $415 and $611 for the years ended December
        31, 2006, 2005 and 2004, respectively. The net book value of the above-market
        leases is $4,689 and $5,494 as of December 31, 2006 and December 31, 2005,
        respectively, and is included in the accounts payable and accrued liabilities
        on
        the consolidated balance sheet. The net book value of the below-market leases
        is
        $12,091 and $13,663 as of December 31, 2006 and December 31, 2005, respectively,
        and is included in the accounts payable and accrued liabilities on the
        consolidated balance sheet. The net book value of the tenant relationships
        is
        $3,169 and $3,498 as of December 31, 2006 and December 31, 2005, respectively,
        and is included in prepaid and other assets on the consolidated balance sheet.
 
 On
        January 17, 2006, GPLP acquired Tulsa from an independent third party. The
        purchase price was $58,300 and the Company did not assume any debt in connection
        with the purchase. On March 14, 2006, GPLP transferred all of its ownership
        interest in Tulsa to the ORC Venture for total consideration of $58,300 (which
        included the ORC Venture’s assumption of a $35,000 mortgage loan).
 
 Net
        amortization of intangibles as an increase to net income will be as
        follows:
 
 For
                  the year ending December 31, 2007
              
              $
              416For
                  the year ending December 31, 2008
              
              
              484For
                  the year ending December 31, 2009
              
              
              480For
                  the year ending December 31, 2010
              
              
              553For
                  the year ending December 31, 2011
              
              
              525$
              2,458
 
 **21.**
              **Discontinued
                  Operations**
 
 Financial
        results of Properties the Company sold in previous periods and classified
        as
        held-for-sale as of year-end are reflected in discontinued operations for
        all
        periods reported in the consolidated statements of income. The table below
        summarizes key financial results for these operations:
 
 **For
                  the Years Ended December 31,********2006**
              
              ******2005**
              
              ******2004**Revenues
              
              $
              44,907
              
              $
              52,640
              
              $
              66,340Operating
                  expenses
              
              
              (25,089
              )
              
              (34,198
              )
              
              (40,976
              )Operating
                  income
              
              
              19,818
              
              
              18,442
              
              
              25,364Interest
                  expense, net
              
              
              (12,511
              )
              
              (14,484
              )
              
              (15,743
              )Costs
                  associated with debt defeasance
              
              
              (9,357
              )
              
              -
              
              
              -Net
                  (loss) income before impairment losses
              
              
              (2,050
              )
              
              3,958
              
              
              9,621Impairment
                  losses on real estate
              
              
              (65,230
              )
              
              (16,393
              )
              
              -Net
                  (loss) income from discontinued operations
              
              $
              (67,280
              )
              $
              (12,435
              )
              $
              9,621
 
 78
 **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS - continued**
 **(dollars
        in thousands, except share and unit amounts)**
 
 The
        impairment losses recorded in 2006 primarily relate to two of our held-for-sale
        Mall assets. Montgomery Mall had impairment charges in 2006 of $56,994 and
        Eastland Mall in Charlotte, North Carolina of approximately $6,778. These
        charges were recorded based upon the Company’s decision to sell these assets.
        The facts and information available to the Company through the sales process
        assisted the Company in determining the value for these assets. The impairment
        losses recorded in 2005 relate to the Company’s decision to sell all but four of
        its remaining Community Center Properties.
 
 **22.**
              **Subsequent
                  Events**
 
 Effective
        January 1, 2007, the Company’s 401(k) plan qualifies as a safe harbor plan. The
        Company has committed to an employer contribution at a required level that
        will
        permit highly compensated employees to defer the maximum amount and the plan
        is
        automatically in compliance for actual deferral percentage (ADP) and actual
        contribution percentage (ACP) testing.
 
