UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                    FORM 10-K

(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934 [Fee Required]
For the fiscal year ended                     December 31, 2001
                                              -------------------------

or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
    EXCHANGE ACT OF 1934 [No Fee Required]
For the transition period from                      to
                               --------------------    -------------------------

Commission file Number 1-12286
--------------------------------------------------------------------------------

                            Mid-Atlantic Realty Trust
--------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)

           Maryland                                              52-1832411
-------------------------------                             --------------------
(State or other jurisdiction of                              (I.R.S. Employer
incorporation or organization)                             Identification No.)

170 West Ridgely Road, Suite 300 - Lutherville, Maryland          21093
--------------------------------------------------------    --------------------
(Address of principal executive offices)                        (Zip Code)

Registrant's telephone number, including area code                (410)684-2000
                                                            --------------------


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

                                      NONE
--------------------------------------------------------------------------------
Securities registered pursuant to Section 12 (g) of the Act:

              Common Shares of Beneficial Interest, $.01 par value
--------------------------------------------------------------------------------
                                (Title of Class)

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.

                X            Yes                       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 the
Form 10-K. [X]

As of February 28, 2002,  15,224,232  common  shares of  beneficial  interest of
Mid-Atlantic  Realty Trust were  outstanding  and the aggregate  value of common
stock (based upon the $15.35 closing price on that date) held by  non-affiliates
was approximately $233,691,961.

                       Documents Incorporated by Reference

The  definitive  proxy  statement  with  respect to the 2002  annual  meeting of
Mid-Atlantic Realty Trust shareholders (to be filed).




<PAGE>


PART I

ITEM 1 - BUSINESS

Mid-Atlantic  Realty  Trust  was  incorporated  June  29,  1993,  and  commenced
operations effective with the completion of its initial public share offering on
September  11,  1993.  Mid-Atlantic  Realty  Trust  qualifies  as a real  estate
investment trust ("REIT") for Federal income tax purposes.  As used herein,  the
term "MART" or the "Company"  refers to  Mid-Atlantic  Realty Trust and entities
owned or controlled by MART,  including MART Limited Partnership (the "Operating
Partnership").

The Company is a fully  integrated,  self-administered  real  estate  investment
trust which owns, acquires, develops,  redevelops,  leases and manages primarily
neighborhood or community  shopping centers in the Middle Atlantic region of the
United  States.  The  Company's  primary  objectives  are to enhance  funds from
operations  ("FFO") per share and  maximize  shareholder  value.  To achieve its
objectives,  the  Company  seeks to operate its  properties  for  long-term  FFO
growth.  The Company also acquires  neighborhood or community  shopping  centers
that  either  have  dominant  anchor  tenants or contain a mix of tenants  which
reflects  the shopping  needs of the  communities  they serve.  The Company also
develops and redevelops  shopping centers on a tenant-driven  basis,  leveraging
either existing  tenant  relationships  or geographic and demographic  knowledge
while  seeking to  minimize  exposure to risk  associated  with  long-term  land
development.

The  Company's  financial  strategy  is to  execute  its  operating  and  growth
strategies  by  utilizing a blend of  internally  generated  funds,  issuance of
Operating   Partnership  Units,  defined  below,   proceeds  from  divestitures,
institutional   borrowings  and  issuance  of  corporate   equity  or  debt,  as
appropriate.  The Company  currently intends to maintain a ratio of secured debt
to total estimated property value at or below 50%.

The Company has an equity interest in 39 operating shopping centers, 33 of which
are wholly  owned by the  Company  and six in which the  Company  has  interests
ranging from 50% to 93%, as well as other  commercial  properties,  collectively
the  "Properties".  The Properties  have a gross leasable area of  approximately
5,236,000  square feet,  of which  approximately 92% was leased  at December 31,
2001. Of these  Properties,  approximately  99% of the gross leasable area is in
the states of Maryland,  Virginia,  New York,  Pennsylvania,  Massachusetts  and
Delaware.  The Company also owns  approximately  78 acres of undeveloped land in
parcels varying in size from three to thirty-one acres.

All of MART's  interests in the  Properties  are held directly or indirectly by,
and substantially all of its operations relating to the Properties are conducted
through  the  Operating  Partnership.  Units  of  partnership  interest  in  the
Operating  Partnership  ("Units")  may be exchanged by the limited  partners for
cash or  common  shares  of  beneficial  interest  in MART at the  option of the
Company on a one-for-one  basis. MART controls the Operating  Partnership as the
sole general partner,  and owns  approximately  82% of the Units at December 31,
2001.

The  business of the  Company is not  materially  affected by seasonal  factors.
Although  construction  may be  affected  to some  extent by  inclement  weather
conditions,  usually  during  winter  months,  revenues  from  income  producing
properties  held for investment are usually not affected  significantly  by such
conditions.

The commercial  real estate  development  and investment  industry is subject to
widespread competition for desirable sites, tenants and financing.  The industry
is  extremely  fragmented  and there are no  principal  methods of  competition.
However,  the  ability  to  compete  is  dependent  in part upon the  ability to
identify  and  acquire  and/or  develop   appropriate  real  estate   investment
opportunities  in a timely manner.  While many competitors have fewer assets and
financial  resources than the Company,  there are many  competitors with greater
financial resources competing for similar business  opportunities.  Accordingly,
it is not  possible to estimate  the  Company's  position  in the  industry.  In
addition,  certain of the  Company's  real estate  projects are near  unimproved
sites that could be developed commercially and would provide further competition
to the  Company.  The  management  of the Company  believes,  however,  that the
Company  competes   favorably  in  the  industry  due  to  the  quality  of  its
developments,  its ability to take advantage of opportunities as they arise, its
access to capital and its reputation.

The Company has 70 full time employees and believes that its  relationship  with
its employees is good.

                                      -2-
<PAGE>

ITEM 2 - PROPERITIES
<TABLE>
<CAPTION>
The following schedule describes the Company's commercial and other properties as of December 31, 2001.

SHOPPING CENTER PROPERTIES (1)
                                                                     Year(s)       Gross
                                               Percent     Year       Built/    Leasable Area  Percent
                                              Ownership  Acquired  Redeveloped    (Sq. Ft.)    Leased   Major Tenants
------------------------------------------------------------------------------------------------------------------------------------
Maryland
------------------------------------------------------------------------------------------------------------------------------------

Baltimore Metropolitan Area
---------------------------

<S>                                              <C>      <C>       <C>           <C>          <C>      <C>
Arundel Plaza Shopping Center                    67%      1997      1967/1998      250,000      100%    Giant Food, Lowe's Home
                                                                                                        Center

Club Centre at Pikesville Shopping Center       100%      1997      1990/-          44,000       86%    Blockbuster, Wells Fargo

Enchanted Forest Shopping Center                100%      1997      1992/-         140,000       95%    Safeway, Petco

Fullerton Plaza Shopping Center                 100%      2000      1979           153,000       94%    Kmart, McDonalds

Glen Burnie Village Shopping Center             100%      1997      1972/2000       75,000       80%    Rite Aid, Allfirst Bank

Harford Mall and Business Center (2)            100%      1972      1972/1984-96/   625,000      96%    Hechts, Sears, Petsmart,
                                                                       1999                             Best Buy, Old Navy

Ingleside Shopping Center                       100%      1997      1963/1996      115,000      100%    Safeway, Rite Aid, Allfirst
                                                                                                        Bank

Little Glen Shopping Center                     100%      1997      1961-1973/      19,000       61%    None

Lutherville Station Shopping Center (3)         100%      1993      1969/1997      286,000       67%    Circuit City, Super Valu,
                                                                                                        State of MD

New Town Village Shopping Center                100%      1995*     1995/-         118,000       97%    Giant Food

North East Station Shopping Center              100%      1989      1998/-          80,000       90%    Food Lion

Patriots Plaza Shopping Center (3)              50%       1984*     1984/-          39,000      100%    Denny's

Perry Hall Shopping Center                      100%      1997      1965/1996      187,000       97%    Rite Aid, Outback

Radcliffe Shopping Center at Towson             100%      1997      1988/1993       82,000      100%    CVS Drug,CompUSA, Linens 'N
                                                                                                        Things

Rolling Road Plaza Shopping Center              100%      1973*     1973/1994       63,000       82%    Firestone, Cort Furniture

Rosedale Plaza Shopping Center                  100%      1989      1972/2000       91,000       97%    Super Fresh Food Market,
                                                                                                        Rite Aid

Security Square Shopping Center                 100%      2001      2001            77,000      100%    Super Fresh Food Market

Shawan Plaza Shopping Center                    100%      1997      1991/-          95,000       98%    Giant Food, Bank of America,
                                                                                                        Provident Bank

Timonium Crossing Shopping Center               100%      1997      1986/1996       60,000       56%    None

Timonium Shopping Center                        100%      1997      1962/-         207,000       87%    Ames

Waverly Woods Shopping Center                   100%      2001      2001            99,000       96%    Weis Market

Wilkens Beltway Plaza Shopping Center           93%       1981*     1985-87/        80,000      100%    Giant Food, Provident Bank
                                                                    1991/1995

York Road Plaza Shopping Center                 100%      1967*     1967/1996       91,000      100%    Giant Food, Firestone

Easton
------
Shoppes at Easton Shopping Center               100%      1994      1994/-         113,000      100%    Giant Food, Wal-Mart (on own
                                                                                                        pad)
Total Maryland                                                                   3,189,000

                                       -3-
<PAGE>
ITEM 2 - PROPERITIES (Continued)
SHOPPING CENTER PROPERTIES (Continued)
                                                                     Year(s)       Gross
                                               Percent     Year       Built/    Leasable Area  Percent
                                              Ownership  Acquired  Redeveloped    (Sq. Ft.)    Leased   Major Tenants

------------------------------------------------------------------------------------------------------------------------------------
DELAWARE
------------------------------------------------------------------------------------------------------------------------------------
Wilmington
----------
Brandywine Commons Shopping Center (3)          100%      1995      1992/-         166,000      100%   Shop Rite, Office Depot,
                                                                                                       Sports Authority

Milford
-------
Milford Commons Shopping Center                 100%      1997      1994            61,000       78%   Food Lion, Advance Auto

Total Delaware                                                                     227,000
------------------------------------------------------------------------------------------------------------------------------------
PENNSYLVANIA
------------------------------------------------------------------------------------------------------------------------------------
Bethlehem
---------
Saucon Valley Square Shopping Center             89%     1999       1998          81,000        100%   Super Fresh Food Market,
                                                                                                       Blockbuster, Radio Shack
Carlisle
--------
Stonehedge Square Shopping Center               100%     2000       1990/1994       88,000       98%   Nells Market, Eckerd Drug

Chambersburg
------------
Wayne Avenue Plaza Shopping Center              100%     1998       1990/1993      121,000       99%   Giant Food (of Carlisle), CVS
                                                                                                       Drug, Blockbuster
Pottstown
---------
Pottstown Plaza Shopping Center                 100%     2001       1988-1989/-    162,000       79%   Giant Food (of Carlisle),
                                                                                                       TJ Maxx, Radio Shack,
                                                                                                       Applebees
Waynesboro
----------
Wayne Heights Shopping Center                   100%     1998       1975/-         108,000       92%   Martins (Giant of Carlisle),
                                                                                                       Ames, Eckerd Drug
Total Pennsylvania                                                                 560,000
------------------------------------------------------------------------------------------------------------------------------------
MASSACHUSETTS/NEW YORK
------------------------------------------------------------------------------------------------------------------------------------
Pittsfield
----------
Del Alba Shopping Center                        100%     1998*      1995/-          70,000       92%   Super Stop & Shop

Colonie
-------
Colonie Plaza Shopping Center                   100%     1987*      1987/-         140,000       90%   Price Chopper, Consolidated
                                                                                                       Stores
East Greenbush
--------------
Columbia Plaza Shopping Center                  100%     1988*      1988/1997      133,000      100%   Price Chopper, Fashion Bug

Total Massachusetts/New York                                                       343,000
------------------------------------------------------------------------------------------------------------------------------------
VIRGINIA
------------------------------------------------------------------------------------------------------------------------------------
Burke
-----
Burke Town Plaza Shopping Center (3)            100%     1979*      1979-1982/     133,000       100%  Safeway, CVS Drug,
                                                                     1997/2000                         Radio Shack
Dale City
---------
Smoketown Plaza Shopping Center (5)              93%     1987*      1987/1994      176,000       48%   None

Fredericksburg
--------------
Spotsylvania Crossing Shopping Center            93%     1987*      1987/1991      142,000       99%   Giant Food (on own pad),
                                                                                                       Kmart
Harrisonburg
------------
Skyline Village Shopping Center                 100%     1988*      1988/1992      127,000       99%   Toys "R" Us, Super Valu

Manassas
--------
Sudley Towne Plaza Shopping Center              100%     1984*      1984/-         108,000      100%   Burlington Coat Factory,
                                                                                                       CVS Drug, Best Buy
                                                                                                       (on own pad)
Total Virginia                                                                     686,000

                                       -4-
<PAGE>
OTHER RETAIL AND COMMERCIAL PROPERTIES (4)
                                                                     Year(s)       Gross
                                               Percent     Year       Built/    Leasable Area  Percent
                                              Ownership  Acquired  Redeveloped    (Sq. Ft.)    Leased   Major Tenants
------------------------------------------------------------------------------------------------------------------------------------
MARYLAND
------------------------------------------------------------------------------------------------------------------------------------
Baltimore Metropolitan Area
---------------------------
Orchard Square Medical Office                   100%    1997       1988/-            28,000       100%   N/A

Patriots Office                                  50%    1984*      1984/-            28,000        67%   N/A

Wilkens Office I, II, III                        93%    1981*      1985-87/          53,000        99%   N/A
                                                                   1991/1995

Southwest Mixed Use Property                    100%    1968*      1968/1984         25,000       100%   Shell Oil

Other
-----
Clinton Property (3)                            100%    1971*      1971/-            29,000       100%   AMF

Waldorf Property                                100%    1979*      1979/-            31,000       100%   AMF, Firestone

Total Maryland                                                                      194,000
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS
------------------------------------------------------------------------------------------------------------------------------------
Chicago Property                                100%    1978       1963/-            37,000       100%   AMF

Total Illinois                                                                       37,000

Total Portfolio                                                                   5,236,000

UNDEVELOPED LAND
                                                                                                 Percent      Area in
                                                                                                Ownership      Acres        Zoning
------------------------------------------------------------------------------------------------------------------------------------
MARYLAND
------------------------------------------------------------------------------------------------------------------------------------
Baltimore Metropolitan Area
---------------------------
Dorsey Property                                                                                   100%         19.4       Commercial

