##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2010
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 COMMISSION FILE NUMBER: 001-31817
 CEDAR SHOPPING CENTERS, INC.
 (Exact name of registrant as specified in its charter)
 Maryland
    
    42-1241468(State or other jurisdiction of
    
    (I.R.S. Employerincorporation or organization)
    
    Identification No.)
 44 South Bayles Avenue, Port Washington, New York 11050-3765
 (Address of principal executive offices) (Zip Code)
 (516) 767-6492  (Registrants
telephone number, including area code)
 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 þ No o
 Indicate by check mark whether the registrant has submitted electronically and posted on its
corporate Web site, if any, every Interactive Data File required to be submitted and posted
pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months
(or for such shorter period that the registrant was required to submit and post such files).
 Yes o No o
 Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a
non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated
filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act.
 Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
    
    Smaller reporting company o(Do not check if a smaller reporting company)
 Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the
Exchange Act).
 Yes
o No
þ
 Indicate the number of shares outstanding of each of the issuers classes of common stock, as of
the latest practicable date: At July 30, 2010, there were 65,728,293 shares of Common Stock, $0.06
par value, outstanding.




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##### 



CEDAR SHOPPING CENTERS, INC.
  
 INDEX
 Forward-Looking Statements
    
    
    3Part I. Financial InformationItem 1. Financial StatementsConsolidated Balance Sheets  June 30, 2010 (unaudited) and
December 31, 2009
    
    
    4Consolidated Statements of Operations (unaudited)  Three and six months ended June 30, 2010
and 2009
    
    
    5Consolidated Statement of Equity (unaudited)  Six months
ended June 30, 2010
    
    
    6Consolidated Statements of Cash Flows (unaudited)  Six months
ended June 30, 2010 and 2009
    
    
    7Notes to Consolidated Financial Statements (unaudited) 
June 30, 2010
    
    
    8-33Item 2. Managements Discussion and Analysis of Financial Condition
And Results of Operations
    
    
    34-49Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    49-50Item 4. Controls and
Procedures
    
    
    50Part II. Other InformationItem 6. Exhibits
    
    
    51Signatures
    
    
    51EX-10.1EX-10.2EX-10.3EX-10.4EX-31EX-32
  2




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Forward-Looking Statements
  3




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CEDAR SHOPPING CENTERS, INC.
 
 Consolidated Balance Sheets
 June 30,
    
    
    December 31,2010
    
    
    2009(unaudited)AssetsReal estate:Land
    
    $
    349,710,000
    
    
    $
    356,366,000Buildings and improvements
    
    
    1,336,366,000
    
    
    
    1,316,315,0001,686,076,000
    
    
    
    1,672,681,000Less accumulated depreciation
    
    
    (184,939,000
    )
    
    
    (163,879,000
    )Real estate, net
    
    
    1,501,137,000
    
    
    
    1,508,802,000Real estate to be transferred to a joint venture
    
    
    
    
    
    
    139,743,000Real estate held for sale  discontinued operations
    
    
    8,325,000
    
    
    
    21,380,000Investment in unconsolidated joint ventures
    
    
    27,066,000
    
    
    
    14,113,000Cash and cash equivalents
    
    
    13,794,000
    
    
    
    17,164,000Restricted cash
    
    
    12,828,000
    
    
    
    14,075,000Receivables:Rents and other tenant receivables, net
    
    
    8,814,000
    
    
    
    7,423,000Straight-line rents
    
    
    15,807,000
    
    
    
    14,545,000Joint venture settlements
    
    
    6,146,000
    
    
    
    2,322,000Other assets
    
    
    7,271,000
    
    
    
    9,315,000Deferred charges, net
    
    
    34,564,000
    
    
    
    36,236,000Total assets
    
    $
    1,635,752,000
    
    
    $
    1,785,118,000Liabilities and equityMortgage loans payable
    
    $
    688,265,000
    
    
    $
    688,289,000Mortgage loans payable  real estate to be transferred to a joint venture
    
    
    
    
    
    
    94,018,000Mortgage loans payable  real estate held for sale  discontinued operations
    
    
    4,647,000
    
    
    
    12,455,000Secured revolving credit facilities
    
    
    167,841,000
    
    
    
    257,685,000Accounts payable and accrued liabilities
    
    
    29,429,000
    
    
    
    46,902,000Unamortized intangible lease liabilities
    
    
    51,605,000
    
    
    
    53,733,000Liabilities  real estate held for sale and, at December 31, 2009, real
estate to be transferred to a joint venture
    
    
    1,275,000
    
    
    
    5,634,000Total liabilities
    
    
    943,062,000
    
    
    
    1,158,716,000Limited partners interest in Operating Partnership
    
    
    10,888,000
    
    
    
    12,638,000Commitments and contingencies
    
    
    
    
    
    
    Equity:Cedar Shopping Centers, Inc. shareholders equity:Preferred stock ($.01 par value, $25.00 per share
liquidation value, 12,500,000 shares authorized, 3,550,000
shares issued and outstanding)
    
    
    88,750,000
    
    
    
    88,750,000Common stock ($.06 par value, 150,000,000 shares authorized
65,104,000 and 52,139,000 shares, respectively, issued and
outstanding)
    
    
    3,906,000
    
    
    
    3,128,000Treasury stock (1,127,000 and 981,000 shares,
respectively, at cost)
    
    
    (10,521,000
    )
    
    
    (9,688,000
    )Additional paid-in capital
    
    
    705,314,000
    
    
    
    621,299,000Cumulative distributions in excess of net income
    
    
    (175,628,000
    )
    
    
    (162,041,000
    )Accumulated other comprehensive loss
    
    
    (4,082,000
    )
    
    
    (2,992,000
    )Total Cedar Shopping Centers, Inc. shareholders equity
    
    
    607,739,000
    
    
    
    538,456,000Noncontrolling interests:Minority interests in consolidated joint ventures
    
    
    66,957,000
    
    
    
    67,229,000Limited partners interest in Operating Partnership
    
    
    7,106,000
    
    
    
    8,079,000Total noncontrolling interests
    
    
    74,063,000
    
    
    
    75,308,000Total equity
    
    
    681,802,000
    
    
    
    613,764,000Total liabilities and equity
    
    $
    1,635,752,000
    
    
    $
    1,785,118,000
  4




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CEDAR SHOPPING CENTERS, INC.
 