 **23.**
              **Interim
                  Financial Information (unaudited)**
  Year
                  Ended December 31, 2006
              
              **First**
                **Quarter**
              
              **Second**
                **Quarter**
              
              **Third**
                **Quarter**
              
              **Fourth**
                **Quarter**Total
                  revenues
              
              $
              75,448
              
              $
              73,211
              
              $
              74,530
              
              $
              86,075Total
                  revenues as previously reported
              
              $
              83,859
              
              $
              73,211
              
              $
              74,530
              
              $
              86,075Operating
                  income (loss)
              
              $
              25,501
              
              $
              24,922
              
              $
              25,363
              
              $
              (12,044
              )Operating
                  income (loss) as previously reported
              
              $
              28,314
              
              $
              24,922
              
              $
              25,363
              
              $
              (12,044
              )Net
                  (loss) income
              
              $
              8,343
              
              $
              (38,686
              )
              $
              6,070
              
              $
              (52,892
              )Net
                  (loss) income available to common shareholders
              
              $
              3,984
              
              $
              (43,045
              )
              $
              1,710
              
              $
              (57,251
              )Earnings
                  (loss) per share (diluted)
              
              $
              0.11
              
              $
              (1.17
              )
              $
              0.05
              
              $
              (1.56
              )
  Year
                  Ended December 31, 2005
              
              **First**
                **Quarter**
              
              **Second**
                **Quarter**
              
              **Third**
                **Quarter**
              
              **Fourth**
                **Quarter**Total
                  revenues
              
              $
              70,525
              
              $
              73,098
              
              $
              76,124
              
              $
              80,279Total
                  revenues as previously reported
              
              $
              79,573
              
              $
              73,098
              
              $
              76,124
              
              $
              90,052Operating
                  income
              
              $
              22,761
              
              $
              22,989
              
              $
              28,313
              
              $
              31,931Operating
                  income as previously reported
              
              $
              25,620
              
              $
              22,985
              
              $
              28,309
              
              $
              35,016Net
                  (loss) income
              
              $
              5,796
              
              $
              3,279
              
              $
              (2,342
              )
              $
              14,117Net
                  (loss) income available to common shareholders
              
              $
              1,437
              
              $
              (1,080
              )
              $
              (6,702
              )
              $
              9,758Earnings
                  (loss) per share (diluted)
              
              $
              0.04
              
              $
              (0.03
              )
              $
              (0.18
              )
              $
              0.27
 
 Total
        revenues and operating income (loss) for 2006 and 2005 are restated to reflect
        SFAS 144. Net income available to shareholders reflects the net gains and
        losses
        associated with the sale of discontinued operations. It also reflects the
        income
        and loss from discontinued operations. The differences between revenues and
        revenues previously reported in interim financial statements in 2006 and
        2005
        relate to changes in property classification from continuing to discontinued
        operations.
  79




**GLIMCHER
                  REALTY TRUST****SCHEDULE
                  III - REAL ESTATE AND ACCUMULATED DEPRECIATION****as
                  of December 31, 2006****(dollars
                  in thousands)**
  **Costs****Capitalized****Sub-****sequent
                  to**
              
              **Gross
                  Amounts at Which****Initial
                  Cost**
              
              **Acquisition**
              
              **Carried
                  at Close of Period****Life
                  Upon Which****Deprecia-tion
                  in****Buildings**
              
              
              
              
              
              **Buildings**
              
              
              
              
              
              **Date**
              
              
              
              **Latest
                  Statement****and**
              
              **Improve-**
              
              
              
              **and**
              
              
              
              **Accumu-**
              
              **Construc-**
              
              
              
              **of
                  Opera-****Encum-**
              
              
              
              **Improve-**
              
              **ments**
              
              
              
              **Improve-**
              
              
              
              **lated**
              
              **tion**
              
              
              
              **tions****Description
                  and Location**
              
              **brances**
              
              
              
              **ments**
              
              **and
                Adjust-**
              
              
              