Pulaski Property                                                                                  100%          3.0       Industrial

Salisbury
---------
Northwood Industrial Park                                                                          67%         16.1       Industrial

------------------------------------------------------------------------------------------------------------------------------------
NORTH CAROLINA
------------------------------------------------------------------------------------------------------------------------------------
Burlington
----------
Burlington Commerce Park                                                                          100%         31.2       Commercial

Hillsborough
------------
Hillsborough Crossing                                                                             100%          8.0       Commercial
------------------------------------------------------------------------------------------------------------------------------------
<FN>
(1)  Shopping centers in operation are subject to mortgage financing aggregating $167,717,332 at December 31, 2001.
(2)  The Harford Mall property is subject to mortgage financing  aggregating  $18,534,076 at December 31, 2001. The mortgage bears
     interest at a rate of 9.78%,  and a balloon  payment of  $18,148,848  is due at maturity in July 2003.  The  mortgage  allows
     prepayment with a penalty of the greater of 1% of the outstanding principal balance or yield maintenance.
(3)  These properties are subject to ground leases;  all of the land relating to the other properties listed above is owned in fee
     simple. The ground leases are subject to the following terms:
</FN>
</TABLE>
<TABLE>
<CAPTION>
Property                               Annual Rent            Remaining Lease Term
--------                               -----------            --------------------
<S>                                     <C>                   <C>
Lutherville Station Shopping Center     $ 60,000              4 years 1 month, plus six 10 year renewal options
Lutherville Station Shopping Center     $ 26,000              45 years 11 months
Patriots Plaza Shopping Center          $ 65,200              8 years 10 months, plus two 10 year renewal options
Brandywine Commons Shopping Center      $392,600              50 years 4 months, plus two 10 year renewal options
Burke Towne Plaza Shopping Center       $ 80,000              30 years plus three 15 year renewal options
Clinton Property                        $ 33,000              22 years 8 months, plus one 45 year renewal options
<FN>
(4)  Other retail and commercial properties in operation are subject to mortgage financing  aggregating $2,552,745 at December 31,
     2001.
(5)  Redevelopment of this center will  commence  in early  2002.   Existing  center gross  leasable area is 176,000.  Redeveloped
     center  will be anchored by Lowe's Home Center (167,000  square feet) and is  anticipated to  open in March 2003, with 97,000
     square feet of gross leasable area of in-line retail space.
</FN>
</TABLE>
* Developed by MART
                                       -5-
<PAGE>

ITEM 3 - LEGAL PROCEEDINGS

In  the  ordinary  course  of  business,   the  Company  is  involved  in  legal
proceedings.  However, there are no material legal proceedings presently pending
against the Company.


ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None.

PART II

ITEM 5-MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED STOCKHOLDER MATTERS

The number of holders of record of the Company's shares was 1,083 as of February
28, 2002.

MART's  common  shares  of  beneficial  interest,  par  value  $.01  per  share,
("shares"),  trade on the New York Stock Exchange,  under the symbol "MRR".  The
following table sets forth, for the quarters indicated, the high and low closing
sale  prices of MART  shares on the NYSE,  and the cash  distributions  paid per
share for the indicated period.
<TABLE>
<CAPTION>
                        Closing Prices Per Share

<S>                      <C>           <C>          <C>
2001                     High          Low          Distributions
-----------------------------------------------------------------
First Quarter          $ 13.480         11.750             0.2825
Second Quarter           13.650         10.950             0.2825
Third Quarter            14.090         12.810             0.2825
Fourth Quarter           15.720         12.950             0.2950

2000                     High          Low          Distributions
-----------------------------------------------------------------
First Quarter          $ 10.563          9.125             0.2700
Second Quarter           10.125          9.063             0.2700
Third Quarter            12.000         10.063             0.2700
Fourth Quarter           13.000         11.125             0.2825

</TABLE>
<TABLE>
<CAPTION>
For the shareholders of MART during the entire year, per share dividends were taxable as follows:

                                                                                Per Share
                                                               2001               2000               1999
---------------------------------------------------------------------------------------------------------------
<S>                                                       <C>                         <C>               <C>
Ordinary dividends - taxable as ordinary income           $       1.08                0.98              0.90

Capital gain distribution - taxable as capital gain                 -                  -                -

Other distribution -
 return of capital or capital gain
 (depending on shareholders' basis in MART shares)                0.06                0.11              0.15
                                                         ------------------------------------------------------
Total annual gross dividends per share                    $       1.14                1.09              1.05
                                                         ------------------------------------------------------

Percent of total annual gross dividends per share -
 return of capital or capital gain                                   6%                10%               14%
                                                         ------------------------------------------------------

</TABLE>
                                       -6-
<PAGE>


ITEM 6 - SELECTED FINANCIAL DATA
<TABLE>
The following  table sets forth certain  consolidated  financial data for the Company and should be read in  conjunction  with the
consolidated financial statements and notes thereto included elsewhere in this report.

------------------------------------------------------------------------------------------------------------------------------------
                                                                        Years Ended December 31,
                                                       2001               2000           1999             1998            1997
------------------------------------------------------------------------------------------------------------------------------------
<S>                                                <C>                 <C>            <C>              <C>             <C>
Revenues                                           $   62,456,375      57,585,123     53,346,473       49,537,130     39,152,220
                                                   ---------------------------------------------------------------------------------
Earnings before extraordinary gain (loss)          $   14,359,029      12,555,629     12,751,158       12,385,861      6,819,211
Extraordinary gain (loss)                                      -          255,268             -          (32,984)        (226,873)
                                                   ---------------------------------------------------------------------------------
Net earnings                                       $   14,359,029      12,810,897     12,751,158       12,352,877      6,592,338
                                                   ---------------------------------------------------------------------------------
Net earnings per share - basic                     $         0.99            0.93           0.89             0.85           0.70
Net earnings per share - diluted                             0.97            0.92           0.88             0.84           0.70
                                                   ---------------------------------------------------------------------------------
Total assets                                       $  389,563,563     371,080,608    328,570,661      317,008,617    298,154,555
                                                  ---------------------------------------------------------------------------------
Indebtedness -
  Total mortgages, covertible debentures,
  construction loans and notes payable             $  241,941,366     232,962,526    186,593,831      166,732,850    145,660,657
                                                   ---------------------------------------------------------------------------------
Net cash flow:
  Provided by operating activities                 $   32,659,889      26,539,335     25,153,324       24,255,137     16,005,958
  (Used by) investing activities                   $  (30,791,989)    (49,427,922)   (24,175,685)     (21,668,918)    (5,995,155)
  (Used by) provided by financing activities       $      624,616      22,850,395     (1,440,868)     (10,402,329)    (2,597,424)
                                                   ---------------------------------------------------------------------------------
Cash dividends paid per share                      $         1.14            1.09           1.05             1.01           0.97
                                                   ---------------------------------------------------------------------------------
Weighted average number of shares outstanding: EPS
  Basic                                                14,268,487      13,538,886     14,021,403       14,240,533      9,308,682
  Diluted                                              15,010,310      14,806,204     15,337,652       15,778,727      9,360,566
                                                   ---------------------------------------------------------------------------------

RECONCILIATION OF NET EARNINGS TO FFO

Net earnings                                       $   14,359,029      12,810,897     12,751,158       12,352,877      6,592,338
Depreciation                                           11,118,924      10,392,055      9,557,204        8,813,251      6,954,803
(Gain) loss on properties                                 (20,212)            -         (131,611)           4,223        (16,836)
Extraordinary (gain) loss from early extinguishment
  of debt                                                     -          (255,268)           -             32,984        226,873
                                                   ---------------------------------------------------------------------------------
FFO                                                $   25,457,741      22,947,684     22,176,751       21,203,335     13,757,178
                                                   =================================================================================
<FN>

(1)  The Company  believes that Funds from  Operations  (FFO)  provides  relevant and meaningful  information  about its operating
     performance that is necessary,  along with net earnings, for an understanding of its operating results. Funds from operations
     is defined by the  National  Association  of Real Estate  Investment  Trusts,  Inc.  (NAREIT) as net  earnings  (computed  in
     accordance with accounting  principles  generally accepted in the United States of America),  excluding cumulative effects of
     changes in accounting  principles,  extraordinary  items and gains or losses on sales of properties,  plus  depreciation  and
     amortization,  and after adjustments to record unconsolidated partnerships and joint ventures on the same basis. FFO does not
     represent cash flows from operations as defined by accounting  principles  generally accepted in the United States of America
     (GAAP).  FFO is not  indicative  that cash flows are  adequate  to fund all cash needs and  should  not be  considered  as an
     alternative  to cash flows as a measure of  liquidity.  The  Company's  FFO may not be  comparable to the FFO of other REIT's
     because they may not use the current NAREIT definition or they may interpret the definition differently.
</FN>
</TABLE>

                                      -7-
<PAGE>
ITEM 6 - SELECTED FINANCIAL DATA (Continued)

Quarterly Results of Operations (Unaudited)
<TABLE>
<CAPTION>
The unaudited quarterly results of operations for MART for 2001 and 2000 are summarized as follows:

                                                              Quarter Ended
2001                                       March 31,     June 30,     September 30,    December 31,
---------------------------------------------------------------------------------------------------
<S>                                      <C>             <C>           <C>             <C>
Revenues                                 $ 15,246,088    15,271,597    15,756,930      16,181,760
                                         ----------------------------------------------------------
Earnings before extraordinary gain          3,294,664     3,261,460     3,741,576       4,061,329
Extraordinary gain from early
  extinguishment of debt                         -            -             -               -
                                         ----------------------------------------------------------
Net earnings                             $  3,294,664     3,261,460     3,741,576       4,061,329
                                         ==========================================================
Net earnings per share - basic           $       0.24          0.22          0.25            0.27
Net earnings per share - diluted         $       0.23          0.22          0.25            0.27

                                                              Quarter Ended
2000                                       March 31,     June 30,     September 30,    December 31,
---------------------------------------------------------------------------------------------------

Revenues                                 $ 13,909,381    14,483,757    14,205,405      14,986,580
                                         ----------------------------------------------------------
Earnings before extraordinary gain          2,927,006     3,228,470     2,970,190       3,429,963
Extraordinary gain from early
  extinguishment of debt                         -          163,923        91,345            -
                                         ----------------------------------------------------------
Net earnings                             $  2,927,006     3,392,393     3,061,535       3,429,963
                                         ==========================================================
Net earnings per share - basic           $       0.21          0.24          0.23            0.25
Net earnings per share - diluted         $       0.21          0.24          0.23            0.24
                                         ==========================================================
<FN>
Quarterly  results are  influenced  by a number of factors,  including  the timing of property  acquisitions,  sales and financing
transactions and the completion of development/redevelopment projects.
</FN>
</TABLE>
                                       -8-
<PAGE>


ITEM 7 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS

The following  discussion  and analysis of operating  results covers each of the
Company's  business  segments for the years ended  December  31, 2001,  2000 and
1999.

Management believes that a segment analysis provides the most effective means of
understanding the business. As discussed in Note N to the consolidated financial
statements,  segment data are reported using the accounting policies followed by
the Company for internal reporting to management. These policies are the same as
those  used for  external  reporting.  Operating  results  of the  segments  are
reconciled to earnings from operations in the financial statements in Note N.

Critical Accounting Policies

Critical   accounting  policies  are  those  that  are  both  important  to  the
presentation  of our financial  condition and results of operations  and require
management's  most  difficult,  complex or subjective  judgments.  The Company's
critical   accounting  policies  relate  to  the  evaluation  of  impairment  of
long-lived assets and the collectibility of notes and accounts receivable.

If events or changes in  circumstances  indicate  that the carrying  value of an
operating  property  to be held and used or land  held  for  development  may be
impaired, a recoverability analysis is performed based on estimated undiscounted
cash flows to be  generated  from the  property in the future.  If the  analysis
indicates that the carrying value is not recoverable from future cash flows, the
property  is written  down to  estimated  fair value and an  impairment  loss is
recognized.  If we  decide  to sell an  operating  property  or  land  held  for
development,  we evaluate  the  recoverability  of the  carrying  amounts of the
assets.  If the evaluation  indicates that the carrying value is not recoverable
from  estimated  net sales  proceeds,  the property is written down to estimated
fair  value  less  costs  to sell  and an  impairment  loss is  recognized.  Our
estimates of cash flows and fair values of the  properties  are based on current
market  conditions and consider matters such as rental rates and occupancies for
comparable  properties,  recent sales data for comparable  properties and, where
applicable,  contracts  or  the  results  of  negotiations  with  purchasers  or
prospective  purchasers.  Our  estimates  are  subject  to  revision  as  market
conditions and our assessments of them change.

The allowance for doubtful notes and accounts receivable is established based on
analysis  of the  risk  of  loss  on  specific  accounts.  The  analysis  places
particular  emphasis on past-due accounts and considers  information such as the
nature and age of the  receivable,  the  payment  history of the tenant or other
debtor, the financial  condition of the tenant and our assessment of its ability
to meet its lease  obligations,  the basis for any  disputes  and the  status of
related negotiations,  etc. Our estimate of the required allowance is subject to
revision as these factors change and is sensitive to the effects of economic and
market conditions on our tenants.


Operating Results- Shopping Centers

The operating results of shopping center  properties are affected  significantly
by acquisition and disposition  transactions  and openings of newly developed or
redeveloped properties.  Information related to shopping center acquisitions and
developments/redevelopments  completed  during 2001, 2000 and 1999 is summarized
in the following table:

Property                                               Transaction
                                                       or Opening Date
Acquisitions
------------
Pottstown Plaza Shopping Center                        October 2001
Fullerton Plaza Shopping Center                        March 2000
Stonehedge Square Shopping Center                      February 2000
Saucon Valley Square Shopping Center                   March 1999

Development/Redevelopment
-------------------------
Waverly Woods Shopping Center                          March 2001
Security Square Shopping Center                        February 2001
Burke Town Plaza Shopping Center                       December 2000
Glen Burnie Village Shopping Center                    November 2000
Rosedale Plaza Shopping Center                         August 2000
Harford Mall                                           December 1999
Arundel Plaza Shopping Center                          March 1999

                                      -9-
<PAGE>
ITEM 7 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS (Continued)

Operating  results of shopping  center  properties are summarized as follows (in
thousands):

                                             2001          2000         1999
--------------------------------------------------------------------------------
Revenues                                    $  60,264       55,538      51,235
Operating and interest expenses,
  exclusive of depreciation and
  amortization                                 32,288       30,204      26,958
Depreciation and amortization                  10,654        9,926       9,082
Minority interest                               3,800        3,581       3,318
                                         ---------------------------------------
Earnings from operations                    $  13,522       11,827      11,877


Revenues from shopping centers increased by $4,726,000 in 2001 and by $4,303,000
in 2000.  The increase in 2001 was due primarily to the  operations of the newly
developed  properties opened in 2001 ($2,137,000),  properties  acquired in 2001
and 2000 ($578,000),  the  redevelopment  projects  completed and opened in 2000
($869,000) and other net rental and occupancy changes ($1,142,000). The increase
in 2000 was due primarily to the operations of the  properties  acquired in 2000
and 1999 ($2,075,000),  the redevelopment  projects completed and opened in 2000
and 1999 ($1,680,000) and other net rental and occupancy changes ($187,000).