 Consolidated Statements of Operations
 (unaudited)
 Three months ended June 30,
    
    
    Six months ended June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Revenues:Rents
    
    $
    33,089,000
    
    
    $
    35,538,000
    
    
    $
    67,497,000
    
    
    $
    70,579,000Expense recoveries
    
    
    7,312,000
    
    
    
    7,972,000
    
    
    
    17,322,000
    
    
    
    18,133,000Other
    
    
    302,000
    
    
    
    40,000
    
    
    
    428,000
    
    
    
    298,000Total revenues
    
    
    40,703,000
    
    
    
    43,550,000
    
    
    
    85,247,000
    
    
    
    89,010,000Expenses:Operating, maintenance and management
    
    
    7,671,000
    
    
    
    7,583,000
    
    
    
    18,245,000
    
    
    
    16,644,000Real estate and other property-related taxes
    
    
    5,353,000
    
    
    
    5,233,000
    
    
    
    10,756,000
    
    
    
    10,362,000General and administrative
    
    
    2,106,000
    
    
    
    2,853,000
    
    
    
    4,317,000
    
    
    
    4,292,000Impairments
    
    
    562,000
    
    
    
    
    
    
    
    2,117,000
    
    
    
    Terminated projects and acquisition transaction costs, net
    
    
    2,000
    
    
    
    2,423,000
    
    
    
    1,322,000
    
    
    
    3,948,000Depreciation and amortization
    
    
    12,326,000
    
    
    
    12,356,000
    
    
    
    23,631,000
    
    
    
    24,447,000Total expenses
    
    
    28,020,000
    
    
    
    30,448,000
    
    
    
    60,388,000
    
    
    
    59,693,000Operating income
    
    
    12,683,000
    
    
    
    13,102,000
    
    
    
    24,859,000
    
    
    
    29,317,000Non-operating income and expense:Interest expense, including amortization of
deferred financing costs
    
    
    (12,784,000
    )
    
    
    (11,795,000
    )
    
    
    (26,557,000
    )
    
    
    (23,066,000
    )Interest income
    
    
    5,000
    
    
    
    4,000
    
    
    
    19,000
    
    
    
    18,000Equity in income of unconsolidated joint ventures
    
    
    479,000
    
    
    
    283,000
    
    
    
    835,000
    
    
    
    542,000Gain on sale of land parcel
    
    
    
    
    
    
    (3,000
    )
    
    
    
    
    
    
    236,000Total non-operating income and expense
    
    
    (12,300,000
    )
    
    
    (11,511,000
    )
    
    
    (25,703,000
    )
    
    
    (22,270,000
    )Income (loss) before discontinued operations
    
    
    383,000
    
    
    
    1,591,000
    
    
    
    (844,000
    )
    
    
    7,047,000(Loss) income from discontinued operations
    
    
    (2,925,000
    )
    
    
    43,000
    
    
    
    (3,033,000
    )
    
    
    311,000Gain on sale of discontinued operations
    
    
    (5,000
    )
    
    
    277,000
    
    
    
    170,000
    
    
    
    277,000Total discontinued operations
    
    
    (2,930,000
    )
    
    
    320,000
    
    
    
    (2,863,000
    )
    
    
    588,000Net (loss) income
    
    
    (2,547,000
    )
    
    
    1,911,000
    
    
    
    (3,707,000
    )
    
    
    7,635,000Less, net loss (income) attributable to noncontrolling interests:Minority interests in consolidated joint ventures
    
    
    87,000
    
    
    
    (309,000
    )
    
    
    (388,000
    )
    
    
    45,000Limited partners interest in Operating Partnership
    
    
    178,000
    
    
    
    15,000
    
    
    
    292,000
    
    
    
    (160,000
    )Total net loss (income) attributable to noncontrolling interests
    
    
    265,000
    
    
    
    (294,000
    )
    
    
    (96,000
    )
    
    
    (115,000
    )Net (loss) income attributable to Cedar Shopping Centers, Inc.
    
    
    (2,282,000
    )
    
    
    1,617,000
    
    
    
    (3,803,000
    )
    
    
    7,520,000Preferred distribution requirements
    
    
    (1,969,000
    )
    
    
    (1,984,000
    )
    
    
    (3,938,000
    )
    
    
    (3,938,000
    )Net (loss) income attributable to common shareholders
    
    $
    (4,251,000
    )
    
    $
    (367,000
    )
    
    $
    (7,741,000
    )
    
    $
    3,582,000Per common share attributable to common sharehoders (basic
and diluted):Continuing operations
    
    $
    (0.02
    )
    
    $
    (0.01
    )
    
    $
    (0.08
    )
    
    $
    0.07Discontinued operations
    
    
    (0.05
    )
    
    
    
    
    
    
    (0.05
    )
    
    
    0.01$
    (0.07
    )
    
    $
    (0.01
    )
    
    $
    (0.13
    )
    
    $
    0.08Amounts
attributable to Cedar Shopping Centers, Inc. common shareholders, net of limited partners interest:(Loss) income from continuing operations
    
    $
    (1,406,000
    )
    
    $
    (646,000
    )
    
    $
    (4,967,000
    )
    
    $
    3,019,000(Loss) income from discontinued operations
    
    
    (2,840,000
    )
    
    
    14,000
    
    
    
    (2,939,000
    )
    
    
    298,000Gain on sale of discontinued operations
    
    
    (5,000
    )
    
    
    265,000
    
    
    
    165,000
    
    
    
    265,000Net (loss) income
    
    $
    (4,251,000
    )
    
    $
    (367,000
    )
    
    $
    (7,741,000
    )
    
    $
    3,582,000Dividends declared per common share
    
    $
    0.0900
    
    
    $
    
    
    
    $
    0.0900
    
    
    $
    0.1125Weighted average number of common shares outstanding
    
    
    64,434,000
    
    
    
    45,062,000
    
    
    
    61,581,000
    
    
    
    44,971,000
  5




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CEDAR SHOPPING CENTERS, INC.
 