              **ments**
              
              **Total**
              
              **Deprecia-**
              
              **Was**
              
              **Date**
              
              **is****of
                  Property**
              
              **[d]**
              
              **Land**
              
              **[a]**
              
              **ments**
              
              **Land
                  [b]**
              
              **[c]**
              
              **[b]
                  [c]**
              
              **tion**
              
              **Completed**
              
              **Acquired**
              
              **Computed****MALL
                  PROPERTIES**Ashland
                  Town CenterAshland,
                  KY
              
              $
              24,809
              
              $
              3,866
              
              $
              21,454
              
              $
              7,683
              
              $
              4,144
              
              $
              28,859
              
              $
              33,003
              
              $
              12,826
              
              
              1989
              
              
              
              
              
              [e]Colonial
                  Park MallHarrisburg,
                  PA
              
              $
              32,451
              
              
              9,765
              
              
              43,770
              
              
              1,596
              
              
              9,704
              
              
              45,427
              
              
              55,131
              
              
              14,148
              
              
              
              
              
              2003
              
              
              [e]Dayton
                  MallDayton,
                  OH
              
              $
              55,886
              
              
              9,068
              
              
              90,676
              
              
              17,694
              
              
              7,509
              
              
              109,929
              
              
              117,438
              
              
              25,969
              
              
              
              
              
              2002
              
              
              [e]Eastland
                  MallColumbus,
                  OH
              
              $
              43,000
              
              
              12,570
              
              
              17,794
              
              
              28,475
              
              
              12,937
              
              
              45,902
              
              
              58,839
              
              
              4,577
              
              
              
              
              
              2003
              
              
              [e]Grand
                  Central MallParkersburg,
                  WV
              
              $
              47,815
              
              
              3,961
              
              
              41,135
              
              
              37,389
              
              
              3,961
              
              
              78,524
              
              
              82,485
              
              
              25,420
              
              
              
              
              
              1993
              
              
              [e]Great
                  Mall of the Great PlainsOlathe,
                  KS
              
              $
              30,000
              
              
              15,646
              
              
              101,790
              
              
              (39,229
              )
              
              12,321
              
              
              65,886
              
              
              78,207
              
              
              38,114
              
              
              1999
              
              
              
              
              
              [e]Indian
                  Mound MallNewark,
                  OH
              
              $
              -
              
              
              892
              
              
              19,497
              
              
              12,695
              
              
              773
              
              
              32,311
              
              
              33,084
              
              
              17,193
              
              
              1986
              
              
              
              
              
              [e]Jersey
                  Gardens MallElizabeth,
                  NJ
              
              $
              158,791
              
              
              32,498
              
              
              206,478
              
              
              22,681
              
              
              33,480
              
              
              228,177
              
              
              261,657
              
              
              64,016
              
              
              2000
              
              
              
              
              
              [e]Lloyd
                  CenterPortland,
                  OR
              
              $
              133,256
              
              
              47,737
              
              
              115,219
              
              
              44,719
              
              
              47,737
              
              
              159,938
              
              
              207,675
              
              
              33,996
              
              
              
              
              
              1998
              
              
              [e]The
                  Mall at Fairfield CommonsBeavercreek,
                  OH
              
              $
              109,232
              
              
              5,438
              
              
              102,914
              
              
              21,825
              
              
              7,696
              
              
              122,481
              
              
              130,177
              
              
              43,614
              
              
              1993
              
              
              
              
              
              [e]The
                  Mall at Johnson CityJohnson
                  City, TN
              
              $
              38,787
              
              
              4,462
              
              
              39,439
              
              
              3,320
              
              
              4,405
              
              
              42,816
              
              
              47,221
              
              
              12,267
              
              
              
              
              
              2000
              
              
              [e]
  80
 **GLIMCHER
                        REALTY TRUST****SCHEDULE
                        III - REAL ESTATE AND ACCUMULATED DEPRECIATION****as
                        of December 31, 2006****(dollars
                        in thousands)**
 **Costs****Capitalized****Sub-****sequent
                    to**
                
                **Gross
                    Amounts at Which****Initial
                    Cost**
                
                **Acquisition**
                
                **Carried
                    at Close of Period****Life
                    Upon Which****Deprecia-tion
                    in****Buildings**
                
