EXHIBIT 99.1

                           REAL ESTATE INVESTMENT RISK

     Statements  in this  document  filed with the SEC 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 our good faith belief
based on current  expectations,  estimates  and  projections  about (among other
things)  the  industry  and the  markets  in  which  we  operate,  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.  In making these cautionary  statements,  we are not committed to
addressing or updating each factor in future filings or communications regarding
our business or results,  or addressing how any of these factors may have caused
results to differ from discussions or information  contained in previous filings
or  communications.  The  following is a discussion of factors that could impact
future results:

Company Risks

     Our performance  depends on the economic  conditions of the Middle Atlantic
Area where most of our properties are located.

     Our performance  depends on the economic conditions in markets in which our
properties  are  concentrated.  Since our  properties  are located in the Middle
Atlantic  area,  our results  could be  adversely  affected by adverse  economic
conditions in the Middle  Atlantic  region or by adverse  commercial real estate
conditions, such as an oversupply of space or a reduction in demand for our real
estate,  in the Middle  Atlantic  area.  These  conditions  could have a greater
adverse  impact  on us than if we  owned  properties  in a number  of  different
geographic markets.

     Our organizational documents do not place limits on the incurrence of debt.

     Our  organizational  documents do not limit the amount of indebtedness that
we may incur.  Although  our board of  trustees  attempts  to maintain a balance
between total  outstanding  indebtedness and the value of our portfolio (i.e., a
ratio of secured debt to real estate value of 50% or less),  it could alter this
balance at any time  without  shareholder  approval.  If we become  more  highly
leveraged,  then the  resulting  increase in debt  service  could  diminish  our
ability to make  expected  distributions  to  shareholders  and make payments on
outstanding indebtedness. If we default on our obligations under any outstanding
indebtedness,  we could lose our  interest  in any  properties  that secure that
indebtedness.

     Many of our leases  contain  covenants that restrict the use of other space
at a property and may prevent us from re-leasing the property.

     Many leases with existing  tenants have  covenants that restrict the use of
other  space at a  property.  For  example,  many  shopping  center  leases have
covenants  that  provide for a specified  tenant mix or balance of the  shopping
center.

     We may need to borrow money to qualify as a REIT.

     Our ability to make  distributions  to shareholders  could be diminished by
increased  debt  service  obligations  if we need to  borrow  money  in order to
maintain our REIT qualification. For example, differences in timing between when
we receive  income and when we have to pay expenses  could  require us to borrow
money to meet the requirement that we distribute to shareholders at least 90% of
our net taxable  income  excluding net capital gain each year. The incurrence of



<PAGE>

large  expenses also could require us to borrow money to meet this  requirement.
We might need to borrow money for these  purposes even if we believe that market
conditions are not favorable for such borrowings. In other words, we may have to
borrow money on unfavorable terms.

     We are subject to risks inherent in development and acquisition activities.

     Developing or expanding existing properties in our real estate portfolio is
an integral part of our strategy for  maintaining and enhancing the value of our
portfolio.  We may also choose to acquire  additional  properties in the future.
While our policies  with respect to  developing  and  expanding  properties  are
intended  to  limit  some  of  the  risks  otherwise  associated  with  property
acquisition such as not starting  construction on a project prior to obtaining a
commitment from an anchor tenant,  we nevertheless  will incur risks,  including
risks related to delays in construction and lease-up,  costs of materials,  cost
overruns,  financing  availability,  volatility  in  interest  rates  and  labor
availability.

     In addition,  once a property is acquired,  the renovation and  improvement
costs we incur in  bringing  an acquired  property  up to market  standards  may
exceed our estimates, and the property may fail to perform as expected.

     Maryland law may present or discourage a change in control.

     The Maryland  General  Corporation  Law  establishes  special  restrictions
against "business  combinations"  between a Maryland corporation and "interested
shareholders"  or their  affiliates  unless  an  exemption  is  applicable.  The
business  combination  statute could have the effect of  discouraging  offers to
acquire  us and of  increasing  the  difficulty  of  consummating  any offers to
acquire  us,  even  if  our  acquisition  would  be in  our  shareholders'  best
interests.