 Consolidated Statement of Equity

Six months ended June 30, 2010
 (unaudited)
 Cedar Shopping Centers, Inc. ShareholdersPreferred stock
    
    
    Common stock
    
    
    
    
    
    
    
    
    
    
    Cumulative
    
    
    Accumulated$25.00
    
    
    
    
    
    
    
    
    
    
    Treasury
    
    
    Additional
    
    
    distributions
    
    
    otherLiquidation
    
    
    
    
    
    
    $0.06
    
    
    stock,
    
    
    paid-in
    
    
    in excess of
    
    
    comprehensiveShares
    
    
    value
    
    
    Shares
    
    
    Par value
    
    
    at cost
    
    
    capital
    
    
    net income
    
    
    loss
    
    
    TotalBalance, December 31, 2009
    
    
    3,550,000
    
    
    $
    88,750,000
    
    
    
    52,139,000
    
    
    $
    3,128,000
    
    
    $
    (9,688,000
    )
    
    $
    621,299,000
    
    
    $
    (162,041,000
    )
    
    $
    (2,992,000
    )
    
    $
    538,456,000Net (loss) income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,803,000
    )
    
    
    
    
    
    
    (3,803,000
    )Unrealized loss on change in fair value
of cash flow hedges
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,090,000
    )
    
    
    (1,090,000
    )Total other comprehensive loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (4,893,000
    )Deferred compensation activity, net
    
    
    
    
    
    
    
    
    
    
    494,000
    
    
    
    30,000
    
    
    
    (833,000
    )
    
    
    2,083,000
    
    
    
    
    
    
    
    
    
    
    
    1,280,000Net proceeds from sales of common stock
    
    
    
    
    
    
    
    
    
    
    11,026,000
    
    
    
    661,000
    
    
    
    
    
    
    
    70,251,000
    
    
    
    
    
    
    
    
    
    
    
    70,912,000Exercise of warrant
    
    
    
    
    
    
    
    
    
    
    1,429,000
    
    
    
    86,000
    
    
    
    
    
    
    
    9,914,000
    
    
    
    
    
    
    
    
    
    
    
    10,000,000Conversion of OP units into common stock
    
    
    
    
    
    
    
    
    
    
    16,000
    
    
    
    1,000
    
    
    
    
    
    
    
    162,000
    
    
    
    
    
    
    
    
    
    
    
    163,000Preferred distribution requirements
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,938,000
    )
    
    
    
    
    
    
    (3,938,000
    )Distributions to common shareholders/
noncontrolling interests
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (5,846,000
    )
    
    
    
    
    
    
    (5,846,000
    )Reallocation adjustment of limited
partners interest
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,605,000
    
    
    
    
    
    
    
    
    
    
    
    1,605,000Balance, June 30, 2010
    
    
    3,550,000
    
    
    $
    88,750,000
    
    
    
    65,104,000
    
    
    $
    3,906,000
    
    
    $
    (10,521,000
    )
    
    $
    705,314,000
    
    
    $
    (175,628,000
    )
    
    $
    (4,082,000
    )
    
    $
    607,739,000
 Noncontrolling InterestsLimitedMinority
    
    
    partnersinterests in
    
    
    interest inconsolidated
    
    
    Operating
    
    
    
    
    
    
    Totaljoint ventures
    
    
    Partnership
    
    
    Total
    
    
    equityBalance, December 31, 2009
    
    $
    67,229,000
    
    
    $
    8,079,000
    
    
    $
    75,308,000
    
    
    $
    613,764,000Net (loss) income
    
    
    388,000
    
    
    
    (115,000
    )
    
    
    273,000
    
    
    
    (3,530,000
    )Unrealized loss on change in
fair value
of cash flow hedges
    
    
    
    
    
    
    (3,000
    )
    
    
    (3,000
    )
    
    
    (1,093,000
    )Total other comprehensive loss
    
    
    388,000
    
    
    
    (118,000
    )
    
    
    270,000
    
    
    
    (4,623,000
    )Deferred
compensation activity, net
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,280,000Net proceeds
from sales of common stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    70,912,000Exercise of warrant
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    10,000,000Conversion
of OP units into common stock
    
    
    
    
    
    
    (163,000
    )
    
    
    (163,000
    )
    
    
    Preferred
distribution requirements
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,938,000
    )Distributions to common
shareholders/
noncontrolling interests
    
    
    (660,000
    )
    
    
    (69,000
    )
    
    
    (729,000
    )
    
    
    (6,575,000
    )Reallocation adjustment of
limited
partners interest
    
    
    
    
    
    
    (623,000
    )
    
    
    (623,000
    )
    
    
    982,000Balance, June 30, 2010
    
    $
    66,957,000
    
    
    $
    7,106,000
    
    
    $
    74,063,000
    
    
    $
    681,802,000
  6




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CEDAR SHOPPING CENTERS, INC.
 
 Consolidated Statements of Cash Flows
 (unaudited)
 Six months ended June 30,2010
    
    
    2009Cash flow from operating activities:Net (loss) income
    
    $
    (3,707,000
    )
    
    $
    7,635,000Adjustments to reconcile net (loss) income to net cash provided by operating activities:Non-cash provisions:Equity in income of unconsolidated joint ventures
    
    
    (835,000
    )
    
    
    (542,000
    )Distributions from unconsolidated joint ventures
    
    
    548,000
    
    
    
    516,000Impairments
    
    
    2,117,000
    
    
    
    Terminated projects
    
    
    1,273,000
    
    
    
    2,675,000Impairment  discontinued operations
    
    
    3,238,000
    
    
    
    170,000Gain on sales of real estate
    
    
    (170,000
    )
    
    
    (513,000
    )Straight-line rents
    
    
    (1,424,000
    )
    
    
    (1,176,000
    )Provision for doubtful accounts
    
    
    1,518,000
    
    
    
    1,538,000Depreciation and amortization
    
    
    23,753,000
    
    
    
    25,159,000Amortization of intangible lease liabilities
    
    
    (5,427,000
    )
    
    
    (6,670,000
    )Amortization/market price adjustments relating to stock-based compensation
    
    
    1,236,000
    
    
    
    346,000Amortization of deferred financing costs
    
    
    2,493,000
    
    
    
    1,464,000Increases/decreases in operating assets and liabilities:Rents and other receivables, net
    
    
    (2,875,000
    )
    
    
    (2,896,000
    )Joint venture settlements
    
    
    (2,426,000
    )
    
    
    Prepaid expenses and other
    
    
    1,340,000
    
    
    
    1,509,000Accounts payable and accrued expenses
    
    
    (3,894,000
    )
    
    
    (3,946,000
    )Net cash provided by operating activities
    
    
    16,758,000
    
    
    
    25,269,000Cash flow from investing activities:Expenditures for real estate and improvements
    
    
    (15,512,000
    )
    
    
    (63,593,000
    )Net proceeds from sales of real estate
    
    
    2,056,000
    
    
    
    1,480,000Net proceeds from transfers to unconsolidated joint venture, less
cash at dates of transfer
    
    
    31,513,000
    
    
    
    Investment in unconsolidated joint ventures
    
    
    (4,302,000
    )
    
    
    (350,000
    )Distribution of capital from unconsolidated joint venture
    
    
    1,559,000
    
    
    
    Construction escrows and other
    
    
    1,156,000
    
    
    
    (984,000
    )Net cash provided by (used in) investing activities
    
    
    16,470,000
    
    
    
    (63,447,000
    )Cash flow from financing activities:Net (repayments)/advances (to)/from revolving credit facilities
    