     Operating   and  interest   expenses   (exclusive   of   depreciation   and
amortization) for for shopping center properties increased by $2,084,000 in 2001
and by  $3,246,000  in  2000.  The  increase  in 2001 was due  primarily  to the
acquisitions, developments and redevelopments referred to above ($1,184,000) and
new mortgage debt for Ingleside Shopping Center ($727,000). The increase in 2000
was due  primarily  to the  acquisitions  and  redevelopments  referred to above
($2,374,000)  and new mortgage debt for Ingleside  Shopping  Center  ($371,000).
Depreciation  and  amortization  expense  increased  by  $728,000 in 2001 and by
$844,000  in  2000.   These  increases  were   attributable   primarily  to  the
acquisitions and redevelopments referred to above.

Operating Results- All Other Properties

Operating  results  of all  other  properties  are  summarized  as  follows  (in
thousands):

                                           2001            2000          1999
--------------------------------------------------------------------------------
Revenues                                  $  2,192            2,047      2,111
Operating and interest expenses,
  exclusive of depreciation and
  amortization                                 859              844        889
Depreciation and amortization                  465              466        475
Minority interest                               51                8          4
                                         ---------------------------------------
Earnings from operations                  $    817              729        743
                                         =======================================


There  were  no  significant  changes  in the  operating  results  of all  other
properties during the period.

Gain (Loss) on Properties
The  gain  on  properties  for  2001  is due to the  sale  of  land  located  in
Burlington,  North  Carolina.  The $132,000 gain on  properties  for 1999 is due
primarily  to the  final  resolution  of  contingencies  in the sale  agreements
relating to properties sold in 1997.

Funds from Operations
The Company uses a supplemental  performance  measure along with net earnings to
report  its  operating  results.  This  measure  is  referred  to as Funds  from
Operations  ("FFO").  FFO is defined by the National  Association of Real Estate
Investment  Trusts,  Inc.  (NAREIT) as net earnings  computed in accordance with
GAAP,  excluding  cumulative  effects  of  changes  in  accounting   principles,
extraordinary  items,  and  gains  or  losses  on  sales  of  properties,   plus
depreciation and amortization,  and after  adjustments to record  unconsolidated
partnerships  and joint ventures on the same basis.  FFO does not represent cash
flows from  operations as defined by GAAP. FFO is not indicative that cash flows
are  adequate  to fund  all  cash  needs  and  should  not be  considered  as an
alternative  to cash flows as a measure of liquidity.  The Company's FFO may not
be  comparable  to the FFO of other REIT's  because they may not use the current
NAREIT  definition  or they may interpret the  definition  differently.

     FFO was  $25,458,000 in 2001,  $22,948,000 in 2000 and $22,177,000 in 1999.
The  increases  in FFO in 2001  and  2000  were due  primarily  to the  property
acquisitions and the development and  redevelopment  projects  referred to above
and higher rents from re-leased  space.  The reasons for significant  changes in
revenues and expenses comprising FFO by segment are described above.

                                      -10-
<PAGE>
ITEM 7 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS (Continued)

Liquidity and Capital Resources
The Company had cash and cash equivalents of $2,602,000 at December 31, 2001.
     Net cash provided by operating activities was $32,660,000, $26,539,000, and
$25,154,000, in 2001, 2000, and 1999, respectively. The changes in cash provided
by operating activities were due primarily to the factors discussed above in the
comparisons  of operating  results.  The level of net cash provided by operating
activities is also affected by the timing of receipt of revenues and the payment
of operating and interest expenses.
     Net  cash  used  by  investing  activities  decreased  by  $18,636,000,  to
$30,792,000 in 2001 from  $49,428,000 in 2000. The decrease was due primarily to
lower   levels   of   acquisitions   ($6,071,000)   and   development   activity
($13,580,000).
     Net  cash  used  by  investing   activities  increased  by  $25,252,000  to
$49,428,000 in 2000 from  $24,176,000 in 1999. The increase was due primarily to
higher levels of acquisitions and development activity.
     Net cash  provided by  financing  activities  decreased by  $22,225,000  to
$625,000 in 2001 from  $22,850,000  in 2000.  The decrease was due  primarily to
lower   net    credit    line    borrowings    ($4,000,000),    decreased    net
financing/refinancing  activity  ($12,831,000),  and decreased net  construction
borrowings   ($7,131,000),   partly  offset  by  decreased   share   repurchases
($2,686,000).
     Net cash  provided by  financing  activities  increased by  $21,409,000  to
$22,850,000  in 2000  compared  to net  cash  used by  financing  activities  of
$1,441,000 in 1999. Financing activities provided cash in 2000 primarily because
of financing/refinancing activity for four shopping centers ($24,168,000).
     The Company currently has a $75,000,000  unsecured line of credit available
for various  purposes,  including  acquisition,  development or redevelopment of
properties  and  liquidity,  subject to various terms and  conditions.  The note
payable under the bank line of credit had an outstanding  balance of $42,500,000
at December 31, 2001.
     The Company has  registered  to sell up to an  aggregate  of  approximately
$98,000,000  (based on the public offering price) of additional common shares of
beneficial  interest and/or debt  securities.  The shares and debt may be issued
from time to time at prices,  in amounts  and on terms to be  determined  at the
time of offering.
     In order to qualify as a REIT for  Federal  income  tax  purposes,  MART is
required  to pay  dividends  to its  shareholders  of at  least  90% of its REIT
taxable  income.  MART intends to pay these dividends from operating cash flows.
While MART intends to distribute to its  shareholders  a substantial  portion of
its cash flows from operating activities, MART also intends to retain or reserve
such amounts as it considers  necessary from time to time for the acquisition or
development  of new  properties  as  suitable  opportunities  arise  and for the
expansion and renovation of its shopping  centers.  Also, MART currently has and
expects to continue to maintain a line of credit from its primary bank.
     The Company anticipates  material  commitments for capital  expenditures to
include,  in the next two years,  the ongoing  redevelopment of eleven projects,
currently in various stages of planning,  at an estimated  cost of  $42,900,000.
The  Company  expects  to  fund  the  development  projects  and  other  capital
expenditures  with  available net cash flows from  operating  activities  and if
necessary with  construction  loan financing,  long-term  mortgage  financing on
unencumbered operating properties or the use of its line of credit.
It is management's  intention that MART  continually  have access to the capital
resources  necessary  to expand and  develop  its  business.  Management  cannot
practically  quantify  MART's  2002 cash  requirements,  but expects to meet its
short-term  liquidity  requirements  generally  through  available net cash flow
provided by operations and short-term borrowings.  To meet its long-term capital
requirements,  MART intends to obtain funds through additional equity offerings,
joint  ventures or  long-term  debt  financing in a manner  consistent  with its
financial  strategy.  The Company  anticipates that the cash flow available from
operations,  together with cash from  borrowings and equity  offerings,  will be
sufficient  to meet its  liquidity  and  capital  needs  in both  the  short-and
long-term.

Market Risk Information
     The market  risk  associated  with  financial  instruments  and  derivative
financial and commodity  instruments is the risk of loss from adverse changes in
market prices or rates. The Company's market risk arises primarily from interest
rate risk relating to variable rate borrowings used to maintain liquidity (e.g.,
credit line borrowings) or finance project development costs (e.g., construction
loans).  The Company's  interest rate risk management  objective is to limit the
impact of interest rate changes on earnings and cash flows.  In order to achieve
this  objective,   the  Company  relies  primarily  on  long  term,  fixed  rate
nonrecourse   loans  from   institutional   lenders  to  finance  its  operating
properties.  In addition,  long term fixed rate financing is typically  arranged
concurrently with or shortly after a variable rate project  construction loan is
negotiated  or the project is  complete.  The  Company  has not used  derivative
financial or commodity instruments to manage interest rate risk.
     The Company's  interest rate risk is monitored  closely by management.  The
table below presents the principal  amounts,  weighted  average  interest rates,
fair values and other data  required to evaluate the expected  cash flows of the
Company under debt agreements and its sensitivity to interest rate changes.
     At  December  31,  2001,  the  Company's  variable  rate  debt  relates  to
borrowings  under its  credit  line and  construction  loans.  The  credit  line
borrowings  are assumed to be repaid at their  maturity  dates through 2004. The
construction loans are assumed to be repaid at their maturity in 2004.

                                      -11-

<PAGE>
ITEM 7 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS (Continued)

The table below presents the annual maturities,  weighted-average interest rates
on outstanding debt at the end of each year and fair values required to evaluate
the expected cash flows of the Company under debt and related agreements and its
sensitivity  to  interest  rate  changes  at  December  31,  2001.  As the table
incorporates  only those  exposures  that exist as of December 31, 2001, it does
not consider exposures of positions that could arise after that date.

<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------
                                                                   (In thousands)
                                                                                                                Fair
                                     2002      2003    2004       2005       2006       Thereafter   Total     Value
-----------------------------------------------------------------------------------------------------------------------
<S>                                  <C>       <C>     <C>        <C>        <C>        <C>          <C>       <C>
Fixed rate debt                      $10,512   36,716  10,939     3,019      21,943     100,814      183,943   186,974
Weighted average interest rate          8.63%    8.93%   7.00%      -          7.98%       7.94%        8.11%      -

Variable rate debt                   $11,000   42,500   4,498       -            -           -        57,998    57,998
Weighted average interest rate          3.58%    3.79%   3.43%      -            -           -          3.78%      -
------------------------------------------------------------------------------------------------------------------------

</TABLE>
Inflation

The majority of leases for the shopping center properties contain provisions for
annual  increases  in rents  and/or  provisions,  which  entitle MART to receive
percentage rents, based on the tenants' gross sales. Such provisions  ameliorate
the risk to MART of the adverse  effects of  inflation.  If a recession  were to
begin and continue for a prolonged  time,  FFO could decline as some tenants may
have  trouble  meeting  their  lease  obligations.  Most of the  leases  for the
properties require the tenants to pay a substantial share of operating expenses,
such as real estate taxes,  insurance  and common area  maintenance  costs,  and
thereby  reduce MART's  exposure to increased  costs.  In addition,  many of the
leases for the properties are for terms of less than 10 years,  which may enable
MART to seek increased  rents upon renewal of existing leases if rents are below
the then existing market rates.

New Accounting Standards
In June 2001, the Financial  Accounting  Standards Board (FASB) issued Statement
of Financial  Accounting  Standards (SFAS) No. 141, "Business  Combinations" and
SFAS No. 142, "Goodwill and Other Intangible Assets." SFAS No. 141 requires that
the purchase method of accounting be used for all business combination initiated
after June 2001. SFAS No. 142 changes the accounting for goodwill and intangible
assets with indefinite lives from an amortization approach to an impairment-only
approach.  The  adoption  of SFAS No.  142 on  January  1, 2002 will not have an
effect on our financial statements.

In October 2001, the FASB issued SFAS No. 144, "Accounting for the Impairment or
Disposal  of  Long-Lived   Assets."  SFAS  No.  144  supersedes  SFAS  No.  121,
"Accounting for the Impairment of Long-Lived Assts and for Long-Lived  Assets to
Be Disposed Of," and APB Opinion No. 30,  "Reporting the Results of Operations -
Reporting the Effects of Disposal of a Segment of a Business, and Extraordinary,
Unusual and Infrequently  Occurring Events and Transactions." The Statement does
not change the  fundamental  provisions  of SFAS No. 121;  however,  it resolves
various  implementation  issues  of  SFAS  No.  121  and  establishes  a  single
accounting model for long-lived assets to be disposed of by sale. It retains the
requirement of APB Opinion No. 30 to report separately  discontinued  operations
but extends  that  reporting  to a  component  of an entity that either has been
disposed  of  (by  sale,  abandonment,  or  in  distribution  to  owners)  or is
classified as held for sale.  We do not believe that adoption of this  Statement
in 2002 will have a material effect on our financial statements.

Cautionary Disclosure Relating to Forward Looking Statements
Statements made in this document  include forward looking  statements  under the
federal securities laws. Statements that are not historical in nature, including
the words "anticipate,"  "estimate," "should," "expect," "believe," "intend" and
similar expressions are intended to identify forward looking  statements.  While
these  statements  reflect the  Company's  good faith  beliefs  based on current
expectations,  estimates and projections about (among other things) the industry
and the markets in which the Company operates, they are not guarantees of future
performance,  involve known and unknown risks and uncertainties that could cause
actual  results  to  differ   materially  from  those  in  the  forward  looking
statements,  and  should not be relied  upon as  predictions  of future  events.
Factors which could impact future results  include (among other things)  general
economic  conditions,  local real estate  conditions,  oversupply  of  available
space, financial condition of tenants, timely ability to lease or re-lease space
upon favorable economic terms,  agreements with anchor tenants,  interest rates,
availability of financing, competitive factors, and similar considerations.  The
Company  disclaims  any  obligation  to  publicly  update or revise any  forward
looking  statement,  whether as a result of new  information,  future  events or
otherwise.  For a discussion of risks and uncertainties  that could cause actual
results  to differ  materially  from  those  contained  in the  forward  looking
statements, see "Risk Factors" filed as Exhibit 99.1 to the Company's Form 10-K.

                                      -12-
<PAGE>

ITEM 8 - FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

INDEPENDENT AUDITORS' REPORT


Board of Trustees and Shareholders

Mid-Atlantic Realty Trust:

We have audited the  accompanying  consolidated  balance sheets of  Mid-Atlantic
Realty Trust and  subsidiaries  as of December 31, 2001 and 2000 and the related
consolidated  statements of operations,  shareholders' equity and cash flows for
each  of the  years  in the  three-year  period  ended  December  31,  2001.  In
connection with our audits of the  consolidated  financial  statements,  we also
have audited the  financial  statement  schedule of real estate and  accumulated
depreciation.   These  consolidated   financial  statements  and  the  financial
statement  schedule are the  responsibility  of the  Company's  management.  Our
responsibility  is to  express  an opinion  on these  financial  statements  and
financial  statement  schedule  based on our audits.