                
                
                
                
                **Buildings**
                
                
                
                
                
                **Date**
                
                
                
                **Latest
                    Statement****and**
                
                **Improve-**
                
                
                
                **and**
                
                
                
                **Accumu-**
                
                **Construc-**
                
                
                
                **of
                    Opera-****Encum-**
                
                
                
                **Improve-**
                
                **ments**
                
                
                
                **Improve-**
                
                
                
                **lated**
                
                **tion**
                
                
                
                **tions****Description
                    and Location**
                
                **brances**
                
                
                
                **ments**
                
                **and
                  Adjust-**
                
                
                
                **ments**
                
                **Total**
                
                **Deprecia-**
                
                **Was**
                
                **Date**
                
                **is****of
                    Property**
                
                **[d]**
                
                **Land**
                
                **[a]**
                
                **ments**
                
                **Land
                    [b]**
                
                **[c]**
                
                **[b]
                    [c]**
                
                **tion**
                
                **Completed**
                
                **Acquired**
                
                **Computed**Morgantown
                    MallMorgantown,
                    WV
                
                
                (g)
                
                $
                1,273
                
                $
                40,484
                
                $
                5,050
                
                $
                1,556
                
                $
                45,251
                
                $
                46,807
                
                $
                19,187
                
                
                1990
                
                
                
                
                
                [e]New
                    Towne MallNew
                    Philadelphia, OH
                
                $
                -
                
                
                1,190
                
                
                23,475
                
                
                8,363
                
                
                1,248
                
                
                31,780
                
                
                33,028
                
                
                14,523
                
                
                1988
                
                
                
                
                
                [e]Northtown
                    MallBlaine,
                    MN
                
                $
                -
                
                
                13,264
                
                
                40,988
                
                
                15,576
                
                
                13,466
                
                
                56,362
                
                
                69,828
                
                
                13,978
                
                
                
                
                
                1998
                
                
                [e]Polaris
                    Fashion PlaceColumbus,
                    OH
                
                $
                142,129
                
                
                36,687
                
                
                167,251
                
                
                4,611
                
                
                38,661
                
                
                169,888
                
                
                208,549
                
                
                28,964
                
                
                
                
                
                2004
                
                
                [e]River
                    Valley MallLancaster,
                    OH
                
                $
                50,000
                
                
                875
                
                
                26,910
                
                
                18,552
                
                
                1,001
                
                
                45,336
                
                
                46,337
                
                
                21,989
                
                
                1987
                
                
                
                
                
                [e]Supermall
                    of Great NWAuburn,
                    WA
                
                $
                59,515
                
                
                1,058
                
                
                104,612
                
                
                845
                
                
                7,187
                
                
                99,328
                
                
                106,515
                
                
                33,998
                
                
                
                
                
                2002
                
                
                [e]Weberstown
                    MallStockton,
                    CA
                
                $
                60,000
                
                
                3,237
                
                
                23,479
                
                
                7,532
                
                
                3,298
                
                
                30,950
                
                
                34,248
                
                
                12,320
                
                
                
                
                
                1998
                
                
                [e]Westshore
                    PlazaTampa,
                    FL
                
                $
                95,255
                
                
                15,653
                
                
                145,158
                
                
                7,490
                
                
                15,653
                
                
                152,648
                
                
                168,301
                
                
                19,025
                
                
                
                
                
                2003
                
                
                [e]**COMMUNITY
                    CENTERS**Knox
                    Village SquareMount
                    Vernon, OH
                
                $
                8,753
                
                
                865
                
                
                8,479
                
                
                406
                
                
                869
                
                
                8,881
                
                
                9,750
                
                
                3,289
                
                
                1992
                
                
                
                
                
                [e]Morgantown
                    CommonsMorgantown,
                    WV
                
                
                (g)
                
                
                175
                
                
                7,549
                
                
                12,652
                
                
                -
                
                
                20,376
                
                
                20,376
                
                
                6,511
                
                
                1991
                
                
                