    
    (89,844,000
    )
    
    
    16,435,000Proceeds from mortgage financings
    
    
    16,242,000
    
    
    
    44,231,000Mortgage repayments
    
    
    (16,457,000
    )
    
    
    (13,519,000
    )Payments of debt financing costs
    
    
    (998,000
    )
    
    
    (2,429,000
    )Termination payments related to interest rate swaps
    
    
    (5,476,000
    )
    
    
    Noncontrolling interests:Contributions from consolidated joint venture minority interests, net
    
    
    
    
    
    
    12,212,000Distributions to consolidated joint venture minority interest
    
    
    (660,000
    )
    
    
    (2,061,000
    )Redemption of Operating Partnership Units
    
    
    (485,000
    )
    
    
    Distributions to limited partners
    
    
    (353,000
    )
    
    
    (227,000
    )Net proceeds from the sales of common stock
    
    
    65,913,000
    
    
    
    Exercise of warrant
    
    
    10,000,000
    
    
    
    Preferred stock distributions
    
    
    (3,938,000
    )
    
    
    (3,938,000
    )Distributions to common shareholders
    
    
    (10,542,000
    )
    
    
    (5,046,000
    )Net cash (used in) provided by financing activities
    
    
    (36,598,000
    )
    
    
    45,658,000Net (decrease) increase in cash and cash equivalents
    
    
    (3,370,000
    )
    
    
    7,480,000Cash and cash equivalents at beginning of period
    
    
    17,164,000
    
    
    
    8,231,000Cash and cash equivalents at end of period
    
    $
    13,794,000
    
    
    $
    15,711,000
  7




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##### Table of Contents



Cedar Shopping Centers, Inc.
Notes to Consolidated Financial Statements
June 30, 2010
(unaudited)
 Note 1. Organization and Basis of Preparation
     8




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##### Table of Contents



Cedar Shopping Centers, Inc.
Notes to Consolidated Financial Statements
June 30, 2010
(unaudited)
     9




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##### Table of Contents



Cedar Shopping Centers, Inc.
Notes to Consolidated Financial Statements
June 30, 2010
(unaudited)
  Note 2. Summary of Significant Accounting Policies
    10




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##### Table of Contents



Cedar Shopping Centers, Inc.
Notes to Consolidated Financial Statements
June 30, 2010
(unaudited)
   11




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##### Table of Contents



Cedar Shopping Centers, Inc.
Notes to Consolidated Financial Statements
June 30, 2010
(unaudited)
 December 31, 2009As reported
    
    
    Adjustment
    
    
    As revisedReal estate (a)
    
    $
    1,675,322,000
    
    
    $
    8,429,000
    
    
    $
    1,683,751,000Less accumulated depreciation (a)
    
    
    (164,615,000
    )
    
    
    (741,000
    )
    
    
    (165,356,000
    )Real estate, net
    
    $
    1,510,707,000
    
    
    $
    7,688,000
    
    
    $
    1,518,395,000Unamortized intangible lease liabilities (a)
    
    $
    46,643,000
    
    
    $
    8,429,000
    
    
    $
    55,072,000Limited partners interest in Operating Partnership
    
    $
    12,656,000
    
    
    $
    (18,000
    )
    
    $
    12,638,000Total equity
    
    $
    614,487,000
    
    
    $
    (723,000
    )
    
    $
    613,764,000
 Three months ended June 30, 2009As reported
    
    
    Adjustment
    
    
    As revisedDepreciation and amortization expense (a)
    
    $
    12,650,000
    
    
    $
    53,000
    
    
    $
    12,703,000Net (loss) attributable to common shareholders
    
    $
    (316,000
    )
    
    $
    (51,000)
    (b)
    
    $
    (367,000
    )Per common share (basic and diluted)
    
    $
    (0.01
    )
    
    $
    
    
    
    $
    (0.01
    )
 Six months ended June 30, 2009As reported
    
    
    Adjustment
    
    
    As revisedDepreciation and amortization expense (a)
    
    $
    25,035,000
    
    
    $
    106,000
    
    
    $
    25,141,000Net income attributable to common shareholders
    
    $
    3,683,000
    
    
    $
    (101,000)
    (b)
    
    $
    3,582,000Per common share (basic and diluted)
    
    $
    0.08
    
    
    $
    
    
    
    $
    0.08
 Year ended December 31, 2009As reported
    
    
    Adjustment
    
    
    As revisedDepreciation and amortization expense (a)
    
    $
    54,257,000
    
    
    $
    212,000
    
    
    $
    54,469,000Net loss attributable to common shareholders
    
    $
    (24,543,000
    )
    
    $
    (204,000)
    (b)
    
    $
    (24,747,000
    )Per common share (basic and diluted)
    
    $
    (0.53
    )
    
    $
    (0.01
    )
    
    $
    (0.54
    )
 
 (a)
    
    Does not include revisions for other retroactive adjustments such as the sales of properties, where the applicable net assets
and resuts of operations have been treated as held for sale and income (loss) from discontinued operations, respectively.(b)
    
    Net of noncontrolling interests (limited partners interest). Real Estate Investments and Discontinued Operations
  12




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Cedar Shopping Centers, Inc.
Notes to Consolidated Financial Statements
June 30, 2010
(unaudited)
      13




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##### Table of Contents



Cedar Shopping Centers, Inc.
Notes to Consolidated Financial Statements
June 30, 2010
(unaudited)
     14




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##### Table of Contents



Cedar Shopping Centers, Inc.
Notes to Consolidated Financial Statements
June 30, 2010
(unaudited)
 Three months ended June 30,
    
    
    Six months ended June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Revenues:Rents
    
    $
    263,000
    
    
    $
    989,000
    
    
    $
    790,000
    
    
    $
    2,017,000Expense recoveries
    
    
    78,000
    
    
    
    296,000
    
    
    
    214,000
    
    
    
    702,000Total revenues
    
    
    341,000
    
    
    
    1,285,000
    
    
    
    1,004,000
    
    
    
    2,719,000Expenses:Operating, maintenance and management
    
    
    130,000
    
    
    
    193,000
    
    
    
    388,000
    
    
    
    432,000Real estate and other property-related taxes
    
    
    27,000
    
    
    
    199,000
    
    
    
    96,000
    
    
    
    441,000Depreciation and amortization
    
    
    51,000
    
    
    
    358,000
    
    
    
    126,000
    
    
    
    722,000Interest expense
    
    
    68,000
    
    
    
    322,000
    
    
    
    189,000
    
    
    
    643,000276,000
    
    
    
    1,072,000
    
    
    
    799,000
    
    
    
    2,238,000Income from discontinued operations before
impairment charges
    
    
    65,000
    
    
    
    213,000
    
    
    
    205,000
    
    
    
    481,000Impairment charges
    
    
    2,990,000
    
    
    
    170,000
    
    
    
    3,238,000
    
    
    
    170,000(Loss) income from discontinued operations
    
    $
    (2,925,000
    )
    
    $
    43,000
    
    
    $
    (3,033,000
    )
    
    $
    311,000Gain on sale of discontinued operations
    
    $
    (5,000
    )
    
    $
    277,000
    
    
    $
    170,000
    
    
    $
    277,000
 Conditional asset retirement obligation
  Fair Value Measurements
  15




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##### Table of Contents



Cedar Shopping Centers, Inc.
Notes to Consolidated Financial Statements
June 30, 2010
(unaudited)
   
    
    Level 1  Inputs to the valuation methodology are quoted prices (unadjusted) for
identical assets or liabilities in active markets.
    