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

In our opinion, the consolidated  financial statements referred to above present
fairly, in all material respects,  the financial position of Mid-Atlantic Realty
Trust and  subsidiaries  as of December  31,  2001 and 2000,  and the results of
their  operations  and their cash flows for each of the years in the  three-year
period  ended  December 31,  2001,  in  conformity  with  accounting  principles
generally  accepted in the United  States of America.  Also in our opinion,  the
related financial statement  schedule,  when considered in relation to the basic
consolidated  financial  statements taken as a whole,  presents  fairly,  in all
material respects, the information set forth therein.



/s/ KPMG LLP
-------------------


Baltimore, Maryland
February 22, 2002

                                      -13-

<PAGE>

                   MID-ATLANTIC REALTY TRUST AND SUBSIDIARIES
                           Consolidated Balance Sheets


                                                       As of December 31,

                                                     2001             2000
--------------------------------------------------------------------------------

ASSETS
Properties:
  Operating properties (Notes B and C)             $ 441,313,588    400,319,243
  Less accumulated depreciation and amortization      81,465,520     70,435,693
                                                    ----------------------------
                                                     359,848,068    329,883,550
  Properties in development (Notes C and D)           16,010,962     29,590,613
  Properties held for development or sale              3,288,171      3,587,610
                                                    ----------------------------
                                                     379,147,201    363,061,773

  Cash and cash equivalents                            2,602,202        109,686
  Notes and accounts receivable - tenants and other
     (Note E)                                          2,304,973      2,689,573
  Prepaid expenses and deposits                        3,270,013      2,991,645
  Deferred financing costs, net (Note F)               2,239,174      2,227,931
                                                    ----------------------------
                                                   $ 389,563,563    371,080,608
                                                    ============================

LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
  Accounts payable and accrued expenses (Note G)   $   9,269,339      7,332,902
  Notes payable (Note H)                              42,500,000     37,000,000
  Construction loans payable (Note C)                 24,387,289     20,258,948
  Mortgage payable (Note C)                          170,270,077    162,627,578
  Convertible subordinated debentures (Note I)         4,784,000     13,076,000
  Deferred income                                        938,596        491,096
                                                    ----------------------------
                                                     252,149,301    240,786,524
                                                    ----------------------------
Minority interest in consolidated joint ventures      32,819,374     36,608,643
                                                    ----------------------------

Shareholders' equity (Note K):

  Preferred shares of beneficial interest, $.01
    par value, authorized 2,000,000 shares, issued
    and outstanding, none                                    -               -
  Common shares of beneficial interest, $.01 par
    value, authorized 100,000,000 shares, issued
    and outstanding 15,103,221 and 13,810,162
    shares, respectively                                 151,032        138,102
  Additional paid-in capital                         138,267,358    125,088,309
  Distributions in excess of accumulated earnings    (33,823,502)   (31,540,970)
                                                    ----------------------------
                                                     104,594,888     93,685,441
                                                    ----------------------------

Commitments (Note L)                                ----------------------------
                                                   $ 389,563,563    371,080,608
                                                    ============================

See accompanying notes to consolidated financial statements.

                                      -14-

<PAGE>

<TABLE>
<CAPTION>

                   MID-ATLANTIC REATLY TRUST AND SUBSIDIARIES
                     Consolidated Statements of Operations

                                                                 Years ended December 31,
                                                           2001               2000         1999
----------------------------------------------------------------------------------------------------

REVENUES:
<S>                                                        <C>                <C>          <C>
   Minimum rents                                           $  50,633,183      46,680,656   43,082,458
   Percentage rents                                            1,640,027       1,588,771    1,380,690
   Tenant recoveries                                           9,709,503       8,883,947    8,287,459
   Other (Note O)                                                473,662         431,749      595,866
                                                           ------------------------------------------
                                                              62,456,375      57,585,123   53,346,473
                                                           ------------------------------------------

EXPENSES:
   Interest                                                   17,332,440      16,355,070   14,062,178
   Depreciation and amortization
     of property and improvements                             11,118,924      10,392,055    9,557,204
   Operating                                                  12,577,288      11,832,858   11,046,411
   General and administrative                                  3,237,545       2,859,809    2,739,079
                                                           ------------------------------------------
                                                              44,266,197      41,439,792   37,404,872
                                                           ------------------------------------------

EARNINGS FROM OPERATIONS
  BEFORE MINORITY INTEREST                                    18,190,178      16,145,331   15,941,601
Minority interest                                             (3,851,361)     (3,589,702)  (3,322,054)
                                                           ------------------------------------------
EARNINGS FROM OPERATIONS                                      14,338,817      12,555,629   12,619,547
Gain on properties (Note P)                                       20,212           -          131,611
                                                           ------------------------------------------

EARNINGS BEFORE EXTRAORDINARY GAIN                            14,359,029      12,555,629   12,751,158
Extraordinary gain from early extinguishment of debt               -             255,268        -
                                                           ------------------------------------------
NET EARNINGS                                               $  14,359,029      12,810,897   12,751,158
                                                           ==========================================

NET EARNINGS PER SHARE - BASIC (Note Q):
Earnings before extraordinary gain                         $        0.99            0.93         0.89
Extraordinary gain from early extinguishment of debt                  -               -            -
                                                           ------------------------------------------
Net earnings                                               $        0.99            0.93         0.89
                                                           ==========================================

NET EARNINGS PER SHARE - DILUTED (Note Q):
Earnings before extraordinary gain                         $        0.97            0.92         0.88
Extraordinary gain from early extinguishment of debt                  -               -            -
                                                           ------------------------------------------
Net earnings                                               $        0.97            0.92         0.88
                                                           ==========================================


See accompanying notes to consolidated financial statements.

                                      -15-


</TABLE>
<PAGE>
<TABLE>
<CAPTION>
                                            MID-ATLANTIC REALTY TRUST AND SUBSIDIARIES
                                          Consolidated Statements of Shareholders' Equity

                                           Years ended December 31, 2001, 2000 and 1999

                                                                                                        Distributions
                                                          Number of         Common       Additional      in Excess of      Net
                                                           Common           Shares at     Paid-in        Accumulated   Shareholders'
                                                           Shares           Par Value     Capital          Earnings       Equity
------------------------------------------------------------------------------------------------------------------------------------

<S>                                                       <C>              <C>          <C>              <C>            <C>
BALANCE, December 31, 1998                                14,495,045       $  144,950   131,368,001      (27,021,892)   104,491,059
Conversion of convertible subordinated debentures             65,235              652       670,365              -          671,017
Share purchase plan                                         (569,200)          (5,692)   (5,841,867)             -       (5,847,559)
Share-based compensation plans                                14,327              144       608,605              -          608,749
Dividends paid - $1.05 per share                                  -                -            -        (15,005,937)   (15,005,937)
Net earnings                                                      -                -            -         12,751,158     12,751,158
                                                         ---------------------------------------------------------------------------
BALANCE, December 31, 1999                                14,005,407          140,054   126,805,104      (29,276,671)    97,668,487
Conversion of convertible subordinated debentures             16,189              162       167,328              -          167,490
Share purchase plan                                         (283,800)          (2,838)   (2,683,296)             -       (2,686,134)
Share-based compensation plans                                53,073              531       576,802              -          577,333
Conversion of Operating Partnership Units                     19,293              193       222,371              -          222,564
Dividends paid - $1.0925 per share                                -                -            -        (15,075,196)   (15,075,196)
Net earnings                                                      -                -            -         12,810,897     12,810,897
                                                         ---------------------------------------------------------------------------
BALANCE, December 31, 2000                                13,810,162          138,102   125,088,309      (31,540,970)    93,685,441
Conversion of convertible subordinated debentures            789,709            7,897     8,185,171              -        8,193,068
Share-based compensation plans                               151,730            1,517     1,184,758              -        1,186,275
Conversion of Operating Partnership Units                    351,620            3,516     3,809,120              -        3,812,636
Dividends paid - $1.1425 per share                                -                -            -        (16,641,561)   (16,641,561)
Net earnings                                                      -                -            -         14,359,029     14,359,029
                                                         ---------------------------------------------------------------------------
BALANCE, December 31, 2001                                15,103,221       $  151,032   138,267,358      (33,823,502)   104,594,888
                                                         ===========================================================================

See accompanying notes to consolidated financial statements.
</TABLE>

                                      -16-

<PAGE>



<TABLE>
<CAPTION>

                                            MID-ATLANTIC REALTY TRUST AND SUBSIDIARIES
                                               Consolidated Statements of Cash Flows

                                                                                            Years ended December 31,
                                                                                   2001              2000            1999
--------------------------------------------------------------------------------------------------------------------------------
CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                                           <C>                <C>            <C>
  Net earnings                                                                $   14,359,029        12,810,897      12,751,158
  Adjustments to reconcile net earnings to net
   cash provided by operating activities:
    Extraordinary (gain) from early extinguishment of debt                              -             (255,268)            -
    Depreciation and amortization                                                 11,118,924        10,392,055       9,557,204
    Minority interest in earnings, net                                             3,851,361         3,589,702       3,322,054
    Amortization of deferred financing costs                                         545,313           398,195         315,828
    Changes in operating assets and liabilities:
      Decrease (increase) in assets                                                  106,232          (883,396)       (911,734)
      Increase (decrease) in liabilities                                           2,383,937           (87,673)       (101,255)
    Other, net                                                                       295,093           574,823         220,369
                                                                               --------------------------------------------------
    Total adjustments                                                             18,300,860        13,728,438      12,402,466
                                                                               --------------------------------------------------
         NET CASH PROVIDED BY OPERATING ACTIVITIES                                32,659,889        26,539,335      25,153,624
                                                                               --------------------------------------------------

CASH FLOWS FROM INVESTING ACTIVITIES:
  Acquisitions of and additions to properties                                    (27,283,646)      (44,909,584)    (17,205,063)
  Proceeds from sales of properties                                                  319,651              -               -
  Payments to minority partners                                                   (3,827,994)       (4,518,338)     (6,970,622)
                                                                               --------------------------------------------------
         NET CASH USED BY INVESTING ACTIVITIES                                   (30,791,989)      (49,427,922)    (24,175,685)
                                                                               --------------------------------------------------

CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from notes payable                                                    132,500,000       101,600,000      67,800,000
  Principal payments on notes payable                                           (127,000,000)      (92,100,000)    (58,700,000)
  Proceeds from mortgages payable                                                 12,000,000        37,855,500      25,300,000
  Principal payments on mortgages payable                                         (4,357,501)      (17,382,660)    (13,854,019)
  Proceeds from construction loans payable                                        14,815,033        11,258,948             -
  Deferred interest on construction loans payable                                    530,819               -               -
  Principal payments on construction loans payable                               (11,217,511)              -               -
  Deferred financing costs                                                          (605,617)         (620,063)     (1,133,621)
  Proceeds from exercise of share options                                            600,954               -               -
  Shares repurchased                                                                     -          (2,686,134)     (5,847,559)
  Dividends paid                                                                 (16,641,561)      (15,075,196)    (15,005,937)
  Other, net                                                                             -                 -               (32)
                                                                              ----------------------------------------------------
        NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES                             624,616        22,850,395      (1,441,168)
                                                                              ----------------------------------------------------

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                               2,492,516           (38,192)       (463,229)

CASH AND CASH EQUIVALENTS, beginning of year                                         109,686           147,878         611,107
                                                                              ----------------------------------------------------
CASH AND CASH EQUIVALENTS, end of year                                        $    2,602,202           109,686         147,878
                                                                              ====================================================

SUPPLEMENTAL DISCLOSURES OF CASH
  FLOW INFORMATION
  Interest paid                                                               $   16,913,863        15,617,469      13,746,350
                                                                              ====================================================

SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES
  Conversion of subordinated debentures, net of deferred
    financing costs                                                           $    8,193,140           167,515         671,051
  Conversion of Operating Partnership Units                                        3,812,636           222,564             -
  Mortgages payable assumed                                                              -           5,562,175             -
  Operating Partnership Units issued                                                     -             400,000       2,273,458
                                                                              ====================================================

See accompanying notes to consolidated financial statements.
</TABLE>

                                      -17-

<PAGE>

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2001, 2000 and 1999

A.  Summary of Significant Accounting Policies

Organization

Mid-Atlantic  Realty  Trust  was  incorporated  June  29,  1993,  and  commenced
operations effective with the completion of its initial public share offering on
September  11,  1993.  Mid-Atlantic  Realty  Trust  qualifies  as a real  estate
investment trust ("REIT") for Federal income tax purposes.  As used herein,  the
term "MART" or the "Company"  refers to  Mid-Atlantic  Realty Trust and entities
owned or controlled by MART,  including MART Limited Partnership (the "Operating
Partnership").

Description of Business

The Company is a fully  integrated,  self-administered  real  estate  investment
trust which owns, acquires, develops,  redevelops,  leases and manages primarily
neighborhood or community  shopping centers in the Middle Atlantic region of the
United States.

The Company has an equity interest in 39 operating shopping centers, 33 of which
are wholly  owned by the  Company  and six in which the  Company  has  ownership
interests ranging from 50% to 93%, as well as other commercial  properties.  The
Company also owns five  undeveloped  parcels of land totaling  approximately  78
acres, which it is holding for development or sale.

All of MART's  interests in properties  are held directly or indirectly  by, and
all of its  operations  relating to the properties  are conducted  through,  the
Operating  Partnership.  Subject to  certain  conditions,  units of  partnership
interest in the Operating  Partnership ("Units") may be exchanged by the limited
partners for cash or, at the option of MART,  the  obligation  may be assumed by
MART and paid either in cash or in common shares of beneficial  interest in MART
on a one-for-one  basis.  MART controls the  Operating  Partnership  as the sole
general partner, and owns approximately 82% of the Units at December 31, 2001.

Basis of Presentation

The preparation of financial statements in conformity with accounting principles
generally  accepted in the United States of America requires  management to make
estimates  and  judgments  that  affect  the  reported  amounts  of  assets  and
liabilities  and  disclosures  of  contingencies  at the  date of the  financial
statements  and revenues and expenses  recognized  during the reporting  period.
Actual results could differ from those estimates.

Principles of Consolidation

The consolidated  financial statements include all wholly owned subsidiaries and
majority-owned  partnerships,  including the Operating Partnership.  The Company
owns 100%  interests in  corporate  subsidiaries  which are general  partners in
several partnerships which have outside partners with 50% interests. Under terms
of the partnership  agreements,  the Company has control over the  partnerships,
including   acquisition,   leasing,   financing  and  sale   transactions   and,
accordingly, the Company uses the full consolidation method to account for them.
All significant  intercompany  balances and transactions have been eliminated in
consolidation.