     Maryland law also provides that "control shares" of a Maryland  corporation
acquired in a "control  share  acquisition"  have no voting rights except to the
extent  approved by a vote of two-thirds of the votes entitled to be cast on the
matter,  excluding  shares of  beneficial  interest  owned by the  acquiror,  by
officers or by trustees who are employees of the corporation.  The control share
statute  could  have the  effect of  discouraging  offers to  acquire  us and of
increasing the difficulty of consummating any control share  acquisitions,  even
if our acquisition would be in our shareholders' best interests.

     Increased market interest rates could reduce share prices.

     The annual  dividend rate on our shares as a percentage of its market price
may influence the trading price of stock.  Also, an increase in market  interest
rates may lead purchasers to demand a higher annual  dividend rate,  which could
lower the market  price of the  shares.  A decrease  in the market  price of the
shares could reduce our ability to raise additional equity in the public markets
or could result in a dilution of our existing shareholders.

     Sales of a  substantial  number of our shares  could  adversely  affect the
market price.

     Sales of a substantial  number of our common shares, or the perception that
such sales could occur,  could adversely affect prevailing market prices for our
common shares.  In addition to the possibility that we may sell common shares in
public offerings at any time, we may also issue common shares upon redemption of
Units,  as well as upon exercise of stock options that we grant to our employees
and others. All of these shares will be available for sale in the public markets
from time to time.

                                      -2-

<PAGE>

Industry Risks

     Real  property  investments  are  subject to  changes  in general  economic
conditions.

     Real property  investments are subject to varying types and degrees of risk
that may hinder or otherwise affect our ability to generate income.  These risks
could reduce the amount of cash available for distributions to shareholders.

     Any of the following  factors could adversely  affect the value of our real
estate and our ability to generate revenues:

     o    adverse changes in general economic conditions;

     o    adverse  local  conditions  (such as increases in leasable  space or a
          reduction in demand for real estate in an area);

     o    competition  from other shopping  centers,  properties,  developers or
          real estate owners;

     o    increases in operating costs;

     o    government regulations;

     o    increases in interest rates;

     o    reduction in  available financing; and

     o    liability due to environmental and other laws.


                                      -3-

<PAGE>

     Real estate investments are relatively illiquid.

     Real estate investments are relatively illiquid and, therefore, our ability
to react  promptly in response  to changes in  economic or other  conditions  is
limited.  In  addition,  in some cases the  Internal  Revenue Code may limit our
ability to sell property held for less than four years.

     We may not be able to re-lease  properties  upon the expiration of existing
     leases.

     Upon the expiration of leases,  tenants may not renew leases and we may not
be  able  to  re-lease  properties  or the  terms  of the  renewal  or  re-lease
(including  the costs of required  renovations or concessions to tenants) may be
less favorable than current lease terms.  Our operating cash flow would decrease
if we were  unable to promptly  re-lease  all or a  substantial  portion of this
space,  if the rental rates upon such  re-lease  were  significantly  lower than
expected, or if reserves for costs of the re-leasing prove inadequate.

     If tenants are unable to meet their  obligations to us, our cash flow would
     be adversely affected.

     If a significant  number of tenants are unable to meet their obligations to
us, our cash receipts and cash available for distribution will decrease. Also, a
tenant may  experience a downturn in its business which may weaken its financial
condition  and result in a reduction in or failure to make rental  payments when
due.  If a tenant  defaults  in its  obligations  to us,  we may be  delayed  in
enforcing our rights as landlord.  In addition,  we may incur  substantial costs
and experience  significant  delays  associated  with protecting our investment,
including costs incurred in renovating and re-leasing the property.

     At any time,  one or  more of our  tenants  may seek the protection  of the
bankruptcy  laws,  which could result in the rejection and  termination of their
lease. We are subject to risks that:

     o    any present tenant that has filed for bankruptcy  protection  will not
          continue making payments under its lease;

     o    any tenant may file for bankruptcy protection in the future; or

     o    any tenants that file for  bankruptcy  protection  may not continue to
          make rental payments in a timely manner.

     Losses from earthquakes and other natural  disasters and terrorist  attacks
are   uninsurable  or  insurable  only  at  costs  that  are  not   economically
justifiable.