    Level 2  Inputs to the valuation methodology include quoted prices for similar
assets and liabilities in active markets, and inputs that are observable for the asset
or liability, either directly or indirectly, for substantially the full term of the
financial instrument.
    
    Level 3  Inputs to the valuation methodology are unobservable and significant to
the fair value measurement.
   16




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##### Table of Contents



Cedar Shopping Centers, Inc.
Notes to Consolidated Financial Statements
June 30, 2010
(unaudited)
   Intangible Lease Asset/Liability
    17




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##### Table of Contents



Cedar Shopping Centers, Inc.
Notes to Consolidated Financial Statements
June 30, 2010
(unaudited)
     Cash and Cash Equivalents
  Restricted Cash
  Rents and Other Receivables
  18




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##### Table of Contents



Cedar Shopping Centers, Inc.
Notes to Consolidated Financial Statements
June 30, 2010
(unaudited)
   Concentration of Credit Risk
  Other Assets
  19




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##### Table of Contents



Cedar Shopping Centers, Inc.
Notes to Consolidated Financial Statements
June 30, 2010
(unaudited)
 June 30,
    
    
    December 31,2010
    
    
    2009Prepaid expenses
    
    $
    2,389,000
    
    
    $
    5,279,000Cumulative mark-to-market adjustments
related to stock-based compensation
    
    
    2,288,000
    
    
    
    2,100,000Property deposits
    
    
    2,127,000
    
    
    
    1,430,000Other
    
    
    467,000
    
    
    
    506,000$
    7,271,000
    
    
    $
    9,315,000
 Deferred Charges, Net
  June 30,
    
    
    December 31,2010
    
    
    2009Lease origination costs (i)
    
    $
    17,660,000
    
    
    $
    17,696,000Financing costs (ii)
    
    
    15,339,000
    
    
    
    16,833,000Other
    
    
    1,565,000
    
    
    
    1,707,000$
    34,564,000
    
    
    $
    36,236,000
 
 (i)
    
    Lease origination costs include the unamortized balance of intangible lease
assets resulting from purchase accounting allocationsof $9,290,000 and $9,992,000, respectively.(ii)
    
    Financing costs are incurred in connection with the Companys credit
facilities and other long-term debt.  Income Taxes
  20




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##### Table of Contents



Cedar Shopping Centers, Inc.
Notes to Consolidated Financial Statements
June 30, 2010
(unaudited)
  Derivative Financial Instruments
   21




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##### Table of Contents



Cedar Shopping Centers, Inc.
Notes to Consolidated Financial Statements
June 30, 2010
(unaudited)
  Notional values
    
    
    
    
    
    
    Balance
    
    
    Fair valueDesignation/
    
    
    
    
    
    
    
    
    
    June 30,
    
    
    
    
    
    
    December 31,
    
    
    Expiration
    
    
    sheet
    
    
    June 30,
    
    
    December 31,Cash flow
    
    Derivative
    
    
    Count
    
    
    2010
    
    
    Count
    
    
    2009
    
    
    dates
    
    
    location
    
    
    2010
    
    
    2009Non-qualifying
    
    Interest
    
    
    
    
    
    $
    
    
    
    
    1
    
    
    $
    23,891,000
    
    
    
    2011
    
    
    Accounts payable and
    
    $
    
    
    
    $
    1,297,000Qualifying
    
    rate swaps
    
    
    2
    
    
    $
    20,287,000
    
    
    
    8
    
    
    $
    56,925,000
    
    
    
    2010 - 2020
    
    
    accrued expenses
    
    $
    1,789,000
    
    
    $
    4,655,000
  Amount of gain (loss) recognized in other
    
    
    Amount of gain (loss) recognized in othercomprehensive (loss) income (effective portion)
    
    
    comprehensive (loss) income (effective portion)Designation/
    
    
    
    
    
    Three months ended June 30,
    
    
    Six months ended June 30,Cash flow
    
    Derivative
    
    
    2010
    
    
    2009
    
    
    2010
    
    
    2009Qualifying
    
    Interest rate swaps
    
    $
    (93,000
    )
    
    $
    2,981,000
    
    
    $
    (1,090,000
    )
    
    $
    3,900,000Amount of gain (loss) recognized in interest expense
    
    
    Amount of gain (loss) recognized in interest expense(ineffectve portion)
    
    
    (ineffectve portion)Qualifying
    
    Interest rate swaps
    
    $
    
    
    
    $
    91,000
    
    
    $
    
    
    
    $
    115,000
 Earnings Per Share
  22




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##### Table of Contents



Cedar Shopping Centers, Inc.
Notes to Consolidated Financial Statements
June 30, 2010
(unaudited)
  Stock-Based Compensation
     23




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##### Table of Contents



Cedar Shopping Centers, Inc.
Notes to Consolidated Financial Statements
June 30, 2010
(unaudited)
   Three months ended June 30,
    
    
    Six month ended June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Restricted share grants
    
    
    4,000
    
    
    
    
    
    
    
    505,000
    
    
    
    594,000Average per-share grant price
    
    $
    6.52
    
    
    $
    
    
    
    $
    6.55
    
    
    $
    4.91Recorded as deferred compensation, net
    
    $
    27,000
    
    
    $
    (3,000
    )
    
    $
    3,305,000
    
    
    $
    2,914,000Charged to operations:Amortization relating to stock-based compensation
    
    $
    884,000
    
    
    $
    722,000
    
    
    $
    1,590,000
    
    
    $
    1,421,000Adjustments to reflect changes in market price of
Companys common stock
    
    
    (884,000
    )
    
    
    560,000
    
    
    
    (375,000
    )
    
    
    (1,075,000
    )Total charged to operations
    
    $
    
    
    