Earnings Per Share

Basic earnings per share ("EPS") is computed by dividing  earnings  available to
common shareholders by the weighted average number of common shares outstanding.
Diluted EPS is computed  after  adjusting the numerator and  denominator  of the
basic EPS  computation for the effects of all dilutive  potential  common shares
outstanding  during the period.  The dilutive effects of convertible  securities
are  computed  using the  "if-converted"  method  and the  dilutive  effects  of
options,  warrants and their  equivalents  (including fixed awards and nonvested
shares  issued under  share-based  compensation  plans) are  computed  using the
"treasury stock" method.

Capitalization Policy

Acquisition, development and construction costs of properties in development are
capitalized including, where applicable, salaries and related costs, real estate
taxes  and  interest  costs.  Development  and  construction  costs and costs of
significant  improvements,  replacements and renovations to operating properties
are capitalized while costs of maintenance and repairs are expensed as incurred.
Direct costs  incurred in financing  transactions  are  capitalized  as deferred
costs and amortized to interest cost over the term of the related loan using the
interest method.  Initial direct costs incurred with respect to completed tenant
leases are deferred and amortized using the straight-line  method over the terms
of the related leases.

                                      -18-

<PAGE>
Properties
Properties to be developed or held and used in  operations  are carried at cost,
reduced for impairment  losses where  appropriate.  Properties held for sale are
carried  at the  lower of their  carrying  value  (i.e.  cost  less  accumulated
depreciation and any impairment loss recognized,  where applicable) or estimated
fair value less costs to sell. The net carrying  values of operating  properties
are  classified as properties  held for sale when senior  management  authorizes
their  disposition,  the Company  begins  marketing the  properties for sale and
various  other  criteria  for a plan of sale  are  met.  Depreciation  of  these
properties is discontinued at that time, but operating revenues, other operating
expenses and interest continue to be recognized until the date of sale.
     If events or circumstances indicate that the carrying value of an operating
property  to be held and used may be  impaired,  a  recoverability  analysis  is
performed based on estimated undiscounted future cash flows to be generated from
the  property.  If  the  analysis  indicates  that  the  carrying  value  is not
recoverable  from future cash flows,  the  property is written down to estimated
fair value and an impairment loss is recognized.
     Depreciation is computed using the straight-line  method over the estimated
useful lives of the related assets, as follows: Buildings and additions, 30 - 50
years; land improvements,  5 - 15 years;  tenant  improvements,  lesser of lease
term or asset useful lives; and furniture, fixtures and equipment, 3 - 10 years.

Revenue Recognition
Minimum rent revenues are generally recognized when due from tenants under terms
of the related leases. Revenues from tenant reimbursements of real estate taxes,
maintenance  and  insurance  costs  are  recognized  in the  period in which the
related  expense is  incurred.  Until  September  30,1999,  revenues  based on a
percentage  of  tenant's  sales in  excess  of  levels  specified  in the  lease
agreement were  estimated and accrued  ratably  throughout  the year.  Effective
October  1,1999,  the Company  changed its method of accounting  for  percentage
rents to  recognize  revenues  only when a tenant's  sales  actually  exceed the
specified  minimum level as required by Staff Accounting  Bulletin 101 - Revenue
Recognition.  This  change  did not  have a  material  effect  on the  financial
statements for 1999.

Share-based Compensation Plans
The Company uses the intrinsic value method to account for share-based  employee
compensation  plans.  Under this method,  compensation  cost is  recognized  for
awards of shares to  employees  only if the quoted  market price of the share at
the grant date (or other  measurement date, if later) is greater than the amount
the employee must pay to acquire the share. Information concerning the pro forma
effects on net earnings  and net earnings per share of using a fair  value-based
method to account for share-based  employee  compensation plans, rather than the
intrinsic value method, is provided in note K.

Income Taxes
The Company qualifies, and intends to continue to qualify, as a REIT pursuant to
Sections 856 through 860 of the Internal  Revenue Code of 1986,  as amended.  In
general, under such Code provisions a trust which has made the required election
and, in the taxable year,  meets certain  requirements  and  distributes  to its
shareholders  at least 90% of its REIT  taxable  income  will not be  subject to
Federal income tax to the extent of the income which it distributes.

Cash Equivalents
All highly liquid unrestricted  investments with maturities at dates of purchase
of three months or less are considered cash equivalents.

Financial Instruments
Fair values of financial  instruments  approximate  their carrying values in the
financial statements,  except for mortgages payable and convertible subordinated
debentures  for which  fair value  information  is  presented  in notes C and I,
respectively.  The fair values of this debt at December 31, 2001 and 2000,  were
determined based on quoted market prices for publicly traded debt and discounted
estimated  future  payments to be made for other debt.  The discount  rates used
approximate  the rates currently  offered for borrowings with similar  remaining
maturities.

B.  Operating Properties

Operating properties consist of the following:
                                                          December 31,

                                                 2001                2000
-------------------------------------------------------------------------------
Land                                          $  87,399,838          78,837,971
Land Improvements                                32,473,159          31,993,409
Buildings                                       268,101,954         241,556,479
Improvements for tenants                         16,204,784          15,988,843
Development costs on completed projects          12,998,167           9,476,127
Furnitures, fixtures and equipment                3,887,959           3,591,548
Deferred leasing costs                           20,247,727          18,874,866
                                               ---------------------------------
                                                441,313,588         400,319,243
Less accumulated depreciation and amortization   81,465,520          70,435,693
                                               ---------------------------------
                                              $ 359,848,068         329,883,550
                                               =================================
                                      -19-
<PAGE>


C. Properties and Related Accumulated Depreciation and Amortization and Debt
<TABLE>
<CAPTION>
A summary  of the  Company's  properties  and  related  mortgages  payable is as follows at December 31, 2001

                                                                                            Accumulated
                                                            Cost of                         Depreciation
                            Mortgages       Initial        Subsequent         Total             and
Classification               Payable         Cost         Improvements         Cost         Amortization        Net Cost
----------------------------------------------------------------------------------------------------------------------------
<S>                      <C>              <C>              <C>              <C>              <C>               <C>
Shopping centers         $  167,717,332     323,475,401     100,103,785       423,579,186      74,732,480        348,846,706
Bowling centers                     -         2,200,106          71,706         2,271,812       1,328,764            943,048
Office buildings              2,552,745       9,439,113       1,452,444        10,891,557       3,369,382          7,522,175
Other rental properties             -         2,040,071       1,117,876         3,157,947       1,107,690          2,050,257
Other property                      -           681,313         731,773         1,413,086         927,204            485,882
                         ---------------------------------------------------------------------------------------------------
Operating properties        170,270,077     337,836,004     103,477,584       441,313,588      81,465,520        359,848,068
Properties in development           -        16,010,962             -          16,010,962             -           16,010,962
Property held for
  development or sale               -         3,288,171             -           3,288,171             -            3,288,171
                         ---------------------------------------------------------------------------------------------------
                         $  170,270,077     357,135,137     103,477,584       460,612,721      81,465,520        379,147,201
                         ===================================================================================================
</TABLE>



Mortgages  payable at  December  31, 2001 bear  interest  at a weighted  average
effective  rate of 8.11% and  mature in  installments  through  2030.  Aggregate
annual  principal  payments  applicable  to mortgages  payable are as follows at
December 31, 2001

<TABLE>
<CAPTION>
<C>          <C>
2002         $ 10,147,979
2003           31,546,186
2004            2,799,794
2005            3,019,142
2006           21,942,650
Thereafter    100,814,326
             ------------
Total        $170,270,077
             ============
<FN>
At December 31, 2001 and 2000, the estimated fair values of mortgages payable were $178,546,000 and $160,046,000, respectively.
</FN>
</TABLE>

Construction loans payable consist of the following:
                                                         December 31,
                                                     2001          2000
--------------------------------------------------------------------------------
$9,000,000 loan payable in monthly installments,
  maturing in June 2004 and bearing
  interest at 7%                                   $ 8,888,921         9,000,000

$11,000,000 loan maturing September 2002 bearing
  interest at a variable rate based on LIBOR
  (3.58% at December 31, 2001)                      11,000,000         5,071,364

$11,000,000 loan repaid prior to maturity in
  November 2001                                            -           6,187,584

$9,490,000 loan maturing January 2004 bearing
  interest at a variable rate based on LIBOR
  (3.43% at December 31, 2001)                       4,498,368               -
                                                 -------------------------------
                                                   $24,387,289        20,258,948
                                                 ===============================

The loan maturing September 2002 was repaid in January 2002.

The loan maturing  January 2004  provides for  conversion to a fixed rate at the
option of the  Company  after  satisfying  certain  construction  and  operating
conditions.  The Company also has the option to extend the  maturity  date until
January 2007.


                                      -20-

<PAGE>
D. Properties in Development

Properties in development consist of the following:

                                   December 31,
                                  2001          2000
--------------------------------------------------------
Land                          $   538,528      7,641,434
Construction in progress       14,590,040     21,209,796
Preconstruction costs             882,394        739,383
                              --------------------------
                              $16,010,962     29,590,613
                              ==========================

Costs of completed  development  projects are transferred to operating  property
costs when the project is completed, at which time depreciation and amortization
commences.  Construction  period interest cost capitalized during 2001, 2000 and
1999 was approximately $940,000, $1,142,000 and $242,000, respectively.

E. Notes and Accounts Receivable

The Company performs credit  evaluations of prospective new tenants and requires
security deposits where appropriate.  Tenants'  compliance with the terms of the
leases  is  monitored  closely  and  the  allowance  for  doubtful  accounts  is
established  based on  management's  analysis  of the  risk of loss on  specific
tenants, historical trends, and other relevant information.  Management believes
adequate  provision  has  been  made  for  the  Company's  credit  risk  for all
receivables.

F. Deferred Financing Costs

Deferred financing costs consist of the following:

                                                   December 31,
                                                 2001             2000
--------------------------------------------------------------------------
Costs related to subordinated debentures      $  235,960          667,604
Costs related to line of credit                1,051,571          820,633
Costs related to operating properties' debt    3,449,881        3,017,103
                                              ----------------------------
                                               4,737,412        4,505,340
Less accumulated amortization                  2,498,238        2,277,409
                                              ----------------------------
                                              $2,239,174        2,227,931
                                              ============================

G. Accounts Payable and Accrued Expenses

Accounts payable and accrued expenses consist of the following:

                                                       December 31,
                                                   2001             2000
-----------------------------------------------------------------------------
Trade accounts payable                         $ 7,640,278          4,758,638
Retainage on construction in progress              423,400          1,212,080
Accrued interest on subordinated debentures        106,394            290,805
Other accrued expenses                           1,099,267          1,071,379
                                               ------------------------------
                                               $ 9,269,339          7,332,902
                                               ==============================
                                      -21-
<PAGE>
H. Notes Payable
Notes  payable  consist  of  line  of  credit   borrowings  of  $42,500,000  and
$37,000,000  at  December  31, 2001 and 2000,  respectively.  The Company has an
agreement  with its primary bank that provides for a $75,000,000  unsecured line
of  credit.  The  loan  maturity  date is April  2003.  The  agreement  contains
covenants which provide for the  maintenance of specified debt service  coverage
ratios, minimum levels of net worth, negative pledges concerning certain secured
financings,  and other  requirements,  among which is the  requirement  that the
Company  maintains  its status as a REIT.  The line bears  interest at the prime
rate (4.75% at December 31,  2001).  However,  the Company has the option to fix
the rate at LIBOR  plus  1.25%  for fixed  periods  from one to nine  months.  A
stand-by  fee is  required  by the bank for any unused  portion of the line.  At
December 31, 2001, the unused line of credit  available to the Company,  subject
to  compliance  with  all  terms  and  conditions  of the  agreement  and net of
outstanding letters of credit of $1,922,831, was $30,577,169.  The maximum level
of  borrowings  under  the  line of  credit  was  $51,000,000,  $54,000,000  and
$28,500,000  in 2001,  2000 and  1999,  respectively.  The  average  amounts  of
borrowings were approximately $43,252,000, $39,549,000 and $23,937,000, in 2001,
2000 and 1999, respectively,  with weighted average interest rates approximating
5.9%, 8.0% and 6.8%.

I. Convertible Subordinated Debentures
Effective  September 11, 1993,  the Company  issued  $60,000,000  of convertible
subordinated  debentures  at  7.625%  scheduled  to mature  in  September  2003.
Interest on the debentures is paid  semi-annually  on March 15 and September 15.
The debentures are convertible, unless previously redeemed, at any time prior to
maturity into common shares of beneficial  interest of the Company at $10.50 per
share,  subject to certain adjustments.  In 2001,  $8,292,000 in debentures were
converted to 789,709 common shares of beneficial interest.  In 2000, $170,000 in
debentures  were  converted to 16,189 common shares of beneficial  interest.  In
1999,  $685,000  in  debentures  were  converted  to  65,235  common  shares  of
beneficial  interest.  The balance of the  debentures,  at December 31, 2001, of
$4,784,000, if fully converted,  would produce an additional 455,619 shares. The
debentures  are  redeemable  by the Company at any time at 100% of the principal
amount thereof,  together with accrued interest.  The debentures are subordinate
to all mortgages  payable.  At December 31, 2001 and 2000,  the  estimated  fair
values of convertible  subordinated  debentures were $7,085,000 and $15,177,000,
respectively.

J.  Income Taxes
As discussed  in Note A, the Company  plans to maintain its status as a REIT and
be taxed  under  Sections  856-860  of the  Internal  Revenue  Code of 1986,  as
amended.  Accordingly,  no provision has been made for Federal income taxes.  At
December 31, 2001, the income tax bases of the Company's  assets and liabilities
were approximately $309,000,000 and $251,000,000, respectively.
     The net operating losses carried forward from December 31, 2001 for Federal
income tax purposes aggregate approximately $12,000,000 and will begin to expire
in 2006.
     In  connection  with its  election  to be taxed as a REIT,  the Company has
elected to be subject to the "built-in gain" rules. Under these rules, taxes may
be payable at the time and to the extent  that the net  unrealized  gains on the
Company's  assets at the date of  conversion  to REIT status are  recognized  in
taxable dispositions of such assets in the ten-year period following conversion.
This ten year period expires  September 2003. The remaining net unrealized gains
were approximately  $90,500,000 at December 31, 2001.  Management  believes that
the Company  will not be required  to make  payments of taxes on built-in  gains
throughout the ten-year period due to the availability of the net operating loss
carryforward  to  offset  built-in  gains  which  might  be  recognized  and the
potential  for  the  Company  to make  nontaxable  dispositions,  if  necessary.
Accordingly,  at December 31, 2001, no deferred tax liability for built-in gains
has been recognized. It may be necessary to recognize a liability for such taxes
in the  future  if  management's  plans and  intentions  with  respect  to asset
dispositions or the related tax laws change.