     We carry comprehensive liability, fire, flood, extended coverage and rental
loss insurance with policy  specifications and insured limits that are customary
for similar  properties.  Losses from catastrophic  events and natural disasters
like wars or  earthquakes,  however,  are uninsurable or insurable only at costs
that are not economically justifiable.  If an uninsured loss occurs, we may lose
both  our  invested   capital  and   anticipated   profits  from  the  property.
Nevertheless,  we  would  still be  obligated  to repay  any  recourse  mortgage
indebtedness on the property.

     Insurance  payouts  resulting  from  the  terrorist  attacks  occurring  on
September 11, 2001 will significantly  reduce the insurance industry's reserves.
Moreover,  the  demand for  higher  levels of  insurance  coverage  will  likely
increase because of these attacks. As a result, we expect our insurance premiums
to increase  significantly  in the future,  which may have a materially  adverse
impact on our cash flow. Furthermore, we may not be able to purchase policies in
the  future  with  coverage  limits and  deductibles  similar to those that were

                                      -4-

<PAGE>

available before the attacks. Because it is impossible to determine what kind of
policies  will be available  in the future and at what prices,  we are unable to
determine  whether  we will  be able to  maintain  our  pre-September  11,  2001
insurance  coverage levels. Our real property insurance policies put into effect
before  September 11, 2001 do not expressly  exclude from coverage hostile acts,
except for acts of war.  Following  the  terrorist  acts of September  11, 2001,
however,  our insurance  policies  purchased by us may expressly exclude hostile
acts,  and it may be impossible or very expensive to obtain  insurance  covering
terrorist attacks.

     We are subject to risks  associated  with debt  financing and existing debt
     maturities.

     We are  subject  to a variety  of risks  associated  with  debt  financing.
Examples of these risks include the following:

     o    our  cash  from  operating  activities  may be  insufficient  to  meet
          required payments;

     o    we may be unable to pay or refinance indebtedness on our properties;

     o    increases in interest  rates  increase  our debt service  obligations,
          expose us to risks of  refinancing  our  existing  debt,  diminish our
          returns on development and redevelopment activities,  reduce cash from
          operating activities,  and hamper our ability to make distributions to
          shareholders;

     o    if we are unable to secure  refinancing of  indebtedness on acceptable
          terms, we may be forced to dispose of properties upon  disadvantageous
          terms,  which may cause  losses and affect our funds from  operations;
          and

     o    if properties are mortgaged to secure payment of  indebtedness  and we
          are unable to meet  payments,  the mortgagee  may  foreclose  upon the
          properties, resulting in a loss of income and a valuable asset to us.

     Because many of our competitors have greater capital  resources,  we may be
at  a  disadvantage  with  regard  to  exploiting  land  development,   property
acquisition and tenant opportunities.

     Based on total assets and annual revenues,  we are smaller than many of the
numerous commercial  developers,  real estate companies and other owners of real
estate that  compete  with us in seeking land for  development,  properties  for
acquisition  and  tenants for  properties.  Many of these  competitors  may have
greater  capital  and other  resources  than us, and this fact could  impair our
ability to acquire properties and tenants in the future.

     We may become  liable for the costs of  removal or  remediation  of certain
environmental hazardous or toxic substances under federal, state or local laws.

     Under various federal, state and local laws, ordinances and regulations, we
may become liable for the cost of removal or remediation of certain hazardous or
toxic substances on or in our real property. Liability may be imposed regardless
of whether we or the tenant knew of, or was  responsible  for,  the  presence of
such  hazardous or toxic  substances.  The costs of any required  remediation or
removal of substances may be  substantial,  and our liability as to any property
is generally  not limited  under those laws,  ordinances  and  regulations.  The
liability could exceed the value of our property and/or  aggregate  assets.  The
presence of, or the failure to properly  remediate  substances when released may
adversely affect our ability to sell the affected real estate or to borrow using
the  real  estate  as  collateral.  While  we  have  not  been  notified  by any
governmental authority of any non-compliance, liability or other

                                      -5-

<PAGE>

claim in  connection  with any of our  properties,  and we are not  aware of any
other  environmental  condition  with  respect  to  any  of  the  our  portfolio
properties that we believe would have a material adverse effect on our business,
assets or results of  operations, we cannot  assure that there are no
potential  environmental  liabilities,  that no  environmental  liabilities  may
develop,  that no prior owner created any material  environmental  condition not
known to us, or that future uses or conditions,  including,  without limitation,
changes in applicable  environmental  laws and  regulations,  will not result in
liability to us.