    $
    1,282,000
    
    
    $
    1,215,000
    
    
    $
    346,000Non-vested shares:Non-vested, beginning of period
    
    
    1,368,000
    
    
    
    1,102,000
    
    
    
    980,000
    
    
    
    508,000Grants
    
    
    4,000
    
    
    
    
    
    
    
    505,000
    
    
    
    594,000Vested during period
    
    
    (28,000
    )
    
    
    (11,000
    )
    
    
    (141,000
    )
    
    
    (11,000
    )Forfeitures/cancellations
    
    
    
    
    
    
    (1,000
    )
    
    
    
    
    
    
    (1,000
    )Non-vested, end of period
    
    
    1,344,000
    
    
    
    1,090,000
    
    
    
    1,344,000
    
    
    
    1,090,000Average value of non-vested shares (based on
grant price)
    
    $
    6.33
    
    
    $
    8.23
    
    
    $
    6.33
    
    
    $
    8.23Value of shares vested during the
period (based on grant price)
    
    $
    397,000
    
    
    $
    166,000
    
    
    $
    2,189,000
    
    
    $
    166,000
  24




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##### Table of Contents



Cedar Shopping Centers, Inc.
Notes to Consolidated Financial Statements
June 30, 2010
(unaudited)
 Supplemental consolidated statements of cash flows information
 Six months ended June 30,2010
    
    
    2009Supplemental disclosure of cash activities:Interest paid
    
    $
    25,714,000
    
    
    $
    24,794,000Supplemental disclosure of non-cash activities:Additions to deferred compensation plans
    
    
    3,305,000
    
    
    
    2,914,000Assumption of mortgage loans payable  acquisitions
    
    
    
    
    
    
    (54,565,000
    )Assumption of mortgage loans payable  disposition
    
    
    (7,740,000
    )
    
    
    Conversion of OP Units into common stock
    
    
    163,000
    
    
    
    Purchase accounting allocations:Intangible lease assets
    
    
    
    
    
    
    7,174,000Intangible lease liabilities
    
    
    (2,901,000
    )
    
    
    (3,265,000
    )Net valuation decrease in assumed mortgage loan
payable (a)
    
    
    
    
    
    
    1,649,000Other non-cash investing and financing activities:Accrued interest rate swap liabilities
    
    
    (1,307,000
    )
    
    
    4,122,000Accrued real estate improvement costs
    
    
    
    
    
    
    845,000Accrued construction escrows
    
    
    357,000
    
    
    
    1,027,000Accrued financing costs and other
    
    
    
    
    
    
    22,000Capitalization of deferred financing costs
    
    
    495,000
    
    
    
    852,000Deconsolidation of properties transferred to joint venture:Real estate, net
    
    
    139,745,000
    
    
    
    Mortgage loans payable
    
    
    (94,058,000
    )Other assets/liabilties, net
    
    
    (3,574,000
    )
    
    
    Investment in and advances to unconsolidated joint venture
    
    
    9,423,000
    
    
    
    Settlement receivable from unconsolidated joint venture
    
    
    3,824,000
    
    
    
    
 
 (a)
    
    The net valuation decrease in an assumed mortgage loan payable resulted from adjusting the contract
rate of interest (4.9% per annum) to a market rate of interest (6.1% per annum). Recently-Issued Accounting Pronouncements
  25




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##### Table of Contents



Cedar Shopping Centers, Inc.
Notes to Consolidated Financial Statements
June 30, 2010
(unaudited)
  Note 3. Real Estate/Investment in Unconsolidated Joint Ventures
    26




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##### Table of Contents



Cedar Shopping Centers, Inc.
Notes to Consolidated Financial Statements
June 30, 2010
(unaudited)
 Cedar/RioCan Joint VentureJune 30, 2010
    
    
    December 31, 2009Assets:Real estate, net
    
    $
    195,179,000
    
    
    $
    41,158,000Cash and cash equivalents
    
    
    3,739,000
    
    
    
    404,000Restricted cash
    
    
    2,826,000
    
    
    
    812,000Due from RioCan
    
    
    6,146,000
    
    
    
    2,322,000Other assets
    
    
    6,729,000
    
    
    
    1,162,000Total assets
    
    $
    214,619,000
    
    
    $
    45,858,000Liabilities and partners capital:Mortgage loans payable
    
    $
    93,340,000
    
    
    $
    Due to the Company
    
    
    6,146,000
    
    
    
    2,322,000Other liabilities
    
    
    6,378,000
    
    
    
    345,000Preferred Stock
    
    
    96,000
    
    
    
    Partners capital:RioCan
    
    
    87,371,000
    
    
    
    34,553,000The Company
    
    
    21,288,000
    
    
    
    8,638,000Total partners capital
    
    
    108,659,000
    
    
    
    43,191,000Total liabilties and partners capital
    
    $
    214,619,000
    
    
    $
    45,858,000Three months ended
    
    
    Six months endedJune 30, 2010
    
    
    June 30, 2010Statements of income:Revenues
    
    $
    5,161,000
    
    
    $
    8,245,000Property operating expenses
    
    
    1,266,000
    
    
    
    2,026,000Management fees to the Company
    
    
    176,000
    
    
    
    275,000Acquisition transaction costs
    
    
    
    
    
    
    595,000Depreciation and amortization
    
    
    1,283,000
    
    
    
    1,795,000Interest expense and other non-operating items
    
    
    1,415,000
    
    
    
    1,942,000Net income
    
    $
    1,021,000
    
    
    $
    1,612,000RioCan
    
    
    827,000
    
    
    
    1,322,000The Company
    
    
    194,000
    
    
    
    290,000$
    1,021,000
    
    
    $
    1,612,000
 27




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##### Table of Contents



Cedar Shopping Centers, Inc.
Notes to Consolidated Financial Statements
June 30, 2010
(unaudited)
   Real Estate Pledged
  Note 4. Mortgage Loans Payable and Secured Revolving Credit Facilities
  28




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##### Table of Contents



Cedar Shopping Centers, Inc.
Notes to Consolidated Financial Statements
June 30, 2010
(unaudited)
 June 30, 2010
    
    
    December 31, 2009Interest rates
    
    
    
    
    
    
    Interest ratesBalance
    
    
    Weighted
    
    
    
    
    
    
    Balance
    
    
    WeightedDescription
    
    outstanding
    
    
    average
    
    
    Range
    
    
    outstanding
    
    
    average
    
    
    RangeFixed-rate mortgages (a)
    
    $
    604,718,000
    
    
    
    5.8
    %
    
    
    5.0% - 7.6
    %
    
    $
    606,108,000
    
    
    