Following  is a  reconciliation  of the  Company's  net earnings to REIT taxable
income:
<TABLE>
<CAPTION>

                                                                      Years ended December 31,
                                                               2001              2000              1999
---------------------------------------------------------------------------------------------------------------
<S>                                                          <C>                 <C>               <C>
Net earnings                                                 $ 14,359,029        12,810,897        12,751,158
Book/tax difference on depreciation/amortization                 (667,518)          302,399           297,416
Net prepaid rental income                                         831,791           170,557           125,197
Book/tax difference on vested portion of restricted stock        (504,637)         (381,847)         (126,465)
Other differences, net                                            455,469           144,749          (323,610)
                                                             --------------------------------------------------

Taxable income before deduction for dividends paid             14,474,134        13,046,755        12,723,696

Dividends paid deduction                                      (16,641,562)      (15,075,196)      (15,005,937)
                                                             --------------------------------------------------
REIT taxable income (loss)                                   $ (2,167,428)       (2,028,441)       (2,282,241)
                                                             ==================================================

</TABLE>
                                      -22-
<PAGE>
K. Shareholders' Equity

Preferred Shares
At its  inception on September 11, 1993,  MART  authorized  2,000,000  preferred
shares of beneficial  interest at a par value of $.01 per share. At December 31,
2001, none of these shares were issued and outstanding.

Share-Based Compensation Plans
The Company has  established  a 1993 Omnibus  share plan and a 1995 share option
plan  ("Plans")  under which  trustees,  officers and  employees  may be granted
awards of share options,  share appreciation  rights,  performance shares and/or
restricted  shares.  The  purposes  of the  Plans  are to  provide  equity-based
incentive compensation based on long-term appreciation in value of MART's shares
and to promote the interests of the Company and its  shareholders by encouraging
greater management ownership of the Company's shares.
     Share options granted generally vest over a three-year  period,  subject to
certain  conditions,  typically have an exercise price equal to the market price
at the grant date and have a maximum  term of ten  years.  The  Company  has not
granted any share appreciation rights or performance shares.

Changes in options outstanding under the Plans are summarized as follows:

<TABLE>
<CAPTION>

                                                                       Years ended December 31,

                                                               2001                          2000                          1999
----------------------------------------------------------------------------------------------------------------------------------
                                                               Weighted                      Weighted                     Weighted
                                                                average                       average                      average
                                                               exercise                      exercise                     exercise
                                                 Options         price         Options         price       Options          price
----------------------------------------------------------------------------------------------------------------------------------
<S>                                              <C>          <C>             <C>           <C>            <C>            <C>
Balance at beginning of year                     845,335    $  11.03          529,600      $ 11.66         554,533       $ 11.61
Options granted                                    5,300       12.64          406,233        10.12               -             -
Options exercised                               (281,931)      10.17          (55,165)       10.09               -             -
Options canceled                                  (3,000)      10.00          (35,333)       11.47         (24,933)        10.58
                                               -----------------------------------------------------------------------------------
Balance at end of year                           565,704    $  11.47          845,335      $ 11.03         529,600       $ 11.66
                                               ===================================================================================
Options exercisable                              409,533    $  11.90          567,302      $ 11.45         529,600       $ 11.66
                                               -----------------------------------------------------------------------------------

Information about options outstanding at December 31, 2001 is summarized as follows:
</TABLE>
Exercise price               Options             Remaining life        Options
per share                 outstanding             (years)           Exercisable
--------------------------------------------------------------------------------
$  10.50                     94,000                  2.1              94,000
    8.94                     10,000                  3.8              10,000
    9.75                     10,000                  3.8              10,000
   13.38                    219,700                  5.9             219,700
   10.00                    197,504                  8.3              74,867
   11.50                     30,000                  8.8                 -
   11.90                      1,000                  9.3                 -
   13.00                      2,000                  9.5                 666
   12.85                      1,500                  9.7                 300
                          ------------------------------------------------------
                            565,704                                  409,533
                          ======================================================



The per share  weighted-average  fair values of options  granted during 2001 and
2000 were $0.97 and $1.52, respectively. These fair values were estimated on the
dates of each  grant  using  the  Black-Scholes  option-pricing  model  with the
following assumptions:

                               Years ended December 31,
                              2001             2000
--------------------------------------------------------
Risk-free interest rate       4.20%            5.04%
Dividend yield                9.29%            9.40%
Volatility factor            22.36%           21.64%
Life (years)                  3.27             3.00
--------------------------------------------------------
                                      -23-
<PAGE>

K. Shareholders' Equity (continued):

The option  prices were equal to the market  prices at the date of grant for all
of the options granted in 2001 and 2000,  accordingly,  no compensation cost was
recognized  for these  options in the financial  statements.  If the Company had
applied a fair value-based  method to recognize  compensation cost for all stock
options  issued after 1994, net earnings and net earnings per common share would
have been reduced as indicated below:

                                                  Years ended December 31,
                                       2001             2000          1999
--------------------------------------------------------------------------------
Net earnings:
  As reported                          $ 14,359,029     12,810,897    12,751,158
  Pro forma                              14,151,632     12,605,072    12,687,065
Net earnings per common share:
  Basic
    As reported                                0.99           0.93          0.89
    Pro forma                                  0.99           0.91          0.88
  Diluted
    As reported                                0.97           0.92          0.88
    Pro forma                                  0.96           0.90          0.88
================================================================================

Restricted Share Plan

In 1997,  the Executive  Compensation  Committee  recommended,  and the Board of
Trustees approved, a Restricted Share Plan. The Executive Compensation Committee
believes  that  the  grant of  restricted  share  awards  provides  a  long-term
incentive  to persons who  contribute  to the growth of MART and  establishes  a
direct link between compensation and shareholder return.

In 1997,  400,000  restricted  shares were made  available for the plan.  Awards
granted in 2001,  2000 and 1999  aggregated  8,741,  35,124  and 15,000  shares,
respectively,  with a weighted-average market value of $13.74, $11.18 and $10.38
per share,  respectively.  Shares awarded are subject to forfeiture restrictions
which  lapse  at  defined  annual  rates  to 2010,  subject  to the  recipients'
continued  employment with the Company.  The Company recognizes the amortization
of the fair value of the shares awarded as compensation  costs over the terms of
the awards.

Share Repurchase Plan

At December 31, 2001,  the Company was  authorized to repurchase up to 1,547,982
common shares of beneficial  interest (from a total  authorization  of 3,000,000
common shares of beneficial  interest)  pursuant to its share  repurchase  plan.
During 2001, the Company did not purchase shares.  In 2000 and 1999, the Company
purchased 283,800 and 569,200 shares, respectively, at an average per share cost
of $9.43 and $10.21, respectively. The excess of the purchase price over the par
value of shares repurchased is applied to reduce additional paid-in capital.

L. Commitments

The  Company  leases  the land  relating  to  certain  of its  properties  under
operating  leases expiring at various dates to 2052,  subject to renewal options
in most cases.  Minimum rental commitments under leases in effect as of December
31, 2001 are as follows:

2002             $     657,000
2003                   657,000
2004                   657,000
2005                   657,000
2006                   657,000
Thereafter          22,266,000
                 -------------
Total            $  25,551,000
                 =============

Certain of the leases contain purchase options and are subject to CPI increases.
All of the leases  require the Company to pay real estate  taxes.  Total  annual
minimum  lease  payments  amounted to $657,000  in 2001,  $651,000 in 2000,  and
$702,000 in 1999.
                                      -24-
<PAGE>
M. Leases

The Company's  shopping  centers and other  commercial  properties are generally
leased to tenants on a long-term  basis.  All leases are classified as operating
leases.  Future minimum lease payments receivable under noncancelable  operating
leases in effect as of December 31, 2001 are as follows:

2002            $   50,906,000
2003                48,323,000
2004                43,823,000
2005                39,357,000
2006                33,829,000
Thereafter      $  249,767,000
                --------------
Total           $  466,005,000
                ==============

The minimum future lease payments do not include contingent rentals which may be
paid under  certain  leases on the basis of a  percentage  of sales in excess of
stipulated   amounts.   Contingent  rentals  amounted  to  $1,640,000  in  2001,
$1,589,000 in 2000 and $1,381,000 in 1999. On a prospective  basis, no more than
4.4% of annual  rental  revenue is derived  from any one  tenant,  except  Royal
Ahold.  Royal Ahold minimum lease payments  represent  approximately 13% for the
years 2002 through 2006 and 28%  thereafter of the total minimum lease  payments
above.  The  percentage of total minimum lease payments in the years beyond 2006
is higher than in the prior  years due to the fact that Royal Ahold  leases have
long initial lease terms  compared with other major tenants which  generally use
renewal option terms.  Renewal option minimum lease payments are not included in
the totals above.

N. Segment Information

The Company's only reportable segment is Shopping Centers. This segment includes
the operation and  management of shopping  center  properties,  and revenues are
derived  primarily  from rents and  services to tenants.  These  properties  are
managed  separately  from the other property types owned by the Company  because
they require different operating strategies and management expertise.

The  accounting  policies of the  segments  are the same as those of the Company
described in Note A. Segment  operating  results are measured and assessed based
on a performance measure known as Funds from Operations ("FFO").  FFO is defined
as net earnings  (computed in accordance  with accounting  principles  generally
accepted  in the United  States of  America),  excluding  cumulative  effects of
changes in  accounting  principles,  extraordinary  items and gains or losses on
sales of properties,  plus depreciation and amortization,  and after adjustments
to record unconsolidated  partnerships and joint ventures on the same basis. FFO
is not a measure of operating results or cash flows from operating activities as
measured by generally  accepted  accounting  principles,  and is not necessarily
indicative of cash  available to fund cash needs and should not be considered an
alternative to cash flows as a measure of liquidity.

<TABLE>
<CAPTION>
Operating results for the segements are summarized as follows:
------------------------------------------------------------------------------------------------------------------------------------
                                                                      Years ended December 31,
                                         2001                                    2000                             1999
------------------------------------------------------------------------------------------------------------------------------------
                           Shopping       All                  Shopping          All                Shopping      All
                           Centers       Other       Total      Centers         Other     Total      Centers     Other      Total
------------------------------------------------------------------------------------------------------------------------------------
<S>                      <C>           <C>        <C>          <C>          <C>        <C>         <C>         <C>        <C>
Revenues                  $60,264,215  2,192,160  62,456,375    55,538,377  2,046,746  57,585,123  51,235,338  2,111,135  53,346,473

Expenses, exclusive of
  depreciation and
  amortization of property
  and improvements         32,287,821    859,452  33,147,273    30,203,756    843,981  31,047,737  26,958,271    889,397  27,847,668
Minority Interest           3,799,956     51,405   3,851,361     3,581,356      8,346   3,589,702   3,318,389      3,665   3,322,054
                         -----------------------------------------------------------------------------------------------------------
FFO                       $24,176,438  1,281,303  25,457,741    21,753,265  1,194,419  22,947,684  20,958,678  1,218,073  22,176,751
                         ===========================================================================================================
</TABLE>
                                      -25-
<PAGE>
N. Segment Information (continued):

A reconciliation of FFO to earnings from operations in the financial  statements
is summarized as follows:

                                            Years ended December 31,
                                        2001         2000          1999
-----------------------------------------------------------------------------
FFO                                  $ 25,457,741    22,947,684    22,176,751
   Depreciation and
   amortization of
   property and
   improvements                        11,118,924    10,392,055     9,557,204
                                  -------------------------------------------
Earnings from operations             $ 14,338,817    12,555,629    12,619,547
                                  ===========================================


Substantially  all assets of the Company,  with the exception of properties held
for  development  or sale and cash and cash  equivalents,  are  allocable to the
Shopping  Center  segment.  Additions to  long-lived  assets of the segments are
summarized as follows:

                                             Years ended December 31,
                                     2001           2000          1999
-----------------------------------------------------------------------------
Shopping Centers:
   Acquisitions                   $  10,849,901   16,786,510       10,602,882
   Development                       13,438,600   33,462,826        6,491,855
   Improvements for tenants
      and others                      3,339,186    1,807,478        2,614,639
                                  -------------------------------------------
                                     27,627,687   52,056,814       19,709,376
                                  -------------------------------------------

All others                               24,642      113,091          113,910
                                  -------------------------------------------
Total                             $  27,652,329   52,169,905       19,823,286
                                  ===========================================



O. Other Revenues

Other revenues consists of the following:

                                  Years ended December 31,
                              2001        2000              1999
----------------------------------------------------------------------
Interest and dividends     $ 125,217      162,988           115,320
Miscellaneous                348,445      268,761           480,546
                           -------------------------------------------
                           $ 473,662      431,749           595,866
                           ===========================================




P. Gain on Properties

Gain on properties consists of the following:

                                                   Years ended December 31,
                                                   2001      2000       1999
--------------------------------------------------------------------------------
Gain on sales of operating properties           $    -          -       131,611

Gain on sales of properties held for
   development or sale, net                        20,212       -          -
                                                --------------------------------
                                                $  20,212       -       131,611
                                                ================================


The gain on sales of properties  held for development or sale for 2001 is due to
the sale of land.  The gain on  sales of  operating  properties  for 1999 is due
primarily  to the  final  resolution  of  contingencies  in the sale  agreements
relating to properties sold in 1997.