                
                
                [e]Ohio
                    River PlazaGallipolis,
                    OH
                
                $
                -
                
                
                502
                
                
                6,373
                
                
                655
                
                
                461
                
                
                7,069
                
                
                7,530
                
                
                2,827
                
                
                1989
                
                
                
                
                
                [e]Polaris
                    Town CenterColumbus,
                    OH
                
                $
                40,482
                
                
                19,082
                
                
                38,950
                
                
                318
                
                
                19,082
                
                
                39,268
                
                
                58,350
                
                
                7,600
                
                
                
                
                
                2004
                
                
                [e]
  81
  **GLIMCHER
                          REALTY TRUST****SCHEDULE
                          III - REAL ESTATE AND ACCUMULATED DEPRECIATION****as
                          of December 31, 2006****(dollars
                          in thousands)**
 **Costs****Capitalized****Sub-****sequent
                      to**
                  
                  **Gross
                      Amounts at Which****Initial
                      Cost**
                  
                  **Acquisition**
                  
                  **Carried
                      at Close of Period****Life
                      Upon Which****Deprecia-tion
                      in****Buildings**
                  
                  
                  
                  
                  
                  **Buildings**
                  
                  
                  
                  
                  
                  **Date**
                  
                  
                  
                  **Latest
                      Statement****and**
                  
                  **Improve-**
                  
                  
                  
                  **and**
                  
                  
                  
                  **Accumu-**
                  
                  **Construc-**
                  
                  
                  
                  **of
                      Opera-****Encum-**
                  
                  
                  
                  **Improve-**
                  
                  **ments**
                  
                  
                  
                  **Improve-**
                  
                  
                  
                  **lated**
                  
                  **tion**
                  
                  
                  
                  **tions****Description
                      and Location**
                  
                  **brances**
                  
                  
                  
                  **ments**
                  
                  **and
                    Adjust-**
                  
                  
                  
                  **ments**
                  
                  **Total**
                  
                  **Deprecia-**
                  
                  **Was**
                  
                  **Date**
                  
                  **is****of
                      Property**
                  
                  **[d]**
                  
                  **Land**
                  
                  **[a]**
                  
                  **ments**
                  
                  **Land
                      [b]**
                  
                  **[c]**
                  
                  **[b]
                      [c]**
                  
                  **tion**
                  
                  **Completed**
                  
                  **Acquired**
                  
                  **Computed****CORPORATE
                      ASSETS**Glimcher
                      Properties LimitedPartnership
                  
                  $
                  -
                  
                  $
                  -
                  
                  $
                  1,780
                  
                  $
                  10,112
                  
                  $
                  -
                  
                  $
                  11,892
                  
                  $
                  11,892
                  
                  $
                  6,247
                  
                  
                  
                  
                  
                  
                  
                  
                  [e]Lloyd
                      Ice RinkOEC
                  
                  $
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  56
                  
                  
                  -
                  
                  
                  56
                  
                  
                  56
                  
                  
                  39
                  
                  
                  
                  
                  
                  
                  
                  
                  [e]University
                      Mall TheaterOEC
                  
                  $
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  600
                  
                  
                  -
                  
                  
                  600
                  
                  
                  600
                  
                  
                  478
                  
                  
                  
                  
                  
                  
                  
                  
                  [e]$
                  239,764
                  
                  $
                  1,435,654
                  
                  $
                  251,666
                  
                  $
                  247,149
                  
                  $
                  1,679,935
                  
                  $
                  1,927,084
                  
                  $
                  483,115**DEVELOPMENTS
                      IN PROGRESS**Georgesville
                      SquareColumbus,
                      OH
                  
                  $
                  -
                  
                  $
                  -
                  
                  $
                  -
                  
                  $
                  725
                  
                  $
                  296
                  
                  $
                  429
                  
                  $
                  725City
                      ParkCincinnati,
                      OH
                  