    5.8
    %
    
    
    5.0% - 8.5
    %Variable-rate mortgages
    
    
    83,547,000
    
    
    
    3.4
    %
    
    
    2.6% - 5.9
    %
    
    
    82,181,000
    
    
    
    3.4
    %
    
    
    2.5% - 5.9
    %Total property-specific mortgages
    
    
    688,265,000
    
    
    
    5.5
    %
    
    
    
    
    
    
    688,289,000
    
    
    
    5.6
    %Stabilized property credit facility
    
    
    81,835,000
    
    
    
    5.5
    %
    
    
    
    
    
    
    187,985,000
    
    
    
    5.5
    %Development property credit facility
    
    
    86,006,000
    
    
    
    2.6
    %
    
    
    
    
    
    
    69,700,000
    
    
    
    2.5
    %$
    856,106,000
    
    
    
    5.2
    %
    
    
    
    
    
    $
    945,974,000
    
    
    
    5.3
    %Fixed-rate mortgages related to:Real estate transferred or to be
transferred
to a joint venture
    
    $
    
    
    
    
    
    
    
    
    
    
    
    $
    94,018,000
    
    
    
    5.8
    %
    
    
    4.8% - 7.2
    %Real estate held for sale  discontinued
operations
    
    $
    4,647,000
    
    
    
    5.7
    %
    
    
    
    
    
    $
    12,455,000
    
    
    
    5.5
    %
    
    
    5.2% - 5.7
    %
 
 (a)
    
    Restated to reflect the reclassifications of properties transferred to the Cedar/RioCan joint
venture and properties treated as discontinued operations.  Secured Revolving Stabilized Property Credit Facility
  29




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##### Table of Contents



Cedar Shopping Centers, Inc.
Notes to Consolidated Financial Statements
June 30, 2010
(unaudited)
   Secured Revolving Development Property Credit Facility
  Note 5. Common Stock
  30




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##### Table of Contents



Cedar Shopping Centers, Inc.
Notes to Consolidated Financial Statements
June 30, 2010
(unaudited)
     31




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##### Table of Contents



Cedar Shopping Centers, Inc.
Notes to Consolidated Financial Statements
June 30, 2010
(unaudited)
     Note 6. Subsequent Events
     32




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##### Table of Contents



Cedar Shopping Centers, Inc.
Notes to Consolidated Financial Statements
June 30, 2010
(unaudited)
    33




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##### Table of Contents



Item 2.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations
  Executive Summary
    34




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##### Table of Contents



Summary of Critical Accounting Policies
   Revenue Recognition
   35




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##### Table of Contents



Real Estate Investments
     36




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##### Table of Contents



37




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##### Table of Contents



Stock-Based Compensation
  Results of Operations
  38




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##### Table of Contents



Comparison
of the three months ended June 30, 2010 to 2009
 Properties(Decrease)
    
    Percent
    
    
    
    
    
    held in2010
    
    2009
    
    increase
    
    change
    
    Other (ii)
    
    both periodsTotal revenues
    
    $
    40,703,000
    
    
    $
    43,550,000
    
    
    $
    (2,847,000
    )
    
    
    -7
    %
    
    $
    (1,095,000
    )
    
    
    (1,752,000
    )Property operating expenses
    
    
    13,024,000
    
    
    
    12,816,000
    
    
    
    208,000
    
    
    
    2
    %
    
    
    349,000
    
    
    
    (141,000
    )Depreciation and amortization
    
    
    12,326,000
    
    
    
    12,356,000
    
    
    
    (30,000
    )
    
    
    0
    %
    
    
    (831,000
    )
    
    
    801,000General and administrative
    
    
    2,106,000
    
    
    
    2,853,000
    
    
    
    (747,000
    )
    
    
    -26
    %
    
    
    n/a
    
    
    
    n/aImpairments
    
    
    562,000
    
    
    
    
    
    
    
    562,000
    
    
    
    n/a
    
    
    
    n/a
    
    
    
    n/aTerminated projects and acquisition
transaction costs
    
    
    2,000
    
    
    
    2,423,000
    
    
    
    (2,421,000
    )
    
    
    n/a
    
    
    
    n/a
    
    
    
    n/aNon-operating income and
expense, net (i)
    
    
    12,300,000
    
    
    
    11,511,000
    
    
    
    789,000
    
    
    
    7
    %
    
    
    n/a
    
    
    
    n/aDiscontinued operations:Income from discontinued operations
    
    
    65,000
    
    
    
    213,000
    
    
    
    (148,000
    )
    
    
    n/a
    
    
    
    n/a
    
    
    
    n/aImpairment charges
    
    
    (2,990,000
    )
    
    
    (170,000
    )
    
    
    (2,820,000
    )
    
    
    n/a
    
    
    
    n/a
    
    
    
    n/aGain on sale of discontinued operations
    
    
    (5,000
    )
    
    
    277,000
    
    
    
    (282,000
    )
    
    
    n/a
    
    
    
    n/a
    
    
    
    n/a
 
 (i)
    
    Non-operating income and expense consists principally of interest expense (including
amortization of deferred financing costs) and equity in income of unconsolidated joint ventures,
and gain on sale of a land parcel.(ii)
    
    Includes principally (a) the results of properties acquired after January 1, 2009, (b)
properties transferred to the Cedar/RioCan joint venture, (c) unallocated property and construction
management compensation and benefits (including stock-based compensation), and (d) results of
ground-up development and re-development properties recently placed into service. Properties held in both periods.
 Total revenues
 Property operating expenses
 39




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##### Table of Contents



General and administrative expenses
 Impairments
 Terminated projects and acquisition transaction costs
 Non-operating income and expense, net
 Discontinued operations
 40




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##### Table of Contents



Comparison
of the six months ended June 30, 2010 to 2009
 PropertiesIncrease
    
    Percent
    
    
    
    
    
    held in2010
    
    2009
    
    (decrease)
    
    change
    
    Other (ii)
    
    both yearsTotal revenues
    
    $
    85,247,000
    
    
    $
    89,010,000
    
    
    $
    (3,763,000
    )
    
    
    -4
    %
    
    $
    (168,000
    )
    
    
    (3,595,000
    )Property operating expenses
    
    
    29,001,000
    
    
    
    27,006,000
    
    
    
    1,995,000
    
    
    
    7
    %
    
    
    1,657,000
    
    
    
    338,000Depreciation and amortization
    
    
    23,631,000
    
    
    
    24,447,000
    
    
    
    (816,000
    )
    
    
    -3
    %
    
    
    (273,000
    )
    
    
    (543,000
    )General and administrative
    
    
    4,317,000
    
    
    
    4,292,000
    
    
    