                                      -26-
<PAGE>


Q. Earnings Per Share
<TABLE>
<CAPTION>
The following table sets forth information  relating to the computation of basic and diluted earnings per share:


                                                                                             Years Ended December 31,

                                                                                      2001           2000          1999
------------------------------------------------------------------------------------------------------------------------------

<S>                                                                                   <C>            <C>           <C>
Numerator:
  Earnings before extraordinary gain                                                  $ 14,359,029   12,555,629    12,751,158
    Dividends on unvested restricted share awards                                         (285,959)    (288,102)    (294,038)
                                                                                      ----------------------------------------
  Numerator for basic earnings per share--earnings available to common shareholders     14,073,070   12,267,527   12,457,120
    Interest on subordinated debentures                                                    538,283    1,072,636    1,111,858
                                                                                      ----------------------------------------
  Numerator for diluted earnings per share--earnings available to common shareholders $ 14,611,353   13,340,163   13,568,978
                                                                                      ========================================

Denominator:(1)
  Denominator for basic earnings per share--weighted average shares outstanding         14,268,487   13,538,886   14,021,403
  Effect of dilutive securities:
    Debentures                                                                             692,559    1,257,514    1,306,079
    Unvested portion of restricted share awards and share options                           49,264        9,804       10,170
                                                                                       ---------------------------------------
  Denominator for diluted earnings per share--adjusted weighted average shares          15,010,310   14,806,204   15,337,652
                                                                                       =======================================

<FN>

     (1)  Effects of  potentially  dilutive  securities  are  presented  only in
periods in which they are  dilutive.  At  December  31,  2001,  the  convertible
subordinated  debentures,  if converted,  would  produce an  additional  455,619
shares and the Units,  if  exchanged,  would  produce  an  additional  3,036,327
shares.
</FN>
</TABLE>

ITEM 9 -  CHANGES  IN AND  DISAGREEMENTS  WITH  ACCOUNTANTS  ON  ACCOUNTING  AND
          FINANCIAL DISCLOSURE

None.


                                      -27-
<PAGE>


PART III

ITEM 10 - TRUSTEES AND EXECUTIVE OFFICERS OF THE REGISTRANT

The  information  with respect to the identity  and business  experience  of the
trustees of MART and their  remuneration,  in the definitive proxy statement (to
be filed pursuant to Regulation 14A) with respect to the election of trustees at
the 2002 annual meeting of shareholders, is incorporated herein by reference.

  The Executive Officers of MART are as follows:

Name              Age        Position and Business Experience
--------------------------------------------------------------------------------
LeRoy E.          76         Chairman of the Board of MART since September 1993.
Hoffberger

F. Patrick        54         President and CEO of MART since September 1993.
Hughes

Paul F.           48         Executive Vice President of MART since March 1996.
Robinson                     Vice President and Secretary/General Counsel of
                             MART since September 1993.

Eugene T.         53         Treasurer of MART since September 1993.
Grady

Deborah R. Cheek  42         Controller of MART since October 2001.

                             Assistant Controller of MART from March 2000 to
                             September 2001.

                             Controller of Insurance Buyers' Council, Inc. from
                             March 1987 to February 2000.

Each executive officer is elected for a term expiring at the next regular annual
meeting of the Board of Trustees of the Company or until  his/her  successor  is
duly elected and qualified.


                                      -28-
<PAGE>
ITEM 11 - EXECUTIVE COMPENSATION
The  information  required by this item is  incorporated  by reference  from the
Registrant's Proxy Statement to be filed with respect to the 2002 annual meeting
of shareholders.

ITEM 12 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The  information  required by this item is  incorporated  by reference  from the
Registrant's Proxy Statement to be filed with respect to the 2002 annual meeting
of shareholders.

ITEM 13 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The  information  required by this item is  incorporated  by reference  from the
Registrant's Proxy Statement to be filed with respect to the 2002 annual meeting
of shareholders.

PART IV

ITEM 14 - EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

(a)      1.  Financial Statements
The following financial statements of Mid-Atlantic Realty Trust and Subsidiaries
are included in Part II Item 8:

     Independent auditor's report
     Consolidated balance sheets as of December 31, 2001 and 2000
     Consolidated  statements  of  operations  for the years ended  December 31,
        2001, 2000 and 1999
     Consolidated  statements  of  shareholders'  equity  for  the  years  ended
        December 31, 2001, 2000 and 1999
     Consolidated  statements  of cash flows for the years  ended  December  31,
        2001, 2000 and 1999
     Notes to consolidated financial statements

(a)      2.  Financial Statement Schedule
Schedule III - Real estate and accumulated depreciation and amortization
All  other  schedules  are  omitted  because  they  are not  applicable,  or not
required,  or because the required  information is included in the  consolidated
financial statements or notes thereto.

(a)      3.  Exhibits
Exhibit No.
     3(a) Declaration of Trust dated June 29, 1993 (incorporated by reference to
          Exhibit 3(a) to MART's  Registration  Statement on Form S-11, File No.
          33-66386).
     3(b) By-laws   (incorporated   by  reference  to  Exhibit  3(b)  to  MART's
          Registration Statement on Form S-11, File No. 33-66386).
     3(c) Amendment to Declaration  of Trust dated August 4, 1998  (incorporated
          by reference to Exhibit 3(c) to MART's  Annual Report on Form 10-K for
          the year ended December 31, 1998).
     4(a) Specimen   certificate  for  Common  Shares  of  Beneficial   Interest
          (incorporated  by  reference  to Exhibit  4(a) to MART's  Registration
          Statement on Form S-11, File No. 33-66386).
     4(b) Trust  Indenture  dated  September 8, 1993,  between MART and Security
          Trust  Company,  N.A.  (incorporated  by  reference to Exhibit 4(b) to
          MART's Registration Statement on Form S-11, File No. 33-66386).
     10(a)Mid-Atlantic  Realty Trust 1993 Omnibus Share Plan, as amended through
          November  14, 1997  (incorporated  by  reference  to Exhibit  10(a) to
          MART's  Annual  Report on Form 10-K for the year  ended  December  31,
          1997).
     10(b)Mid-Atlantic  Realty  Trust 1995 Stock  Option Plan  (incorporated  by
          reference  to MART's  Registration  Statement  on Form  S-8,  File No.
          333-12161).
     10(c)Employment  Agreement  between BTR Realty,  Inc. and F. Patrick Hughes
          (incorporated  by  reference to Exhibit  10(b) to MART's  Registration
          Statement on Form S-11, File No. 33-66386).
     10(d)Employment  Agreement  between  Paul  F.  Robinson   (incorporated  by
          reference to Exhibit  10(c) to MART's  Registration  Statement on Form
          S-11, File No. 33-66386).
     10(e)Amendment dated December 1, 1995 to Employment  Agreement between MART
          and F. Patrick Hughes and MART and Paul F. Robinson  (incorporated  by
          reference to Exhibit  10(e) to MART's  Annual  Report on Form 10-K for
          the year ended December 31, 1995).
     10(f)Commitment  Letter from First  National Bank of Md. for Line of Credit
          to  MART  (incorporated  by  reference  to  Exhibit  10(d)  to  MART's
          Registration Statement on Form S-11, File No.33-66386).
     10(f)(1)  Financing  Agreement  dated April 23, 1999  between  MART and the
          Named Banks  (incorporated  by  reference  to Exhibit  10(1) to MART's
          Quarterly Report on Form 10-Q for the quarter ended March 31, 1999).
     10(g)Agreement for  Contribution  of Interests  dated April 1, 1997,  among
          MART and the Contributors named therein  (incorporated by reference to
          Exhibit (c) 1 to Form 8-K filed July 15, 1997).
     10(h)Agreement of Limited  Partnership of MART Limited Partnership dated as
          of June 30, 1997  (incorporated  by reference to Exhibit (c) 2 to Form
          8-K filed July 15, 1997).
     10(i)Partnership Purchase and Sale Agreement among BTR Gateway, Inc., MART,
          and Prentiss Properties  Acquisition,  L.P. (incorporated by reference
          to Exhibit (b) 1 to Form 8-K filed September 30, 1997).

                                      -29-
<PAGE>

(a) Exhibits (continued)

     10(j)Mid-Atlantic  Realty Trust Restricted Share Plan,  adopted on November
          14, 1997. (incorporated by reference to Exhibit 10(j) to MART's Annual
          Report on Form 10-K for the year ended December 31, 1997).
     10(k)Mid-Atlantic Realty Trust Non-Employee  Trustee Deferred  Compensation
          Plan,  adopted on November  14,  1997.  (incorporated  by reference to
          Exhibit  10(k) to MART's Annual Report on Form 10-K for the year ended
          December 31, 1997).
     10(l)Financing agreement dated April 23,1999 with named banks (incorporated
          by reference to Exhibit 10.1 to MART's  quarterly  report on Form 10-Q
          for the quarter ended March 31, 1999).
     12   Computation of Ratio of Earnings to Fixed Charges.*
     21   Subsidiaries of the Registrant.*
     23   Consent of KPMG LLP.*
     99.1 Real Estate Investment Risks.

*Filed herewith


(b) Reports on Form 8-K

Form 8-K filed March 5, 2002  reporting  selected  financial  information  under
Items 5 and 7.


                                      -30-

<PAGE>
<TABLE>
<CAPTION>

MID-ATLANTIC REALTY TRUST AND SUBSIDIARIES
Schedule III - Real Estate and Accumulated Depreciation

December 31, 2001                               Initial cost to Company                  Cost capitalized subsequent to acquisition
                             Mortgages                   Building and                                              Carrying Costs
Description                  Payable              Land     Improvement           Improvements        Land           Improvements
------------------------------------------------------------------------------------------------------------------------------------

Shopping Centers
<S>                         <C>                <C>            <C>               <C>             <C>                   <C>
Arundel Plaza             $ 11,481,761         1,695,566        530,951           6,262,612       1,843,683            -
Brandywine Commons              -                 -          12,164,821              69,421           -                -
Burke Town Plaza                -                 -           2,936,134           4,403,259           -                -
Club Centre                  5,106,543         2,029,919      3,600,663             111,330           -                -
Colonie Plaza                   -              1,137,567      7,755,095             817,762           -                -
Columbia Plaza                  -                999,739      6,887,711           4,030,126         203,353            -
Del Alba                     6,972,825         2,270,000      7,882,217              36,690           -                -
Enchanted Forest            10,998,173         3,873,246     15,314,736             420,060           -                -
Fullerton Plaza                 -              2,704,763      5,707,164              20,953           -                -
Glen Burnie Village             -              3,081,554      4,598,794           1,099,301           -                -
Harford Mall                18,534,076           599,031      8,457,331          29,429,082        (12,954)            -
Ingleside                   12,445,970         3,023,230     11,817,212             173,278           -                -
Little Glen                     -                 -              -                  104,574           -                -
Lutherville Station             -                 -           4,031,809          14,466,727           -                -
Milford Commons                 -                673,306      3,789,682              42,293           -                -
New Town Village            12,245,502         4,381,666      9,547,434             220,900           -                -
North East                      -                 -              -                5,950,311       2,687,905            -
Patriots Plaza                  -                 -           1,709,846             690,471           -                -
Perry Hall Square            5,697,406         3,538,824      6,604,216             886,486           -                -
Pottstown Plaza                 -              3,600,000      7,249,901                 -             -                -
Radcliffe Center                -             11,205,665      5,663,480             106,661           -                -
Rolling Road Plaza              -                338,791      1,632,268           2,289,020           -            (837,931)
Rosedale Plaza                  -              1,024,712      3,217,926           5,339,708           -                -
Saucon Valley Square         8,311,388            -           4,560,182           1,763,343      4,292,700             -
Security Square             11,992,945         1,477,199     10,335,676                 -             -                -
Shawan Plaza                13,251,478         2,055,695     13,930,839             245,351           -                -
Shoppes at Easton            7,203,139         2,600,000     10,379,069              69,876           -                -
Skyline Village              4,345,741           555,295      6,240,003           1,158,717           -                -
Smoketown Plaza                 -                516,312     10,095,077             800,742           -                -
Spotsylvania Crossing           -              1,544,314      6,600,616             441,551           -                -
Stonehedge Square            5,459,259         1,151,500      7,202,742              26,649           -                -
Sudley Towne Plaza              -                789,881      3,736,837             538,297           -                -
Timonium Crossing            5,452,337         4,276,779      4,792,548             262,389           -                -
Timonium Shopping Center    10,751,755         6,252,248     12,090,955           1,125,246           -                -
Waverly Woods                   -              3,484,670      7,998,007                 -             -                -
Wayne Heights                   -              1,546,720      3,837,159             179,482           -                -
Wayne Plaza                  8,919,145         1,650,300      9,230,960             909,849           -                -
Wilkens Beltway Plaza          397,158            -           3,601,891           4,082,216        475,481             -
York Road Plaza              8,150,731         1,562,382      2,102,575           2,876,815           -                -
                          ----------------------------------------------------------------------------------------------------------
                           167,717,332        75,640,874    247,834,527          91,451,548      9,490,168         (837,931)
                          ----------------------------------------------------------------------------------------------------------
Office Buildings
Orchard Square               2,552,745         1,160,666      2,959,390             210,493           -                -
Partiots Office                   -                 -         1,522,943             315,221           -                -
Wilkens Office I                  -                 -         1,383,102             396,567           -                -
Wilkens Office II                 -                 -         1,644,370             301,457           -                -
Wilkens Office III                -                 -           768,642             228,706           -                -
                          ----------------------------------------------------------------------------------------------------------
                             2,552,745         1,160,666      8,278,447           1,452,444           -                -
                          ----------------------------------------------------------------------------------------------------------
Bowling Centers
Clinton                           -                 -           457,764              63,297           -                -
Freestate                         -              180,025        740,082               2,719           -                -
Waldorf                           -              243,139        579,096               5,690           -                -
                          ----------------------------------------------------------------------------------------------------------
                                  -              423,164      1,776,942              71,706           -                -
                          ----------------------------------------------------------------------------------------------------------
Other Rental Properties
Harford Business Center           -              395,536       1,190,692            149,373        235,022             -
Southwest                         -                -             283,039            674,511         45,149             -
Waldorf Firestone                 -                9,261         161,543             13,821           -                -
                          ----------------------------------------------------------------------------------------------------------
                                  -              404,797       1,635,274            837,705        280,171             -
                          ----------------------------------------------------------------------------------------------------------
Properties in Development         -                -          16,010,962                -              -               -
                          ----------------------------------------------------------------------------------------------------------
Properties Held For               -            3,288,171            -                   -              -               -
  Development or Sale     ----------------------------------------------------------------------------------------------------------
Other Property                    -                -             681,313            731,773            -               -
                          ----------------------------------------------------------------------------------------------------------
                          $ 170,270,077       80,917,672     276,217,465         94,545,176      9,770,339         (837,931)
                          ----------------------------------------------------------------------------------------------------------
</TABLE>
                                      -31-
<PAGE>
MID-ATLANTIC REALTY TRUST AND SUBSIDIARIES
Schedule III - Real Estate and Accumulated Depreciation - (Continued)
<TABLE>
<CAPTION>

December 31, 2001
                         Amount at which carried at close of period                                           Life on which deprec.
                                        Buildings and              Accumulated     Date of          Date        on latest income
Description                  Land       improvements     Total     depreciation    construction    acquired   statement is computed
------------------------------------------------------------------------------------------------------------------------------------
Shopping Centers