                  $
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  10,946
                  
                  
                  -
                  
                  
                  10,946
                  
                  
                  10,946Jersey
                      Gardens CenterElizabeth
                      , NJ
                  
                  $
                  -
                  
                  
                  1,937
                  
                  
                  4,561
                  
                  
                  804
                  
                  
                  1,231
                  
                  
                  6,071
                  
                  
                  7,302Meadowview
                      SquareKent,
                      OH
                  
                  $
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  273
                  
                  
                  264
                  
                  
                  9
                  
                  
                  273Dayton
                      StreetscapeDayton,
                      OH
                  
                  $
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  12,206
                  
                  
                  12,206Johnson
                      City RedevelopmentJohnson
                      City, TN
                  
                  $
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  3,925
                  
                  
                  2,085
                  
                  
                  6,010GB
                      NorthtownBlaine,
                      MN
                  
                  $
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  4,698
                  
                  
                  4,698Other
                      Developments
                  
                  $
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  7,643
                  
                  
                  -
                  
                  
                  7,643
                  
                  
                  7,643
                  
                  
                  -$
                  1,937
                  
                  $
                  4,561
                  
                  $
                  20,391
                  
                  $
                  5,716
                  
                  $
                  44,087
                  
                  $
                  49,803
                  
                  $
                  -
   82
  **GLIMCHER
                            REALTY TRUST****SCHEDULE
                            III - REAL ESTATE AND ACCUMULATED DEPRECIATION****as
                            of December 31, 2006****(dollars
                            in thousands)**
 **Costs****Capitalized****Sub-****sequent
                        to**
                    
                    **Gross
                        Amounts at Which****Initial
                        Cost**
                    
                    **Acquisition**
                    
                    **Carried
                        at Close of Period****Life
                        Upon Which****Deprecia-tion
                        in****Buildings**
                    
                    
                    
                    
                    
                    **Buildings**
                    
                    
                    
                    
                    
                    **Date**
                    
                    
                    
                    **Latest
                        Statement****and**
                    
                    **Improve-**
                    
                    
                    
                    **and**
                    
                    
                    
                    **Accumu-**
                    
                    **Construc-**
                    
                    
                    
                    **of
                        Opera-****Encum-**
                    
                    
                    
                    **Improve-**
                    
                    **ments**
                    
                    
                    
                    **Improve-**
                    
                    
                    
                    **lated**
                    
                    **tion**
                    
                    
                    
                    **tions****Description
                        and Location**
                    
                    **brances**
                    
                    
                    
                    **ments**
                    
                    **and
                      Adjust-**
                    
                    
                    
                    **ments**
                    
                    **Total**
                    
                    **Deprecia-**
                    
                    **Was**
                    
                    **Date**
                    
                    **is****of
                        Property**
                    
                    **[d]**
                    
                    **Land**
                    
                    **[a]**
                    
                    **ments**
                    
                    **Land
                        [b]**
                    
                    **[c]**
                    
                    **[b]
                        [c]**
                    
                    **tion**
                    
                    **Completed**
                    
                    **Acquired**
                    
                    **Computed****ASSETS
                        HELD FOR SALE (h)**Almeda
                        MallHouston,
                        TX
                    
                    
                    (f)
                    
                    $
                    6,859
                    
                    $
                    16,034
                    
                    $
                    1,321
                    
                    $
                    7,621
                    
                    $
                    16,593
                    
                    $
                    24,214
                    
                    $
                    4,549
                    
                    
                    
                    
                    
                    2002
                    
                    
                    [e]Eastland
                        MallCharlotte,
                        NC
                    
                    $
                    43,766
                    
                    
                    5,357
                    
                    
                    47,860
                    
                    
                    (6,225
                    )
                    
                    5,315
                    
                    
                    41,677
                    
                    
                    46,992
                    
                    
                    5,143
                    
                    
                    
                    
                    
                    2003
                    
                    
                    [e]Montgomery
                        MallMontgomery,
                        AL
                    
                    $
                    25,000
                    
                    
                    10,382
                    
                    
                    60,311
                    
                    
                    (50,823
                    )
                    