     We  may  incur   significant   costs  complying  with  the  Americans  with
     Disabilities Act.

     We must comply with Title III of the Americans  with  Disabilities  Act. To
comply with the ADA's requirements,  we may be required to incur costs to remove
structural,  architectural or communication  barriers to handicapped  access and
utilization  in certain  public  areas of our  properties.  Noncompliance  could
result in  injunctive  relief,  imposition  of fines or an award of  damages  to
private litigants.

     The ownership limitations on REITs create an anti-takeover effect.

     To maintain our  qualification as a REIT, not more than 50% in value of our
outstanding shares may be owned,  actually or  constructively,  by five or fewer
individuals.  In addition,  the Internal  Revenue  Code  imposes  certain  other
limitations  on the  ownership  of the  shares  of a REIT.  For the  purpose  of
preserving  our  tax  status  as  a  REIT,  our  charter   prohibits  actual  or
constructive  ownership of more than 9.9% of the outstanding  shares,  either in
the  aggregate  or of any class,  by any person,  unless  waived by the board of
trustees. The rules addressing  constructive ownership are complex and may cause
shares  owned,  actually or  constructively,  by a group of related  individuals
and/or  entities to be deemed to be  constructively  owned by one  individual or
entity.  As a result,  the  acquisition  of less  than  9.9% of the  outstanding
shares,  either in the  aggregate or of any class,  by an  individual  or entity
could  cause that  individual  or entity (or  another  individual  or entity) to
constructively  own more than 9.9% of the  outstanding  shares.  This  situation
would subject such shares to the  beneficial  ownership  limitations.  Actual or
constructive ownership of shares in excess of such limits would either cause the
violative  transfer or ownership to be void or cause such shares to be converted
to excess  shares  pursuant  to our  charter.  Excess  shares are common  shares
automatically  transferred  to a  special  trust to be  maintained  by us to the
extent necessary to ensure that the purported transfer does not result in common
share  ownership  in  violation  of  the  beneficial  ownership  limitations.  A
purported  folder or transferee  of common shares  converted to excess shares is
not entitled to voting rights,  except to the extent  required by law, or to any
dividends,  distributions or other rights as a shareholder. Our charter contains
provisions  that are designed to ensure that the  purported  transferee or other
purported  holder of excess shares may not receive in return for such a transfer
an amount that  reflects  any  appreciation  in the common  shares for which the
excess  shares  were  converted  during the period  that the excess  shares were
outstanding.

     The  ownership  restrictions  have the effect of deterring  non-negotiated
acquisitions  of, and proxy fights for, our company by third  parties.  Limiting
the ownership of our shares may discourage a change of control and may also:

     o    deter tender offers for our shares,  which offers may be attractive to
          our shareholders,

     o    limit the  opportunity  for our  shareholders to receive a premium for
          their shares that might  otherwise  exist if an investor  attempted to
          assemble a block of shares in excess of the 9.9% beneficial  ownership
          limitation, or

     o    limit  the  opportunity  for our  shareholders  to  effect a change in
          control of our company.

     We may not  qualify  as a REIT in the  future  causing  us to be  taxed  at
regular   corporate  rates  and  reducing  the  amount  of  cash  available  for
distribution.

     We believe that we have  operated in a manner that permits us to qualify as
a REIT under the internal revenue code for each taxable year since our formation
in 1993.  Qualification as a REIT,  however,  involves the application of highly

                                      -6-
<PAGE>

technical and complex  internal revenue code provisions for which there are only
limited  judicial  or   administrative   interpretations.   In  addition,   REIT
qualification   involves  the  determination  of  various  factual  matters  and
circumstances not entirely within our control.  For example, in order to qualify
as a REIT,  at least 95% of our gross  income in any year must be  derived  from
qualifying  sources,  and we must distribute annually to shareholders 90% of our
REIT  taxable  income  (excluding  net capital  gains).  Therefore,  although we
believe  that we are  organized  and  operating  in a manner that  permits us to
remain qualified as a REIT, we cannot guarantee that we will be able to continue
to operate in such a manner. In addition, if we are ever audited by the Internal
Revenue Service with respect to any past year, the Internal  Revenue Service may
challenge our qualification as a REIT for such year.