<S>                    <C>             <C>            <C>          <C>             <C>             <C>             <C>
Arundel Plaza          $  3,539,249       6,793,563    10,332,812      776,846                       12/97           5-50 yrs.
Brandywine Commons              -        12,234,242    12,234,242    2,564,440                       11/95           5-50 yrs.
Burke Town Plaza                -         7,339,393     7,339,393    2,483,894       7/79-7/82                       5-50 yrs.
Club Centre               2,029,919       3,711,993     5,741,912      998,743                        7/97           5-50 yrs.
Colonie Plaza             1,137,567       8,572,857     9,710,424    3,230,420         12/87                         5-50 yrs.
Columbia Plaza            1,203,092      10,917,837    12,120,929    3,371,294          6/88                         5-50 yrs.
Del Alba                  2,270,000       7,918,907    10,188,907      536,972                        9/98           5-50 yrs.
Enchanted Forest          3,873,246      15,734,796    19,608,042    2,499,491                        7/97           5-50 yrs.
Fullerton Plaza           2,704,763       5,728,117     8,432,880      201,448                        3/00           5-50 yrs.
Glen Burnie Village       3,081,554       5,698,095     8,779,649      809,565                        7/97           5-50 yrs.
Harford Mall                586,077      37,886,413    38,472,490   16,126,020         12/73                         5-50 yrs.
Ingleside                 3,023,230      11,990,490    15,013,720    1,392,335                        7/97           5-50 yrs.
Little Glen                     -           104,574       104,574       68,040                        7/97           5-50 yrs.
Lutherville Station             -        18,498,536    18,498,536    2,056,876                       10/93           5-50 yrs.
Milford Commons             673,306       3,831,975     4,505,281      330,860                       12/97           5-50 yrs.
New Town Village          4,381,666       9,768,334    14,150,000    1,383,580         12/95                         5-50 yrs.
North East                2,687,905       5,950,311     8,638,216      525,424          2/96-                        5-50 yrs.
Patriots Plaza                  -         2,400,317     2,400,317    1,187,619          6/84                         5-50 yrs.
Perry Hall Square         3,538,824       7,490,702    11,029,526    2,828,519                        7/97           5-50 yrs.
Pottstown Plaza           3,600,000       7,249,901    10,849,901       47,838                       10/01           5-50 yrs.
Radcliffe Center         11,205,665       5,770,141    16,975,806    2,194,928                        7/97           5-50 yrs.
Rolling Road Plaza          338,791       3,083,357     3,422,148    1,563,049          6/73                         5-50 yrs.
Rosedale Plaza            1,024,712       8,557,634     9,582,346    1,566,436                       10/89           5-50 yrs.
Saucon Valley Square      4,292,700       6,323,525    10,616,225      328,322                        3/99           5-50 yrs.
Security Square           1,477,199      10,335,676    11,812,875      239,460          5/00                         5-50 yrs.
Shawan Plaza              2,055,695      14,176,190    16,231,885    3,043,324                        7/97           5-50 yrs.
Shoppes at Easton         2,600,000      10,448,945    13,048,945    1,680,107                        9/94           5-50 yrs.
Skyline Village             555,295       7,398,720     7,954,015    2,804,689          5/88                         5-50 yrs.
Smoketown Plaza             516,312      10,895,819    11,412,131    4,120,764          4/87                         5-50 yrs.
Spotsylvania Crossing     1,544,314       7,042,167     8,586,481    2,711,602          5/87                         5-50 yrs.
Stonehedge Square         1,151,500       7,229,391     8,380,891      259,150                       3/00            5-50 yrs.
Sudley Towne Plaza          789,881       4,275,134     5,065,015    1,837,050          7/84                         5-50 yrs.
Timonium Crossing         4,276,779       5,054,937     9,331,716      923,684                       7/97            5-50 yrs.
Timonium Shopping Center  6,252,248      13,216,201    19,468,449    1,814,643                       7/97            5-50 yrs.
Waverly Woods             3,484,670       7,998,007    11,482,677      192,227          4/00                         5-50 yrs.
Wayne Heights             1,546,720       4,016,641     5,563,361      353,557                       1/98            5-50 yrs.
Wayne Plaza               1,650,300      10,140,809    11,791,109      846,651                       2/98            5-50 yrs.
Wilkens Beltway Plaza       475,481       7,684,107     8,159,588    2,330,714          5/81                         5-50 yrs.
York Road Plaza           1,562,382       4,979,390     6,541,772    2,501,899                      11/85            5-50 yrs.
                        ------------------------------------------------------------------------------------------------------------
                         85,131,042     338,448,144   423,579,186   74,732,480
                        ------------------------------------------------------------------------------------------------------------
Office Buildings
Orchard Square            1,160,666       3,169,883     4,330,549      671,203                       7/97            5-50 yrs.
Patriots Office                 -         1,838,164     1,838,164      774,080          8/85                         5-50 yrs.
Wilkens Office I                -         1,779,669     1,779,669      818,878          1/85                         5-50 yrs.
Wilkens Office II               -         1,945,827     1,945,827      766,421          1/87                         5-50 yrs.
Wilkens Office III              -           997,348       997,348      338,800          1/91                         5-50 yrs.
                        ------------------------------------------------------------------------------------------------------------
                          1,160,666       9,730,891    10,891,557    3,369,382
                        ------------------------------------------------------------------------------------------------------------
Bowling Centers
Clinton                         -           521,061       521,061      333,866          8/71                         5-50 yrs.
Freestate                   180,025         742,801       922,826      706,698          3/78                         5-50 yrs.
Waldorf                     243,139         584,786       827,925      288,200          3/79                         5-50 yrs.
                        ------------------------------------------------------------------------------------------------------------
                            423,164       1,848,648     2,271,812    1,328,764
                        ------------------------------------------------------------------------------------------------------------
Other Rental Properties
Harford Business Center     630,558       1,340,065     1,970,623      428,039          4/90                         5-50 yrs.
Southwest                    45,149         957,550     1,002,699      597,889          4/68                         5-50 yrs.
Waldorf Firestone             9,261         175,364       184,625       81,762          9/78                         5-50 yrs.
                        ------------------------------------------------------------------------------------------------------------
                            684,968       2,472,979     3,157,947    1,107,690
                        ------------------------------------------------------------------------------------------------------------
Properties in Development       -        16,010,962    16,010,962          -          Various
                        ------------------------------------------------------------------------------------------------------------
Properties Held For       3,288,171             -       3,288,171          -
  Development or Sale   ------------------------------------------------------------------------------------------------------------
Other Property                  -         1,413,086     1,413,086      927,204                       9/82-12/98      3-10 yrs.
                        ------------------------------------------------------------------------------------------------------------
                        $90,688,011     369,924,710   460,612,721   81,465,520
                        ============================================================================================================
</TABLE>
                                      -32-
<PAGE>


MID-ATLANTIC REALTY TRUST AND SUBSIDIARIES
Schedule III - Real Estate and Accumulated Depreciation - (Continued)

(1) The changes in total cost of properties are as follows:

                                               Year ended December 31,
                                       2001             2000             1999
--------------------------------------------------------------------------------
Balance beginning of year        $ 433,497,466       381,716,196    361,892,910
Additions during year.
  Acquisitions                      10,849,901        16,786,510     10,602,882
  Improvements                       3,363,828         1,920,569      2,728,549
  Development operations            13,438,600        33,462,826      6,491,855
                                 -----------------------------------------------
                                    27,652,329        52,169,905     19,823,286
                                 -----------------------------------------------
Deductions during year.
  Cost of real estate sold            (299,439)              -              -
  Retirements and disposals           (237,635)         (388,635)           -
                                 -----------------------------------------------
                                      (537,074)         (388,635)           -
                                 -----------------------------------------------

                                 -----------------------------------------------
Balance end of year              $ 460,612,721       433,497,466    381,716,196
                                 -----------------------------------------------


(2)  The changes in accumulated depreciation are as follows:


                                               Year ended December 31,
                                       2001             2000             1999
--------------------------------------------------------------------------------
Balance beginning of year        $ (70,435,693)      (60,097,298)   (50,540,094)
Depreciation and amortization      (11,118,924)      (10,392,055)    (9,557,204)
Retirements, disposals and sales        89,097            53,660            -
                                 -----------------------------------------------
Balance end of year              $ (81,465,520)      (70,435,693)   (60,097,298)


(3)  The  aggregate  cost of  properties  for  Federal  income tax  purposes  is
     approximately $422,000,000 at December 31, 2001.

(4)  See Item 2 for geographic location of properties.

(5)  Freestate includes one bowling center in Illinois.

                                      -33-

<PAGE>


                                   SIGNATURES

Pursuant to the  requirements  of Section 13 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.

                                    MID-ATLANTIC REALTY TRUST

Date:  3/05/02                     /s/ F. Patrick Hughes
       ----------------------      ---------------------------------------------
                                   F. Patrick Hughes, President and
                                   Chief Executive Officer



                                   Signatures

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

Date:    3/05/02                    /s/ LeRoy E. Hoffberger
         ---------------------      --------------------------------------------
                                    LeRoy E. Hoffberger, Chairman


Date:    3/05/02                    /s/ F. Patrick Hughes
         ---------------------      --------------------------------------------
                                    F. Patrick Hughes, President and Chief
                                    Executive Officer, Trustee


Date:    3/05/02                    /s/ Eugene T. Grady
         ---------------------      --------------------------------------------
                                    Eugene T. Grady, Treasurer


Date:    3/05/02                    /s/ Deborah R. Cheek
         ---------------------      --------------------------------------------
                                    Deborah R. Cheek, Controller


Date:    3/05/02                    /s/ David F. Benson
         ---------------------      --------------------------------------------
                                    David F. Benson, Trustee


Date:    3/05/02                    /s/ Marc P. Blum
         ---------------------      --------------------------------------------
                                    Marc P. Blum, Trustee


Date:    3/05/02                    /s/ Robert A. Frank
         ---------------------      --------------------------------------------
                                    Robert A. Frank, Trustee


Date:    3/05/02                    /s/ M. Ronald Lipman
         ---------------------      --------------------------------------------
                                    M. Ronald Lipman, Trustee


Date:    3/05/02                    /s/ Daniel S. Stone
         ---------------------      --------------------------------------------
                                    Daniel S. Stone, Trustee


                                      -34-
<PAGE>

                                 EXHIBIT INDEX

Exhibit No.     Description
     3(a) Declaration of Trust dated June 29, 1993 (incorporated by reference to
          Exhibit 3(a) to MART's  Registration  Statement on Form S-11, File No.
          33-66386).
     3(b) By-laws   (incorporated   by  reference  to  Exhibit  3(b)  to  MART's
          Registration Statement on Form S-11, File No. 33-66386).
     3(c) Amendment to Declaration  of Trust dated August 4, 1998  (incorporated
          by reference to Exhibit 3(c) to MART's  Annual Report on Form 10-K for
          the year ended December 31, 1998).
     4(a) Specimen   certificate  for  Common  Shares  of  Beneficial   Interest
          (incorporated  by  reference  to Exhibit  4(a) to MART's  Registration
          Statement on Form S-11, File No. 33-66386).
     4(b) Trust  Indenture  dated  September 8, 1993,  between MART and Security
          Trust  Company,  N.A.  (incorporated  by  reference to Exhibit 4(b) to
          MART's Registration Statement on Form S-11, File No. 33-66386).
     10(a)Mid-Atlantic  Realty Trust 1993 Omnibus Share Plan, as amended through
          November  14, 1997  (incorporated  by  reference  to Exhibit  10(a) to
          MART's  Annual  Report on Form 10-K for the year  ended  December  31,
          1997).
     10(b)Mid-Atlantic  Realty  Trust 1995 Stock  Option Plan  (incorporated  by
          reference  to MART's  Registration  Statement  on Form  S-8,  File No.
          333-12161).
     10(c)Employment  Agreement  between BTR Realty,  Inc. and F. Patrick Hughes
          (incorporated  by  reference to Exhibit  10(b) to MART's  Registration
          Statement on Form S-11, File No. 33-66386).
     10(d)Employment  Agreement  between  Paul  F.  Robinson   (incorporated  by
          reference to Exhibit  10(c) to MART's  Registration  Statement on Form
          S-11, File No. 33-66386).
     10(e)Amendment dated December 1, 1995 to Employment  Agreement between MART
          and F. Patrick Hughes and MART and Paul F. Robinson  (incorporated  by
          reference to Exhibit  10(e) to MART's  Annual  Report on Form 10-K for
          the year ended December 31, 1995).
     10(f)Commitment  Letter from First  National Bank of Md. for Line of Credit
          to  MART  (incorporated  by  reference  to  Exhibit  10(d)  to  MART's
          Registration Statement on Form S-11, File No.33-66386).
     10(f)(1)  Financing  Agreement  dated April 23, 1999  between  MART and the
          Named Banks  (incorporated  by  reference  to Exhibit  10(1) to MART's
          Quarterly Report on Form 10-Q for the quarter ended March 31, 1999).
     10(g)Agreement for  Contribution  of Interests  dated April 1, 1997,  among
          MART and the Contributors named therein  (incorporated by reference to
          Exhibit  (c) 1 to Form 8-K filed  July 15,  1997).  10(h)Agreement  of
          Limited  Partnership of MART Limited  Partnership dated as of June 30,
          1997  (incorporated  by  reference  to Exhibit (c) 2 to Form 8-K filed
          July 15, 1997). 10(i)Partnership Purchase and Sale Agreement among BTR
          Gateway,  Inc.,  MART,  and  Prentiss  Properties  Acquisition,   L.P.
          (incorporated  by  reference  to  Exhibit  (b)  1 to  Form  8-K  filed
          September 30, 1997).  10(j)Mid-Atlantic  Realty Trust Restricted Share
          Plan,  adopted on November  14,  1997.  (incorporated  by reference to
          Exhibit  10(j) to MART's Annual Report on Form 10-K for the year ended
          December  31,  1997).   10(k)Mid-Atlantic  Realty  Trust  Non-Employee
          Trustee  Deferred  Compensation  Plan,  adopted on November  14, 1997.
          (incorporated by reference to Exhibit 10(k) to MART's Annual Report on
          Form  10-K for the  year  ended  December  31,  1997).  10(l)Financing
          agreement  dated  April  23,1999  with named  banks  (incorporated  by
          reference to Exhibit 10.1 to MART's  quarterly report on Form 10-Q for
          the quarter ended March 31, 1999). 12 Computation of Ratio of Earnings
          to Fixed Charges.* 21  Subsidiaries of the  Registrant.* 23 Consent of
          KPMG LLP.* 99.1 Real Estate Investment Risks.

*Filed herewith