                    4,455
                    
                    
                    15,415
                    
                    
                    19,870
                    
                    
                    15,415
                    
                    
                    
                    
                    
                    1998
                    
                    
                    [e]Northwest
                        MallHouston,
                        TX
                    
                    
                    (f)
                    
                    
                    9,114
                    
                    
                    12,820
                    
                    
                    1,119
                    
                    
                    9,928
                    
                    
                    13,125
                    
                    
                    23,053
                    
                    
                    3,225
                    
                    
                    
                    
                    
                    2002
                    
                    
                    [e]University
                        MallTampa,
                        FL
                    
                    $
                    -
                    
                    
                    13,314
                    
                    
                    108,230
                    
                    
                    9,205
                    
                    
                    13,314
                    
                    
                    117,435
                    
                    
                    130,749
                    
                    
                    26,733
                    
                    
                    
                    
                    
                    1997
                    
                    
                    [e]45,026
                    
                    
                    245,255
                    
                    
                    (45,403
                    )
                    
                    40,633
                    
                    
                    204,245
                    
                    
                    244,878
                    
                    
                    55,065Total
                    
                    
                    
                    
                    $
                    286,727
                    
                    $
                    1,685,470
                    
                    $
                    226,654
                    
                    $
                    293,498
                    
                    $
                    1,928,267
                    
                    $
                    2,221,765
                    
                    $
                    538,180
  83




**GLIMCHER
        REALTY TRUST**
 **NOTES
        TO SCHEDULE III**
 **(dollars
        in thousands)**
  (a)
                Initial
                    cost for constructed and acquired property is cost at end of
                    first
                    complete calendar year subsequent to opening or acquisition.(b)
                The
                    aggregate gross cost of land as of December 31, 2006.(c)
                The
                    aggregate gross cost of building, improvements and equipment
                    as of
                    December 31, 2006.(d)
                See
                    description of debt in Note 5 of Notes to consolidated financial
                    statements.(e)
                Depreciation
                    is computed based upon the following estimated weighted average
                    composite
                    lives:Buildings
                    and improvements-40 years; equipment and fixtures-five to ten
                    years.(f)
                Properties
                    cross-collateralize the following loan:SAN
                    Mall, L.P.
                $33,020(g)
                Properties
                    cross-collateralize the following loan:Morgantown
                    Mall Associates Limited Partnership
                $52,474(h)
                Properties
                    were held for sale at December 31, 2006. The total for building
                    and
                    improvements for the assets held-for-sale excludes the deferred
                    costs of
                    $2,488 that appear on the consolidated balance sheet.
  **Reconciliation
        of Real Estate**
 **Year
                    Ended December 31,****2006**
                
                ******2005**
                
                **2004**Balance
                    at beginning of year
                
                $
                2,211,614
                
                $
                2,250,640
                
                $
                2,092,202Additions:Improvements
                
                
                79,512
                
                
                109,159
                
                
                32,684Acquisitions
                
                
                61,276
                
                
                -
                
                
                261,036Deductions
                
                
                (375,515
                )
                
                (148,185
                )
                
                (135,282
                )Balance
                    at close of year
                
                $
                1,976,887
                
                $
                2,211,614
                
                $
                2,250,640
  
 **Reconciliation
        of Accumulated Depreciation**
 **Year
                    Ended December 31,********2006**
                
                **2005**
                
                **2004**Balance
                    at beginning of year
                
                $
                470,397
                
                $
                435,821
                
                $
                394,870Depreciation
                    expense and other
                
                
                70,281
                
                
                72,472
                
                
                95,463Deductions
                
                
                (57,563
                )
                
                (37,896
                )
                
                (54,512
                )Balance
                    at close of year
                
                $
                483,115
                
                $
                470,397
                
                $
                435,821
  The
        aggregate cost of land and buildings, improvements and equipment for federal
        income tax purposes is approximately $2,318,332.
   84