    25,000
    
    
    
    1
    %
    
    
    n/a
    
    
    
    n/aImpairments
    
    
    2,117,000
    
    
    
    
    
    
    
    2,117,000
    
    
    
    n/a
    
    
    
    n/a
    
    
    
    n/aTerminated projects and acquisition
transaction costs
    
    
    1,322,000
    
    
    
    3,948,000
    
    
    
    (2,626,000
    )
    
    
    n/a
    
    
    
    n/a
    
    
    
    n/aNon-operating income and
expense, net (i)
    
    
    25,703,000
    
    
    
    22,270,000
    
    
    
    3,433,000
    
    
    
    15
    %
    
    
    n/a
    
    
    
    n/aDiscontinued operations:Income from discontinued operations
    
    
    205,000
    
    
    
    481,000
    
    
    
    (276,000
    )
    
    
    n/a
    
    
    
    n/a
    
    
    
    n/aImpairment charges
    
    
    (3,238,000
    )
    
    
    (170,000
    )
    
    
    (3,068,000
    )
    
    
    n/a
    
    
    
    n/a
    
    
    
    n/aGain on sale of discontinued operations
    
    
    170,000
    
    
    
    277,000
    
    
    
    (107,000
    )
    
    
    n/a
    
    
    
    n/a
    
    
    
    n/a
 
 (i)
    
    Non-operating income and expense consists principally of interest expense (including
amortization of deferred financing costs) and equity in income of unconsolidated joint ventures,
and gain on sale of a land parcel.(ii)
    
    Includes principally (a) the results of properties acquired after January 1, 2009, (b)
properties transferred to the Cedar/RioCan joint venture, (c) unallocated property and construction
management compensation and benefits (including stock-based compensation), and (d) results of
ground-up development and re-development properties recently placed into service. Properties held in both periods.
 Total revenues
 Property operating expenses
 41




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##### Table of Contents



General and administrative expenses
 Impairments
 Terminated projects and acquisition transaction costs
 Non-operating income and expense, net
 Discontinued operations
 42




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##### Table of Contents



Liquidity and Capital Resources
      43




---



##### Table of Contents



44




---



##### Table of Contents



45




---



##### Table of Contents



Net Cash Flows
 Operating Activities
  Investing Activities
  46




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##### Table of Contents



Financing Activities
  Funds From Operations
   47




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##### Table of Contents



Three months ended June 30,
    
    
    Six months ended June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Net (loss) income attributable to common shareholders
    
    $
    (4,251,000
    )
    
    $
    (367,000
    )
    
    $
    (7,741,000
    )
    
    $
    3,582,000Add (deduct):Real estate depreciation and amortization
    
    
    12,327,000
    
    
    
    12,646,000
    
    
    
    23,655,000
    
    
    
    25,092,000Noncontrolling interests:Limited partners interest
    
    
    (178,000
    )
    
    
    (15,000
    )
    
    
    (292,000
    )
    
    
    160,000Minority interests in consolidated joint ventures
    
    
    (87,000
    )
    
    
    309,000
    
    
    
    388,000
    
    
    
    (45,000
    )Minority
interests share of FFO applicable to consolidated joint ventures
    
    
    (1,686,000
    )
    
    
    (1,638,000
    )
    
    
    (3,377,000
    )
    
    
    (2,470,000
    )Equity in income of unconsolidated joint ventures
    
    
    (479,000
    )
    
    
    (283,000
    )
    
    
    (835,000
    )
    
    
    (542,000
    )FFO from unconsolidated joint ventures
    
    
    834,000
    
    
    
    377,000
    
    
    
    1,420,000
    
    
    
    736,000Gain on sale of discontinued operations
    
    
    5,000
    
    
    
    (277,000
    )
    
    
    (170,000
    )
    
    
    (277,000
    )Funds From Operations
    
    $
    6,485,000
    
    
    $
    10,752,000
    
    
    $
    13,048,000
    
    
    $
    26,236,000FFO per
common share (assuming conversion of OP Units) Basic and diluted
    
    $
    0.10
    
    
    $
    0.23
    
    
    $
    0.21
    
    
    $
    0.56Weighted average number of common shares (basic):Shares used in determination of basic earnings per share
    
    
    64,434,000
    
    
    
    45,062,000
    
    
    
    61,581,000
    
    
    
    44,971,000Additional shares assuming conversion of OP Units
    
    
    1,945,000
    
    
    
    2,018,000
    
    
    
    1,965,000
    
    
    
    2,018,000Shares used in determination of basic FFO per share
    
    
    66,379,000
    
    
    
    47,080,000
    
    
    
    63,546,000
    
    
    
    46,989,000Weighted average number of common shares (dilutive):Shares used in determination of diluted earnings per share
    
    
    64,486,000
    
    
    
    45,062,000
    
    
    
    61,620,000
    
    
    
    44,971,000Additional shares assuming conversion of OP Units
    
    
    1,945,000
    
    
    
    2,018,000
    
    
    
    1,965,000
    
    
    
    2,018,000Shares used in determination of diluted FFO per share
    
    
    66,431,000
    
    
    
    47,080,000
    
    
    
    63,585,000
    
    
    
    46,989,000
 48




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Inflation
  
 Item 3. Quantitative and Qualitative Disclosures About Market Risk
    49




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##### Table of Contents



Item 4. Controls and Procedures
   50




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##### Table of Contents



Part II
    
    Other Information
 
 Item 6.
    
    Exhibits
 Exhibit 10.1
    
    Amendment to Employment Agreement between Cedar Shopping
Centers, Inc. and Nancy H. Mozzachio, dated as of June 1,
2010.Exhibit 10.2
    
    Amendment to Employment Agreement between Cedar Shopping
Centers, Inc. and Thomas B. Richey, dated as of June 1, 2010.Exhibit 10.3
    
    Amendment to Employment Agreement between Cedar Shopping
Centers, Inc. and Brenda J. Walker, dated as of June 1, 2010.Exhibit 10.4
    
    Amendment to Employment Agreement between Cedar Shopping
Centers, Inc. and Frank C. Ullman, dated as of June 1, 2010.Exhibit 31
    
    Section 302 CertificationsExhibit 32
    
    Section 906 Certifications
 
 SIGNATURES
  CEDAR SHOPPING CENTERS, INC.By:
    
    /s/ LEO S. ULLMAN
    
    By:
    
    /s/ LAWRENCE E. KREIDER, JR.Leo S. Ullman
    
    

    Lawrence E. Kreider, Jr.Chairman of the Board, Chief
Executive Officer and President
(Principal executive officer)
    
    

    Chief Financial Officer
(Principal financial officer)
  51