     Similarly, new legislation, regulations,  administrative interpretations or
court decisions may change the tax laws with respect to  qualification as a REIT
or the federal income tax consequences of such qualification.  We are not aware,
however,  of any currently  pending tax legislation  that would adversely affect
our ability to continue to operate as a REIT.

     If we fail to qualify as a REIT,  we will be subject to federal  income tax
on taxable income at regular  corporate rates. Such increased tax liability in a
given year could significantly reduce, or possibly eliminate, the amount of cash
we have available for investment or distribution to shareholders  for that year.
In addition,  we will also be disqualified from treatment as a REIT for the next
four  taxable  years,  unless we are  entitled to relief  under other  statutory
provisions.

     If we do not  qualify  as a REIT,  we will no  longer be  required  to make
annual  distributions to shareholders.  To the extent that we made distributions
to  shareholders  in  anticipation  of our  qualifying  as a REIT,  we  might be
required to borrow  funds or to  liquidate  some of our  investments  to pay the
applicable tax. Our failure to qualify as a REIT would also constitute a default
under certain of our debt obligations and would significantly  reduce the market
value of our shares.

     Our board of trustees adopted a cash bonus plan for our senior  management,
trustees and certain  officers and  employees  that could have an  anti-takeover
effect

     In May 2001,  our board of trustees  adopted a cash bonus plan  pursuant to
which, in the event of an  extraordinary  transaction  involving a sale or other
change  of  control  of the  company,  cash  payments  totaling  1% of the total
consideration of the  transaction,  including any assumed debt, would be paid to
members of our senior  management,  trustees and other  officers and  employees.
This  plan  could  have an  adverse  effect  on our  ability  to  negotiate  and
consummate  a  transaction  involving  a sale or other  change of control of the
company  and could  deter  third  parties  from making an offer to effect such a
transaction.

     Failure to make required distributions would subject us to tax.

     Each  year,  we must pay to our  shareholders  at least 90% of our  taxable
income,  other than any net  capital  gain.  To the extent  that we satisfy  the
distribution  requirement,  but distribute less than 100% of our taxable income,
we will be subject to federal corporate income tax on our undistributed  taxable
income. In addition,  we will be subject to a 4% nondeductible excise tax if the
actual amount we pay out to our  shareholders  in a calendar year is less than a
minimum  amount  specified  under the  federal  tax laws.  We may be required to
borrow money or sell assets to make distributions sufficient to enable us to pay
out enough of our taxable income to satisfy the distribution  requirement and to
avoid corporate income tax and the 4% tax in a particular year.

     Failure to have  distributed  earnings  and profits of BTR Realty,  Inc. in
1993 would cause us to fail to qualify as a REIT.

     At the end of any  taxable  year,  a REIT  may  not  have  any  accumulated
earnings and profits,  described  generally  for federal  income tax purposes as
cumulative undistributed net income, from a non-REIT corporation.  In connection
with the merger of BTR Realty,  Inc. into our company,  BTR Realty,  Inc. made a
corresponding  special one-time  distribution to its shareholders.  However, the
determination  of  accumulated  earnings  and  profits  for  federal  income tax
purposes is extremely complex.  Should the Internal Revenue Service successfully
assert that BTR Realty,  Inc.'s  accumulated  earnings  and profits were greater
than the amount so distributed, we may fail to qualify as a REIT. Alternatively,
the  Internal  Revenue  Service may permit us to avoid losing our REIT status by

                                      -7-
<PAGE>

paying a deficiency dividend to eliminate any remaining accumulated earnings and
profits of BTR Realty,  Inc. We may need to borrow  money or sell assets to pay
such a deficiency dividend.

     A sale of assets acquired from BTR Realty,  Inc. within ten years after our
formation will result in corporate income tax.

     If we sell any asset that we  acquired  from BTR  Realty,  Inc.  within ten
years  after our  formation  in a taxable  transaction,  we will be taxed at the
highest  corporate  rate on an amount  equal to the  lesser of (1) the amount of
gain that we recognize  at the time of the sale,  or (2) the amount of gain that
we would have  recognized  if we had sold the asset at the time that we acquired
the asset from BTR Realty, Inc. for its then fair market value. In addition, the
10-year built-in gain tax period will end in 2003.

                                      -8-